-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MH7hO8Evn/0wCqvAyG+3jyi1is3iRRaK3E8VOW/PkPmHADnNkhVnbtJ+3JTLVSVH ycvy2iSs0V8kPtJn1Lvc2A== 0000942708-04-000210.txt : 20040625 0000942708-04-000210.hdr.sgml : 20040625 20040624184611 ACCESSION NUMBER: 0000942708-04-000210 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20040623 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040625 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERCEPT INC CENTRAL INDEX KEY: 0001054930 STANDARD INDUSTRIAL CLASSIFICATION: FUNCTIONS RELATED TO DEPOSITORY BANKING, NEC [6099] IRS NUMBER: 582237359 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14213 FILM NUMBER: 04880501 BUSINESS ADDRESS: STREET 1: 3150 HOLCOMB BRIDGE ROAD SUITE 200 CITY: NORCROSS STATE: GA ZIP: 30071 BUSINESS PHONE: 7702489600 MAIL ADDRESS: STREET 1: 3150 HOLCOMB BRIDGE ROAD SUITE 200 CITY: NORCROSS STATE: GA ZIP: 30071 FORMER COMPANY: FORMER CONFORMED NAME: INTERCEPT GROUP INC DATE OF NAME CHANGE: 19980209 8-K 1 form8k-062404.htm 062404

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported): June 23, 2004

_________________

INTERCEPT, INC.
(Exact name of registrant as specified in its charter)

GEORGIA			01-14213			58-2237359
(State or other jurisdiction of			(Commission file number)			(I.R.S. Employer
incorporation or organization)						Identification No.)


3150 Holcomb Bridge Road, Suite 200 Norcross, Georgia						30071
(Address of Principal Executive Offices)						(Zip Code)

(Registrant’s telephone number, including area code): (770) 248-9600

N/A
(Former Name or Former Address, if Changed Since Last Report)

Item 5. Other Events and Required FD Disclosure

On June 24, 2004, InterCept issued a press release regarding the adjournment of its annual shareholders meeting to September 14, 2004; the expansion of its board of directors from six to nine directors and the election of three new directors; and the closing of the previously announced agreement in principle with Sprout Group to modify the terms of the $10 million in preferred stock purchased by Sprout in September 2003. The press release is attached hereto as Exhibit 99.1, and the documents for the preferred stock transaction are attached hereto as Exhibits 3.1, 3.2, 10.1, and 10.2 as noted below.

Item 7. Financial Statements and Exhibits


			3.1			Amendment to Articles of Incorporation of InterCept, Inc. designating the rights and
						preferences of InterCept's Series B Preferred Stock, filed with the Georgia Secretary of State
						on June 23, 2004.
			3.2			Amendment to Articles of Incorporation of InterCept, Inc. eliminating InterCept's Series A
						Preferred Stock, filed with the Georgia Secretary of State on June 24, 2004.
			10.1			Exchange Agreement dated June 23, 2004 by and between InterCept, Inc., on one hand, and the
						investors named therein, on the other hand.
			10.2			Amendment to Registration Rights Agreement dated June 23, 2004 by and between
						InterCept, Inc., on one hand, and the investors named therein, on the other hand.
			99.1			Press Release dated June 24, 2004.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: June 24, 2004

INTERCEPT, INC.
(Registrant)

By:       /s/ John W. Collins
       John W. Collins
       Chief Executive Officer

EXHIBIT INDEX


			3.1			Amendment to Articles of Incorporation of InterCept, Inc. designating the rights and
						preferences of InterCept's Series B Preferred Stock, filed with the Georgia Secretary of State
						on June 23, 2004.
			3.2			Amendment to Articles of Incorporation of InterCept, Inc. eliminating InterCept's Series A
						Preferred Stock, filed with the Georgia Secretary of State on June 24, 2004.
			10.1			Exchange Agreement dated June 23, 2004 by and between InterCept, Inc., on one hand, and the
						investors named therein, on the other hand.
			10.2			Amendment to Registration Rights Agreement dated June 23, 2004 by and between
						InterCept, Inc., on one hand, and the investors named therein, on the other hand.
			99.1			Press Release dated June 24, 2004.

EX-3 2 ex3-1_062404.htm 062404

Exhibit 3.1

ARTICLES OF AMENDMENT TO

AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF INTERCEPT, INC.

In accordance with Sections 14-2-602 and 14-2-1006 of the Georgia Business Corporation Code (the “Code”), INTERCEPT, INC. (the “Corporation”), a corporation organized and existing under and by virtue of the Code, DOES HEREBY CERTIFY:

The name of the Corporation is InterCept, Inc.

The Amended and Restated Articles of Incorporation of the Corporation are hereby amended to provide for the establishment and designation of a new “Series B Preferred Stock” which shall have the terms, preferences, limitations and relative rights set forth on Exhibit A attached hereto and made a part hereof.

The Corporation’s Board of Directors duly adopted a resolution containing the amendment on June 21, 2004.

Such amendment was duly adopted by the Board of Directors and shareholder action was not required, pursuant to the authority granted in Article Two of the Corporation’s Articles of Incorporation and Section 14-2-602 of the Code.

IN WITNESS WHEREOF, the Corporation has caused this Amendment to be signed by the undersigned duly authorized officer, this 23rd day of June, 2004.

INTERCEPT, INC.

By:       /s/ G. Lynn Boggs
Name:       G. Lynn Boggs
Its:       President and COO

EXHIBIT A

DESIGNATIONS OF PREFERENCES, LIMITATIONS,
AND RELATIVE RIGHTS OF SERIES B
PREFERRED STOCK OF
INTERCEPT, INC.

SECTION 1. DESIGNATION OF AMOUNT; RANKING.

Of the 1,000,000 authorized shares of Preferred Stock, no par value, 100,000 shall be a series designated as Series B Preferred Stock (hereinafter referred to as “Series B Preferred”). The Series B Preferred shall be deemed to have an original purchase price of $100.00 per share (as appropriately adjusted to reflect any stock split, combination, reclassification or reorganization of the Series B Preferred, the “Series B Original Price”). With respect to liquidation rights and redemption rights as provided for in the Corporation’s Amended and Restated Articles of Incorporation, as amended (including this Amendment, the “Restated Articles”), the Series B Preferred shall rank senior to all Junior Stock.

SECTION 2. REDUCTION OF AUTHORIZED SHARES.

The number of Series B Shares may be reduced or eliminated by the Board or a duly-authorized committee thereof in compliance with the Georgia Business Corporation Code and the terms hereof; provided, however, that no decrease shall reduce the number of shares of any such series to less than the sum of the number of shares of such series then issued and outstanding, plus the number of shares of such series issuable pursuant to rights or warrants then outstanding to subscribe for or purchase shares of such series, plus the number of shares of such series issuable upon the exercise of any options then outstanding to purchase shares of such series, plus shares of such series issuable upon exercise, conversion or exchange of any securities then outstanding that are exercisable, convertible or exchangeable for shares of such series.

SECTION 3. CERTAIN DEFINITIONS.

For purposes of this Amendment, the following definitions shall apply:

“Amendment means this Designation of Preferences, Limitations, and Relative Rights of Series B Preferred Stock of InterCept, Inc.

“Board” means the Board of Directors of the Corporation.

“Business Day” means any day excluding Saturday, Sunday and any day which shall be, in the State of Georgia, a legal holiday or a day on which banking institutions in the State of Georgia are authorized by law to close.

“Change of Shares” has the meaning assigned to such term in Section 8(e)(ii) hereof.

“Closing Bid Price” of any security, for each trading day, means the price at which such security was last exchanged on the Stock Market during such trading day, or, if there

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were no transactions on such trading day, the average of the reported closing bid and asked prices, regular way, of such security on the relevant Stock Market on such trading day or if there is no closing bid price, the last sale price of such security, regular way.

“Common Holders” means the holders of Common Stock.

“Common Shares” means the shares of Common Stock.

“Common Stock” means the common stock, no par value, of the Corporation.

“Convertible Securities” has the meaning assigned to such term in Section 8(e)(vi)(C) hereof.

“Corporation” means InterCept, Inc., a corporation organized and existing under the laws of the State of Georgia.

“Dilutive Issuance” has the meaning assigned to such term in Section 8(e)(ii) hereof.

“Fair Market Value” of any asset (including any security) means the fair market value thereof as mutually determined by the Corporation and a Series B Majority, except that (i) the Fair Market Value of cash is its face amount and (ii) the Fair Market Value of any marketable securities equals the average Closing Bid Price of such securities for the fifteen trading days immediately prior to the date of determination of the Fair Market Value of such marketable securities. If the Corporation and a Series B Majority are unable to reach agreement on any valuation of property or securities, such valuation shall be submitted to, and determined by, a nationally recognized independent investment bank selected by the Board and a Series B Majority (or, if such selection cannot be agreed upon promptly, or in any event within ten days, then such valuation shall be made by a nationally recognized independent investment banking firm selected by the American Arbitration Association in New York City in accordance with its rules), the costs of which valuation shall be paid for by the Corporation.

“Junior Stock” means any class or series of equity securities of the Corporation now existing or hereafter created, including, without limitation, the Common Stock, which by the terms of creation of such class or series ranks junior to the Series B Preferred with respect to liquidation rights and/or redemption rights.

“Issuance Date” means the date of original issuance of the Series B Preferred.

“Liquidation” means any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation.

“Notice” has the meaning assigned to such term in Section 8(f) hereof.

“Permitted Transaction” has the meaning assigned to such term in Section 7(b) hereof.

