As filed with the Securities and Exchange Commission on July 30, 1998
Registration Statement No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM S-3
----------------------
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
----------------------
INTERNATIONAL TELECOMMUNICATION DATA SYSTEMS, INC.
(Exact Name of Registrant as Specified in Its Charter)
----------------------
DELAWARE 06-1295986
(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation or Organization)
225 High Ridge Road
Stamford, Connecticut 06905
(203) 329-3300
(Address, Including Zip Code, and
Telephone Number, Including Area Code,
of Registrant's Principal
Executive Offices)
----------------------
Peter P. Bassermann
President and Chief Executive Officer
International Telecommunication Data Systems, Inc.
225 High Ridge Road
Stamford, Connecticut 06905
(203) 329-3300
(Name, Address, Including Zip Code, and
Telephone Number, Including Area Code,
of Agent For Service)
with a copy to:
John H. Chory Esq.
Hale and Dorr LLP
60 State Street
Boston, Massachusetts 02109
Approximate date of commencement of proposed sale to public: As soon as
practicable after this Registration Statement becomes effective.
<PAGE>
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] ___________.
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] ______________.
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
--------------------------------------
CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
Proposed Proposed
Title of Each Class of Amount Maximum Maximum
Securities to be Registered to be Offering Aggregate Amount of
Registered Price Offering Price(1) Registration
Per Share (1) Fee
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01 par value per share.......... 606,673 $33.56 $20,359,945.88 $6,007
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) under the Securities Act and based upon the average of the
high and low sale prices of the Common Stock on the Nasdaq National Market
on July 24, 1998.
-------------------------------------------------------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
shall determine.
================================================================================
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This Prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
<PAGE>
PROSPECTUS
606,673 SHARES
INTERNATIONAL TELECOMMUNICATION DATA SYSTEMS, INC.
COMMON STOCK
---------------------
This Prospectus relates to 606,673 issued and outstanding shares (the
"Shares") of Common Stock, $0.01 par value per share (the "Common Stock"), of
International Telecommunication Data Systems, Inc. ("ITDS" or the "Company")
which may be offered and sold, from time to time, by or on behalf of Century
Corporation, a stockholder of the Company (the "Selling Stockholder"). The
Shares were issued by the Company as consideration, in part, for the purchase by
the Company of all of the issued and outstanding shares of capital stock of ITDS
Intelicom Services, Inc. ("Intelicom") from the CSC Domestic Enterprises, Inc.
(the "Seller") on January 2, 1998. Thereafter, the Seller transferred the Shares
to the Selling Stockholder, a wholly owned subsidiary of Computer Sciences
Corporation. Pursuant to the terms of a Stock Purchase Agreement among the
Company, the Seller and Intelicom (the "Purchase Agreement"), the Company agreed
to register the Shares under the Securities Act of 1933, as amended (the
"Securities Act"), and to use its best efforts to cause the Registration
Statement of which the Prospectus constitutes a part to be declared and remain
effective until the earlier of (i) the sale of all of the Shares by the Seller
or (ii) January 2, 2000. The Selling Stockholder has advised the Company that it
proposes to sell, from time to time, all or part of the Shares covered by this
Prospectus on the Nasdaq National Market, in ordinary brokerage transactions, in
negotiated transactions, or otherwise, at market prices prevailing at the time
of sale, at prices related to such market prices or at negotiated prices.
Pursuant to the Purchase Agreement, the Selling Stockholder agreed to limit the
number of Shares it will sell pursuant to this Registration Statement prior to
July 2, 1999, as determined by a formula. See "Plan of Distribution."
This Prospectus may be used by the Selling Stockholder or by any
broker-dealer who may participate in sales of the Shares. The Selling
Stockholder will pay all commissions, transfer taxes and other expenses
associated with the sale of the Shares.
The Company will not receive any of the proceeds from the sale of the
Shares by the Selling Stockholder. The Company has agreed to bear certain
expenses in connection with the registration and sale of the Shares being
offered by the Selling Stockholder. The Company and the Selling Stockholder have
agreed to indemnify each other against certain liabilities, including certain
liabilities under the Securities Act. See "Use of Proceeds."
The Company's Common Stock is traded on the Nasdaq National Market under
the symbol "ITDS." On July 24, 1998, the closing sale price of the Common Stock
on the Nasdaq National Market was $33.375 per share.
---------------------
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE
OF RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 3.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
---------------------
The date of this Prospectus is July 30, 1998.
-1-
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such documents may be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at
the Commission's Regional Offices located at 7 World Trade Center, Suite 1300,
New York, New York 10048, and Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Copies of such documents also may be obtained at
prescribed rates by writing to the Securities and Exchange Commission Public
Reference Section, 450 Fifth Street, N.W., Washington, D.C. 20549. In addition,
the Commission maintains a World Wide Web site at http://www.sec.gov that
contains reports, proxy and information statements and other information
regarding registrants, such as the Company, that file electronically with the
Commission. Copies of such documents may also be inspected at the offices of the
Company. The Company's Common Stock is traded on the Nasdaq National Market
under the Symbol "ITDS."
The Company has filed with the Commission a Registration Statement on Form
S-3 (together with all amendments, supplements, exhibits and schedules thereto,
the "Registration Statement") under the Securities Act with respect to the
Shares offered hereby. This Prospectus does not contain all of the information
set forth in the Registration Statement, as certain items are omitted in
accordance with the rules and regulations of the Commission. For further
information pertaining to the Company and the Shares, reference is made to such
Registration Statement. Statements contained in this Prospectus regarding the
contents of any agreement or other document are not necessarily complete, and in
each instance reference is made to the copy of such agreement or document filed
as an exhibit to the Registration Statement, each such statement being qualified
in all respects by such reference. The Registration Statement may be inspected
without charge at the office of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and copies of all or any part thereof may be obtained
from the Commission at prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(1) The Company's Annual Report on Form 10-K for the year ended
December 31, 1997, including the amendment thereto on Form 10-K/A
filed with the Commission on March 31, 1998;
(2) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998;
(3) The Company's Current Report on Form 8-K dated January 13, 1998,
including the amendment thereto on Form 8-K/A filed with the
Commission on March 18, 1998; and
(4) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-A, as filed with the Commission
on October 10, 1996.
