As filed with the Securities and Exchange Commission on September 21, 2011

Registration Number 333-176557

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

 

 

 

Amendment No. 2
to
Form S-4

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

 

 

 

 

ACI WORLDWIDE, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

120 Broadway, Suite 3350
New York, New York 10271
Tel.: (646) 348-6700
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

 

Dennis P. Byrnes, Esq.
Executive Vice President, General Counsel and Secretary
ACI Worldwide, Inc.
6060 Coventry Drive
Elkhorn, Nebraska 68022
(402) 778-2183
(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

 

 

Copies to:

 

Robert A. Profusek, Esq.
Jones Day
222 East 41st Street
New York, New York 10017
Tel.: (212) 326-3939

 

 

 

 

Approximate date of commencement of proposed sale of securities to the public:  As soon as practicable after the effective date of this Registration Statement.

 

 

 

 

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box  o

 

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering  o

 

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering  o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

(Do not check if a smaller reporting company)

 

 

 

 

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

 

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)  o

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)  o

 

 

 

 

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

 

 

 

Offer to Exchange

 

Each Outstanding Share of Common Stock

 

of

 

S1 CORPORATION

 

for

0.2800 of a Share of ACI Common Stock

 

or
$10.00 in Cash,

 

subject to the proration procedures described in this prospectus/offer
to exchange and the related letter of election and transmittal,

 

by

 

ANTELOPE INVESTMENT CO. LLC

 

a wholly-owned subsidiary of

 

ACI WORLDWIDE, INC.

 

Antelope Investment Co. LLC (“Offeror”), a Delaware limited liability company and a wholly-owned subsidiary of ACI Worldwide, Inc., a Delaware corporation, which we refer to as “ACI” or “we,” “us” or “our,” is offering, upon the terms and subject to the conditions set forth in this prospectus/offer to exchange and in the accompanying letter of election and transmittal, to exchange for each issued and outstanding share of common stock of S1 Corporation (“S1”), par value $0.01 per share (the “S1 Shares”), validly tendered pursuant to the Exchange Offer and not properly withdrawn either of the following:

 

 

subject to the proration procedures described in this prospectus/offer to exchange and the related letter of election and transmittal (together, as each may be amended, supplemented or otherwise modified from time to time, the “Exchange Offer”).

 

You should be aware that the $10.00 per share Cash Consideration will have a value greater than the 0.2800 per share Stock Consideration if market prices for ACI Shares are less than $35.70 per share. Furthermore, as explained below, if more than 62.0% of S1 Shares elect to receive cash, the proration procedures will result in some of those shares receiving stock. Conversely, if more than 38.0% of S1 Shares elect to receive stock, the proration procedures will result in some of those shares receiving cash. Based on the closing sales price for ACI Shares on September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange and assuming the 38.0% Stock Consideration and the 62.0% Cash Consideration were allocated pro rata among all S1 Shares, which we refer to herein as “full proration”, the blended value of the Cash Consideration and the Stock Consideration (together, the “Cash-Stock Consideration”) as of the close of trading on September 20, 2011 was $9.33 per S1 Share.

 

If market prices for ACI Shares upon consummation of the Exchange Offer are less than $38.75, the Stock Consideration may be taxable to you, and would be taxable based on the trading price for ACI Shares on

September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange. You are urged to obtain current trading price information prior to making any decision with respect to the Exchange Offer.

 

On July 26, 2011, ACI publicly announced its proposal to combine the businesses of ACI and S1 through a merger transaction in which ACI would acquire all of the issued and outstanding S1 Shares in a cash and stock transaction (the “Original ACI Merger Proposal”). Based on the $35.70 closing trading price per ACI Share on July 25, 2011, the last trading day prior to the Original ACI Merger Proposal, the relative value of the Cash-Stock Consideration reflected in the Original ACI Merger Proposal as of such date consisted of $5.70 in cash and $3.80 in ACI Shares per S1 Share (or an implied exchange ratio of 0.1064 shares), assuming full proration, or an aggregate value of $9.50 per S1 Share. On August 2, 2011, S1 announced that the S1 Board had rejected the Original ACI Merger Proposal.