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“Person” means any natural person and any corporation, partnership, joint venture, limited liability company or any other entity, organization or association.

“Registered Holders” means, at any time, the holders of record of Series B Preferred.

“Sale Event” means (i) any merger, consolidation, combination, reorganization or other similar transaction or series of related transactions pursuant to which any Person or group of related Persons (as the term “group” is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) obtains control of securities of the Corporation constituting in excess of 50% of the voting power of the Corporation, or (ii) the sale or license of all or substantially all of the assets of the Corporation.

“Securities Act” means the Securities Act of 1933, as amended.

“Series B Conversion Price” has the meaning assigned to such term in Section 8(c)(i) hereof.

“Series B Holders” means the holders of Series B Shares.

“Series B Liquidation Amount” has the meaning assigned to such term in Section 5(a) hereof.

“Series B Majority” means Series B Holders that own more than 50% of the outstanding Series B Shares.

“Series B Original Price” has the meaning assigned to such term in Section 1 hereof.

“Series B Preferred” has the meaning assigned to such term in Section 1 hereof.

“Series B Shares” means shares of Series B Preferred.

“Stock Market” means, with respect to any security, the principal national securities exchange on which such security is listed or admitted to trading or, if such security is not listed or admitted to trading on any national securities exchange, shall mean The Nasdaq National Market System or The Nasdaq SmallCap Market or, if such security is not quoted on Nasdaq, shall mean the OTC Bulletin Board or, if such security is not quoted on the OTC Bulletin Board, shall mean the over-the-counter market as furnished by any NASD member firm selected from time to time by the Corporation for that purpose.

“Subsidiary” means any corporation, limited liability company or other entity, a majority of the voting stock or interests of which is, at the time as of which any determination is being made, owned by the Corporation either directly or through one or more Subsidiaries.

“Voting Stock” means any shares of capital stock of the Corporation having general voting power in electing the Board (irrespective of whether or not at the time stock of any other class or classes has or might have voting power by reason of the occurrence of any

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contingency). Without limitation of any such shares that might constitute Voting Stock, the Common Stock and the Series B Preferred are Voting Stock.

SECTION 4. DIVIDENDS

If the Corporation shall at any time pay a dividend on the Common Stock (other than a dividend payable solely in shares of Common Stock) or on any shares of Junior Stock that are convertible into Common Stock, it shall, at the same time, pay to each Series B Holder a dividend equal to the dividend that would have been payable to such holder if the Series B Shares held by such holder had been converted into Common Stock on the date of determination of holders of Common Stock entitled to receive such dividend (irrespective of whether the Series B Shares were actually convertible as of such date). Other than the foregoing, the Series B Preferred shall not be entitled to any dividend rights.

SECTION 5. LIQUIDATION; SALE EVENT.

In the event of any Liquidation or Sale Event, distributions to the shareholders of the Corporation out of assets of the Corporation legally available for distribution to its shareholders (whether from capital or surplus) shall be made in the following manner:

(a) The Series B Holders shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Corporation to the holders of Junior Stock, an amount (in the aggregate, the “Series B Liquidation Amount”) per share equal to the Series B Original Price. If the assets of the Corporation legally available for distribution to its shareholders are insufficient to permit the payment to the Series B Holders of the aggregate Series B Liquidation Amount, then the entire assets of the Corporation legally available for distribution to its shareholders shall be distributed ratably among the Series B Holders according to the Series B Liquidation Amount payable to each such holder.

(b) Following payment in full of the Series B Liquidation Amount as aforesaid, the remaining assets of the Corporation available for distribution to its shareholders shall be distributed among the holders of Junior Stock in the manner set forth in the Restated Articles.

(c) For purposes of this Section 5, if any assets distributed to shareholders upon a Liquidation or Sale Event consist of property other than cash, the amount of such distribution shall be deemed to be the Fair Market Value thereof at the time of such distribution.

SECTION 6. VOTING RIGHTS.

Series B Holders shall have full voting rights and powers equal to the voting rights and powers of the Common Holders, and shall be entitled to vote, together with the Common Holders, on any and all matters upon which the Common Holders have the right to vote. Except as otherwise expressly provided herein, the Series B Holders shall be entitled to the number of votes equal to the largest number of full Common Shares into which the Series B Shares held by such holder could be converted, assuming for this purpose that the Series B Shares are converted (regardless of whether the conversion right has yet matured), on the record

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date for the determination of the shareholders entitled to vote on such matters or, if no record date is established, on the date such vote is taken. Except as expressly provided in this Amendment, or as required by law, the holders of Voting Stock shall vote together, and not as separate classes, on any matter submitted to the shareholders of the Corporation for a vote.

SECTION 7. RESTRICTIONS AND LIMITATIONS.

(a) The Corporation shall not, and shall not permit any Subsidiary to, without the prior written consent of a Series B Majority:

(i) Take any action that alters, changes or adversely affects any rights, privileges or protections of the Series B Preferred, whether by amendment of the Restated Articles, merger or otherwise (excluding, however, any action taken pursuant to – and effective only upon the closing of – a Permitted Transaction); or

(ii) Authorize, designate, create or issue (whether by amendment of the Restated Articles, merger or otherwise) any shares of any class or series of stock having any rights, preferences or privileges senior to or on parity with the Series B Preferred with respect to dividends, distributions, or upon a Liquidation or Sale Event or with respect to voting power (other than (A) as to matters relating solely to such class of capital stock and other than by virtue of increased voting power commensurate with differences in original issuance price or (B) if pursuant to – and effective only upon the closing of – a Permitted Transaction).

(b) The Corporation shall not approve or effect a Liquidation or a Sale Event without the prior written consent of a Series B Majority unless the Liquidation or Sale Event (i) is approved by a majority of the members of the Board and (ii) results in consideration per Series B Share to be paid at closing (i.e., excluding escrows, earn-outs or other contingent consideration) equal to at least one hundred and eighty percent (180%) of the Series B Original Price (any such Liquidation or Sale Event meeting the requirements of (i) and (ii) of this clause (b), a “Permitted Transaction”). The consideration received, if not cash, shall be valued in the manner set forth in the definitive agreement relating to the Liquidation or Sale Event, subject to the remainder of this Section 7(b). If the definitive agreement relating to the Liquidation or Sale Event provides for the shareholders of the Corporation to receive consideration that is composed all or in part of a specified number of marketable securities, the value of those securities for purposes of determining whether such transaction is a Permitted Transaction shall be established as of the execution date of the definitive agreement rather than at the closing date, and any decline in the trading price of such securities between the execution date of such definitive agreement and the closing date shall have no effect on whether such transaction is a “Permitted Transaction.” If the definitive agreement does not value such securities in dollar terms but specifies the number of securities to be distributed to the Corporation’s shareholders in or as a result of the transaction, then the consideration for purposes of the definition of “Permitted Transaction” shall be the Fair Market Value of such securities on the execution date of the definitive agreement. If the definitive agreement does not specify the number of such marketable securities to be received as consideration but instead specifies that the shareholders of the Corporation shall receive securities on the closing date with a then-current market value (pursuant to a method of valuation described in the definitive agreement) that would satisfy

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clause (ii), then the value of such securities on the closing date (as so valued) shall be the consideration for purposes of the definition of “Permitted Transaction.”

(c) Without limiting the consent rights set forth in paragraphs (a) and (b) above, unless approved by a majority of the members of the Board, the Corporation shall not, and shall not permit any Subsidiary to, without the prior written consent of a Series B Majority:

(i) Amend or repeal any provision of the Restated Articles or the Bylaws of the Corporation;

(ii) Permit any Subsidiary to sell or issue any of its capital stock or any right to acquire any of its capital stock to any party other than the Corporation;

(iii) Change the number of directors constituting the Board;

(iv) Increase the size of the pool of stock available for issuance under options to be granted to officers, directors, employees, consultants or others (other than pursuant to option plans and the stock purchase plan currently in effect);

(v) Make, or take any action that results in, any investment in or loan by the Corporation or any Subsidiary to any other Person in an amount greater than $5 million in the aggregate; or

(vi) Change the nature of the Corporation’s business.

(d) The Series B Holders shall be deemed to have withheld their consent pursuant to Section 7(b) hereof with respect to any Sale Event that is not approved by a majority of the members of the Board. In the event that any Permitted Transaction requires the vote of the Series B Holders, they shall be deemed to have voted in favor of any such Permitted Transaction.

SECTION 8. CONVERSION.

The Series B Holders shall have the following conversion rights:

(a) Conversion at Holder’s Option. Any Series B Holder shall have the right, at its option, to convert any of its Series B Shares into Common Stock on the terms set forth herein at any time from and after the earliest to occur of:

(i) The date as of which the Closing Bid Price of the Common Stock shall have been equal to or greater than one hundred and eighty percent (180%) of the Series B Conversion Price per share (as adjusted for any stock splits, stock dividends or recapitalizations) for at least ten (10) consecutive trading days;

(ii) September 16, 2008; or

(iii) Five business days prior to a Liquidation or the closing of a Sale Event.

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(b) Conversion at Corporation’s Option. The Corporation shall have the right, at its option, to cause all Series B Shares to be converted to Common Stock on the terms set forth herein at any time from and after the later to occur of (i) December 31, 2005 and (ii) the date as of which the Closing Bid Price of the Common Stock shall have been equal to or greater than two hundred fifty percent percent (250%) of the Series B Conversion Price per share (as adjusted for any stock splits, stock dividends or recapitalizations) for at least fifteen (15) consecutive trading days.