-2-
<PAGE>
All documents filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date hereof and
prior to the termination of the offering of the Shares registered hereby shall
be deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon written or oral
request of such person, a copy of any or all of the foregoing documents
incorporated by reference into this Prospectus (without exhibits to such
documents other than exhibits specifically incorporated by reference into such
documents). All such requests shall be directed to: the Company, 225 High Ridge
Road, Stamford, Connecticut 06905, Attention: Chief Financial Officer, telephone
(203) 329-3300.
No dealer, salesperson or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus and, if given or made, such information or representations must not
be relied upon as having been authorized by the Company or the Selling
Stockholder. This Prospectus does not constitute an offer to sell or a
solicitation of any offer to buy any of the securities offered hereby to any
person in any jurisdiction in which such offer or solicitation of an offer would
be unlawful. Neither the delivery of this Prospectus nor any offer or sale
hereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of the Company or that the information contained
herein is correct as of any time subsequent to the date hereof. This Prospectus
does not constitute an offer to sell or a solicitation of an offer to buy any
securities other than the registered securities to which it relates. This
Prospectus does not constitute an offer to sell or a solicitation of an offer to
buy such securities in any circumstances in which such offer or solicitation is
unlawful.
SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION
Certain statements in this Prospectus and in the documents incorporated
herein constitute "forward-looking statements" within the meaning of Section 27A
of the Securities Act and Section 21E of the Exchange Act. For this purpose, any
statements contained herein or incorporated herein that are not statements of
historical fact may be deemed to be forward-looking statements. Without limiting
the foregoing, the words "believes," "anticipates," "plans," "expects" and
similar expressions are intended to identify forward-looking statements. There
are a number of important factors that could cause the results of the Company to
differ materially from those indicated by such forward-looking statements. These
factors include those set forth in "Risk Factors" herein and elsewhere in this
Prospectus.
RISK FACTORS
The following risk factors should be considered carefully in addition to
the other information in this Prospectus before purchasing the Common Stock
offered by this Prospectus. Except for the historical information contained
herein, the discussion in this Prospectus contains certain forward-looking
statements that involve risks and uncertainties. The cautionary statements made
in this Prospectus should be read as being applicable to all related
forward-looking statements wherever they appear in this Prospectus. The
Company's actual results could differ materially from those discussed here.
Important factors that could cause or contribute to such differences include
those discussed below, as well as those discussed elsewhere herein.
-3-
<PAGE>
Management of Growth
The Company has historically experienced rapid growth and expects to
experience considerable growth in the foreseeable future. As a result of the
Company's acquisition of Intelicom, a subsidiary of Computer Sciences
Corporation ("CSC") on January 2, 1998 (the "Intelicom Acquisition"), the
Company substantially increased the size of its operations as well as the number
of subscribers it serves. The growth in the size and complexity of its business,
as well as its customer base, has placed, and is expected to continue to place,
significant demands on the Company's administrative, operational and financial
personnel and systems. Additional expansion by the Company may further strain
the Company's management, financial and other resources. There can be no
assurance that the Company's systems, procedures, controls and existing
facilities will be adequate to support expansion of its operations. The
Company's future operating results will depend on the ability of its officers
and key employees to manage changing business conditions and to implement and
improve the operational, financial control and reporting functions of the
Company. If the Company is unable to manage expansion of its operations, the
quality of the Company's services, its ability to retain key personnel and its
business, financial condition and results of operations could be materially
adversely affected.
From January 1993 to June 1998, the number of the Company's employees
increased from 26 to 590 and the number of the Company's full-time consultants
increased from zero to 123. A substantial portion of the Company's current
employees and consultants joined the Company in January 1998, in conjunction
with the Intelicom Acquisition. The Company anticipates that continued growth
will require it to recruit and hire a substantial number of new development,
managerial, finance, sales and marketing support personnel. There can be no
assurance that the Company will be successful in hiring or retaining any of the
foregoing personnel. The Company's ability to compete effectively and to manage
future growth, if any, will depend on its ability to improve operational systems
and to expand, train, motivate and manage its workforce.
Integration of Intelicom; Payment of Contingent Purchase Price
In January 1998, the Company completed the Intelicom Acquisition and
substantially increased the size of the Company's operations. The future success
of the Company will depend in part upon whether the integration of the two
companies' businesses is achieved in an efficient and effective manner; there
can be no assurance that this will occur. The integration of the finance and
administrative operations and the product offerings and platforms, and the
coordination of the respective sales, marketing and research and development
efforts of ITDS and Intelicom will require significant financial resources and
attention from management. There can be no assurance that such integration and
coordination will be successful or accomplished in a timely manner or that the
anticipated economic, operational and other benefits of the Intelicom
Acquisition will be achieved. The difficulties of such integration may be
increased by the necessity of coordinating the activities of ITDS facilities in
Stamford, Connecticut with Intelicom's facilities in Champaign, Illinois, each
of which has a distinct culture. The integration of Intelicom has required, and
will continue to require, the dedication of management resources which may
temporarily divert attention from the daily operations of the combined company.
