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INTERCEPT, INC.
(Name Of Registrant As Specified In Its Charter)
JANA PARTNERS LLC
(Name Of Person(s) Filing Proxy Statement, If Other Than The Registrant)
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FOR IMMEDIATE RELEASE
For information contact MacKenzie Partners, Inc.:
Lawrence E. Dennedy or Robert C. Marese - (800) 322-2885
JANA PARTNERS LLC UNVEILS PROPOSALS TO BRING SHAREHOLDER
DEMOCRACY TO INTERCEPT, INC.
Atlanta, Georgia - May 3rd, 2004 - JANA Partners LLC ("JANA") today delivered
three proposals designed to increase shareholder democracy to InterCept, Inc.
(NASDAQ - ICPT) ("InterCept") for inclusion among the proposals to be voted upon
at the company's 2004 Annual Meeting, which is scheduled for June 24, 2004. The
delivery of these proposals follows the issuance by the Atlanta Division of the
United States District Court for the Northern District of Georgia of an order
requiring InterCept to allow JANA to present shareholder proposals at the annual
meeting.
JANA's proposals would amend InterCept's bylaws as follows:
o Under InterCept's current bylaws, members of the board of
directors of the company may only be removed for "cause" and even
if such cause exists the vote of shareholders holding two-thirds
of the shares entitled to vote is required. Under JANA's
proposals, holders of a majority of InterCept's shares could
remove a director with or without cause at a shareholders'
meeting.
o Under InterCept's current bylaws, a vacancy on the board can only
be filled by the remaining directors. Under JANA's proposals, any
vacancy on the board could be filled first by the shareholders,
and any vacancy caused by removal could be filled only by the
shareholders.
o Under InterCept's current bylaws, shareholders holding 25% or
more of the company's shares can force the company to call a
special meeting. Under JANA's proposals, shareholders owning 10%
or more could do so, thus making it easier for shareholders to
call meetings to address issues of importance to them.
"We believe these proposals are necessary to insure that the majority of
shareholders can elect directors of their choosing, rather than have the board
hand-pick its own members," JANA Managing Member Barry S. Rosenstein said
today. "Our goal is to put InterCept on the path to achieving maximum value for
its shareholders, and these proposals will allow InterCept's shareholders to
replace the current board majority with directors who will work to accomplish
that goal."
A COPY OF THE LETTER SENT BY JANA TO INTERCEPT TODAY SETTING FORTH ITS PROPOSALS
FOR INCREASING SHAREHOLDER DEMOCRACY IS ATTACHED HERETO.
In addition to submitting the shareholder proposals described above, JANA has
previously nominated two individuals, Marc Weisman and Kevin Lynch, for election
as directors at InterCept's Annual Meeting.
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BACKGROUND
In October, 2003, InterCept announced that its Chairman and Chief Executive
Officer, John W. Collins, intended to make an offer to take InterCept private,
and that the InterCept board of directors had formed a special independent
committee to evaluate the possible sale of the Company. On December 12, 2003,
InterCept announced that Mr. Collins would not be making an offer but that
"several third parties initiated contact with the special committee and
expressed interest in InterCept, and the special committee will be evaluating
those indications of interest." Less than two months later, InterCept's board of
directors terminated the sale process and dissolved the special committee.
Following the decision not to continue with the sale process, on February 13,
2004, two of the three independent directors on the special committee, Boone A.
Knox (the then Vice Chairman) and Jon R. Burke, resigned as a result of the
decision.
If elected, the directors nominated by JANA would propose to immediately engage
a nationally recognized investment banking firm to conduct a full and fair
review of the best value-maximizing options for shareholders, including sale of
the company.
CERTAIN INFORMATION CONCERNING PARTICIPANTS
JANA Partners LLC manages securities portfolios with assets of approximately
$1.4 billion and currently owns 1,639,937 shares (approximately 8%) of the
common stock of InterCept.