 

On August 25, 2011, ACI publicly announced an increase in the cash consideration payable under the Original ACI Merger Proposal by $0.50 per share (which, based on the closing trading prices as of July 26, 2011, the date of the Original ACI Merger Proposal, would result in a blended value, assuming full proration, of $10.00 per S1 Share) (the “Enhanced ACI Merger Proposal”). Under the Enhanced ACI Merger Proposal and this Exchange Offer, based on the reported 55.5 million S1 Shares outstanding, ACI would exchange approximately $344.2 million cash and 5.9 million ACI Shares, of which approximately 34.4 million S1 Shares (62.0%) would be exchanged for the Cash Consideration and the remaining approximately 21.1 million S1 Shares (38.0%) would be exchanged for the Stock Consideration, or an implied exchange ratio of 0.2800 of an ACI Share per S1 Share.

 

Based on the $29.40 closing trading price per ACI Share on September 20, 2011, the last trading day prior to the date of this prospectus / offer to exchange the relative value of the Cash-Stock Consideration reflected by this Exchange Offer consisted of $6.20 in cash and $3.13 in ACI Shares per S1 Share as of such date, or an aggregate blended value of $9.33 per S1 Share as of such date, assuming full proration. ACI, through Offeror, is making the Exchange Offer directly to S1 stockholders on the terms and conditions set forth in this prospectus/offer to exchange as an alternative to the Enhanced ACI Merger Proposal.

 

At the $9.33 per S1 Share value of the Cash-Stock Consideration as of September 20, 2011, the Exchange Offer represented (1) a 30.9% premium to the closing sales price of S1 Shares on July 25, 2011, the last trading day prior to the public announcement of the Original ACI Merger Proposal, (2) a 29.4% premium to the volume weighted average closing price of S1 Shares over the previous 90 days prior to the announcement of the Original ACI Merger Proposal, and (3) a 20.4% premium to the 52-week high of S1 Shares for the 52-week period ending July 25, 2011.

 

The equity capital markets have been highly volatile since July 26, 2011 and market prices for ACI Shares and S1 Shares have fluctuated and can be expected to continue to fluctuate. S1 stockholders are urged to obtain current trading price information prior to making any decision with respect to the Exchange Offer.

 

S1 stockholders electing either the Cash Consideration or the Stock Consideration will be subject to proration so that 62.0% of S1 Shares will be exchanged for the Cash Consideration and 38.0% of S1 Shares will be exchanged for the Stock Consideration in the Exchange Offer. S1 stockholders who do not participate in the Exchange Offer and whose shares are acquired in the Second-Step Merger will receive $6.20 in cash, without interest, and 0.1064 of an ACI Share (the “Proration Amount of Cash and Stock Consideration”). The elections of other S1 stockholders will affect whether a tendering S1 stockholder electing the Cash Consideration or the Stock Consideration receives solely the type of consideration elected or if a portion of such S1 stockholder’s tendered S1 Shares is exchanged for another form of consideration. S1 stockholders who otherwise would be entitled to receive a fractional ACI Share will instead receive cash in lieu of any fractional ACI Share such holder may have otherwise been entitled to receive based on then-current trading prices. See “The Exchange Offer — Elections and Proration” for a description of the proration procedure and “The Exchange Offer — Cash In Lieu of Fractional ACI Common Stock” for a description of the treatment of fractional ACI Shares.

 

ACI is not asking you for a proxy and you are not requested to send a proxy to ACI pursuant to the Exchange Offer.

 

THE EXCHANGE OFFER AND THE WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., EASTERN TIME, ON WEDNESDAY, SEPTEMBER 28, 2011, OR THE “EXPIRATION TIME,” UNLESS EXTENDED. S1 SHARES TENDERED PURSUANT TO THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION TIME, BUT NOT DURING ANY SUBSEQUENT OFFERING PERIOD.

 

ACI Shares are listed on The NASDAQ Global Select Market under the ticker symbol “ACIW.” S1 Shares are listed on The NASDAQ Stock Market under the ticker symbol “SONE.”

 

FOR A DISCUSSION OF RISKS AND OTHER FACTORS THAT YOU SHOULD CONSIDER IN CONNECTION WITH THE EXCHANGE OFFER, PLEASE CAREFULLY READ THE SECTION OF THIS PROSPECTUS/OFFER TO EXCHANGE TITLED “RISK FACTORS” BEGINNING ON PAGE 22.

 

Offeror’s obligation to accept S1 Shares for exchange and to exchange any S1 Shares for ACI Shares is subject to conditions, including (1) a condition that S1 stockholders shall have validly tendered and not withdrawn prior to the Expiration Time at least that number of S1 Shares that, when added to the S1 Shares then owned by ACI or any of its subsidiaries, constitutes a majority of the then-outstanding number of S1 Shares on a fully diluted basis (the “Minimum Tender Condition”) and (2) a condition that Section 203 of the Delaware General Corporation Law be inapplicable to the Exchange Offer and the Second-Step Merger (the “Delaware 203 Condition”). The Exchange Offer is subject to other conditions including the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”). The Exchange Offer is not conditioned on financing. The conditions to the Exchange Offer are described in the section of this prospectus/offer to exchange titled “The Exchange Offer — Conditions of the Exchange Offer.”