In addition, in connection with the Intelicom Acquisition and subject to
the satisfaction of certain performance criteria, the Company may be required to
pay to CSC up to $6.0 million in cash on January 1, 1999.
Reliance On Significant Customers
The Company's largest two customers, Nextel and Western Wireless,
represented 29.3% and 12.7%, respectively, of the Company's revenues for the
first three months of 1998. It is likely that Nextel
-4-
<PAGE>
and Western Wireless will each continue to represent over 10 percent of the
Company's revenues in the future. The Company has long-term contracts, ranging
from two to five years, with all of its significant customers. However, as a
result of the Intelicom Acquisition, the Company's relationships with its
largest customers have only been in place since January 1998. In addition,
certain of such customers have from time to time expressed concern regarding
service performed by Intelicom prior to the Intelicom Acquisition. The Company
has worked and continues to work with such customers to address these concerns.
There can be no assurance that the Company's customers will renew their
contracts with the Company at the end of the contract term or may not seek to
terminate their contracts on the basis of alleged contractual defaults or other
grounds. Certain of the Company's contracts do not require customers to make any
minimum purchases. Loss of all or a significant part of the business of any of
the Company's significant customers would have a material adverse effect on the
Company's business, financial condition and results of operations. Additionally,
the acquisition by a third party of one of the Company's significant customers
could result in the loss of that customer and have a material adverse effect on
the business, financial condition and results of operations of the Company. The
Company is currently engaged in discussions with Frontier Cellular, a cellular
telephone service provider with which the Company has an agreement for the
development and delivery of a billing and customer care system. The purpose of
these discussions is to review and renegotiate the terms of the development and
delivery schedule for such system, including the proposed functionality, cost of
development and delivery schedule for such system. There can be no assurance
that any such proposed functionality, cost or schedule will be mutually
agreeable to the Company and Frontier Cellular, that the Company's system will
be adopted by Frontier Cellular or that Frontier Cellular will be a customer of
the Company in the future.
Dependence on Key Personnel; New Management
The Company's performance depends substantially on the performance of its
executive officers and key employees. The Company's long-term success will
depend upon its ability to recruit, retain and motivate highly skilled
personnel. Competition for such personnel is intense, and there can be no
assurance that the Company will be able to attract, assimilate or retain highly
skilled personnel in the future. In addition, several members of the Company's
senior management team have only recently joined the Company. For example, Peter
P. Bassermann, the Company's President, joined the Company in September 1997,
Paul K. Kothari joined the Company in late 1997 and began serving as the
Company's Chief Financial Officer in February 1998, and Susan L. Yezzi joined
the Company in late 1997 and assumed the role of the Company's Executive Vice
President of Operations -- Champaign in February 1998. Although each of Mr.
Bassermann, Mr. Kothari, Ms. Yezzi, Lewis D. Bakes, Joseph A. Juliano, Barry K.
Lewis, Peter L. Masanotti and Kevin Piltz has executed an employment contract
with the Company, there can be no assurance that they will serve their full
employment terms. Mark D. Spitzer resigned as Chief Financial Officer in
September 1997 and was replaced by Alan K. Greene, who served as Chief Financial
Officer from September 1997 to February 1998. Although the Company believes that
the extensive industry experience of new members of management is essential to
the Company's growth and outweighs short employment history with the Company,
there can be no assurance that the assimilation of the new officers into their
managerial roles with the Company will be successful.
Fluctuations in Quarterly Performance
The Company's revenues and operating results may fluctuate from quarter to
quarter due to a number of factors, including the timing, size and nature of the
Company's contracts; the integration into the Company's consolidated financial
results of Intelicom and the lack of actual historical financial results as a
combined entity; long sales cycles typically associated with large customers,
which require the Company to make a substantial investment in the conversion
process prior to the generation of revenue; the hiring of additional staff;
seasonal variations in cellular telephone subscriptions; the timing of the
-5-
<PAGE>
introduction and the market acceptance of new products or product enhancements
by the Company or its competitors, changes in the Company's operating expenses;
and fluctuations in economic and financial market conditions. Fluctuations in
quarterly operating results may result in volatility in the price of the Common
Stock.
Rapidly Changing Telecommunications Market
Over the last decade, the market for telecommunications services has been
characterized by rapid technological developments, evolving industry standards,
dramatic changes in the regulatory environment and frequent new product
introductions. The Company's success will depend upon its ability to enhance its
existing products and services and to introduce new products and services which
will respond to these market requirements as they evolve. To date, substantially
all of the Company's revenues are attributable to wireless customers. While the
Company believes that its current systems and services will also permit it to
attract customers in other segments of the Telecommunications services industry,
there can be no assurance that it sill be able to do so. In addition,
technologies, services or standards may be developed which could require
significant changes in the Company's business model, development of new
products, or provision of additional services, at substantial cost to the
Company. Such developments may also result in the introduction of additional
competitors into the marketplace. Furthermore, if the overall market for
Telecommunications services fails to evolve and converge in the manner
contemplated by the Company or grows more slowly than anticipated, or if the
Company's products and services fail in any respect to achieve market
acceptance, there could be a material adverse effect on the Company's business,
financial condition and results of operations. The Telecommunications industry
is also characterized by significant and rapid changes in strategic alignment.
Merger or consolidation of one or more Telecommunications services providers
could result in the loss to the Company of customers or sales opportunities.