The following individuals have consented to being nominated by JANA Partners LLC
for election as directors of InterCept at InterCept's 2004 Annual Meeting of
Shareholders.
o Marc Weisman, 51, has been a Principal of Sagaponack Partners,
L.P. for more than the past five years.
o Kevin J. Lynch, 35, has been a Principal of JANA Partners LLC
since 2001. From 1999 to 2001, Mr. Lynch was an Investment
Analyst at Sagaponack Partners, L.P.
The Managing Directors of JANA Partners are Barry S. Rosenstein and Gary Claar.
Barry S. Rosenstein, 45, has been a Managing Member of JANA Partners LLC since
2001. From 1993 to 2001, Mr. Rosenstein was a Principal of Sagaponack Partners,
L.P., a private equity fund. Gary Claar, 37, has been a Managing Member of JANA
Partners LLC since 2001. From 1999 to 2001, Mr. Claar was a Principal of
Marathon Advisors LLC, an investment fund.
The principal business address of Mr. Rosenstein and Mr. Lynch is 201 Post
Street, Suite 1000, San Francisco, California 94108. The principal business
address of Mr. Weisman is 645 Fifth Avenue, New York, New York 10022. The
principal business address of Mr. Claar is 200 Park Avenue, New York, New York
10166.
Mr. Weisman and Mr. Lynch have each agreed, if elected, to serve as a director
of InterCept. JANA Partners does not expect that any of its nominees will be
unable to stand for election or serve as a director, but if any vacancy in JANA
Partners' slate occurs for any reason (including if InterCept makes or announces
any changes to its bylaws or takes or announces any other action that has, or if
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completed would have, the effect of disqualifying any or all of JANA Partners'
nominees), JANA Partners will vote for the substitute candidate(s) nominated by
JANA Partners in compliance with the rules of the SEC and any other applicable
law and, if applicable, InterCept's bylaws.
JANA Partners LLC intends to file a proxy statement and other relevant documents
with the SEC in support of the election of Messrs. Lynch and Weisman to the
InterCept board. INVESTORS ARE URGED TO READ THE PROXY STATEMENT WHEN IT BECOMES
AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION. You will be able to obtain the documents free of
charge at the SEC's website, www.sec.gov. JANA Partners LLC and Messrs. Lynch
and Weisman may be deemed to be participants in the solicitation of proxies from
the shareholders of InterCept in connection with the annual meeting. Information
about these participants will be set forth in the proxy statement filed by JANA
Partners LLC with the SEC. Investors may obtain additional information by
reading the proxy statement when it becomes available.
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JANA MASTER FUND
200 PARK AVENUE
SUITE 3900
NEW YORK, NEW YORK 10166
May 3rd, 2004
BY HAND DELIVERY AND NEXT DAY MAIL
InterCept, Inc.
3150 Holcomb Bridge Road, Suite 200
Norcross, Georgia 30071
Attention: Secretary
Gentlemen:
Pursuant to (i) Section 2.13 of InterCept, Inc.'s ("InterCept" or "you")
Amended and Restated Bylaws (the "Bylaws") and (ii) the order (the "Order"),
dated April 29, 2004, of the United States District Court For the Northern
District of Georgia - Atlanta in Civil Action No. 1:04-CV-1058-JOF, Jana Master
Fund, Ltd. ("Jana", "we", "us" or "our") hereby notifies you of the following
proposals to be considered at InterCept's 2004 Annual Meeting of Shareholders:
1. Proposal to amend and restate Section 3.3 of the Bylaws in its entirety
with the following:
"The entire Board of Directors or any individual director
may be removed with or without cause by the shareholders,
provided that directors elected by a particular Voting Group
may be removed with or without cause only by the
shareholders in that Voting Group. Removal action may be
taken only at a shareholders' meeting for which notice of
the removal action has been given, and a director may be
removed only by the holders of at least a majority of the
votes entitled to be cast. If any removed director is a
member of any committee of the Board of Directors, he shall
cease to be a member of that committee when he ceases to be
a director. A removed director's successor, if any, may be
elected at the same meeting to serve the unexpired term. The
Board of Directors may not amend or repeal or adopt any
bylaw provision inconsistent with this Section 3.3."