(i) Upon the conversion of any Series B Shares pursuant to paragraph (a) or paragraph (b) above, the holder of the share or shares to be converted shall be entitled to receive such number of fully paid and nonassessable whole Common Shares as is obtained by multiplying (i) the number of Series B Shares so to be converted by (ii) the Series B Original Price, and dividing the result by the Series B Conversion Price. For purposes hereof, the initial conversion price shall be $10.50, subject to adjustment as provided herein (such number, as so adjusted from time to time, the “Series B Conversion Price”).

(d) Mechanics of Conversion.

(i) Upon a conversion of Series B Preferred pursuant to paragraph (a) above, each converting holder shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Corporation or of any transfer agent for the Series B Preferred, and shall give written notice to the Corporation at such office that such holder elects to convert the same and shall state therein the number and series of Series B Shares being converted. Thereupon the Corporation shall promptly issue and deliver to such holder a certificate or certificates for the number of Common Shares to which such holder is entitled, together with a cash adjustment of any fraction of a share as hereinafter provided. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of such surrender of the certificate or certificates representing the Series B Shares to be converted, and the person or entity entitled to receive the Common Shares issuable upon such conversion shall be treated for all purposes as the record holder of such Common Shares on such date.

In the event that a notice to convert is given following a Notice pursuant to paragraph (f) of this Section 8 and such action described in paragraph (f) of this Section 8 is not consummated on the terms described in such notices, then the conversion shall, at the option of the holder of the Series B Preferred who tendered for conversion, be voidable and such holder shall have the right to maintain ownership of the Series B Shares tendered for conversion.

(ii) Upon a conversion of the Series B Preferred pursuant to paragraph (b) above, the outstanding Series B Shares shall be converted automatically upon notice from the Corporation to the Registered Holders without any further action by such holders and whether or not the certificates representing such shares are surrendered to the Corporation or its transfer agent; provided, however, that the Corporation shall not be

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obligated to issue certificates evidencing the Common Shares issuable upon such conversion unless the certificates evidencing such Series B Shares are either delivered to the Corporation or its transfer agent as provided below, or the holder thereof notifies the Corporation or its transfer agent that such certificates have been lost, stolen, mutilated or destroyed and executes an agreement satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificates. Upon the occurrence of such a conversion, the Series B Holders shall surrender the certificates representing such shares at the office of the Corporation or any transfer agent for the Series B Preferred. Thereupon, there shall be issued and delivered to such holder promptly at such office and in its name as shown on such surrendered certificate or certificates, a certificate or certificates for the number of Common Shares into which the Series B Shares surrendered were convertible on the date on which such conversion took place.

(e) Adjustment of Series B Conversion Price.

(i) Except as otherwise provided herein, in the event the Corporation shall, at any time or from time to time after the Issuance Date, (A) issue any Common Shares as a stock dividend to the Common Holders, (B) subdivide the outstanding Common Shares into a greater number of shares, or (C) combine the outstanding Common Shares in a lesser number of shares (any such stock dividend, subdivision or combination being herein called a “Change of Shares”), then, and thereafter upon each further Change of Shares, the Series B Conversion Price in effect immediately prior to such Change of Shares shall be proportionately decreased in the case of a Change of Shares pursuant to clause (A) or (B), and shall be proportionately increased in the case of a Change of Shares pursuant to clause (C).

(ii) Except as otherwise provided herein, in the event the Corporation shall, at any time or from time to time after the Issuance Date, sell or issue any Common Shares for a consideration per share less than the Series B Conversion Price in effect on the date of such sale or issuance (such sale or issuance being herein called a “Dilutive Issuance”), then, and thereafter upon each further such issuance, the Series B Conversion Price in effect immediately prior to such issuance, shall be changed in accordance with the provisions of paragraph (iii) of this Section 8(e).

(iii) Whenever the Series B Conversion Price is to be adjusted as provided in Section 8(e)(ii) hereof, the Series B Conversion Price shall be changed to a price (rounded to the nearest cent) determined by multiplying the Series B Conversion Price in effect immediately prior to the Dilutive Issuance by a fraction, the numerator of which shall be the sum of (x) the number of Common Shares outstanding immediately prior to the such Dilutive Issuance and (y) the number of Common Shares which the aggregate consideration received (determined as provided in Section 8(e)(vi)(F)) for the Dilutive Issuance would purchase at the Series B Conversion Price in effect immediately prior to such Dilutive Issuance, and the denominator of which shall be the number of Common Shares outstanding immediately after the Dilutive Issuance. Such adjustment shall be made successively whenever a Dilutive Issuance is made.

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(iv) In case of any reclassification, capital reorganization or other change of outstanding Common Shares, or in case of any consolidation or merger of the Corporation with or into another entity (other than a Sale Event that results in the payments for the Series B Preferred as provided in Section 5 hereof), the Corporation shall cause effective provisions to be made so that each holder of a Series B Share shall be entitled to receive, upon conversion of such share thereof, the kind and number of shares of stock or other securities or property (including cash) receivable upon such reclassification, capital reorganization or other change, consolidation, merger, sale or conveyance by a holder of the number of Common Shares into which such Series B Share was convertible immediately prior to such reclassification, capital reorganization or other change, consolidation, merger, sale or conveyance. Any such provision shall include provision for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 8(e). The Corporation shall not effect any such consolidation, merger or sale unless prior to or simultaneously with the consummation thereof the successor (if other than the Corporation) resulting from such consolidation or merger or the entity purchasing assets or other appropriate entity shall assume, by written instrument executed and delivered to the Registered Holders, the obligation to deliver to the Series B Holders such shares of stock, securities or assets as, in accordance with the foregoing provisions, such holders may be entitled to receive and the other obligations under the Restated Articles. The foregoing provisions shall similarly apply to successive reclassifications, capital reorganizations and other changes of outstanding Common Shares and to successive consolidations, mergers, sales or conveyances.

(v) After each adjustment of the Series B Conversion Price pursuant to this Subsection 8(e), the Corporation will promptly prepare a certificate signed by the Chairman or President, and by the Chief Financial Officer or the Secretary or an Assistant Secretary, of the Corporation setting forth: (A) the Series B Conversion Price as so adjusted and (B) a brief statement of the facts accounting for such adjustment. The Corporation will promptly file such certificate with its transfer agent for the Series B Preferred (if it has one) and cause a brief summary thereof to be sent by ordinary first class mail to each Registered Holder affected by such adjustment at such Person’s last address as it shall appear on the registry books of the Corporation or its transfer agent, as applicable. No failure to mail such notice nor any defect therein or in the mailing thereof shall affect the validity of such adjustment. The affidavit of an officer of the transfer agent or the Secretary or an Assistant Secretary of the Corporation that such notice has been mailed shall, in the absence of fraud, be prima facie evidence of the facts stated therein. A transfer agent may rely on the information in the certificate as true and correct and has no duty or obligation to independently verify the amounts or calculations set forth therein.

(vi) For purposes of Section 8(e)(iii) hereof, the following provisions (A) through (G) shall also be applicable:

(A) The number of Common Shares deemed outstanding at any given time shall, as further provided in Section 8(e)(vi)(C) hereof, include all shares of capital stock convertible into, or exchangeable for, Common Stock (on

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an as converted basis) as well as all Common Shares issuable upon the exercise of (1) any convertible debt, (2) warrants outstanding on the applicable date, and (3) options outstanding on the applicable date.

(B) No adjustment of the Series B Conversion Price shall be made unless such adjustment would require an increase or decrease of at least $.01 in such price; provided that any adjustments which by reason of this subparagraph (B) are not required to be made shall be carried forward and shall be made at the time of and together with the next subsequent adjustment which, together with adjustments so carried forward, shall require an increase or decrease of at least $.01 in the Series B Conversion Price then in effect hereunder.

(C) In case of (1) the sale or other issuance by the Corporation (including as a component of a unit) of any rights or warrants to subscribe for or purchase, or any options for the purchase of, Common Stock or any securities convertible into or exchangeable for Common Stock (such securities convertible, exercisable or exchangeable into Common Stock being herein called “Convertible Securities”), or (2) the issuance by the Corporation, without the receipt by the Corporation of any consideration therefor, of any rights or warrants to subscribe for or purchase, or any options for the purchase of, Common Stock or Convertible Securities, whether or not such rights, warrants or options, or the right to convert or exchange such Convertible Securities, are immediately exercisable, and the consideration per share for which Common Stock is issuable upon the exercise of such rights, warrants or options or upon the conversion or exchange of such Convertible Securities (determined by dividing (x) the minimum aggregate consideration, as set forth in the instrument relating thereto without regard to any antidilution or similar provisions contained therein for a subsequent adjustment of such amount, payable to the Corporation upon the exercise of such rights, warrants or options, plus the consideration received by the Corporation for the issuance or sale of such rights, warrants or options, plus, in the case of such Convertible Securities, the minimum aggregate amount, as set forth in the instrument relating thereto without regard to any antidilution or similar provisions contained therein for a subsequent adjustment of such amount, of additional consideration, if any, other than such Convertible Securities, payable upon the conversion or exchange thereof, by (y) the total maximum number, as set forth in the instrument relating thereto without regard to any antidilution or similar provisions contained therein for a subsequent adjustment of such amount, of Common Shares issuable upon the exercise of such rights, warrants or options or upon the conversion or exchange of such Convertible Securities issuable upon the exercise of such rights, warrants or options) is less than the Series B Conversion Price as of the date of the issuance or sale of such rights, warrants or options, then such total maximum number of Common Shares issuable upon the exercise of such rights, warrants or options or upon the conversion or exchange of such Convertible Securities (as of the date of the issuance or sale of such rights, warrants or options) shall be deemed to be “Common Stock” for the purposes of Section 8(e)(iii) hereof and shall be deemed to have been sold for an amount

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equal to such consideration per share and shall cause an adjustment to be made in accordance with Section 8(e)(iii) hereof.