Demand for New Product Development
The Company believes that its future success depends in part upon its
ability to enhance its current solutions and develop new products and services
that address the increasingly complex needs of its customers. In addition, the
introduction of new products or services by third parties could render the
Company's existing solutions obsolete or unmarketable. The Company's ability to
anticipate changes in technology and successfully develop and introduce new or
enhanced products incorporating such technology on a timely basis will be
significant factors in its ability to remain competitive. There can be no
assurance that the Company will complete the development of new or enhanced
products or services on a timely or successful basis or successfully manage
transitions from one product release to the next, that the Company will not
encounter difficulties or delays in the introduction of new or enhanced
products, or that defects will not be found in such new or enhanced products
after installation, resulting in a loss of, or delay in, market acceptance. In
particular, the Company is currently developing a series of enhancements to its
existing software system, including incorporation of a Windows 95 compatible
user interface, incorporation of an Oracle relational database management
system, and support of Unix based file servers. The Company believes that these
enhancements will permit the Company to compete effectively as technology
evolves and facilitate its ability to address the requirements of larger
Telecommunications services providers. If the Company is unable to introduce
these new enhancements on a timely basis, or such enhancements result in the
introduction of "bugs" or other performance impairments in the Company's
systems, the Company's business, financial condition and results of operations
could be materially adversely affected, and its ability to expand its sales
activities could be significantly limited.
-6-
<PAGE>
Competition
The market for billing, customer care and management information systems
for the Telecommunications services industry is highly competitive and the
Company expects that the high level of growth within the Telecommunications
services industry will encourage new entrants, both domestically and
internationally, in the future. The Company competes with independent providers
of transactional systems and services, with internal billing departments of
Telecommunications services providers and with the billing services of
management consulting companies. The Company anticipates continued growth in
competition in the Telecommunications services industry and consequently the
entrance of new competitors into its market in the future.
Many of the Company's current and potential future competitors have
significant financial, technical and marketing resources and have greater name
recognition than the Company. In addition, many of the Company's competitors
have established commercial relationships or joint ventures with major cellular
and other Telecommunications services providers. As a result, the Company's
competitors may be able to adapt more quickly to new or emerging technologies
and changes in customer requirements, or to devote greater resources to the
promotion and sale of products than the Company.
Dependence on Cellular Telephone Industry
Although the Company's products have been designed to adapt to a variety of
current and future technologies, substantially all of the Company's revenues to
date have been generated by sales of its solutions to service providers in the
cellular telephone industry. A decrease in the number of cellular service
subscribers served by the Company's customers could result in lower revenues for
the Company. Although the cellular market has experienced substantial growth in
the number of subscribers in the past, there can be no assurance that such
growth will be sustained. In addition, industry reports have indicated that the
average monthly bill per subscriber has decreased in recent years. Such
decreases could result in increased price competition among billing service
providers. Furthermore, any adverse development in the cellular telephone
industry could have a material adverse effect on the business, financial
condition and results of operations of the Company.
Dependence on Proprietary Technology
The Company's success is dependent in part upon its proprietary software
technology. The Company relies on trademark, copyright and trade secret laws,
employee and third-party non-disclosure agreements and other methods to protect
its proprietary rights. There can be no assurance that its agreements with
employees, consultants and others who participate in the development of its
software will not be breached, that the Company will have adequate remedies for
any breach, or that the Company's trade secrets will not otherwise become known
to or independently developed by competitors. Furthermore, there can be no
assurance that the Company's efforts to protect its rights through trademark and
copyright laws will prevent the development and design by others of products or
technology similar to or competitive with those developed by the Company. The
computer technology industry is characterized by frequent and substantial
intellectual property litigation. The Company is not aware of any patent
infringement or any violation of other proprietary rights claimed by any third
party relating to the Company or the Company's products.
The Company's success will depend in part on its continued ability to
obtain and use licensed technology that is important to certain functionalities
of its products. The inability to continue to procure or use such technology
could have a material adverse effect on the Company's business, financial
condition and results of operations.
-7-
<PAGE>
Government Regulation
Currently, the Company's business is not subject to direct government
regulation; however, the Company's existing and potential customers are subject
to extensive regulation. Changes in regulation which adversely affect the
Company's existing and potential customers could have a material adverse effect
on the business, financial condition and results of operations of the Company.
Limited Public Market; Possible Volatility of Stock Price
The Common Stock has traded on the Nasdaq National Market since October
1996 and has a limited public market history. The price at which the Common
Stock will trade could be subject to wide fluctuations in response to quarterly
fluctuations in operating results; announcements of technological innovations or
new products by the Company or its competitors; changes in financial estimates
by securities analysts; fluctuations in economic and financial market
conditions, or other events or factors. In addition, the stock market has
experienced significant price and volume fluctuations that have particularly
affected the market price of equity securities of many high technology companies
and that often have been unrelated to the operating performance of such
companies. In the past, following periods of volatility in the market price of a
company's securities, securities class action litigation has often been
instituted against such a company. Such litigation could result in substantial
costs and a diversion of management's attention and resources, which would have
a material adverse effect on the Company's business, financial condition and
results of operations. These broad market fluctuations may adversely affect the
market price of the Common Stock.
Risks Related to Possible Acquisitions
The Company's strategy includes pursuing additional acquisitions that will
complement its business. There can be no assurance that the Company will be able
to identify, acquire on commercially reasonable terms or at all, or profitably
manage additional businesses or successfully integrate acquired businesses into
the Company without substantial expenses, delays or other operational or
financial difficulties. Furthermore, acquisitions may involve a number of
special risks, including, but not limited to: (i) diversion of management's
attention, (ii) possible failure to retain acquired key personnel, (iii)
unanticipated events or circumstances, (iv) risks of entering markets in which
the Company has no or limited prior experience, (v) financial integration or
(vi) legal liabilities. Customer satisfaction or performance problems at a
single acquired business could have a material adverse effect on the reputation
of the Company as a whole. In addition, there can be no assurance that acquired
businesses will achieve anticipated financial performance. While the Company
from time to time considers acquisition opportunities, it has no existing
agreements, understandings or commitments to effect any material acquisition.
