<PAGE> 1
As filed with the Securities and Exchange Commission on November 22, 2000
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------------
CHECKFREE CORPORATION
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C> <C>
Delaware 7374 58-2360335
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization) Classification Code Number) Identification No.)
</TABLE>
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4411 East Jones Bridge Road
Norcross, Georgia 30092
(678) 375-3000
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
------------------------
Peter F. Sinisgalli
President and Chief Operating Officer
CheckFree Corporation
4411 East Jones Bridge Road
Norcross, Georgia 30092
(678) 375-3000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
------------------------
Copies of Correspondence to:
Robert J. Tannous, Esq.
Porter, Wright, Morris & Arthur LLP
41 South High Street, Suite 2800
Columbus, Ohio 43215
(614) 227-1953
(614) 227-2100 (fax)
[email protected]
------------------------
Approximate date of commencement of proposed sale of the securities to the
public: As soon as practicable after this Registration Statement becomes
effective.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the box. [ ]
If any of the securities being registered on this Form are offered on a delayed
or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other
than the 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 this prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
------------------------- ---------------------- ------------------------ ------------------------ -------------------
Title of Each Class of Proposed Maximum Proposed Maximum Amount of
Securities to be Amount to be Offering Price Per Aggregate Offering Registration Fee*
Registered Registered Unit* Price*
------------------------- ---------------------- ------------------------ ------------------------ -------------------
<S> <C> <C> <C> <C>
Common stock, $.01 par
value............ 15,917,250 $53.72 $855,074,670 $225,740
------------------------- ---------------------- ------------------------ ------------------------ -------------------
</TABLE>
* Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) of the Securities Act of 1933, based on the average
high and low prices of the Common Stock as reported on the Nasdaq National
Market on November 15, 2000.
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),
MAY DETERMINE.
<PAGE> 2
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 THE REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH
STATE.
SUBJECT TO COMPLETION, DATED NOVEMBER 22, 2000
PROSPECTUS
----------
15,917,250 SHARES
[CHECKFREE LOGO]
COMMON STOCK
This prospectus relates to the sale of 15,917,250 shares of our common
stock owned by a group of our stockholders on whose behalf we are registering
these shares. These stockholders may sell the shares through agents,
broker-dealers or underwriters, and on terms determined at the time of the sale.
To the extent required, we will provide you with a supplement to this prospectus
with specific information regarding:
- the shares to be sold;
- the public offering price; and
- the names of any agent, broker-dealer, or underwriter through which
these shares are sold, and any applicable commission or discount.
The stockholders selling shares under this prospectus reserve the sole
right to accept or reject, in whole or in part, any proposed sale of the shares.
We will not receive any proceeds from the sale of shares under this
prospectus. All proceeds will go directly to the selling stockholders.
Our common stock is listed on the Nasdaq National Market under the symbol
"CKFR." On November __, 2000, the closing price per share of our common stock on
the Nasdaq National Market was $______.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
--------------------------
The date of this prospectus is November __, 2000.
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THIS PROSPECTUS INCORPORATES IMPORTANT BUSINESS AND FINANCIAL INFORMATION ABOUT
CHECKFREE THAT IS NOT INCLUDED OR DELIVERED WITH THIS DOCUMENT. THIS INFORMATION
IS DESCRIBED IN GREATER DETAIL IN THE SECTION OF THIS PROSPECTUS ENTITLED "WHERE
YOU CAN FIND MORE INFORMATION." IN ADDITION, THE INFORMATION IS AVAILABLE
WITHOUT CHARGE UPON A WRITTEN OR ORAL REQUEST TO CHECKFREE CORPORATION, 4411
EAST JONES BRIDGE ROAD, NORCROSS, GEORGIA 30092, ATTENTION: INVESTOR RELATIONS,
(678) 375-3000.
TABLE OF CONTENTS
PAGE
----
Table of Contents................................ 2
Where You Can Find More Information.............. 3
Forward-Looking Statements....................... 4
The Company...................................... 5
Use of Proceeds.................................. 5
Selling Stockholders............................. 5
Generally................................... 5
Stockholder Agreements...................... 5
Registration Rights Agreements.............. 8
Plan of Distribution............................. 10
Experts.......................................... 10
Legal Matters.................................... 11
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WHERE YOU CAN FIND MORE INFORMATION
This prospectus incorporates documents by reference which are not presented
in or delivered with this prospectus. You should rely only on the information
contained in this document or to documents that we have referred you to. We have
not authorized anyone to provide you with any additional information.