(D) In case of the sale by the Corporation of any Convertible Securities, whether or not the right of conversion or exchange thereunder is immediately exercisable, and the price per share for which Common Stock is issuable upon the conversion or exchange of such Convertible Securities (determined by dividing (1) the total amount of consideration received by the Corporation for the sale of such Convertible Securities, plus the minimum aggregate amount, as set forth in the instrument relating thereto without regard to any antidilution or similar provisions contained therein for a subsequent adjustment of such amount, of additional consideration, if any, other than such Convertible Securities, payable upon the conversion or exchange thereof, by (2) the total maximum number, as set forth in the instrument relating thereto without regard to any antidilution or similar provisions contained therein for a subsequent adjustment of such amount, of Common Shares issuable upon the conversion or exchange of such Convertible Securities) is less than the Series B Conversion Price as of the date of the sale of such Convertible Securities, then such total maximum number of Common Shares issuable upon the conversion or exchange of such Convertible Securities (as of the date of the sale of such Convertible Securities) shall be deemed to be “Common Stock” for purposes of Section 8(e)(iii) hereof and shall be deemed to have been sold for an amount equal to such consideration per share and shall cause an adjustment of the Series B Conversion Price to be made in accordance with Section 8(e)(iii) hereof.

(E) In case the Corporation shall modify the rights of conversion, exchange or exercise of any of the securities referred to in paragraphs (C) and (D) above or any other securities of the Corporation convertible, exchangeable or exercisable for Common Shares, for any reason other than an event that would require adjustment to prevent dilution, so that the consideration per share received by the Corporation after such modification is less than the Series B Conversion Price as of the date prior to such modification, then such securities, to the extent not theretofore exercised, converted or exchanged, shall be deemed to have expired or terminated immediately prior to the date of such modification and the Corporation shall be deemed for purposes of calculating any adjustments pursuant to this Section 8(e) to have issued such new securities upon such new terms on the date of modification. Such adjustment shall become effective as of the date upon which such modification shall take effect. On the expiration or cancellation of any such right, warrant or option or the termination or cancellation of any such right to convert or exchange any such Convertible Securities, the Series B Conversion Price then in effect hereunder shall forthwith be readjusted to such conversion price as would have obtained (1) had the adjustments made upon the issuance or sale of such rights, warrants, options or Convertible Securities been made upon the basis of the issuance of only the number of Common Shares theretofore actually delivered (and the total consideration received therefor) upon the exercise of such rights, warrants or options or upon the conversion or exchange of such Convertible Securities and (2)

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had adjustments been made on the basis of the Series B Conversion Price as adjusted under item (1) of this sentence for all transactions (which would have affected such adjusted conversion price) made after the issuance or sale of such rights, warrants, options or Convertible Securities.

(F) In case of the sale of any Common Shares, any Convertible Securities, any rights or warrants to subscribe for or purchase, or any options for the purchase of, Common Stock or Convertible Securities, the consideration received by the Corporation therefor shall be deemed to be the gross sales price therefor without deducting therefrom any expense paid or incurred by the Corporation or any underwriting discounts or commissions or concessions paid or allowed by the Corporation in connection therewith. In the event that any securities shall be issued in connection with any other securities of the Corporation, together comprising one integral transaction in which no specific consideration is allocated among the securities, then each of such securities shall be deemed to have been issued for such consideration as the Board determines in good faith; provided, however, that if a Series B Majority disagrees with such determination, the Corporation shall retain, at its own expense, an independent investment banking firm for the purpose of obtaining an appraisal.

(G) In case any event shall occur as to which the other provisions of this Section 8 are not strictly applicable but as to which the failure to make any adjustment would not fairly protect the conversion rights represented by this Section 8 in accordance with the essential intent and principles hereof then, in each such case, a Series B Majority may appoint a firm of independent public accountants of recognized national standing reasonably acceptable to the Corporation, which shall give their opinion as to the adjustment, if any, on a basis consistent with the essential intent and principles established herein, necessary to preserve the conversion rights represented herein. Upon receipt of such opinion, the Corporation will promptly mail a copy thereof to all Registered Holders and shall make the adjustments described therein. The fees and expenses of such independent public accountants shall be borne by the Corporation.

(vii) Notwithstanding any other provision hereof, no adjustment to the Series B Conversion Price will be made:

(A) upon the issuance of common stock, granting of options or warrants or the exercise of options or warrants which may heretofore have been or hereafter be granted with the approval of the Board, or exercised, under any employee benefit plan of the Corporation to officers, directors or employees;

(B) upon the issuance or sale of Common Stock or Convertible Securities pursuant to the exercise of any rights, options or warrants to receive, subscribe for or purchase, or any options for the purchase of, Common Stock or Convertible Securities, whether or not such rights, warrants or options were outstanding on the date of the filing of this Amendment or were thereafter issued or sold, provided that an adjustment was either made or not required to be made in

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accordance with Sections 8(e)(ii) or 8(e)(vi) hereof in connection with the issuance or sale of such securities or any modification of the terms thereof;

(C) upon the issuance of Common Stock or Convertible Securities as acquisition consideration in a bona fide acquisition approved by the Board (provided that the principal asset of the Person being acquired is not cash); or

(D) upon the issuance or sale of Common Stock in a public offering registered under the Securities Act.

(viii) As used in this Subsection 8(e), the term “Common Stock” shall mean and include the Corporation’s Common Stock authorized on the date of filing of this Amendment and shall also include any capital stock of any class of the Corporation hereafter authorized which shall not be limited to a fixed sum or percentage in respect of the rights of the holders thereof to participate in dividends and in the distribution of assets upon the voluntary liquidation, dissolution or winding up of the Corporation; provided, however, that the shares issuable upon conversion of the Series B Preferred shall include only shares of such class designated in the Restated Articles as Common Stock or (A), in the case of any reclassification, change, consolidation, merger, sale or conveyance of the character referred to in Section 8(e)(iv) hereof, the stock, securities or property provided for in such section or (B), in the case of any reclassification or change in the outstanding Common Shares issuable upon conversion of the Series B Preferred as a result of a subdivision or combination or consisting of a change in par value, or from par value to no par value, or from no par value to par value, such Common Shares as so reclassified or changed.

(f) Prior Notice of Certain Events. In case:

(i) the Corporation shall declare any dividend or any other distribution in respect of any class or series of capital stock;

(ii) the Corporation shall authorize the granting to the Common Holders of rights or warrants to subscribe for or purchase any shares of stock of any class or of any other rights or warrants;

(iii) of any reclassification of the Common Stock (other than a subdivision or combination of the outstanding Common Stock, or a change in par value, or from par value to no par value, or from no par value to par value);

(iv) of any consolidation or merger (including, without limitation, a Sale Event) to which the Corporation is a party and for which approval of any shareholders of the Corporation shall be required, or of the sale or transfer of all or substantially all of the assets of the Corporation or of any compulsory share exchange whereby the Common Stock is converted into other securities, cash or other property; or

(v) of the voluntary or involuntary dissolution, liquidation or winding up of the Corporation;

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then the Corporation shall cause to be mailed to the Registered Holders, at their last addresses as they shall appear upon the stock transfer books of the Corporation, at least 30 days prior to the applicable record date hereinafter specified, a notice (the “Notice”) stating (x) the date on which a record (if any) is to be taken for the purpose of such dividend, distribution or granting of rights or warrants or, if a record is not to be taken, the date as of which the Common Holders of record to be entitled to such dividend, distribution, rights or warrants are to be determined and a description of the cash, securities or other property to be received by such holders upon such dividend, distribution or granting of rights or warrants or (y) the date on which such reclassification, consolidation, merger, sale, transfer, share exchange, dissolution, liquidation or winding up is expected to become effective, the date as of which it is expected that Common Holders of record shall be entitled to exchange their Common Shares for securities or other property deliverable upon such exchange, dissolution, liquidation or winding up and the consideration, including securities or other property, to be received by such holders upon such exchange; provided, however, that no failure to mail such notice or any defect therein or in the mailing thereof shall affect the validity of the corporate action required to be specified in such notice.

(g) Fractional Shares. No fractional shares or scrip representing fractional Common Shares shall be issued upon conversion of Series B Preferred. In lieu of any fractional share or scrip to which the holder would otherwise be entitled (after aggregating all of the Series B Shares to be converted on such date), the Corporation shall pay a cash adjustment in respect of such fractional interest in an amount equal to the same fraction of the Series B Conversion Price as of the close of business on the day of conversion.

(h) Reservation of Common Stock Issuable Upon Conversion. The Corporation shall at all times reserve and keep available out of its authorized but unissued Common Shares, solely for the purpose of effecting the conversion of the Series B Shares, such number of its Common Shares as shall from time to time be sufficient to effect the conversion of all outstanding Series B Shares. The Corporation shall use its best efforts from time to time, in accordance with the laws of the State of Georgia, to increase the authorized number of Common Shares if at any time the number of shares of authorized, unissued and unreserved Common Stock shall not be sufficient to permit the conversion of all the then-outstanding Series B Shares.