The failure of the Company to manage its acquisition strategy successfully could
have a material adverse effect on the Company's business, operating results and
financial condition.
Certain Anti-Takeover Effect Provisions Affecting Stockholders
The Company's certificate of incorporation (the "Certificate of
Incorporation") and by-laws (the "By-laws") provide that any action required or
permitted to be taken by stockholders of the Company must be effected at a duly
called annual or special meeting of stockholders and may not be effected by any
consent in writing, and require reasonable advance notice by a stockholder of a
proposal or director nomination which such stockholder desires to present at any
annual or special meeting of stockholders. Special meetings of stockholders may
be called only by the Chairman of the Board, the Chief Executive Officer or, if
none, the President of the Company or by the Board of Directors. The Certificate
of Incorporation and By-laws provide for a classified Board of Directors, and
members of the Board of Directors may be removed only for cause upon the
affirmative vote of holders of at least two-thirds of
-8-
<PAGE>
the shares of capital stock of the Company entitled to vote. The Board of
Directors has the authority, without further action by the stockholders, to fix
the rights and preferences of, and issue shares of, the Company's authorized
Preferred Stock. The rights of the holders of Common Stock will be subject to,
and may be adversely affected by, the rights of any holders of Preferred Stock
that may be issued in the future. The Company has no present plans to issue any
shares of the Company's Preferred Stock. In addition, the Company is subject to
the anti-takeover provisions of Section 203 of the Delaware General Corporation
Law, which prohibit the Company from engaging in a "business combination" with
an "interested stockholder" for a period of three years after the date of the
transaction in which such stockholder became an "Interested Stockholder" unless
the business combination is approved in a prescribed manner. The application of
Section 203 could have the effect of delaying or preventing a change of control
of the Company. These provisions, and the provisions of the Certificate of
Incorporation and By-laws, may have the effect of deterring hostile takeovers or
delaying or preventing changes in control or management of the Company,
including transactions in which stockholders might otherwise receive a premium
for their shares over then current market prices. In addition, these provisions
may limit the ability of stockholders to approve transactions that they may deem
to be in their best interests.
THE COMPANY
ITDS is a leading provider of comprehensive billing, customer care and
management information solutions to providers of wireless and satellite
Telecommunications services. The Company uses its proprietary software
technology to develop solutions which address billing and customer care
requirements as they evolve, regardless of a service provider's market segment,
geographic area or mix of network features and billing options. The Company
currently serves leading national and regional wireless Telecommunications
companies in the United States. Typically, the Company provides its services
under contracts with terms ranging from two to five years, and bills customers
monthly, on a per-subscriber basis. As a result, substantially all of the
Company's revenue is derived from bill processing services, which are recurring
in nature. This revenue generally increases as the number of subscribers served
by the Company grows.
On January 2, 1998, the Company completed the Intelicom Acquisition.
Intelicom provides complete billing and customer care solutions for the wireless
communication industry, including cellular, personal communication services
("PCS"), paging and enhanced specialized mobile radio ("ESMR").
The Company's core systems form the foundation for an integrated suite of
applications that provide subscriber billing, customer care and service support.
In addition, the Company's systems enable the service provider to automate
subscriber activation, remittance processing, collections, data retrieval and
reporting, fraud management, electronic funds transfer, credit management,
inventory management and data archiving. The Company's software and services
allow its customers to develop and support innovative rate and feature offerings
without the delay and cost associated with reconfiguring their billing and
information system; to identify and respond to subscriber demands through
analysis of billing and subscriber databases; to reduce costs with accurate and
timely receivables information; and to manage the subscriber relationship in a
comprehensive and cost-effective manner.
The Company was incorporated as a Connecticut corporation in June 1990 and
was reincorporated in Delaware in September 1996. The Company's principal
executive office is located at 225 High Ridge Road, Stamford, Connecticut 06905,
and its telephone number is (203) 329-3300.
ITDS is a service mark of the Company.
-9-
<PAGE>
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the Shares by
the Selling Stockholder.
The Company will bear all costs (excluding any brokerage fees, underwriting
discounts and selling commissions and expenses incurred by the Selling
Stockholder for legal services), fees and expenses incurred in effecting the
registration of the Shares covered by this Prospectus, including, without
limitation, all registration and filing fees required under federal and state
securities laws, fees and expenses of counsel for the Company and fees and
expenses of accountants for the Company.
SELLING STOCKHOLDER
All of the Shares being offered by the Selling Stockholder were acquired by
it directly from the Company upon issuance thereof on January 2, 1998 in
connection with the acquisition of Intelicom.
The following table sets forth, to the knowledge of the Company, the name
and the number of shares of Common Stock beneficially owned by the Selling
Stockholder as of the date of this Propsectus, all of which shares are offered
hereby the Selling Stockholder. If all of the Shares offered hereby are sold as
described herein, the Selling Stockholder will beneficially own no shares of
Common Stock after completion of the offering.
<TABLE>
<CAPTION>
Number of Shares of Common Stock
Name of Selling Stockholder Beneficially Owned Prior to Offering (1)
--------------------------- ----------------------------------------
<S> <C>
Century Corporation 606,673(2)
</TABLE>
- -------------------
(1) The number of shares beneficially owned is determined under rules
promulgated by the Commission, and the information is not necessarily
indicative of beneficial ownership for any other purpose. Under such rules,
beneficial ownership includes any shares as to which the individual has
sole or shared voting power or investment power and also any shares which
the individual has the right to acquire within 60 days after the date of
this Prospectus through the exercise of any stock option or other right.