The following documents, which have been filed by us with the Securities
and Exchange Commission (SEC file number 0-26802), are incorporated by reference
into, and considered to be a part of, this prospectus:
- Annual Report on Form 10-K for the fiscal year ended June 30, 2000
(filed September 26, 2000);
- Quarterly Report on Form 10-Q for the quarter ended September 30, 2000
(filed November 14, 2000);
- Proxy Statements for the Special Meeting of Stockholders held on
September 28, 2000 (filed August 25, 2000) and the Annual Meeting of
Stockholders to be held on November 1, 2000 (filed September 29, 2000);
- Current Reports on Form 8-K dated July 12, 2000 (filed July 12, 2000),
dated August 2, 2000 (filed August 3, 2000), dated September 1, 2000
(filed September 15, 2000 and amended on November 8, 2000), dated
September 5, 2000 (filed September 5, 2000), dated September 30, 2000
(filed October 3, 2000), dated October 1, 2000 (filed October 2, 2000),
dated October 1, 2000 (filed October 11, 2000), dated November 1, 2000
(filed November 6, 2000), and dated November 14, 2000 (filed November
14, 2000);
- The description of common stock, contained in the registration
statement on Form 8-A filed with the Commission pursuant to Section 12
of the Securities Exchange Act of 1934 and all amendments thereto and
reports filed for the purpose of updating this description; and
- All documents filed by us with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after
the date of this prospectus and before the offering of our common stock
hereby is completed, other than portions of these documents described
in paragraphs (i), (k) and (l) of Item 402 of Regulation S-K
promulgated by the Commission.
Any statement contained in a document incorporated or deemed to be
incorporated by reference into this prospectus will be deemed to be modified or
superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus or any other subsequently filed document that is
deemed to be incorporated by reference into this prospectus modifies or
supersedes the statement. Any statement so modified or superseded will not be
deemed, except as so modified or superseded, to constitute a part of this
prospectus.
We will provide a copy of any and all of the information that we
incorporate by reference in this prospectus to any person, without charge, upon
written or oral request. If exhibits to the documents incorporated by reference
in this prospectus are not themselves specifically incorporated by reference in
this prospectus, then the exhibits will not be provided.
Requests for documents relating to us should be directed to:
CheckFree Corporation
4411 East Jones Bridge Road
Norcross, Georgia 30092
Attention: Investor Relations
Telephone: (678) 375-300
E-mail: [email protected]
We must comply with the informational requirements of the Securities
Exchange Act of 1934 and its rules and regulations. Under the Securities
Exchange Act of 1934, we must file reports, proxy statements, and other
information with the Commission. Copies of these reports, proxy statements, and
other information can be inspected and copied at:
Public Reference Room
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
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or at the public reference facilities of the regional offices of the Commission
at:
500 West Madison Street
Suite 1400
Chicago, Illinois 60661-2511
or
7 World Trade Center
Suite 1300
New York, New York 10048-1102
You may obtain information on the operation of the Public Conference Room
by calling the Commission at 1-800-SEC-0330. You may also obtain copies of our
materials by mail at prescribed rates from the Public Reference Room at the
address noted above. Finally, you may obtain these materials electronically by
accessing the Commission's home page on the Internet at HTTP://WWW.SEC.GOV.
Our common stock is listed on the Nasdaq National Market. Accordingly,
reports and other information concerning us should be available for inspection
and copying at the offices of:
The Nasdaq Stock Market
1735 K Street, N.W.,
Washington, D.C. 20006-1504
We have filed a registration statement on Form S-3 under the Securities Act
of 1933 with the Securities and Exchange Commission with respect to our common
stock to be offered by this prospectus. This prospectus constitutes our
prospectus filed as part of the registration statement. This prospectus does not
contain all of the information set forth in the registration statement because
selected parts of the registration statement are omitted in accordance with the
Commission's rules and regulations. The registration statement and its exhibits
are available for inspection and copying as set forth above.
All information contained in this prospectus regarding CheckFree was
supplied by us, and all information contained in this prospectus regarding the
selling stockholders was supplied by the respective selling stockholders.
Neither CheckFree nor the selling stockholders can warrant the accuracy or
completeness of information relating to the other party.
FORWARD LOOKING STATEMENTS
The Securities and Exchange Commission encourages companies to disclose
forward-looking information so that investors can better understand a company's
future prospects and make informed investment decisions. This prospectus
contains "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements may be made directly
in this prospectus referring to us, and they may also be made as part of this
prospectus by reference to other documents filed with the Securities and
Exchange Commission by us, which is known as "incorporation by reference." These
statements may include statements regarding the period following completion of
offering of our common stock on behalf of the selling stockholders by this
prospectus.
Words like "anticipate," "estimate," "expects," "projects," "intends,"
"plans," "believes" and words and terms of similar substance used in connection
with any discussion of future operating of financial performance, or the
transactions involving us, identify forward-looking statements.
All forward-looking statements are management's present expectations of
future events and are subject to a number of factors and uncertainties that
could cause actual results to differ materially from those described in the
forward-looking statements.
For additional information that could cause actual results to differ
materially from those described in the forward-looking statements, please see
our annual report on Form 10-K for the year ended June 30, 2000 that we filed
with the Commission on September 26, 2000.
Stockholders and potential investors are cautioned not to place undue
reliance on the forward-looking statements, which speak only as of the date of
this prospectus or the date of the document incorporated by reference in this
prospectus. We are not under any obligation, and expressly disclaims any
obligation, to update or alter any forward-looking statements, whether as a
result of new information, future events or otherwise.
All subsequent forward-looking statements attributable us or any person
acting on our behalf are expressly qualified in their entirety by the cautionary
statements contained or referred to in this section.
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THE COMPANY
This summary highlights selected information about our company. You should
carefully read this prospectus and the other documents we refer to for a more
complete understanding of our business.