 

Neither ACI nor Offeror has authorized any person to provide any information or to make any representation in connection with the Exchange Offer other than the information contained or incorporated by reference in this prospectus/offer to exchange and the accompanying letter of election and transmittal, and if any person provides any of this information or makes any representation of this kind, that information or representation must not be relied upon as having been authorized by ACI.

 

ACI reserves the right to solicit proxies or consents to cause the S1 Board to be reconstituted with director nominees proposed by ACI independently of or in connection with the Exchange Offer. Any such proxy solicitation will be made only pursuant to separate proxy materials in accordance with the requirements of the rules and regulations of the Securities and Exchange Commission, which we refer to as the “SEC.” See the section of this prospectus/offer to exchange titled “Solicitation of Proxies.”

 

Neither the SEC nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus/offer to exchange. Any representation to the contrary is a criminal offense.

 

The dealer manager for the Exchange Offer is:

 

 

The date of this prospectus/offer to exchange is September 21, 2011.

 

Table of Contents

 

 

THIS PROSPECTUS/OFFER TO EXCHANGE INCORPORATES IMPORTANT BUSINESS AND FINANCIAL INFORMATION ABOUT ACI AND S1 FROM DOCUMENTS FILED WITH THE SEC THAT HAVE NOT BEEN INCLUDED IN OR DELIVERED WITH THIS PROSPECTUS/OFFER TO EXCHANGE. THIS INFORMATION IS AVAILABLE AT THE INTERNET WEBSITE THE SEC MAINTAINS AT HTTP://WWW.SEC.GOV, AS WELL AS FROM OTHER SOURCES. PLEASE SEE THE SECTION OF THIS PROSPECTUS/OFFER TO EXCHANGE TITLED “WHERE YOU CAN FIND MORE INFORMATION.” YOU ALSO MAY REQUEST COPIES OF THESE DOCUMENTS FROM ACI, WITHOUT CHARGE, UPON WRITTEN OR ORAL REQUEST TO ACI’S INFORMATION AGENT AT ITS ADDRESS OR TELEPHONE NUMBER SET FORTH BELOW AND ON THE BACK COVER OF THIS PROSPECTUS/OFFER TO EXCHANGE. IN ORDER TO RECEIVE TIMELY DELIVERY OF THE DOCUMENTS, YOU MUST MAKE YOUR REQUEST NO LATER THAN SEPTEMBER 21, 2011, OR FIVE BUSINESS DAYS PRIOR TO THE EXPIRATION TIME, WHICHEVER IS LATER.

 

ACI RESERVES THE RIGHT TO SOLICIT PROXIES OR CONSENTS TO CAUSE THE S1 BOARD TO BE RECONSTITUTED WITH DIRECTOR NOMINEES PROPOSED BY ACI INDEPENDENTLY OF OR IN CONNECTION WITH THE EXCHANGE OFFER. ANY SUCH PROXY SOLICITATION WILL BE MADE ONLY PURSUANT TO SEPARATE PROXY MATERIALS IN ACCORDANCE WITH SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE “EXCHANGE ACT”).

 

STOCKHOLDERS WILL BE ABLE TO OBTAIN A FREE COPY OF ANY FILING CONTAINING INFORMATION ABOUT THE PARTIES FROM THE SEC’S WEB SITE AT HTTP://WWW.SEC.GOV. DOCUMENTS FILED BY ACI, IF AND WHEN AVAILABLE, MAY ALSO BE OBTAINED FOR FREE FROM ACI’S WEB SITE AT HTTP://WWW.ACIWORLDWIDE.COM OR UPON WRITTEN OR ORAL REQUEST TO THE INFORMATION AGENT AT INNISFREE M&A INC., 501 MADISON AVENUE, 20TH FLOOR, NEW YORK, NEW YORK 10022, STOCKHOLDERS MAY CALL TOLL-FREE AT (888) 750-5834, AND BANKS AND BROKERAGE FIRMS MAY CALL COLLECT (212) 750-5833. WE RESERVE THE RIGHT TO SOLICIT PROXIES OR CONSENTS PURSUANT TO SEPARATE PROXY OR CONSENT SOLICITATION MATERIALS IN ACCORDANCE WITH THE EXCHANGE ACT.

