EX-99.2 3 0003.txt STATEMENTS OF THE INTERCEPT GROUP & SLMSOFT.COM Exhibit 99.2 The InterCept Group, Inc. Unaudited Pro Forma Condensed Consolidated Statement of Income As of December 31, 1999

(a) (b) Historical US Operations Pro Forma Pro Forma Consolidated SLMsoft.com Adjustments Consolidated ------------ ------------- ----------- ------------ Revenues 52,359 32,424 (182) (c) 84,601 Cost of services 20,452 28,204 (182) (c) - - (4,646) (d) 43,828 Selling, general and administrative expense 20,992 14,282 35,274 Depreciation and amortization 4,462 3,718 3,145 (e) 11,325 ------- ------- ------ ------- Total operating expense 45,906 46,204 (1,683) 90,427 Operating income 6,453 (13,780) 1,501 (5,826) Interest and other income, net 39,172 284 - 39,456 ------- ------- ------ ------- Income before provision for income taxes and minority interest 45,625 (13,496) 1,501 33,630 Provision for income taxes 20,212 - (4,858) (f) 15,354 Equity in loss of affiliate (15,352) - - (15,352) Minority interest (120) 65 - (55) ------- ------- ------ ------- Net loss before preferred dividends 9,941 (13,431) 6,359 2,869 Preferred dividends - - - ------- ------- ------ ------- Net loss attributable to common shareholders 9,941 (13,431) 6,359 2,869 ======= ======= ====== ======= Pro forma net loss per share 0.94 0.24 ======= ======= Pro forma weighted average common and common equivalent shares outstanding 10,564 11,818

Exhibit 99.2 The InterCept Group, Inc. Unaudited Pro Forma Condensed Consolidated Statement of Income As of December 31, 2000

(a) (b) Historical US Operations Pro Forma Pro Forma Consolidated SLMsoft.com Adjustments Consolidated ------------ ------------- ----------- ------------ Revenues 69,639 32,987 (148) (c) 102,478 Cost of services 26,952 27,577 (148) (c) - - (4,646) (d) 49,735 Selling, general and administrative expense 27,017 15,190 - 42,207 Depreciation and amortization 4,403 5,202 3,145 (e) 12,750 ------- ------- ------ ------- Total operating expense 58,372 47,969 (1,649) 104,692 Operating income 11,267 (14,982) 1,501 (2,214) Interest and other income, net 11,825 70 - 11,895 ------- ------- ------ ------- Income before provision for income taxes and minority interest 23,092 (14,912) 1,501 9,681 Provision for income taxes 9,216 5,340 (5,431) (f) (1,555) Equity in loss of affiliate (30,710) - - (30,710) Minority interest (28) - - (28) ------- ------- ------ ------- Net loss before preferred dividends (16,862) 9,572 6,932 (19,502) Preferred dividends - - - - ------- ------- ------ ------- Net loss attributable to common shareholders (16,862) 9,572 6,932 (19,502) Pro forma net loss per share (1.32) (1.39) ======= ======= Pro forma weighted average common and common equivalent shares outstanding 12,820 14,073

Exhibit 99.2 The InterCept Group, Inc. Unaudited Pro Forma Condensed Balance Sheet As of December 31, 2000

(a) (b) Historical US Operations Pro Forma Pro Forma Consolidated SLMsoft.com Adjustments Consolidated ASSETS Current assets: Cash and cash equivalents $ 8,061 $ 89 $ (8,061) (c) $ (89) (d) - Short term investments 37,484 - (26,939) (c) 10,545 Accounts receivable, net 9,960 3,194 (3,194) (d) 9,960 Advances to SLM 5,000 - (5,000) (c) 0 Inventory, prepaid expenses and other 4,689 937 5,626 Deferred tax assets - 5,340 (5,340) - -------- -------- -------- -------- Total current assets 65,194 9,560 (43,283) 26,131 Property and equipment, net 16,883 5,547 - 22,430 Intangible assets, net 24,786 2,379 (2,379) (c) - - 55,992 80,778 Accounts receivable - affiliate 15,000 8,888 (8,888) (d) 15,000 Investment in affiliate 19,196 - - 19,196 Other assets 1,067 178 - 1,245 -------- -------- -------- -------- Total assets $142,126 $ 26,552 $ (3,898) $164,780 ======== ======== ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current maturities of long-term debt $ 45 $ 3,220 $ (3,220) (d) $ 45 Accounts payable and accrued expenses 3,188 8,263 (8,088) (d) 5,363 - - 2,000 (c) - Due to SLM Parent - 25,225 (25,225) (d) - Deferred revenue 5,054 1,490 (423) (d) 6,121 -------- -------- -------- -------- Total current liabilities 8,287 38,198 (34,956) 11,529 Long-term debt, net of current portion 4,513 125 (125) (d) 4,513 Deferred revenue 453 - - 453 Deferred taxes 26,279 - - 26,279 Deferred compensation - - - - -------- -------- -------- -------- Total liabilities 39,532 38,323 (35,081) 42,774 Minority interest 202 - - 202 Redeemable preferred stock - - - - Shareholders' equity: Common stock 109,340 13 19,399 (c) 128,752 Preferred stock - 750 (750) (d) - Treasury stock - (391) 391 (d) - Additional Paid in Capital - 10,780 (10,780) (d) - Retained earnings (6,951) (22,923) 22,923 (d) (6,951) Unrealized gain on securities 3 - - 3 -------- -------- -------- -------- Total shareholders equity 102,392 (11,771) 31,183 121,804 -------- -------- -------- -------- Total liabilities and shareholders' equity $142,126 $ 26,552 $ (3,898) $164,780 ======== ======== ======== ========