CHECKFREE CORPORATION
4411 EAST JONES BRIDGE ROAD
NORCROSS, GEORGIA 30092
(678) 375-3000
WWW.CHECKFREE.COM
The reference to our website address above does not constitute
incorporation by reference of the information contained on that website, so you
should not consider any information on this website to be a part of this
prospectus.
We are the leading provider of electronic billing and payment services. We
operate our business through three independent but inter-related divisions:
- Electronic Commerce;
- Investment Services; and
- Software.
Our Electronic Commerce business provides services that allow consumers to:
- receive electronic bills through the Internet;
- pay any bill--electronic or paper--to anyone; and
- perform customary banking transactions, including balance inquiries,
transfers between accounts and on-line statement reconciliations.
Our Investment Services business offers portfolio accounting and
performance measurement services to investment advisors, brokerage firms, banks
and insurance companies and financial planning application software to financial
planners.
Our Software businesses provide electronic commerce and financial
applications software and services for businesses and financial institutions.
We are incorporating by reference important business and financial
information about CheckFree into this prospectus that is not included in or
delivered with this prospectus. You may obtain the information incorporated by
reference into this prospectus without charge by following the instructions in
the section entitled "Where You Can Find More Information" in this prospectus.
USE OF PROCEEDS
The proceeds from the sale of the shares offered by this prospectus are
solely for the stockholders who currently own and are selling the shares. We
will not receive any of the proceeds from the sale of these shares.
SELLING STOCKHOLDERS
GENERALLY
The following table contains information regarding the beneficial ownership
of the selling stockholders as of November 21, 2000:
Shares Shares
Owned Shares Owned
Selling Before the Being After the
Stockholder Offering Offered Offering
----------- -------- ------- --------
Microsoft
Corporation 8,567,250 8,567,250 0
First Data
Corporation 6,567,250 6,567,250 0
Citibank, N.A. 932,750 782,750 150,000
Except for the board seats held by Microsoft and First Data, none of the
selling stockholders are deemed to be our affiliates.
On July 7, 2000, we entered into an amended and restated agreement and plan
of merger with Microsoft Corporation, First Data Corporation, and Citibank,
N.A., whereby through a series of acquisitions we would acquire the business of
TransPoint. In consideration for the mergers and certain related commercial
agreements, we agreed to issue to Microsoft, First Data, and Citibank an
aggregate of 17,000,000 shares of our common stock. The TransPoint acquisition
was completed on September 1, 2000.
STOCKHOLDER AGREEMENTS
At the closing of the TransPoint acquisition, both Microsoft and First Data
executed a stockholders agreement with us that contained provisions that are
summarized as follows:
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Governance.
Pursuant to the stockholder agreements, each of Microsoft and First Data
were entitled to appoint one individual designated by it to our board of
directors. Each of the directors designated by Microsoft and First Data must be
approved by a majority of the members of our board of directors. Following the
TransPoint acquisition, Lewis Levin, a Vice President of Microsoft, and Henry C.
Duques, the Chairman and Chief Executive Officer of First Data, were appointed
as directors to our board of directors.
For so long as either Microsoft or First Data is entitled to designate a
director, we will be obligated to include that designee as part of the
management slate in our proxy statement relating to the election of directors
and use commercially reasonable efforts to support each designee consistent with
our current and historical support of other persons standing for election as
part of the management slate.
As long as each of Microsoft and First Data can designate a nominee for
election as a director, each will agree to vote all of its voting stock in each
stockholder vote for the election of directors in the following manner:
- if there is no bona fide proxy contest for the election of directors,
in favor of the management slate; or
- if there is a bona fide proxy contest for the election of directors,
either (1) in favor of the management slate or (2) in the same
proportion as all votes cast by disinterested stockholders.
The director designation right of each of Microsoft and First Data will
terminate upon the earlier of:
- first date on which the stockholder and its controlled affiliates own
less than 75% of the shares acquired at the closing of the TransPoint
acquisition, and
- the occurrence of a change of control of our company in which the
stockholder and its controlled affiliates no longer own at least 5% of
the voting shares of the surviving company.
For purposes of the stockholder agreements, a "change of control" will
include any of the following:
- any merger, consolidation or other business combination transaction in
which our stockholders immediately prior to the transaction no longer
own at least 50% of the total voting stock of the surviving entity or
its parent after the transaction;
- an acquisition by any person, other than Microsoft and its controlled
affiliates or First Data and its controlled affiliates, as the case may
be, of at least 30% of our total voting stock;
- a sale of our assets to any person, other than Microsoft and its
controlled affiliates or First Data and its controlled affiliates, as
the case may be, for a total price in excess of 30% of the market value
of our outstanding common stock at that time; or
- our liquidation of dissolution.
Standstill.