The inclusion herein of such shares, however, does not constitute an
admission that the Selling Stockholder is a direct or indirect beneficial
owner of such shares. The Selling Stockholder has sole voting power and
investment power with respect to all shares of capital stock listed as
owned by the Selling Stockholder.
(2) Pursuant to the Purchase Agreement, the Selling Stockholder agreed to limit
the number of Shares it will sell pursuant to this Registration Statement
prior to July 2, 1999, as determined by a formula. See "Plan of
Distribution."
PLAN OF DISTRIBUTION
The Selling Stockholder has advised the Company that the Shares covered
hereby may be offered and sold by the Selling Stockholder, or by pledgees,
donees, transferees or other successors in interest, in private or public
transactions, in transactions involving principals, in transactions involving
brokers, or by any other lawful methods. Sales through brokers may be made by
any method of trading authorized by any stock exchange or market on which the
Shares may be listed,
-10-
<PAGE>
including block trading in negotiated transactions. Without limiting the
foregoing, such brokers may act as dealers by purchasing any or all of the
Shares covered by this Prospectus, either as agents for others or as principals
for their own accounts, and reselling such Shares pursuant to this Prospectus.
Sales of Shares are, in general, expected to be made at the market price
prevailing at the time of each such sale; however, prices in negotiated
transactions may differ considerably. The Selling Stockholder may also offer to
sell and sell the Shares in options transactions. The Selling Stockholder has
advised the Company that it does not anticipate paying any consideration other
than usual and customary broker's commissions in connection with sales of the
Shares. The Selling Stockholder is acting independently of the Company in making
decisions with respect to the timing, manner and size of each sale. In addition,
any Shares covered by this Prospectus which qualify for sale pursuant to Rule
144 under the Securities Act may be sold under Rule 144 rather than pursuant to
this Prospectus.
In offering the Shares covered by this Prospectus, the Selling Stockholder
and any broker-dealers who execute sales for the Selling Stockholder may be
considered to be "underwriters" within the meaning of the Securities Act, and
any profits realized by the Selling Stockholder and the compensation of such
broker-dealers may be deemed to be underwriting discounts and commissions. The
Company has agreed to indemnify in certain circumstances the Selling Stockholder
against certain liabilities, including liabilities under the Securities Act.
The Selling Stockholder is limited in the number of Shares it may sell
pursuant to this Registration Statement pursuant to the terms of the Purchase
Agreement. The Purchase Agreement limits the aggregate number of Shares which
the Selling Stockholder may sell pursuant to this Registration Statement (i)
prior to January 1, 1999 to 303,336; (ii) after January 1, 1999 but prior to
July 2, 1999 to the sum of 303,336 and the maximum number of Shares the Selling
Stockholder could sell pursuant to Rule 144 under the Securities Act; and (iii)
after July 2, 1999 to 606,673.
The Company has agreed with the Selling Stockholder to keep the
Registration Statement of which this Prospectus constitutes a part effective
until the earlier of (i) the sale of all of the Shares by the Selling
Stockholder or (ii) January 2, 2000. The Company intends to deregister any of
the Shares not sold by the Selling Stockholder at the end of such period.
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon for the
Company by Hale and Dorr LLP, counsel to the Company.
EXPERTS
The consolidated financial statements of ITDS appearing in ITDS' Annual
Report on Form 10-K/A for the year ended December 31, 1997, have been audited by
Ernst & Young LLP, independent auditors, as set forth in their report thereon
included therein and incorporated herein by reference. The financial statements
of Intelicom appearing in ITDS' Current Report on Form 8 K/A dated March 18,
1998 have been audited by Ernst & Young LLP, as set forth in their report
included therein and incorporated herein by reference. Such consolidated
financial statements are incorporated herein by reference in reliance upon such
reports given upon the authority of such firm as experts in accounting and
auditing.
-11-
<PAGE>
================================================================================
No dealer, salesperson or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus and, if given or made, such information or representations must not
be relied upon as having been authorized by the Company or the Selling
Stockholder. This Prospectus does not constitute an offer to sell or a
solicitation of any offer to buy any of the securities offered hereby to any
person in any jurisdiction in which such offer or solicitation of an offer would
be unlawful. Neither the delivery of this Prospectus nor any offer or sale
hereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of the Company or that the information contained
herein is correct as of any time subsequent to the date hereof.
---------------
TABLE OF CONTENTS
---------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
Available Information........................................ 2
Incorporation of Certain Documents
By Reference............................................... 2
Special Note Regarding Forward-Looking
Information................................................ 3
Risk Factors................................................. 3
The Company.................................................. 9
Use of Proceeds.............................................. 10
Selling Stockholder.......................................... 10
Plan of Distribution......................................... 10
Legal Matters................................................ 11
Experts...................................................... 11
</TABLE>
================================================================================
International Telecommunication Data
Systems, Inc.
606,673 Shares
COMMON STOCK
--------------
PROSPECTUS
--------------
July 30, 1998
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the various expenses to be incurred in connection
with the sale and distribution of the securities being registered hereby, all of
which will be borne by the Registrant (except expenses incurred by the Selling
Stockholder for brokerage fees, selling commissions, underwriting discounts and
selling commissions and expenses incurred by the Selling Stockholder for legal
services). All amounts shown are estimates, except the Securities and Exchange
Commission registration fee.
<TABLE>
<S> <C>
Filing Fee - Securities and Exchange Commission . . ................... $ 6,007
Legal fees and expenses of the Registrant.............................. $ 5,000
Accounting fees and expenses........................................... $ 10,000
Miscellaneous expenses................................................. $ 1,993
--------
Total Expenses................................................ $ 23,000
========
</TABLE>
Item 15. Indemnification of Directors and Officers.