(i) Notices. Any notice or other communication given hereunder shall be deemed sufficient if in writing and sent by registered or certified mail, return receipt requested, or delivered by hand against written receipt therefore, addressed to: the Corporation at 3150 Holcomb Bridge Road, Suite 200, Norcross, GA 30071, Attn: Chief Financial Officer and to a Registered Holder at such holder’s address as appearing on the books of the Corporation. Notices shall be deemed to have been given or delivered on the date of mailing, except notices of change of address, which shall be deemed to have been given or delivered when received.

(j) Payment of Taxes. The Corporation will pay all taxes (other than taxes based upon income) and other governmental charges that may be imposed with respect to the issuance or delivery of Common Shares upon conversion of Series B Shares.

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SECTION 9. NO AMENDMENT OR IMPAIRMENT.

The Corporation shall not amend the Restated Articles (including, for avoidance of doubt, this Amendment), except in accordance with the provisions of Section 7 hereof, or participate in any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, for the purpose of avoiding or seeking to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Corporation, but will at all times in good faith assist in carrying out all such action as may be reasonably necessary or appropriate in order to protect the rights of the Series B Holders against impairment; provided that the Corporation may obtain and rely on the approval of a Series B Majority as conclusively establishing the good faith and validity of any matter.

SECTION 10. NO REISSUANCE OF SERIES B PREFERRED.

No Series B Shares acquired by the Corporation by reason of redemption, purchase, conversion or otherwise shall be reissued.

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EX-3 3 ex3-2_062404.htm 062404

Exhibit 3.2

ARTICLES OF AMENDMENT TO

AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF INTERCEPT, INC.

The name of the Corporation is InterCept, Inc.

The Amended and Restated Articles of Incorporation of the Corporation (the “Articles of Incorporation”) are hereby amended to provide for the elimination, as authorized by Section 14-2-602(e) of the Code, of the Series A Preferred Stock as set forth in the Corporation’s Articles of Incorporation, of which no shares are currently issued and outstanding.

The Corporation’s Board of Directors duly adopted a resolution containing the amendment on June 21, 2004.

Such amendment was duly adopted by the Board of Directors, and shareholder action was not required, pursuant to the authority granted in Article Two of the Corporation’s Articles of Incorporation and Section 14-2-602 of the Code.

IN WITNESS WHEREOF, the Corporation has caused this Amendment to be signed by the undersigned duly authorized officer, this 23rd day of June, 2004.

INTERCEPT, INC.

By:       /s/ G. Lynn Boggs
Name:       G. Lynn Boggs
Its:       President and COO

EX-10 4 ex10-1_062404.htm 062404

Exhibit 10.1

EXCHANGE AGREEMENT

InterCept, Inc., a Georgia corporation (the “Company”), and the investors named on Exhibit A (each an “Investor” and collectively the “Investors”) enter into this Exchange Agreement (this “Agreement”) dated June 23, 2004, relating to the issuance by the Company of shares of newly designated Series B Preferred Stock in exchange for all of the outstanding shares of the Company’s Series A Preferred Stock.

SECTION 1. DESCRIPTION OF TRANSACTION

1.1 Description of Securities. The Company agrees to issue to the Investors One Hundred Thousand (100,000) shares of its authorized but unissued Series B Preferred Stock (the “Preferred Shares”) in exchange for all of the outstanding shares of the Company’s Series A Preferred Stock (the “Old Preferred Shares”) now held by the Investors. The Old Preferred Shares, and all accrued but undeclared dividends thereon, shall be cancelled. The Preferred Shares will be convertible into shares of the Company’s Common Stock, no par value per share (the “Common Stock”), as provided in the Articles of Amendment (the “Designation”) filed with the Secretary of State of the State of Georgia substantially in the form attached hereto as Exhibit B. Any shares of Common Stock of the Company issued or issuable upon such conversion (and any securities resulting from a stock split of or stock dividend upon such Common Stock) are referred to as “Conversion Shares.”

1.2 Closing. The closing (the “Closing”) of the sale of the Preferred Shares will take place at the offices of Nelson Mullins Riley & Scarborough, L.L.P. (“Nelson Mullins”), Atlanta, Georgia, counsel for the Company, at 5:00 P.M., on the date of this Agreement, or such other time of day and place as agreed to by the parties (the “Closing Date”). At the Closing, the Company will deliver certificates evidencing the Preferred Shares being acquired by the Investors upon delivery of the certificates evidencing the Old Preferred Shares by the Investors to the Company. The Company will not be obligated to issue any Preferred Shares unless the Investors acquire all the Preferred Shares by exchanging all of the Old Preferred Shares for them as contemplated hereby. The Preferred Shares will be exchanged on a one-for-one basis for the outstanding Old Preferred Shares, so that upon and after the Closing, 100,000 shares of Preferred Shares will be outstanding and each Investor will own a number of Preferred Shares equal to the number of Old Preferred Shares it currently owns.

1.3 The Investors’ Conditions to Closing. The obligation of the Investors to purchase and pay for the Preferred Shares at the Closing is subject to satisfaction, unless waived by the Investors, of the conditions that:

(i) The Company shall have duly authorized and filed the Designation with the Secretary of State of the State of Georgia and a date-stamped copy of the Designation marked “filed” by the Secretary of State of the State of Georgia shall have been furnished to counsel for the Investors.

(ii) The Company shall have executed and delivered to the Investors an Amendment to Registration Rights Agreement in the form attached hereto as Exhibit C (the “Amendment to Rights Agreement”).

(iii) No injunction, order, investigation, claim, action or proceeding before any court or governmental body shall be pending or threatened wherein an unfavorable judgment, decree or order would restrain, impair or prevent the execution, delivery or (where applicable) filings of this Agreement, the Amendment to Rights Agreement or the Designation or the completion of any of the transactions contemplated hereby and thereby, declare unlawful the transactions contemplated by this Agreement, the Rights Agreement (as amended) or the Designation or cause any such transaction to be rescinded.

(iv) The Company shall have obtained in writing or made all consents, waivers, approvals, orders, permits, licenses and authorizations of, and registrations, declarations, notices to and filings and applications with, any governmental authority or any other person required to be obtained prior to the Closing.

(v) The Company shall have delivered to the Investors:

(A) a certificate of the Secretary or Assistant Secretary of the Company, dated the Closing Date, with respect to the attached copy of the By-laws of the Company, the incumbency of the officers executing this Agreement and the Amendment to Rights Agreement, and the resolutions adopted by the Board of Directors of the Company authorizing the execution, delivery and performance of this Agreement and the Amendment to Rights Agreement and the actions to be taken by the Company under this Agreement and the Rights Agreement (as amended) including any Form D and blue sky filings;

(B) a certificate executed by the Chief Executive Officer of the Company (signing on behalf of the Company and not in his personal capacity), dated the Closing Date, stating that the conditions set forth in Sections 1.3(iii) and 1.3(iv) have been satisfied;

(C) a certificate of the Secretary of State of the State of Georgia, dated as of a recent date, to the effect that the Company is in existence in the State of Georgia;

(D) a certified copy of the Articles of Incorporation of the Company, and all amendments, as filed with the Secretary of State of the State of Georgia and a date-stamped copy of the Designation marked “filed” by the Secretary of State of the State of Georgia.

(vi) Nelson Mullins shall have delivered to the Investors a legal opinion dated as of the Closing Date and substantially in the form attached hereto as Exhibit D.

1.4 The Company’s Conditions to Closing. The obligation of the Company to issue and sell the Preferred Shares at the Closing is subject to satisfaction, unless waived by the Company, of the conditions that no injunction, order, investigation, claim, action or proceeding before any court or governmental body shall be pending or threatened wherein an unfavorable judgment, decree or order would restrain, impair or prevent the execution, delivery or (where applicable) filing of this Agreement, the Rights Agreement (as amended) or the Designation or the completion of any of the transactions contemplated hereby and thereby, declare unlawful the transactions contemplated by this Agreement or the Designation or cause any such transaction to be rescinded.

SECTION 2. REPRESENTATIONS OF THE COMPANY

As part of the basis of this Agreement, the Company represents to the Investors that:

2.1 Public Status. The Company is a publicly traded corporation whose Common Stock is traded on the Nasdaq National Market under the symbol ICPT. The Company has received no notice from Nasdaq that it is in default under, and, to the Company’s best knowledge, it is not in default in respect to, any of Nasdaq’s listing requirements.

2.2 Organization and Authority.

(a) The Company is a corporation duly organized and validly existing under the laws of the State of Georgia.

(b) The Company has the corporate power and authority to execute and deliver this Agreement and the Amendment to Rights Agreement, and to execute and file the Designation, to perform its obligations hereunder and thereunder, to own or lease its properties and assets, and to carry on and conduct its business as it is now being conducted.

(c) The Company has duly authorized the execution and delivery of this Agreement and the Amendment to Rights Agreement, and the execution and filing of the Designation, and all performance by the Company hereunder and thereunder, including issuance of the Preferred Shares and the Conversion Shares in accordance therewith, and has duly executed and delivered this Agreement and the Amendment to Rights Agreement, and has duly executed and filed the Designation.

(d) The execution and delivery by the Company of this Agreement and the Amendment to Rights Agreement, the execution and filing of the Designation, and all performance of the Company’s obligations hereunder and thereunder, with the giving of notice or the passage of time, or both, will not result in any:

(i) violation of the Company’s Articles of Incorporation or bylaws;

(ii) violation of any judgment, order, ruling, or award to which the Company or any of its properties is subject;

(iii) breach of or default under any material written agreements to which the Company or any of its properties is subject; or

(iv) requirement for the consent or approval of any governmental authority or any party to any such material written agreement, other than consents or approvals which have been obtained or will be obtained on a timely basis.