During the standstill period, neither Microsoft, First Data nor any of
their respective controlled affiliates will be able to do, announce an intention
to do, or facilitate or encourage another person to do, any of the following:
- offer or seek to acquire ownership of any of our assets or businesses
for a total price in excess of 30% of the market value of our
outstanding common stock;
- acquire beneficial ownership of any of our voting stock or any of our
subsidiaries, or any options or other rights to acquire the voting
stock, except for acquisitions to maintain their percentage ownership
of our common stock;
- make or participate in any solicitation of proxies with respect to the
voting of any of our securities or any of our subsidiaries;
- deposit any securities of ours or our subsidiaries in a voting trust or
arrangement with any person;
- become a member of a "group," as defined in Section 13(d) of the
Securities Exchange Act of 1934 with respect to any of our voting
securities or any of our subsidiaries;
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- arrange any financing for the purchase of any of our or our
subsidiaries voting securities, or securities convertible into similar
securities;
- propose or participate in any proposal of a tender offer, exchange
offer, merger, business combination, restructuring, liquidation,
recapitalization or similar transaction involving us or any of our
subsidiaries;
- nominate any person as a director who is not nominated by the incumbent
directors, or propose any matter to be voted upon by our stockholders,
except that they may nominate directors in accordance with the
"Governance" provision described above; or
- solicit, initiate, encourage or knowingly or intentionally facilitate
any of its affiliates undertaking any of the acts described in the
bullet points immediately above.
The "standstill period" is defined in each of the stockholder agreements as
the period beginning on September 1, 2000 and ending upon the earliest to occur
of the following:
- September 1, 2003;
- the date of execution of an agreement that will result in our change of
control, which is defined above, or the actual occurrence of a change
of control;
- the commencement of a bona fide third party public offer to acquire at
least 25% of our voting stock; or
- a reduction in beneficial ownership of our voting stock by Microsoft or
First Data, as the case may be, to less than 5% of our total voting
stock.
If the standstill period terminates due to our change of control or the
execution of an agreement that would result in our change of control, the change
of control transaction is terminated and neither Microsoft nor First Data has
acquired control of us before the termination, then the standstill will be
reinstated. Also, if the standstill period terminates due to a third party
public offer for our common stock, the public offer is withdrawn or terminated
prior to its consummation and no tender offer of Microsoft or First Data for our
common stock is pending, then the standstill period will be reinstated.
If, at any time during the standstill period,
- any third party has made any proposal or offer relating to a takeover
transaction or other change of control of us, which has not been
rejected by the board of directors,
- the board of directors has determined to pursue, and is pursuing, a
takeover transaction or other change of control of us, or
- our board of directors or officers have engaged in any discussions or
negotiations with, or provided any information to, any third person
with respect to a potential takeover transaction or our change of
control and have not resolved to terminate the discussions,
negotiations or provision of information,
then, for so long as any one of these conditions apply, Microsoft, First Data or
their controlled affiliates will be able to make an offer or proposal directed
privately to us relating to a takeover transaction or other change of control.
If, during the standstill period, we disclose non-public information to
another party, then Microsoft and First Data each will have the option to be
subject to the terms of any less restrictive standstill provision that is
negotiated by us with the party for the same duration as the less restrictive
standstill applies to this third party. In addition, if, during the standstill
period, we provide non-public information to another party without a signed
confidentiality agreement with the third party, then the standstill restrictions
will no longer apply to Microsoft, First Data and their controlled affiliates.
Transfer Restrictions.
Microsoft and First Data will not be able to transfer any shares of our
common stock they beneficially own during the period ending on September 1,
2001, except for transfers:
- to any controlled affiliate who agrees to be bound by the stockholder
agreement;
- which have been consented to in writing by us;
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- pursuant to a third-party tender offer that is recommended by our board
of directors or a merger transaction in which we are a party; or
- subject to the following paragraph, pursuant to bona fide hedging
transactions with, or arranged by, a nationally recognized investment
banking firm or other nationally recognized financial institutions.
With respect to hedging during the one year period after September 1, 2000:
- as to each of Microsoft and First Data, the total number of shares
underlying hedging transactions entered into or renewed during the
first-year period may not be greater than 50% of the volume limitations
under Rule 144 of the Securities Act of 1933 during any applicable Rule
144 period, assuming the hedges by each were treated as transfers by
each subject to Rule 144;
- Microsoft and First Data may renew or amend any hedge in place as long
as each does not exceed the number of shares underlying their
respective prior hedging transaction; and
- Microsoft and First Data may not enter into, renew or amend more than
one hedge transaction during any calendar quarter if it would require
the filing of an amendment by such party to any Schedule 13D under the
rules and regulations promulgated by the Securities and Exchange
Commission under the Securities Exchange Act of 1934.
Unless Microsoft or First Data beneficially own less than 5% of our
outstanding common stock, during the period beginning on September 1, 2001 and
ending on September 1, 2003, Microsoft and First Data will not be able to
transfer any shares of our common stock they beneficially own, except for
transfers:
- pursuant to each of the bullet points set forth in the first paragraph
of this "Transfer Restrictions" section, except that as to each of them
the shares underlying hedging transactions, together with transfers
pursuant to the third bullet point of this paragraph, may be equal to
up to 100% of the volume limitations of Rule 144 during any applicable
Rule 144 period;
- in a bona fide public distribution or underwritten public offering,
including pursuant to the registration rights granted to Microsoft and
First Data described in the "Registration Rights Agreements" section
below; or
- of shares in amounts that could be sold under the volume limitations of
Rule 144 during any applicable Rule 144 period, assuming during any
period that all shares underlying any new or renewed hedging
transactions by such party are considered to be transfers by such party
subject to the Rule 144 limitations.