Article SEVENTH of the Registrant's Certificate of Incorporation (the
"Certificate of Incorporation") provides that no director of the Registrant
shall be personally liable for any monetary damages for any breach of fiduciary
duty as a director, except to the extent that the Delaware General Corporation
Law prohibits the elimination or limitation of liability of directors for breach
of fiduciary duty.
Article EIGHTH of the Registrant's Certificate of Incorporation provides
that a director or officer of the Registrant (a) shall be indemnified by the
Registrant against all expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement incurred in connection with any litigation or
other legal proceeding (other than an action by or in the right of the
Registrant) brought against him by virtue of his position as a director or
officer of the Registrant if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
Registrant, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful and (b) shall be
indemnified by the Registrant against all expenses (including attorneys' fees)
and amounts paid in settlement incurred in connection with any action by or in
the right of the Registrant brought against him by virtue of his position as a
director or officer of the Registrant if he acted in good faith and in a manner
he reasonably believed to be in, or not opposed to, the best interests of the
Registrant, except that no indemnification shall be made with respect to any
matter as to which such person shall have been adjudged to be liable to the
Registrant, unless a court determines that, despite such adjudication but in
view of all of the circumstances, he is entitled to indemnification of such
expenses. Notwithstanding the foregoing, to the extent that a director or
officer has been successful, on the merits or otherwise, including, without
limitation, the dismissal of an action without prejudice, he is required to be
indemnified by the Registrant against all expenses (including attorneys' fees)
incurred in connection therewith. Expenses shall be advanced to a Director or
officer at his request, provided that he undertakes to repay the amount advanced
if it is ultimately determined that he is not entitled to indemnification for
such expenses.
Indemnification is required to be made unless the Registrant determines
that the applicable standard of conduct required for indemnification has not
been met. In the event of a determination by the Registrant that the director or
officer did not meet the applicable standard of conduct required for
II-1
<PAGE>
indemnification, or if the Registrant fails to make an indemnification payment
within 60 days after such payment is claimed by such person, such person is
permitted to petition the court to make an independent determination as to
whether such person is entitled to indemnification. As a condition precedent to
the right of indemnification, the director or officer must give the Registrant
notice of the action for which indemnity is sought and the Registrant has the
right to participate in such action or assume the defense thereof.
Article EIGHTH of the Registrant's Certificate of Incorporation further
provides that the indemnification provided therein is not exclusive, and
provides that in the event that the Delaware General Corporation Law is amended
to expand the indemnification permitted to directors or officers the Registrant
must indemnify those persons to the fullest extent permitted by such law as so
amended.
Section 145 of the Delaware General Corporation Law provides that a
corporation has the power to indemnify a director, officer, employee or agent of
the corporation and certain other persons serving at the request of the
corporation in related capacities against amounts paid and expenses incurred in
connection with an action or proceeding to which he is or is threatened to be
made a party by reason of such position, if such person shall have acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, in any criminal proceeding, if such person
had no reasonable cause to believe his conduct was unlawful; provided that, in
the case of actions brought by or in the right of the corporation, no
indemnification shall be made with respect to any matter as to which such person
shall have been adjudged to be liable to the corporation unless and only to the
extent that the adjudicating court determines that such indemnification is
proper under the circumstances. Under the Underwriting Agreement, the
Underwriters are obligated, under certain circumstances, to indemnify directors
and officers of the Registrant against certain liabilities, including
liabilities under the Securities Act. Reference is made to the form of
Underwriting Agreement filed as Exhibit 1 hereto.
Item 16. Exhibits.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
2 Stock Purchase Agreement, dated as of December 29, 1997 by and among
the Registrant, ITDS Intelicom, Inc. (formerly, CSC Intelicom, Inc.)
and CSC Domestic Enterprises, Inc., incorporated hereby by reference
to the Registrant's Report on Form 8-K originally filed with the
Securities and Exchange Commission on January 13, 1998.
4 Specimen Certificate for shares of Common Stock, $0.01 par value per
share, of the Registrant, incorporated herein by reference to the
Registrant's Registration Statement on Form S-1 (Commission File No.
333-11045), as amended, originally filed with the Securities and
Exchange Commission on August 29, 1996.
5 Opinion of Hale and Dorr LLP
23.1 Consent of Hale and Dorr LLP, included in Exhibit 5 filed herewith
23.2 Consent of Ernst & Young LLP
24 Power of Attorney, included on page II-4 of this Registration
Statement
</TABLE>
Item 17. Undertakings.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions contained in the Certificate of
Incorporation and By-Laws of the Registrant and the laws of the State of
Delaware, or otherwise, the Registrant has been advised that in the opinion of
the Commission such indemnification
II-2
<PAGE>
is against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing specified in the Underwriting Agreement certificates in such
denominations and registered in such names as required by the Underwriters to
permit prompt delivery to each purchaser. The undersigned Registrant hereby
undertakes that:
(1) For purposes of determining any liability under the Securities Act, the
information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act,
each post-effective amendment that contains a form of prospectus shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the Stamford, Connecticut on the 29th day of July, 1998.
INTERNATIONAL TELECOMMUNICATION DATA
SYSTEMS, INC.
By: /s/ Peter P. Bassermann
------------------------------------------
Peter P. Bassermann
President and Chief Executive Officer
II-4
<PAGE>
Each person whose signature appears below constitutes and appoints Peter P.