 

The information agent for the Exchange Offer is:

 

 

501 Madison Avenue, 20th Floor
New York, New York 10022
Stockholders May Call Toll Free: (888) 750-5834
Banks and Brokers May Call Collect: (212) 750-5833

 

Below are some of the questions that you as a holder of S1 Shares may have regarding the Exchange Offer and answers to those questions. The answers to these questions do not contain all the information relevant to your decision whether to tender your S1 Shares in the Exchange Offer, and ACI urges you to read carefully the remainder of this prospectus/offer to exchange and the letter of election and transmittal circulated with this prospectus/offer to exchange.

 

Who is making the Exchange Offer?

 

The Exchange Offer is being made by ACI, a Delaware corporation, through its wholly-owned subsidiary, Antelope Investment Co. LLC, a Delaware limited liability company. ACI develops, markets, installs and supports a broad line of software products and services primarily focused on facilitating electronic payments. In addition to ACI’s own products, it also distributes, or acts as a sales agent for, software developed by third parties. These products and services are used principally by financial institutions, retailers and electronic payment processors, both in domestic and international markets. Most of ACI’s products are sold and supported through distribution networks covering three geographic regions — the Americas, Europe/Middle East/Africa and Asia/Pacific. Each distribution network has its own sales force that it supplements with independent reseller and/or distributor networks. ACI’s products are marketed under the ACI Worldwide and ACI Payment Systems brands.

 

What is Offeror seeking for exchange in the Exchange Offer?

 

Offeror seeks to acquire all of the issued and outstanding S1 Shares.

 

What will I receive for my S1 Shares in the Exchange Offer?

 

ACI is offering to exchange for each issued and outstanding S1 Share validly tendered pursuant to the Exchange Offer and not properly withdrawn either of the following:

 

 

subject to the proration procedures described in this prospectus/offer to exchange and the related letter of election and transmittal.

 

You should be aware that the $10.00 per share Cash Consideration will have a value greater than the 0.2800 per share Stock Consideration if market prices for ACI Shares are less than $35.70 per share. Furthermore, as explained below, if more than 62.0% of S1 Shares elect to receive cash, the proration procedures will result in some of those shares receiving stock. Conversely, if more than 38.0% of S1 Shares elect to receive stock, the proration procedures will result in some of those shares receiving cash. Based on the closing sales price for ACI Shares on September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange and assuming the 38.0% Stock Consideration and the 62.0% Cash Consideration were allocated pro rata among all S1 Shares, which we refer to herein as “full proration”, the blended value of the Cash-Stock Consideration as of the close of trading on September 20, 2011 was $9.33 per S1 Share.

 

Assuming 55.5 million S1 Shares outstanding (the number reflected in S1’s most recent filing with the SEC), ACI would exchange approximately $344.2 million cash and 5.9 million ACI Shares, of which, assuming full proration, approximately 34.4 million S1 Shares (62.0%) would be exchanged for the Cash Consideration and the remaining approximately 21.1 million S1 Shares (38.0%) would be exchanged for the Stock Consideration, or an implied exchange ratio of 0.2800 of an ACI Share per S1 Share. S1 stockholders electing either the Cash Consideration or the Stock Consideration will be subject to proration so that 62.0% of S1 Shares will be exchanged for the Cash Consideration and 38.0% of S1 Shares will be exchanged for the Stock Consideration in the Exchange Offer. S1 stockholders who do not participate in the Exchange Offer and whose shares are acquired in the Second-Step Merger will receive the Proration Amount of Cash and Stock Consideration. The elections of other S1 stockholders will affect whether a tendering S1 stockholder electing the Cash Consideration or the Stock Consideration receives solely the type of consideration elected or if a

portion of such S1 stockholder’s tendered S1 Shares is exchanged for another form of consideration. S1 stockholders who otherwise would be entitled to receive a fractional ACI Share will instead receive cash in lieu of any fractional ACI Share such holder may have otherwise been entitled to receive based on then-current trading prices. See “The Exchange Offer — Elections and Proration” for a detailed description of the proration procedure and “The Exchange Offer — Cash In Lieu of Fractional ACI Shares” for a detailed description of the treatment of fractional ACI Shares.