With respect to the second and third bullet points immediately above,
however, except as permitted by the following paragraph, these transfers may not
be made if they would result, to the knowledge of Microsoft or First Data, as
the case may be, in the transferee holding more than 5% of our outstanding
shares of common stock.
Microsoft or First Data will only be able to transfer a 5% block of our
common stock or knowingly transfer shares to a third party so that after the
transfer that third party would own more than 5% of our common stock, if the
transfer is to a person that is qualified to file a Schedule 13G pursuant to
Rule 13d-1(b) of the Securities Exchange Act of 1934. Prior to these transfers,
however, Microsoft or First Data must offer to sell those shares to us at least
two days prior to making the transfer. For this two-day period, we will have the
option to purchase all of the shares at the same price and upon the same terms
as the proposed transfer. If we decide not to exercise our right of first offer,
Microsoft or First Data, as the case may be, will be able to sell the 5% block
for a set period at no less than 95% of the price offered to us.
REGISTRATION RIGHTS AGREEMENTS
At the closing of the TransPoint acquisition, Microsoft, First Data and
Citibank each executed a registration rights agreement with us that contained
the following provisions:
Shelf Registration Statement.
Pursuant to the registration rights agreements, as promptly as practicable
after the closing of TransPoint acquisition, we agreed to file, at our expense,
a registration statement allowing the offering for sale on a continuous basis of
the shares of our common stock received by Microsoft, First Data and Citibank in
the
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<PAGE> 10
TransPoint acquisition. We have agreed to use our commercially reasonable best
efforts to cause the registration statement to be declared effective by the
Commission by the 30th day after the effective time of the closing, and to keep
the shelf registration statement effective until Microsoft, First Data and
Citibank have either sold all of the shares they received at the closing or they
are able to sell all of these shares under Rule 144.
We will be able to suspend the effectiveness of the shelf registration
statement in the following circumstances:
- as to each of Microsoft, First Data, and Citibank, if the negotiation
or consummation of a transaction by us is pending or an event has
occurred, and in each case we have has a bona fide business purpose for
keeping this negotiation, consummation or event confidential, and the
nondisclosure would cause the registration statement to fail to comply
with applicable disclosure requirements; or
- as to each of Microsoft and First Data, if an underwritten public
offering of our common stock pursuant to the shelf registration
statement would adversely affect a pending or proposed offering of our
common stock by us.
Underwritten Offerings.
In the registration rights agreements among us and Microsoft and First
Data, each of Microsoft and First Data will have the right to request us to
undertake, at our expense, an underwritten public offering of our shares of
common stock they received in the TransPoint acquisition. Each of Microsoft and
First Data will be limited to one of these requests during any six-month period.
If we are allowed to choose the lead managing underwriter for any particular
underwritten offering, then our management will participate in a customary road
show in connection with the offering.
We will only be obligated to undertake an underwritten offering for
Microsoft or First Data if either of the following minimums is satisfied:
- the aggregate gross proceeds to the participants in the offering equal
or exceed $100 million, or
- the total number shares of our common stock to be registered in the
offering equals or exceeds 1,000,000.
Piggyback Registrations.
In the registration rights agreement among us, Microsoft and First Data, we
will grant customary piggyback registration rights to Microsoft and First Data
so that if, at any time while the shelf registration statement is effective, we
propose to register any of our common stock, whether or not for our own account,
each of Microsoft and First Data will be able to request that we include its
shares in the registration unless the registration is related to shares issued
in connection with a merger or an exchange offer or pursuant to an employee
benefit plan.
Underwriter Limitations on Underwritten Public Offerings.
If the lead managing underwriter of an underwritten public offering of our
common stock advises us, or Microsoft or First Data, if applicable, that the
number of shares proposed to be offered should be limited due to market
conditions, then the amount of shares offered, including pursuant to any
over-allotment options exercised by the underwriters, will be allocated in the
following manner:
- if the offering is initiated by us,
(1) first, to the full extent of shares we desire to sell, and
(2) second, if any shares remain, to Microsoft and First Data and to
any other persons possessing similar registration rights pro
rata in accordance with each request.
- if the offering is initiated by Microsoft or First Data,
(1) first, to the full extent of shares the stockholder initiating the
offering desires to sell, and
(2) second, if any shares remain, to each other holder of our common
stock possessing similar registration rights pro rata in
accordance with each request.
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<PAGE> 11
Expenses.
We have agreed to pay our expenses of registering the shares of our common
stock offered by this prospectus under the Securities Act, including
registration and filing fees, printing expenses, administrative expenses, and
certain legal and accounting fees. Each of the selling stockholders will bear
their pro rata share of all discounts, commissions, or other amounts payable to
underwriters, broker-dealers, or agents as well as fees and disbursements for
legal counsel retained by any selling stockholders and any transfer taxes
relating to the sale or disposition of the shares.
PLAN OF DISTRIBUTION
The shares covered by this prospectus may be offered and sold from time to
time by the selling stockholders or by their pledgees, donees, transferees, and
other successors in interest. The selling stockholders will act independently of
us and each other in making decisions with respect to the timing, manner, and
size of each sale. To our knowledge, none of the selling stockholders have
entered into any agreement, arrangement, or understanding with any particular
broker or market maker that will participate in the offering.