Bassermann, Peter L. Masanotti and John H. Chory, and each of them singly, his
true and lawful attorneys-in-fact and agents, with full power of substitution
and resubstitution in each of them, for him and in his name, place and stead,
and in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement on Form S-3 of
International Telecommunication Data Services, Inc. and to file the same, with
all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power of authority to do and perform each and
every act and thing requisite or necessary to be done in and about the premises,
hereby ratifying and confirming all that said attorneys-in-fact and agents or
any of them or their or his substitutes or substitute, may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons in the capacities and
on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/S/ Peter P. Bassermann President, Chief Executive Officer and July 29, 1998
- ------------------------------------ Director (Principal Executive Officer)
Peter P. Bassermann
/S/ Paul K. Kothari Chief Financial Officer (Principal July 29, 1998
- ------------------------------------ Financial and Accounting Officer)
Paul K. Kothari
/S/ Lewis D. Bakes Director July 29, 1998
- ------------------------------------
Lewis D. Bakes
/S/ Stuart L. Bell Director July 29, 1998
- ------------------------------------
Stuart L. Bell
/S/ Stephen J. Saft Director July 29, 1998
- ------------------------------------
Stephen J. Saft
/S/ Peter L. Masanotti Director July 29, 1998
- ------------------------------------
Peter L. Masanotti
/S/ Samuel L. Jacob Director July 29, 1998
- ------------------------------------
Samuel L. Jacob
/S/ Harvey M. Krueger Director July 29, 1998
- ------------------------------------
Harvey M. Krueger
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------
<S> <C>
2 Stock Purchase Agreement, dated as of December 29, 1997 by and among
the Registrant, ITDS Intelicom, Inc. (formerly, CSC Intelicom, Inc.)
and CSC Domestic Enterprises, Inc., incorporated hereby by reference
to the Registrant's Report on Form 8-K originally filed with the
Securities and Exchange Commission on January 13, 1998.
4 Specimen Certificate for shares of Common Stock, $0.01 par value per
share, of the Registrant, incorporated herein by reference to the
Registrant's Registration Statement on Form S-1 (Commission File No.
333-11045), as amended, originally filed with the Securities and
Exchange Commission on August 29, 1996.
5 Opinion of Hale and Dorr LLP
23.1 Consent of Hale and Dorr LLP, included in Exhibit 5 filed herewith
23.2 Consent of Ernst & Young LLP
24 Power of Attorney, included on page II-4 of this Registration Statement
</TABLE>
II-6
EXHIBIT 5
---------
HALE AND DORR LLP
Counsellors at Law
60 State Street, Boston, Massachusetts 02109
617-526-6000 * FAX 617-526-5000
July 30, 1998
International Telecommunication Data
Systems, Inc.
225 High Ridge Road
Stamford, CT 06905
Ladies and Gentlemen:
This opinion is furnished to you in connection with a Registration
Statement on Form S-3 (the "Registration Statement") filed with the Securities
and Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Securities Act"), for the registration of an aggregate of
2,093,433 shares of Common Stock, $0.01 par value per share (the "Shares"), of
International Telecommunication Data Systems, Inc., a Delaware corporation (the
"Company"), all of which Shares will be sold by a certain stockholder of the
Company (the "Selling Stockholder").
We are acting as counsel for the Company in connection with the
registration of the Shares by the Company for sale by the Selling Stockholder.
We have examined signed copies of the Registration Statement, as filed with the
Commission. We have also examined and relied upon minutes of meetings of the
stockholders and the Board of Directors of the Company as provided to us by the
Company, stock record books of the Company as provided to us by the Company, the
Certificate of Incorporation and By-Laws of the Company, each as amended to
date, and such other documents as we have deemed necessary for purposes of
rendering the opinions hereinafter set forth.
In our examination of the foregoing documents, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals, the conformity to original documents of all documents submitted to
us as copies, the authenticity of the originals of such latter documents and the
legal competence of all signatories to such documents.
Our opinion expressed below, insofar as it relates to the Shares being
fully paid, is based solely on a certificate of the Chief Financial Officer of
the Company.
We assume that the appropriate action will be taken, prior to the offer and
sale of the Shares under the Registration Statement, to register and qualify the
Shares for sale under all applicable state securities or "blue sky" laws.
Based upon and subject to the foregoing, we are of the opinion that the
Shares to be sold by the Selling Stockholder have been duly authorized and are
validly issued, fully paid and nonassessable.
<PAGE>
International Telecommunication Data Systems, Inc.
July 30, 1998
Page 2
It is understood that this opinion is to be used only in connection with
the offer and sale of the Shares while the Registration Statement is in effect.
Please note that we are opining only as to the matters expressly set forth
herein, and no opinion should be inferred as to any other matters. This opinion
is based upon currently existing statutes, rules, regulations and judicial
decisions, and we disclaim any obligation to advise you of any change in any of
these sources of law or subsequent legal or factual developments which might
affect any matters or opinions set forth herein.
We hereby consent to the filing of this opinion with the Commission as an
exhibit to the Registration Statement in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Securities Act and to the use of our
name therein and in the related Prospectus under the caption "Legal Matters." In
giving such consent, we do not hereby admit that we are in the category of
persons whose consent is required under Section 7 of the Securities Act or the
rules and regulations of the Commission.
Very truly yours,
HALE AND DORR LLP
EXHIBIT 23.2
------------
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the reference to our firm under the caption "Experts" and to
the use of our reports dated February 10, 1998, except for information
describing the three-for-two stock split in Note 1 and Note 3 as to which the
date is February 23, 1998, related to our audits of International
Telecommunication Data Systems, Inc. and March 5, 1998 related to our audits of
ITDS Intelicom Services, Inc., and incorporated herein by reference in the
Registration Statement (Form S-3) and related Prospectus of International
Telecommunication Data Systems, Inc. dated July 30, 1998.
Stamford, Connecticut /s/ Ernst & Young LLP
July 29, 1998