 

Based on the $29.40 closing trading price per ACI Share on September 20, 2011, the last trading day prior to this Exchange Offer, the relative value of the Cash-Stock Consideration reflected by this Exchange Offer consisted of $6.20 in cash and $3.13 in ACI Shares per S1 Share as of such date, or an aggregate value of $9.33 per S1 Share as of such date, assuming full proration. At the $9.33 per S1 Share value of the Cash-Stock Consideration as of September 20, 2011, the Exchange Offer represented (1) a 30.9% premium to the closing sales price of S1 Shares on July 25, 2011, the last trading day prior to the public announcement of the Original ACI Merger Proposal, (2) a 29.4% premium to the volume weighted average closing price of S1 Shares over the previous 90 days prior to the announcement of the Original ACI Merger Proposal, and (3) a 20.4% premium to the 52-week high of S1 Shares for the 52-week period ending July 25, 2011.

 

The equity capital markets have been highly volatile since July 26, 2011 and market prices for ACI Shares have fluctuated and will fluctuate, and could be higher or lower than the price of ACI Shares at or after the Expiration Time. Accordingly, S1 stockholders are urged to obtain current trading price information for ACI Shares prior to deciding whether to tender shares pursuant to the Exchange Offer, whether to exercise withdrawal rights as provided herein and, with respect to the election, whether to receive the Cash Consideration or the Stock Consideration or some combination thereof.

 

Solely for purposes of illustration, the following table indicates the value of the Cash Consideration, the Stock Consideration and the blended value of the Cash-Stock Consideration based on different assumed prices for ACI Shares:

 

 

 

 

 

 

 

The prices of ACI Shares used in the above table, and the assumptions regarding the mix of cash and/or stock a hypothetical S1 stockholder would receive, are for purposes of illustration only. The value of the Stock Consideration will change as the price of ACI Shares fluctuates during the Exchange Offer period and thereafter, and may therefore be higher or lower than the prices set forth in the examples above at the expiration of the Exchange Offer and at the time you receive the ACI Shares. S1’s stockholders are encouraged to obtain current market quotations for the ACI Shares and the S1 Shares prior to making any decision with respect to the Exchange Offer. S1 stockholders should also consider the potential effects of proration and

should obtain current market quotations for ACI Shares and the S1 Shares before deciding whether to tender pursuant to the Exchange Offer and before electing the form of consideration they wish to receive. Please also see the section of this prospectus/offer to exchange entitled “Risk Factors.”

 

Will I be taxed on the ACI Shares and cash I receive?

 

Based on closing trading prices of ACI Shares as of the date of this prospectus/offer to exchange, the Exchange Offer would be taxable to you.

 

If the Exchange Offer and the Second-Step Merger qualified as component parts of an integrated transaction that constitutes a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), your exchange of S1 Shares for the Stock Consideration should be tax free, except to the extent that you also receive cash. Whether or not such transactions will so qualify is dependent on whether certain factual requirements are met, including that the Exchange Offer and Second-Step Merger are “interdependent” (that is, ACI would not undertake the Exchange Offer without the intention and expectation of completing the Second-Step Merger). In addition, there must be a “continuity of interest” of holders of S1 Shares in the combined company. ACI believes that this test should be satisfied if the total value of the Stock Consideration represents at least 40% of the total value of the consideration received by holders of S1 Shares, and may be satisfied at a slightly lower percentage. If market prices for ACI Shares upon consummation of the Exchange Offer are less than $38.75, the Stock Consideration would represent less than 40% of the total value of the Exchange Offer consideration. You are urged to obtain current trading price information prior to making any decision with respect to the Exchange Offer. We cannot provide any assurance as to whether these conditions will be satisfied at this time, since it may be affected, among other things, by the total value of the Stock Consideration at the time of the consummation of the Exchange Offer and the Second-Step Merger.

 

If the integrated transaction does not qualify as a reorganization, your exchange of S1 Shares for the Stock Consideration in the Exchange Offer or the Second-Step Merger could be a taxable transaction, depending on the surrounding facts. If the integrated transaction constitutes a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, any gain (but not loss) you realize on the transaction will be treated as a taxable capital gain or dividend in an amount equal to the lesser of (1) the excess of the sum of the Cash Consideration and the fair market value of the Stock Consideration you receive in the transaction over your basis in your shares and (2) the amount of cash you receive in the transaction, including any cash you receive in lieu of a fractional ACI Share, depending on your circumstances. If the offer does not constitute part of an integrated transaction that qualifies as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, you will recognize a capital gain or a capital loss to the extent of the difference between your adjusted tax basis in your shares and the sum of the Cash Considerations and the fair market value of the Stock Consideration you receive. For more information, please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Certain Material Federal Income Tax Consequences.”