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2. Proposal to amend and restate the second sentence of Section 3.4 of the
Bylaws in its entirety with the following:
"Any vacancy occurring on the Board of Directors, including
a vacancy resulting from an increase in the number of
directors, shall be filled by the shareholders at a
shareholders' meeting called for such purpose, or if the
shareholders fail to act to fill the vacancy at such
shareholders' meeting, by the Board of Directors, even if
the remaining directors constitute less than a quorum of the
Board of Directors; PROVIDED, HOWEVER, that if the vacant
office was held by a director elected by a particular Voting
Group, only the holders of shares of that Voting Group or,
if such holders fail to act to fill the vacancy at a
shareholders' meeting called for such purpose, the remaining
directors elected by that Voting Group shall be entitled to
fill the vacancy; PROVIDED FURTHER, HOWEVER, that if the
vacant office was held by a director elected by a particular
Voting Group AND there is no remaining director elected by
that Voting Group, the other remaining directors or director
(elected by another Voting Group or Groups) may fill the
vacancy if the shareholders of the vacated director's Voting
Group fail to act to fill the vacancy at a shareholders'
meeting called for such purpose; PROVIDED FURTHER, HOWEVER,
that notwithstanding the foregoing, a vacancy occurring as a
result of a removal of a director with or without cause
shall be filled exclusively by the shareholders or, if
applicable, holders of shares of a particular Voting Group
as provided above. The Board of Directors may not amend or
repeal or adopt any bylaw provision inconsistent with the
previous sentence of this Section 3.4."
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3. Proposal to amend and restate the first sentence of Section 2.3 of the
Bylaws in its entirety with the following:
"Special meetings of shareholders of one or more classes or
series of the Corporation's shares may be called at any time
by the Board of Directors, the Chairman of the Board, or the
President, and shall be called by the Corporation upon the
written request (in compliance with applicable requirements
of the Code) of the holders of shares representing ten
percent (10%) or more of the votes entitled to be cast on
each issue proposed to be considered at the special meeting.
The Board of Directors may not amend or repeal or adopt any
bylaw provision inconsistent with the previous sentence of
this Section 2.3."
The reason we submit these proposals is to further our goals of maximizing
shareholder value. The only material interests we have in InterCept or in the
proposed business are our share ownership as described below, our nominations to
InterCept's Board of Directors as described below and our goals of maximizing
shareholder value.
Our name, as it appears on InterCept's books, our address and the number of
shares of InterCept capital stock we beneficially own are set forth below:
Name, as it appears on InterCept's books: Jana Master Fund, Ltd.
Address: 200 Park Avenue
Suite 3900
New York, New York 10166
Number of shares of capital stock
beneficially owned: 1,505,663 shares of common
stock, no par value. In
addition to the 1,505,663
shares of Common Stock
mentioned above, another
account managed by our
investment manager JANA
Partners LLC owns 134,274
shares of Common Stock.
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For purposes of clarification, our previously submitted proposal, dated
April 2, 2004, to elect Kevin J. Lynch and Marc Weisman each as a Class III
member to the Board of Directors to fill the seats of the two directors in Class
III whose terms are expiring at the 2004 annual meeting remains in effect and we
rescind our proposal to nominate Gary Claar and Barry Rosenstein to the Board of
Directors.
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If any further information is required concerning any of our proposals,
please do not hesitate to contact us.
Very truly yours,
JANA MASTER FUND, LTD.
By: JANA Partners LLC, Its Investment Manager
By:__________________________
Name: Barry S. Rosenstein
Title: Managing Member