A more detailed description of this acquisition may be found under Item 2 of the Form 8-K InterCept filed on January 19, 2001, and in InterCept's press release incorporated and filed herein. Effective January 1, 2001, SLMSoft.com, Inc., (a Kansas Corporation) (the Company) was acquired by The InterCept Group, Inc. ("InterCept"). The consideration exchanged was approximately $40 million and 1,254,000 shares of InterCept common stock valued at approximately $28.0 million. Of the $40 million, $5 million was advanced to the parent company of SLMSoft.com, Inc. in December 2000, $32.5 million was paid on January 4, 2001, and $2.5 million will be kept in escrow to satisfy unresolved contingencies existing at the closing date. Of the 1,254,000 shares, 609,000 were issued to the parent of SLMSoft.com. Inc. at closing and 258,000 shares will be kept in escrow to satisfy unresolved contingencies existing at the closing date. The remaining 386,000 shares represent contingent consideration and are subject to continuation of the revenue stream associated with certain customers. The unaudited pro forma financial data have been prepared using the purchase method of accounting, whereby the total cost of the acquisition is allocated to tangible and intangible assets acquired and liabilities assumed based upon their respective fair values at the effective date of the acquisition. For purposes of the unaudited pro forma financial data, such allocations have been made based upon currently available information and management's estimates. The final allocation of the purchase price may differ. The unaudited proforma financial data does not include the affect of any synergies or operating cost reductions expected to be associated with the purchase by The Intercept Group, Inc., as management is not currently able to reasonably estimate any synergies or cost savings. The unaudited pro forma balance sheet as of December 31, 2000 reflects the following adjustments as if they occurred on December 31, 2000: (a) Represents the historical condensed balance sheets of The InterCept Group, Inc. ("InterCept" or the "Company") for the year ended December 31, 2000 contained in the Company's Current Report on Form 8-K filed on January 19, 2001. (b) Represents the historical balance sheets of SLMSoft.com., a Kansas Corporation. (c) The payment of cash and the issuance of common stock and the recording of intangible assets associated with the purchase of certain assets and assumption of certain liabilities of the SLMsoft.com, Inc., a Kansas Corporation. The purchase price included cash of $40.0 million and 1,254,000 shares of The InterCept Group, Inc. common shares valued at $22.375 per share. The $40.0 million of cash consideration was satisfied through $8.1 million from cash and cash equivalents, $5.0 million from the reduction in the advances to SLM-Parent previously advanced in December 2000, and $26.9 million from the reduction of InterCept's short term investments. Transaction costs of approximately $2.0 million were incurred as a result of the purchase. The excess of the purchase price over net tangible assets acquired totaled $56.0 million and was allocated to the core processing software, customer relationships, employees and goodwill and will be amortized over periods ranging from three to twenty years. In addition to the purchase price indicated above the agreement includes contingent purchase price related to the continuation of revenue from certain customers. This additional consideration will be recorded to goodwill when the contingency is resolved. Based on the price of $22.375 this contingent consideration will revert in additional goodwill in the amount of $8.6 million. (d) Certain assets and liabilities were excluded in the purchase agreement discussed in a. above. The unaudited pro forma statements of operations for the years ended December 31, 1999 and 2000 reflect the following adjustments as if they occurred on January 1, 1999 and are based on the historical statements of operations, adjusted to reflect the following: (a) Represents the historical Condensed Statements of Income of The InterCept Group, Inc. ("InterCept" or the "Company") for the year ended December 31, 2000 contained in the Company's Current Report on Form 8-K filed on January 19, 2001. (b) Represents the historical Condensed Statements of Income of SLMSoft.com., a Kansas Corporation (c) The reduction in intercompany amounts due between SLMSoft.com, a Kansas Corporation and the InterCept Group, Inc. (d) The reduction in intercompany amounts due between SLMSoft.com, a Canadian company, and SLMSoft.com, a Kansas Corporation (e) The additional amortization of the intangible assets recognized upon the acquisition of SLMSoft.com of $3.1 million for the twelve months ended December 31, 1999 and 2000. (f) The tax benefit realized based on the additional losses of SLMSoft.com for the twelve months ended December 31, 1999 and 2000.