(e) This Agreement and the Amendment to Rights Agreement constitute the valid, legal, binding and enforceable agreements of the Company.

2.3 Capitalization

(a) The authorized capital of the Company consists of (x) 50,000,000 shares of Common Stock, of which 20,625,140 shares are issued and outstanding as of June 16, 2004, and (y) 1,000,000 shares of Preferred Stock, 100,000 of which constitute the issued and outstanding Old Preferred Shares, which will be exchanged for the 100,000 Preferred Shares to be issued and outstanding on the Closing Date of this Agreement. No other shares of Preferred Stock are outstanding. The rights, preferences and privileges of the Preferred Shares as set forth in the Designation will be enforceable against the Company as described in the Georgia Business Corporation Code (“GBCC”), including without limitation Section 14-2-1001 of the GBCC.

(b) Upon issuance, sale and delivery for the consideration stated in this Agreement, the Preferred Shares will be duly and validly issued, fully paid and nonassessable, and will be free and clear of all liens, claims, charges, security interests, pledges or other similar encumbrances (collectively, “Liens”) created by or through the Company, other than voting and transfer restrictions expressly created by the terms of this Agreement, the Company’s Articles of Incorporation, as amended by the Designation, or the Rights Agreement (as amended).

(c) The Conversion Shares, upon issuance and delivery in accordance with the terms of the Company’s Articles of Incorporation, as amended by the Designation, will be duly and validly issued, fully paid and nonassessable, and will be free and clear of all Liens created by or through the Company, other than voting and transfer restrictions expressly created by the terms of this Agreement, the Company’s Articles of Incorporation, as amended by the Designation, or the Rights Agreement (as amended).

(d) The Company’s Board of Directors has duly authorized and adopted a resolution to reserve a number of shares of Common Stock estimated to be sufficient for the conversion of all Preferred Shares (assuming a conversion price of no less than $10.50 per share).

(e) Between the date of original issuance of the Series A Preferred Stock and the Closing Date, no event or circumstance has occurred or existed that would give rise to an adjustment of the conversion price of the Series A Preferred Stock pursuant to Section 8(e) of the Designations of Preferences, Limitations and Relative Rights of Series A Preferred Stock of the Company, as the same has been in effect during such period.

2.4 Historical Regulatory Filings. No final registration statement, prospectus, report, proxy statement or other document filed by the Company with the Securities and Exchange Commission (“SEC”) since December 31, 2002 pursuant to the Securities Act of

1933, as amended (the “Securities Act”) or the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the time of filing, contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein not misleading as of the date of filing. Other than the proxy fight, the settlement thereof, and related litigation described in the Company’s filings with the SEC since April 1, 2004 (and the negative effects thereof on the business of the Company), there have been no material adverse changes to the business (financial or otherwise) or properties of the Company subsequent to the date of filing of the Company’s quarterly report for the first quarter of 2004.

2.5 Regulatory Filings for Preferred Shares. Neither the Company, nor any of its affiliates, nor, to its knowledge, any person or entity acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would require registration of the Preferred Shares or the Conversion Shares under the Securities Act or for the offering of the same to be integrated with any other offering of securities. As used in this Agreement, “affiliate” has the meaning assigned in Rule 405 adopted under the Securities Act. No consent, approval or filing with any regulatory agency is required to be obtained or made by the Company in connection with the transactions contemplated by this Agreement, other than those which the Company has obtained or made, except for any filing of Form D or any applicable state blue sky filing that may be made by the Company after the Closing.

2.6 Representation Regarding Sovereign. The Company reasonably believes that no event has occurred under the Master Services Agreement dated January 21, 2003 between the Company and Sovereign Bank that would cause a material adverse effect on the Company.

2.7 Brokers. No broker or finder has acted on behalf of the Company in connection with this Agreement, and the Company has not made any agreement to pay any agent, finder, broker or any other representative any fee or commission in the nature of a finder’s or originator’s fee arising out of or in connection with the subject matter of this Agreement.

2.8 Other Information. No representation made by the Company in this Agreement contains any untrue statement or omits to state a material fact necessary to make the statements contained herein not misleading.

SECTION 3. REPRESENTATIONS OF THE INVESTORS

As part of the basis of this Agreement, each of the Investors hereby represents that:

3.1 Authorization. This Agreement and the Amendment to Rights Agreement have been duly authorized by all necessary action on the part of such Investor, have been duly executed and delivered by the Investor, and constitute the valid, legal, binding and enforceable agreements of such Investor.

3.2 Investment Purpose. Such Investor is acquiring the Preferred Shares for its own account, for investment, and not with a view to any “distribution” within the meaning of the

Securities Act. Such Investor has no present intention to make any transfer of the Preferred Shares.

3.3 Own Account. Such Investor is acting on its own behalf in connection with the investigation and examination of the Company and its decision to enter into this Agreement.

3.4 Securities Law Legends. Each instrument representing the Preferred Shares or the Conversion Shares may be endorsed with the following or similar legends:

(a) The securities evidenced by this certificate have not been registered under the Securities Act of 1933, as amended, and may not be sold, transferred, assigned or hypothecated unless there is an effective registration statement under such act covering such securities, [the sale is made in accordance with Rule 144 under such Act,] or the Company receives an opinion of counsel for the holder of these securities reasonably satisfactory to the Company, stating that such sale, transfer, assignment or hypothecation is exempt from the registration and prospectus delivery requirements of such act. (The bracketed language, regarding Rule 144, is not and is not expected to become applicable to the Preferred Shares and will not appear in the legend on any instrument representing Preferred Shares.)

(b) Any other legend required by Georgia or other state securities laws.

The Company need not register a transfer of legended securities, and may also instruct its transfer agent not to register the transfer of such securities, unless one of the conditions specified in each of the foregoing legends is satisfied.

3.5 Removal of Securities Law Legends and Transfer Restrictions. Any legend endorsed on an instrument pursuant to Section 3.4 hereof and the stop transfer instructions with respect to such securities shall be removed, and the Company shall issue an instrument without such legend to the holder of such securities if such securities are registered under the Securities Act and a prospectus meeting the requirements of Section 10 of the Securities Act is available or if such holder provides the Company with an opinion of counsel for such holder of the securities, reasonably satisfactory to the Company, to the effect that a public sale, transfer or assignment of such securities may be made without registration.

3.6 Other Legend. Each instrument representing the Preferred Shares will also be endorsed with the following legend:

The securities evidenced by this certificate (and all transfers thereof) are subject to certain restrictions on transfer contained in Section 4.5 of the Exchange Agreement dated June [ ], 2004 among the Company and the Investors listed on Exhibit A thereto, a copy of which is on file at the office of the Company.

3.7 Status of Investors. Such Investor is knowledgeable and experienced in making venture capital investments, and is able to bear the economic risk of loss of its investment in

the Company. Such Investor is an “accredited investor,” as that term is defined in Regulation D under the Securities Act by virtue of meeting the criteria of Rule 501(a)(3). Such Investor’s state of incorporation or organization, as applicable, and principal place of business are listed on Exhibit A, and such Investor has not been organized for purposes of investing in the Company.

3.8 Brokers. No broker or finder has acted on behalf of such Investor in connection with this Agreement, and such Investor has not made any agreement to pay any agent, finder, broker or any other representative any fee or commission in the nature of a finder’s or originator’s fee arising out of or in connection with the subject matter of this Agreement.

SECTION 4. COVENANTS OF THE PARTIES

4.1 Retirement of Series A Preferred Stock. Following the Closing Date, the Company shall use reasonable efforts to cause the authorized shares of Series A Preferred Stock to be permanently retired and to cause such shares to revert to the status of undesignated Preferred Stock. Until such retirement and reversion, the Company shall not issue any shares of Series A Preferred Stock (or any securities convertible into or exchangeable for Series A Preferred Stock) without the express prior written consent of the Investors.

4.2 Board Observer. The holders of a majority of the issued and outstanding Preferred Stock may designate an observer to attend the meetings of the board of directors at any time, provided such observer will be excused from the meeting when privileged matters are discussed. The Company shall pay all ordinary and necessary travel and other expenses that such observer reasonably incurs in attending meetings. Mr. Robert Finzi shall be the initial board observer.

4.3 Reservation of Common Stock. The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of Preferred Shares, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding Preferred Shares. If at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding Preferred Shares, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose.

4.4 Right of First Refusal on Issuance of New Securities.

4.4.1 Grant of Right. The Company hereby grants to each Investor the right of first refusal to purchase its Pro Rata Share (as defined below) of the New Securities (as defined in Section 4.4.2) which the Company may, from time to time, propose to sell and issue for cash. A “Pro Rata Share,” for purpose of this right of first refusal, is the ratio that (i) the sum of the total number of shares of Common Stock which are then held by, are issuable to, or would be issuable to such Investor assuming the conversion of the Preferred Shares (whether or not such conversion right has matured) bears to (ii) the sum of the total number of shares of Common Stock then outstanding and which is issuable pursuant to exercise or conversion of

any then outstanding options, warrants, rights or convertible securities (whether or not such conversion rights or options have vested or are then exercisable), including all outstanding Preferred Shares.

4.4.2 New Securities. “New Securities” shall mean any equity securities of any class of the Company (or any securities that are convertible into or exercisable or exchangeable for equity securities) to be sold in a transaction which does not involve (i) a public offering, (ii) a dividend reinvestment plan, (iii) an employee benefit plan, stock purchase plan, or stock option plan, (iv) securities issued pursuant to the acquisition of another business or assets by merger, share exchange, purchase of all or substantially all of its assets or other reorganization or (v) any other transaction covered by Rule 145 or any similar SEC rule.