The selling stockholders may sell shares in any of the following
transactions:
- through broker-dealers;
- through agents; or
- directly to one or more purchasers.
From time to time, the selling stockholders may sell their shares in one or
more transactions in the over-the-counter market, on the Nasdaq National Market,
or in privately negotiated transactions at market prices prevailing at the time
of sale, at prices related to such prevailing market prices, or at negotiated
prices. In addition, any shares covered by this prospectus which qualify for
sale under Rule 144 of the Securities Act may be sold under Rule 144 rather than
under this prospectus.
Regarding the distribution of the shares or otherwise, subject to the
restrictions set forth in the "Selling Stockholders" section above, the selling
stockholders may do the following:
- enter into hedging transactions with broker-dealers. In connection with
such transactions, broker-dealers may engage in short sales of the
shares registered under this prospectus in the course of hedging the
positions they assume with the selling stockholders.
- sell shares short and redeliver the shares to close out such short
positions.
- enter into option or other transactions with broker-dealers which
require the selling stockholders to deliver the shares registered by
this registration statement to the broker-dealer, so that the
broker-dealer may resell or otherwise transfer the shares under this
prospectus.
- loan or pledge the shares of our common stock offered by this
prospectus to a broker-dealer, who in turn may:
(1) sell the shares so loaned; or
(2) upon a default, sell the shares so pledged, under this
prospectus.
When the selling stockholders offer their shares, to the extent required,
we will provide you with a prospectus supplement detailing:
- the aggregate number of shares being offered;
- the terms of the offering, including the name or names of any
underwriters, broker-dealers, or agents;
- any commissions, discounts, or concessions and other items constituting
compensation from the selling stockholders; and
- any commissions, discounts, or concessions allowed or repaid to
broker-dealers.
EXPERTS
Our consolidated financial statements and the related financial statement
schedule incorporated in this prospectus by reference from our Annual Report on
Form 10-K for the year ended June 30, 2000 have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their reports, which are
incorporated herein by reference, and have been so incorporated in reliance upon
the reports of such firm given upon their authority as experts in accounting and
auditing.
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<PAGE> 12
The consolidated financial statements of MSFDC, L.L.C. and related
companies, incorporated in this prospectus by reference from our Current Report
on Form 8-K, dated as of November 14, 2000, have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their report, which are
incorporated herein by reference, and have been so incorporated in reliance upon
the report of such firm given upon their authority as experts in accounting and
auditing.
LEGAL MATTERS
We have engaged Porter, Wright, Morris & Arthur LLP, Columbus, Ohio to
assist us with legal matters concerning the registration statement for the
shares of our common stock offered by this prospectus. Porter, Wright, Morris &
Arthur LLP will pass on the validity of our common stock offered by this
prospectus.
Partners of Porter, Wright, Morris & Arthur LLP who participated in the
preparation of this prospectus beneficially own an aggregate of 26,507 shares of
our common stock consisting of a combination of stock and options exercisable
within 60 days after the date of this prospectus.
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<PAGE> 13
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the various expenses in connection with
the sale and distribution of the securities being registered hereby, other than
underwriting discounts and commissions, if any. All amounts shown are estimates,
except the SEC registration fee:
SEC registration fee.................................. $225,740
Printing and engraving fee............................ 50,000
Legal fees and expenses............................... 100,000
Accounting fees and expenses.......................... 25,000
Transfer agent and registrar fees and expenses........ 5,000
Miscellaneous fees and expenses....................... 44,260
Total........................................ $450,000
All the costs identified above will be paid by the Company.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(a) Article IX of the Registrant's By-Laws (the "By-Laws") provides
that the Registrant shall, to the fullest extent permitted by applicable law as
then in effect, indemnify any person who is or was involved or threatened to be
made so involved in any action by reason of the fact that he is or was a
director or officer of the Registrant, or is or was serving at the request of
the Registrant as a director or officer of another entity. The right to
indemnification includes the right to receive payment of expenses in advance of
the final disposition of the proceeding. All indemnification rights in Article
IX are contract rights. The Registrant also may provide indemnification for
employees, agents, attorneys and representatives of the Registrant by action of
its board of directors. Article IX expressly states that no amendment to the
By-Laws or the Certificate of Incorporation shall adversely affect any right to
indemnification for acts occurring prior to such amendment. The right of
indemnification is not exclusive of any other rights of indemnification that may
be available.
In determining the right to indemnification, the Registrant
has the burden of proof that the indemnitee has not met the applicable standard
of conduct. If successful in whole or in part in such a proceeding, the
indemnitee is entitled to be indemnified for expenses incurred in connection
with such proceeding. All reasonable expenses incurred by an indemnitee in
connection with any proceeding shall be advanced by the Registrant after receipt
of a statement from the indemnitee requesting such advance.
Article IX provides that the Registrant may purchase and
maintain insurance in connection with any expenses, liability or loss relating
to any proceeding, whether or not the Registrant would have the power to
indemnify the officer, director, employee, agent, attorney, trustee or
representative. The Registrant also may enter into indemnification contracts
with any of the foregoing persons, which contracts are deemed specifically
approved and authorized by the stockholders.
