Form 8-K BOTTOMLINE TECHNOLOGIES For: Jan 12

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January 13, 2015 6:38 AM EST

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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FORM 8-K

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CURRENT REPORT

Pursuant to Section�13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January�12, 2015

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Bottomline Technologies (de), Inc.

(Exact Name of Registrant as Specified in Charter)

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Delaware

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000-25259

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02-0433294

(State or Other Jurisdiction

of Incorporation)

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(Commission File Number)

�

(IRS Employer

Identification No.)

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325 Corporate Drive, Portsmouth, New

Hampshire

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03801

(Address of Principal Executive Offices)

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(Zip Code)

Registrant�s telephone number, including area code: (603)�436-0700

Not Applicable.

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

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

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�	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

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�	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

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�	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

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�	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Item�8.01. Other Events

On January�12, 2015, Bottomline Technologies (de), Inc., a Delaware corporation (�Bottomline�), and its wholly owned subsidiary Bottomline Technologies Sarl, entered into a Securities Purchase Agreement (the �Agreement�) with Intellinx Ltd., an Israeli corporation, (�Intellinx�), certain equity holders of Intellinx named therein and Shareholder Representative Services LLC as the Representative of the Intellinx equity holders. Intellinx is a leading provider of cyber fraud and risk management solutions.

Headquartered in Israel, Intellinx customers include some of the world�s leading banks and government agencies. The fraud detection and prevention market is estimated at $17 billion annually and is projected to grow to $35 billion by 2019, representing a compound annual growth rate of 20%, according to research conducted by Gartner Consulting.

The Intellinx solutions are trusted by some of the largest organizations in the world because of their unique ability to non-invasively monitor, replay, and analyze user behavior across multiple channels and instantly flag and stop suspicious activity. The solutions create accountability by recording and analyzing each keystroke and screen view, reducing the risk of theft, information leakage, internal fraud and payments fraud, as well as decreasing the cost of regulatory compliance. Case management capabilities centralize risk management, speed investigations, and facilitate compliance with regulations pertaining to Anti Money Laundering (AML), the Health Insurance Portability and Accountability Act (HIPAA), and Know Your Customer (KYC).

Pursuant to the Agreement, Bottomline acquired all of the outstanding share capital of Intellinx for aggregate purchase consideration of approximately $66.7 million in cash ($6.8 million of which will be held in escrow as a source for the satisfaction of indemnification obligations owed to Bottomline) and 774,000 shares of Bottomline common stock. The common stock component of the purchase consideration will be issued to certain equity holders of Intellinx who are becoming employees of Bottomline and will be subject to a vesting schedule tied to continued employment. Absent indemnification claims, the portion of the cash purchase consideration held in escrow will be reduced by 50% nine months from the acquisition date, with any remaining escrow balance released to the selling stockholders of Intellinx fifteen months from the acquisition date.

The acquisition is expected to be accretive to Bottomline�s calendar year 2016 core net income.�The revenue contribution from the transaction is expected to be $10 million in calendar 2015.�Bottomline expects the cyber fraud and risk management offering to grow at a 50% compounded annual growth rate over the next five years and achieve $50 million of revenue, principally on a subscription and transaction basis, by calendar 2019.�From a quarterly perspective, Bottomline expects revenue of $2.1 million in the quarter ended March�31, 2015 and $2.2 million in the quarter ended June�30, 2015.�The transaction is expected to have a short term dilutive impact on earnings per share, principally as a result of the write-down of acquired deferred revenue, of three cents in each of the quarters ended March�31, 2015 and June�30, 2015 and one cent in the quarter ended September�30, 2015.�Bottomline anticipates that the transaction will be break even by the quarter ended December�31, 2015 and accretive thereafter.�Additional financial details of the transaction will be provided on Bottomline�s second quarter Fiscal 2015 earnings conference call.

The full text of the press release issued in connection with the Intellinx acquisition is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Cautionary Language

This Current Report on Form 8-K may contain �forward-looking statements� within the meaning of the Private Securities Litigation Reform Act of 1995, including statements reflecting our expectations about the future financial results of the Intellinx acquisition. Any statements that are not statements of historical fact (including but not limited to statements containing the words �believes,� �plans,� �anticipates,� �expects,� �look forward,� �confident,� �estimates� and similar expressions) should be considered to be forward-looking statements. Actual results may differ materially from those indicated by such forward-looking

statements as a result of various important factors including, among others, the risk that Bottomline may not be able to successfully integrate Intellinx� business into Bottomline�s business or achieve the future financial results it expects. For additional discussion of factors that could impact Bottomline�s operational and financial results, refer to Bottomline�s Form 10-K for the fiscal year ended June�30, 2014 and any subsequently filed Form 10-Qs and Form 8-K�s or amendments thereto. Any forward-looking statements represent Bottomline�s views only as of today and should not be relied upon as representing Bottomline�s views as of any subsequent date. Bottomline does not assume any obligation to update any forward-looking statements.

Item�9.01 Financial Statements and Exhibits

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(d)

Exhibits

Please see attached exhibit index.

SIGNATURE

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 hereunto duly authorized.

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	�	�	BOTTOMLINE TECHNOLOGIES (de), INC.