4.4.3 Notice. In the event the Company proposes to undertake a sale of New Securities, it shall give each Investor written notice of its intention, describing the amount and type of New Securities, and the price and terms upon which the Company proposes to issue the same. Such Investor shall have thirty (30) days from the date of receipt of any such notice to agree to purchase up to its Pro Rata Share of such New Securities for the price and upon the terms specified in the notice by giving written notice to the Company and stating therein the quantity of the New Securities to be purchased.

4.4.4 Eligible Sales to Third Parties. After giving the notice and opportunity for the Investors to participate as required under Section 4.4.3 above, the Company shall have one hundred twenty (120) days thereafter to issue and sell the New Securities not elected to be purchased by such Investor at the price and upon the terms no more favorable to the purchasers of such securities than specified in the Company’s notice under Section 4.4.3. In the event the Company has not sold such New Securities within said one hundred twenty (120) day period, the Company shall not thereafter issue or sell any New Securities without first offering such securities in the manner provided above.

4.5 The Company’s Right of First Refusal.

4.5.1 Prohibition on Transfer. Unless otherwise consented to in writing by the Company, each Investor shall refrain from making any transfer of the Preferred Shares unless such transfer is to a Permitted Transferee or such Investor complies with the provisions of Section 4.5.2. Any transfer made in contravention of this prohibition shall be void. “Transfer,” whether used as a noun or a verb, shall mean any sale, assignment, pledge, encumbrance or other disposition with or without consideration. “Permitted Transferee” shall mean (i) any affiliate of such Investor or (ii) any partner or member of such Investor, in either case who is an accredited investor and to whom a transfer may be made in compliance with applicable securities law and other regulatory requirements. Permitted Transferees are bound by the provisions of Section 4.5 as to any Transferred Preferred Shares.

4.5.2 Right of First Refusal.

(a) Prior to any transfer of the Preferred Shares by any Investor, such Investor (the “Transferor”) shall provide the Company with a right of first refusal with respect to such transfer.

(b) To give effect to the Company’s right of first refusal, the Transferor shall notify the Company of the Transferor’s intent to transfer the Preferred Shares. Such notice shall be accompanied by a copy of the offer of the proposed transfer (if the offer is in writing), and shall set forth all pertinent information about the proposed transfer, including the number of Preferred Shares proposed to be transferred, the name, address, and accredited investor status of the proposed transferee, and the terms and conditions of the proposed transfer. The Transferor shall also obtain and provide such further information concerning the proposed transfer or proposed transferee as the Company may reasonably request.

(c) Upon receipt of the Transferor’s notice of the proposed transfer, the Company may elect to purchase all, but not fewer than all, of the shares of Preferred Shares proposed to be transferred.

(d) The purchase price for the shares of Preferred Shares proposed to be transferred, and the other terms of such transfer, shall be the payment amount proposed to be paid by the transferee, and the other terms, as set forth in the notice to the Company.

(e) The Company may exercise its right of first refusal by notice to the Transferor at any time within thirty (30) days following receipt of the notice delivered to the Company pursuant to Section 4.5.2(b). The expiration of such thirty (30) day period without notice of exercise of such right of first refusal, or a written notice of non-exercise by the Company during such period, shall constitute the Company’s election not to exercise such right of first refusal.

(f) If the Company elects not to exercise its right of first refusal, the Transferor may, subject to compliance with applicable securities laws and other regulatory requirements, transfer the Preferred Shares proposed to be transferred in accordance with the information, including the terms and conditions, or on terms and conditions no more favorable to the proposed transferee, set forth in the notice first delivered to the Company. The Company may require the transferee to agree in writing to be bound by the restrictions of this Section 4.5 as a condition to the effectiveness of the proposed transfer. If the Transferor does not complete such transfer within 90 days after the Company has elected not to exercise its right of first refusal, or if there is any material (and favorable to the transferee) change in the terms or conditions of the proposed transfer, the transfer shall again be subject to the right of first refusal set forth in this Section 4.5.

(g) The closing of the purchase of the Preferred Shares pursuant to the Company’s exercise of its right of first refusal shall occur as provided in Section 4.5.3 hereof.

4.5.3 Closing.

(a) In the event that the Company is to purchase Preferred Shares under Section 4.5.2 hereof, the referenced Transferor shall tender the certificates or other instruments evidencing such Preferred Shares at the Company’s offices at such date and time as the Company may designate within five business days of the date of receipt of the Company’s election to purchase such Preferred Shares.

(b) The Company shall deliver the purchase price for such Preferred Shares upon receipt of the certificates or other instruments evidencing such Preferred Shares.

4.6 Consent to Exchange Agreement. By its signature below, each holder of Series A Preferred Stock consents to this Agreement and the transactions contemplated hereby.

SECTION 5. GENERAL

5.1 Amendments, Waivers and Consents. Any consents required and any waiver, amendment or other action of the Investors or holders of the Preferred Shares (or Conversion Shares) may be made by consent(s) in writing signed by the holders of at least a majority of the Preferred Shares (including, for such purposes, any Conversion Shares into which any of the Preferred Shares have been converted that have not been sold to the public). Any amendment or waiver made according to this section will be binding upon each holder of any securities purchased under this Agreement at the time outstanding (including securities into which such securities have been converted) and each future holder. Any amendment or waiver by the Company must be made in writing. This Agreement may not be amended, except in a written document signed by the Company and holders of a majority of the Preferred Shares (including, for such purposes, any Conversion Shares into which any of the Preferred Shares have been converted that have not been sold to the public).

5.2 Governing Law. This Agreement is to be governed by and construed in accordance with the laws of the State of Georgia, without giving effect to the choice of law provisions thereof.

5.3 Counterparts. This Agreement may be executed in any number of counterparts, each of which will be taken to be an original; but such counterparts will together constitute one document. Facsimile signature pages will be accepted as originals for all purposes hereof.

5.4 Succession and Assignment. This Agreement shall be binding upon and inure to the benefit of the parties named herein and their respective successors and permitted assigns. No party may assign either this Agreement or any of its rights, interests, or obligations hereunder without the prior written approval of the other party; provided, however, that each Investor may assign its rights and interests hereunder to any Permitted Transferees.

5.5 Headings. The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

5.6 Notices. All notices, requests, demands, claims, and other communications hereunder will be in writing and shall be deemed given to a party when (i) delivered to the appropriate address by hand or by nationally recognized courier service (costs prepaid); (ii) sent by facsimile with confirmation of transmission by the transmitting equipment; or (iii) received or rejected by the addressee, if sent by certified mail, return receipt requested on the dated indicated on the return receipt; in each case to the addresses or facsimile numbers and marked to the attention of the person (by name or title) designated on the signature page or Exhibit A (or to such other address or facsimile number or person as a party may designate by notice to the other party).

5.7 Severability. If any provision of this Agreement is held invalid under applicable law, such provision will be ineffective to the extent of such invalidity, and such invalid provision will be modified to the extent necessary to make it valid and enforceable. Any such invalidity will not invalidate the remainder of this Agreement.

5.8 Expenses. The Company will pay (a) all costs and expenses that it incurs with respect to the negotiation, execution, delivery and performance of this Agreement and (b) the legal fees and disbursements incurred by the Investors (up to a maximum of $25,000) with respect to this Agreement and the transactions contemplated hereby. The Investors designate Sonnenschein Nath & Rosenthal LLP as their counsel for this transaction. If either party is required to take any action to enforce its rights under this Agreement, the prevailing party shall be entitled to its reasonable expenses, including attorneys’ fees, in connection with any such action.

5.9 Entire Agreement. This Agreement and the exhibits to this Agreement, together with the Rights Agreement (as amended), constitute the entire agreement of the parties, and supersede any prior agreements.

[Signatures begin on the following page.]

The undersigned have executed this Agreement as of the day and year first written above.

COMPANY:

INTERCEPT, INC.

By:       /s/ G. Lynn Boggs
Name:       G. Lynn Boggs
Its:       President and COO

Address for Notices:

3150 Holcomb Bridge Road
Suite 200
Norcross, Georgia 30071-1370
Attention:  President
Facsimile:   770-662-8399

INVESTORS:

SPROUT CAPITAL IX, L.P.

By:  DLJ Capital Corporation,
          Its Managing General Partner

By:  /s/ Robert Finzi
Name:   Robert Finzi
Its:   Managing Director

SPROUT ENTREPRENEURS FUND, L.P.

By:  DLJ Capital Corporation,
          Its General Partner

By:  /s/ Robert Finzi
Name:   Robert Finzi
Its:   Managing Director

DLJ Capital Corporation,

By:  /s/ Robert Finzi
Name:   Robert Finzi
Its:   Managing Director

EXHIBIT A

THE INVESTORS

	Number of Series B Preferred
Name and Address for Notices	Shares Acquired

Sprout Capital IX, L.P.		99,400
Jurisdiction of Organization: Delaware
Principal Place of Business:
Eleven Madison Avenue
13th Floor
New York, NY 10010

Sprout Entrepreneurs Fund, L.P.		392
Jurisdiction of Organization: Delaware
Principal Place of Business:
Eleven Madison Avenue
13th Floor
New York, NY 10010

DLJ Capital Corporation		208
Jurisdiction of Organization: Delaware
Principal Place of Business:
Eleven Madison Avenue
13th Floor
New York, NY 10010

Address for Notice to all Investors:
3000 Sand Hill Road
Building Three, Suite 170
Menlo Park, CA 94025
Attn: Mr. Robert Finzi
Facsimile: (650) 234-2779

With a copy to :
Sonnenschein Nath & Rosenthal LLP
1221 Avenue of the Americas
New York, NY 10020
Attn: Michael R. Flynn, Esq
Facsimile: (212) 768-6800

EXHIBIT B

Form of

ARTICLES OF AMENDMENT

ARTICLES OF INCORPORATION

INTERCEPT, INC.