Article IX provides that if any provision of Article IX is
held invalid, illegal or unenforceable, the remaining provisions of Article IX
shall not be affected. An indemnitee also may elect, as an alternative to the
Article IX procedures, to follow procedures authorized by applicable corporate
law or statute. Article IX sets forth specific procedures for the advancement of
expenses and for the determination of entitlement to indemnification.
Entitlement to indemnification shall be determined by a majority vote of
disinterested directors, by a written opinion of independent counsel under
certain circumstances or by the Registrant's stockholders if a majority of the
disinterested directors determines the issue should be submitted to the
stockholders. If the foregoing persons have not been appointed within 60 days
after the receipt of a request for indemnification, the indemnitee is deemed to
be
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<PAGE> 14
entitled to indemnification unless the indemnitee misrepresented or omitted a
material fact in making or supporting his request for indemnification or the
indemnification is prohibited by law. The termination of an action by judgment,
order, settlement or conviction or upon a plea of nolo contendere does not
adversely affect the right of an indemnitee to indemnification or create any
presumption with respect to any standard of conduct. An indemnitee is entitled
to indemnification for expenses if he is successful on the merits, if the action
is terminated without a determination of liability on the part of the indemnitee
or if the indemnitee was not a party to the action. An indemnitee who is
determined not to be entitled to indemnification may appeal such determination
either through the courts or by arbitration.
(b) Under Section 145 of the Delaware GCL, indemnification of any
person who is or was a party or threatened to be made so in any action by reason
of the fact that he is or was a director, officer, employee or agent of the
corporation or was serving in such capacity for another corporation or other
enterprise at the request of the corporation is permitted against expenses,
fines and amounts paid in settlement actually and reasonably incurred by him in
such proceeding where the indemnified person 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 criminal actions, where he had no reasonable cause to
believe his conduct was unlawful. Indemnification is also permitted in lawsuits
brought by or on behalf of the corporation if the standards of conduct described
above are met, except that no indemnification is permitted in respect to any
matter in which the person is adjudged to be liable to the corporation unless a
court shall determine that indemnification is fair and reasonable in view of all
the circumstances of the case. Indemnification against expenses (including
attorneys' fees) actually and reasonably incurred by directors, officers,
employees and agents is required under Section 145 of the Delaware GCL in those
cases where the person to be indemnified has been successful on the merits or
otherwise in defense of a proceeding of the type described above. In cases where
indemnification is permissive, a determination as to whether the person met the
applicable standard of conduct must be made (unless ordered by a court) by
majority vote of the disinterested directors, by independent legal counsel, or
by the stockholders. Such indemnification rights are specifically not deemed to
be exclusive of other rights of indemnification by agreement or otherwise and
the corporation is authorized to advance expenses incurred prior to the final
disposition of a matter upon receipt of an undertaking to repay such amounts on
a determination that indemnification was not permitted in the circumstances of
the case.
(c) Under Section 145 of the Delaware GCL and Article IX of the
By-Laws, the Registrant may purchase and maintain insurance on behalf of any
person who is or was a director, officer, employee, or agent of the Registrant,
or who serves as a director, officer, employee or agent of another corporation
or other enterprise, against liability asserted against or incurred by such
person in any such capacity whether or not the Registrant would have the power
to provide indemnity under Section 145 or the By-Laws. The Registrant has
obtained insurance which, subject to certain exceptions, insures the directors
and officers of the Registrant and its subsidiaries.
(d) The Registrant has entered into indemnification contracts with its
directors and certain officers which provides that such directors and officers
will be indemnified to the fullest extent provided by Section 145 of the
Delaware GCL (or such other future statutory provision authorizing or permitting
indemnification) against all expenses (including attorneys' fees), judgments,
fines and settlement amounts, actually and reasonably paid or incurred by them
in any action or proceeding, including any action by or in the right of the
Registrant, by reason of the fact that they were a director, officer, employee
or agent of the Registrant, or were serving at the request of the Registrant as
a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise.
No indemnity will be provided under such indemnification
contracts (i) except to the extent that the aggregate losses to be indemnified
pursuant thereto exceed the amount for which the indemnitee is indemnified
pursuant to any directors and officers liability insurance purchased and
maintained by the Registrant; (ii) in respect to remuneration paid to an
indemnitee if it shall be determined by a final judgment that such remuneration
was in violation of law; (iii) on account of any suit in which judgment is
rendered against an indemnitee for an accounting of profits made from the
purchase or sale by indemnitee of securities of the Registrant pursuant to the
provisions of Section 16(b) of the Securities Exchange Act of 1934 and
amendments thereto or similar provisions of any federal, state or local
statutory law; (iv) on account of the indemnitee's act or omission being finally
adjudged to have been
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<PAGE> 15
not in good faith or involving intentional misconduct or a knowing violation of
law; or (v) if a final decision by a court having jurisdiction in the matter
shall determine that such indemnification is not lawful.
(e) Article EIGHTH of the Registrant's Restated Certificate of
Incorporation provides that a director of the Registrant shall not be personally
liable to the Registrant or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the Registrant or its stockholders; (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law; (iii) for any unlawful payment of a dividend or
unlawful stock purchase or redemption; or (iv) for any transaction from which
the director derived any improper personal benefit.