January�13, 2015	�	�	By:	�	/s/�Eric K. Morgan
	�	�		�	Eric K. Morgan
	�	�		�	Senior Vice President, Global Controller

EXHIBIT INDEX

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Exhibit�No.	��	Description

99.1	��	Press Release dated January 13, 2015.

Exhibit 99.1

Bottomline Announces Cyber Fraud and Risk Management Solutions

Company acquires market-leading cyber fraud detection and prevention capabilities to deliver the next line of defense against cyber attacks

(Portsmouth, NH�January 13, 2015) Bottomline Technologies (NASDAQ: EPAY), a leading provider of cloud-based payment, invoice, and digital banking solutions, today announced that it is now offering comprehensive cyber fraud and risk management solutions as a result of the acquisition of Intellinx, Ltd.�Headquartered in Israel, Intellinx customers include some of the world�s leading banks and government agencies. The fraud detection and prevention market is estimated at $17 billion annually and is projected to grow to $35 billion by 2019, representing a compound annual growth rate of 20%, according to research conducted by Gartner Consulting.

The Intellinx solutions are trusted by some of the largest organizations in the world because of their unique ability to non-invasively monitor, replay, and analyze user behavior across multiple channels, and instantly flag and stop suspicious activity. The solutions create accountability by recording and analyzing each keystroke and screen view, reducing the risk of theft, information leakage, internal fraud and payments fraud, as well as decreasing the cost of regulatory compliance. Case management capabilities centralize risk management, speed investigations, and facilitate compliance with regulations pertaining to Anti Money Laundering (AML), the Health Insurance Portability and Accountability Act (HIPAA), and Know Your Customer (KYC).

�We are extremely excited to combine with Intellinx� said Rob Eberle, President and CEO of Bottomline Technologies. �Our customers have been asking us for solutions to help them combat cyber fraud and the Intellinx solution is unmatched in the market. Its ability to create a �digital surveillance camera� delivers a critical and unique line of protection against cyber attacks and cyber fraud, with instant alerts, session replay, and full case management capabilities.�

�We are delighted to combine with Bottomline� said Orna Mintz-Dov, Founder and CEO of Intellinx. �Our technology is proven with some of the largest organizations in the world. By joining Bottomline, we gain the market reach and distribution required to provide our unique capabilities to the broader market.�

�Bottomline�s culture of innovation is an ideal match for Intellinx�s focus on market-leading solutions� said Boaz Krelbaum, Founder, CTO, and U.S. General Manager of Intellinx. �The combination will enable us to be at the forefront of advanced cyber security solutions.�

Fraud and security are top priorities for organizations of all sizes globally. Data leaks irreparably damage hard-won reputations and shareholder value, fraudulent activity costs approximately 5% of revenue, and organizations need all the protection they can get. The Association of Certified Fraud Examiners (ACFE) estimated a $3.7 trillion annual global occupational fraud loss in a 2014 report, 78% of which was committed by employees.�Over 80�million personal records in the U.S. were breached in 2014¹, and 40% of U.S. healthcare organizations have reported criminal data attacks or leaks � up 100% since 2010².

About Bottomline Technologies

Bottomline Technologies (NASDAQ: EPAY) powers mission-critical business transactions. We help our customers optimize financially-oriented operations and build deeper customer and partner relationships by providing a trusted and easy-to-use set of cloud-based digital banking, fraud prevention, payment, financial document, insurance, and healthcare solutions. Over 10,000 corporations, financial institutions, and banks benefit from Bottomline solutions. Headquartered in the United States, Bottomline also maintains offices in Europe and Asia-Pacific. For more information, visit www.bottomline.com.

Sources

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1.	Identity Theft Resource Center Data Breach Reports 2014

2.	Ponemon 4th Annual Patient Privacy�& Data Security Report 2014

All statements in this report attributable to Gartner represent Bottomline Technologies interpretation of data, research opinion or viewpoints published as part of a syndicated subscription service by Gartner, Inc., and have not been reviewed by Gartner. Each Gartner publication speaks as of its original publication date (and not as of the date of this press release). The opinions expressed in Gartner publications are not representations of fact, and are subject to change without notice.

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Bottomline Technologies and the Bottomline Technologies logo are trademarks of Bottomline Technologies (de), Inc. which may be registered in certain jurisdictions. All other brand/product names may be trademarks of their respective owners.

This press release may contain �forward-looking statements� within the meaning of the Private Securities Litigation Reform Act of 1995, including statements reflecting our expectations about our ability to execute on our growth plans. Any statements that are not statements of historical fact (including but not limited to statements containing the words �believes,� �plans,� �anticipates,� �expects,� �look forward�, �confident�, �estimates� and similar expressions) should be considered to be forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors including, among others, competition, market demand, technological change, strategic relationships, recent acquisitions, international operations and general economic conditions. For additional discussion of factors that could impact Bottomline Technologies� operational and financial results, refer to our Form 10-K for the fiscal year ended June 30, 2014 and any subsequently filed Form 10-Q�s and Form 8-K�s or amendments thereto. Any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We do not assume any obligation to update any forward-looking statements.

Contact for Media:

Christine Nurnberger

Bottomline Technologies

603.812.3742

[email protected]

Contact for Investors:

Kevin Donovan

Bottomline Technologies

603.501.5240

[email protected]

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