EXHIBIT C

Form of

AMENDMENT TO
REGISTRATION RIGHTS AGREEMENT

EXHIBIT D

Form of

LEGAL OPINION OF COUNSEL TO INTERCEPT

EX-10 5 ex10_2-062404.htm 062404

Exhibit 10.2

AMENDMENT TO REGISTRATION RIGHTS AGREEMENT

This Amendment to Registration Rights Agreement (the “Amendment”) is made and entered into as of June 23, 2004 between InterCept, Inc., a corporation formed under the laws of the State of Georgia (the “Company”), on one hand, and the investors listed on the signature pages hereto (each an “Investor” and collectively the “Investors”), on the other hand.

Background:

(1) The Company and the Investors have entered into an Exchange Agreement dated the date of this Amendment for the exchange of the Company’s Series A Preferred Stock for the Company’s Series B Preferred Stock (the “Exchange Agreement”).

(2) The Company and the Investors previously entered into a Registration Rights Agreement, dated September 16, 2003, with regard to the Series A Preferred Stock (the “Original Agreement”).

(3) The Company and the Investors desire for the Investors to have the same registration rights with respect to the Series B Preferred Stock issued pursuant to the Exchange Agreement that they had for the Series A Preferred Stock.

NOW THEREFORE, for and in consideration of the premises, the parties hereto, intending to be legally bound, hereby agree as follows:

1. Amendment Regarding Series B Preferred. Every place in the Original Agreement that refers to the Company’s Series A Preferred Stock is hereby amended to refer instead to the Company’s Series B Preferred Stock, such that the Investors and the Company shall have the same rights and obligations with regard to the Series B Preferred Stock under the Original Agreement, as amended hereby, as they had previously with regard to the Series A Preferred Stock.

2. Future Amendments. Section 2.7 of the Original Agreement is hereby deleted and replaced in its entirety with the following:

“No amendment or modification of the Original Agreement, as amended hereby, shall be valid or binding upon InterCept, or the Investors, unless made in compliance with Section 5.1 of the Exchange Agreement. Any amendment or waiver effected in accordance with this section shall be binding upon the Company and each holder of Registrable Securities at the time outstanding and each future holder of all such securities.”

3. Governing Law. This Amendment is to be governed by and construed in accordance with the laws of the State of Georgia, without giving effect to the choice of law provisions thereof.

4. Counterparts. This Amendment may be executed in any number of counterparts, each of which will be taken to be an original; but such counterparts will together constitute one document. Facsimile signature pages will be accepted as originals for all purposes hereof.

5. Succession and Assignment. The Original Agreement, as amended hereby, shall be binding upon and inure to the benefit of the parties named herein and their respective successors and permitted assigns. No party may assign either the Original Agreement, as amended hereby, or any of its rights, interests, or obligations hereunder or thereunder without the prior written approval of the other party; provided, however, that each Investor may assign its rights and interests hereunder and thereunder to any Permitted Transferees (as defined in the Exchange Agreement).

6. Headings. The section headings contained in this Amendment are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Amendment.

7. Enforceability. Should any one or more of the provisions of this Amendment be determined to be illegal or unenforceable as to one or more of the parties hereto, all other provisions nevertheless shall remain effective and binding on the parties hereto.

8. Entire Agreement. Except as expressly amended by this Amendment, the Original Agreement remains in full force and effect in accordance with its original terms. The Original Agreement, as amended hereby, represents the entire agreement of the parties relating to the subject matter hereof. All prior understandings and agreements relating to the subject matter hereof are hereby expressly terminated.

Signatures begin on next page.

This Amendment to Registration Rights Agreement is duly executed as of the date first above written.

"Company"

InterCept, Inc., a Georgia corporation

By:      /s/ G. Lynn Boggs
          Name:  G. Lynn Boggs
          Title:  President and COO

"Investors"

DLJ Capital Corporation, a Delaware corporation

By:      /s/ Robert Finzi
          Name:  Robert Finzi
          Title:  Managing Director

Sprout Capital IX, L.P., a Delaware limited
partnership

By: DLJ Capital Corporation, its Managing General
Partner

By:      /s/ Robert Finzi
          Name:  Robert Finzi
          Title:  Managing Director

Sprout Entrepreneurs Fund, L.P. a Delaware limited
partnership

By: DLJ Capital Corporation, its General Partner

By:      /s/ Robert Finzi
          Name:  Robert Finzi
          Title:  Managing Director

EX-99 6 ex99-1_062404.htm 062404

Exhibit 99.1

PRESS RELEASE
Contact: Carole Collins
Investor Relations Director
(770) 248-9600

INTERCEPT ADJOURNS ANNUAL MEETING, ADDS NEW DIRECTORS AND
CLOSES EXCHANGE OF PREFERRED STOCK

ATLANTA, GA (June 24, 2004) – InterCept, Inc. (Nasdaq: ICPT), a leading provider of technology products and services for financial institutions, announced that its annual shareholders meeting held earlier today was convened and then immediately adjourned until September 14, 2004, when it will be reconvened at 9:00 a.m. at the company’s offices. John W. Collins, Chairman and Chief Executive Officer of InterCept, stated, “Due to the possibility that we may be convening a shareholders meeting in the coming months to approve a sale, business combination or other strategic transaction, we postponed our annual meeting to avoid the time and expense associated with conducting two shareholder meetings in close proximity to one another. We also want to focus our attention on exploring all strategic alternatives for enhancing shareholder value.”

Addition of Three New Directors

InterCept also announced the addition of three new directors to its board. In accordance with its recently announced settlement with JANA Partners, InterCept’s board of directors increased the size of the board from six to nine members and filled the three vacant seats created by the expansion. The board elected as directors Kevin J. Lynch and Marc Weisman, the two nominees proposed by JANA, and J. Daniel Speight. Mr. Speight is vice chairman, chief financial officer and secretary of Flag Financial Corporation, the Atlanta-based, publicly traded parent company of Flag Bank, a community bank with 20 offices in 11 counties in central and western Georgia and north metro Atlanta.

Closing of Agreement with Sprout Group to Modify Preferred Stock

As announced in a Current Report on Form 8-K filed with the SEC on May 25, 2004, InterCept agreed with Sprout Group to modify the terms of the $10 million preferred stock purchased by Sprout and its affiliates in September 2003. This transaction, which closed on June 23, 2004, took the form of an exchange of a new Series B preferred stock of InterCept for all of the outstanding Series A preferred stock of InterCept held by the Sprout Group investors. The modifications to the preferred stock include the elimination of the preferred dividend (including all currently accrued dividends) and the elimination of the right of holders of the preferred stock to block a number of proposed corporate actions approved by a majority of InterCept’s board of directors, including certain

mergers, acquisitions and amendments to the articles and bylaws. The conversion price of the preferred was reduced to $10.50 per share from $13.97 per share.

The exchange transaction will result in a non-cash charge to net income attributable to common shareholders that we currently anticipate amortizing in the amount of approximately $325,000 per quarter for each of the next 17 fiscal quarters, the remaining term during which the Series B preferred stock is convertible into common stock. However, we may accelerate recognition of the entire unamortized portion of the charge in certain circumstances, including in connection with a sale of the company. This charge will replace and be in lieu of the charge for preferred dividends formerly being accrued on the Series A preferred stock

About InterCept

InterCept, Inc. (Nasdaq: ICPT — News) provides innovative technology products and services to the financial industry, including core processing, check imaging and item processing, electronic funds transfer, debit card processing, communications management and related products and services. The company serves over 2,000 clients nationwide and is a leading provider of check imaging solutions with over 30 fully image-enabled processing centers from coast to coast. Visit http:// www.intercept.net , email info@intercept.net or call 770.248.9600 for more information.

This release contains forward-looking statements within the meaning of the securities laws that are based on current expectations, assumptions, estimates, and projections about InterCept and its industry. These forward- looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of InterCept’s control, that may cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include whether InterCept will be able to negotiate and consummate a strategic transaction; and whether the accounting treatment for the preferred stock amortization will ultimately be as described above. Other risks and factors that may affect InterCept and its share price are discussed in detail in the section in its most recent Annual Report on Form 10-Q entitled Management’s Discussion and Analysis of Financial Condition and Results of Operations – Disclosure Regarding Forward-Looking Statements.

-END-

-----END PRIVACY-ENHANCED MESSAGE-----

SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported): June 23, 2004

Item 5. Other Events and Required FD Disclosure

Item 7. Financial Statements and Exhibits

SIGNATURES

EXHIBIT INDEX

ARTICLES OF AMENDMENT TO

AMENDED AND RESTATEDARTICLES OF INCORPORATION OF INTERCEPT, INC.

ARTICLES OF AMENDMENT TO

AMENDED AND RESTATEDARTICLES OF INCORPORATION OF INTERCEPT, INC.

EXCHANGE AGREEMENT

EXHIBIT A

EXHIBIT B

EXHIBIT C

EXHIBIT D

AMENDMENT TO REGISTRATION RIGHTS AGREEMENT

Background:

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF INTERCEPT, INC.

AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF INTERCEPT, INC.