(f) Certain registration rights agreements provide for the
indemnification of the Registrant's directors and officers by the Selling
Stockholders. The indemnification provided for by the Selling Stockholders is
limited to matters arising in connection with this Registration Statement.
The above discussion of the Registrant's By-Laws, Restated Certificate
of Incorporation, indemnification agreements, and of Section 145 of the Delaware
GCL is not intended to be exhaustive and is respectively qualified in its
entirety by such By-Laws, Restated Certificate of Incorporation and statutes.
ITEM 16. EXHIBITS.
EXHIBIT EXHIBIT
NUMBER DESCRIPTION
------ -----------
2(a) Agreement and Plan of Merger, dated as of December
20, 1999, among the Company, CheckFree Acquisition
Corporation IV, and BlueGill Technologies, Inc.
(Reference to Appendix A of Form S-4 Registration
Statement (333-32644) and incorporated herein by
reference.)
2(b) Agreement and Plan Merger and Contribution Agreement,
dated as of February 15, 2000, among Microsoft
Corporation, First Data Corporation, Citibank, N.A.,
MS II, LLC, First Data, L.L.C., H & B Finance, Inc.,
First Data International Partner, Inc., MSFDC
International, Inc., Citicorp Electronic Commerce,
Inc., CheckFree Holdings Corporation, Chopper Merger
Corporation, and CheckFree Corporation. (Reference is
made to Exhibit 2(b) of the Registration Statement on
Form S-4 (333-32644) and incorporated herein by
reference.)
2(c) Amended and Restated Agreement and Plan of Merger,
dated as of July 7, 2000, among CheckFree Holdings
Corporation, Microsoft Corporation, First Data
Corporation, Citibank, N.A., H&B Finance, Inc., FDC
International Partner, Inc., FDR Subsidiary Corp., MS
FDC International, Inc., Citi TransPoint Holdings
Inc., TransPoint Acquisition Corporation, Tank
Acquisition Corporation, Chopper Merger Corporation,
CheckFree Corporation, Microsoft II, LLC and First
Data, L.L.C. (Reference is made to Exhibit 2(c) of
the Registration Statement on Form S-4 (333-32644)
and incorporated herein by reference.)
2(d) Amended and Restated Strategic Alliance Master
Agreement, dated as of April 26, 2000, among
CheckFree Corporation, CheckFree Services
Corporation, and Bank of America, N.A. (Reference is
made to Appendix A of the Proxy Statement for the
Special Meeting of Stockholders held on September 28,
2000 and incorporated herein by reference.)
2(e) Purchase and Assumption Agreement, dated as of August
8, 2000, among CheckFree Corporation, CheckFree
Services Corporation, Bank of America, N.A., and Bank
of America Technology and Operations, Inc. (Reference
is made to Appendix B of the Proxy Statement for the
Special Meeting of Stockholders held on September 28,
2000 and incorporated herein by reference.)
5 * Opinion of Porter, Wright, Morris & Arthur LLP.
23(a) Consent of Porter, Wright, Morris & Arthur LLP
(included in Exhibit 5).
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<PAGE> 16
23(b) * Consent of Deloitte & Touche LLP.
23(c) * Consent of Deloitte & Touche LLP.
24 * Power of Attorney.
27 Financial Data Schedule. (Reference is made to
Exhibit 27 to the Annual Report on Form 10-K for the
year ended June 30, 2000 and incorporated herein by
reference.)
----------------
* Filed with this report.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) to file during any period in which offers or sales are being made,
a post effective amendment to this registration statement:
(i) to include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume or
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement;
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
(2) that for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment 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;
(3) to remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement 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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 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
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<PAGE> 17
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 of 1933 and will be governed by the final adjudication of such
issue.
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<PAGE> 18
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 City of Norcross, State of Georgia, on November 21, 2000.
CHECKFREE CORPORATION
By: /s/ Peter J. Kight
-----------------------
Peter J. Kight, Chairman of
the Board and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Peter J. Kight Chairman of the Board and November 21, 2000
------------------------------------ and Chief Executive Officer
Peter J. Kight (Principal Executive Officer)
*David E. Mangum Executive Vice President and November 21, 2000
------------------------------------ Chief Financial Officer
David E. Mangum (Principal Financial Officer)
*Gary A. Luoma, Jr. Vice President and November 21, 2000
------------------------------------ Chief Accounting Officer
Gary A. Luoma, Jr. (Principal Accounting Officer)
*William P. Boardman Director November 21, 2000
------------------------------------
William P. Boardman
*James D. Dixon Director November 21, 2000
------------------------------------
James D. Dixon
*Henry C. Duques Director November 21, 2000
------------------------------------
Henry C. Duques
*Mark A. Johnson Director November 21, 2000
------------------------------------
Mark A. Johnson
*Lewis C. Levin Director November 21, 2000
------------------------------------
Lewis C. Levin
*Eugene F. Quinn Director November 21, 2000
------------------------------------
Eugene F. Quinn
</TABLE>
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<PAGE> 19
*Jeffrey M. Wilkins Director
------------------------------------
Jeffrey M. Wilkins November 21, 2000
*By: /s/ Curtis A. Loveland
------------------------------------
Curtis A. Loveland, attorney-in-fact
for each of the persons indicated
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