 

ACI urges you to contact your own tax advisor to determine the particular tax consequences to you as a result of the Exchange Offer and/or the Second-Step Merger.

 

What is the Exchange Offer worth today?

 

The value of the Exchange Offer depends in part on market prices for ACI Shares. You should be aware that the $10.00 per share Cash Consideration will have a value greater than the 0.2800 per share Stock Consideration if market prices for ACI Shares are less than $35.70 per share. As of the close of trading on September 20, 2011, the most recent date prior to the date of this prospectus/offer to exchange, the blended value of the Cash-Stock Consideration, assuming full proration, was $9.33 per S1 Share. When we say “full proration”, we mean that the 38.0% Stock Consideration and the 62.0% Cash Consideration were allocated pro rata among all S1 Shares. As explained herein, if more than 62.0% of S1 Shares elect to receive cash, the proration procedures will result in some of those shares receiving stock. Conversely, if more than 38.0% of S1 Shares elect to receive stock, the proration procedures will result in some of those shares receiving cash.

What has ACI proposed to the S1 Board?

 

On July 26, 2011, ACI publicly announced its proposal to combine the businesses of ACI and S1 through a merger transaction in which ACI would acquire all of the issued and outstanding S1 Shares in a cash and stock transaction. Based on the $35.70 closing trading price per ACI Share on July 25, 2011, the last trading day prior to the Original ACI Merger Proposal, the relative value of the cash-stock consideration reflected by the Original ACI Merger Proposal as of such date consisted of $5.70 in cash and $3.80 in ACI Shares per S1 Share (or an implied exchange ratio of 0.1064 shares), assuming full proration, or an aggregate value of $9.50 per S1 Share. On August 2, 2011, S1 announced that the S1 Board had rejected the Original ACI Merger Proposal.

 

On August 25, 2011, ACI publicly announced the Enhanced ACI Merger Proposal, increasing the cash consideration payable under the Original ACI Merger Proposal by $0.50 per share, assuming full proration (which, based on the closing trading prices as of July 26, 2011, the date of the Original ACI Merger Proposal, would result in a blended value, assuming full proration, of $10.00 per S1 Share).

 

Based on the $29.40 closing trading price per ACI Share on September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange, the relative value of the Cash-Stock Consideration reflected by this Exchange Offer consisted of $6.20 in cash and $3.13 in ACI Shares per S1 Share as of such date, or an aggregate blended value of $9.33 per S1 Share as of such date, assuming full proration. ACI is making the Exchange Offer directly to S1 stockholders on the terms and conditions set forth in this prospectus/offer to exchange as an alternative to the Enhanced ACI Merger Proposal.

 

The equity capital markets have been highly volatile since July 26, 2011 and market prices for ACI Shares have fluctuated and will fluctuate, and could be higher or lower than the price of ACI Shares at or after the Expiration Time. Accordingly, S1 stockholders are urged to obtain current trading price information for ACI Shares prior to deciding whether to tender shares pursuant to the Exchange Offer, whether to exercise withdrawal rights as provided herein and, with respect to the election, whether to receive the Cash Consideration or the Stock Consideration or some combination thereof.

 

Have you discussed the Exchange Offer with the S1 Board?

 

Although we would prefer to discuss our proposal with S1, S1 announced on August 2, 2011 that the S1 Board would not discuss our July 26, 2011 proposal with us based on the S1 Board’s determination that pursuing discussions with ACI at this time is not in the best financial or strategic interests of S1 and its stockholders.

 

Between August 31, 2011 and September 20, 2011, senior managers and representatives of ACI and S1 had additional discussions regarding the Enhanced ACI Merger Proposal, however, as of September 20, 2011, no agreement had been reached between the parties.

 

On September 13, 2011, S1 filed a Solicitation/Recommendation Statement on Schedule 14D-9, reporting that the S1 Board has determined to unanimously recommend that S1 stockholders reject the Exchange Offer and not tender their S1 Shares to us.

 

On September 16, 2011, S1 filed an amendment to its Solicitation/Recommendation Statement on Schedule 14D-9, reporting that despite S1’s determination to terminate the Plan of Merger and Reorganization, dated as of June 26, 2011 (the “Fundtech Merger Agreement”), by and among S1, a Delaware corporation, Finland Holdings (2011) Ltd., a company organized under the laws of Israel and a wholly owned subsidiary of S1, and Fundtech Ltd., a company organized under the laws of Israel (“Fundtech”), the S1 Board has not changed its recommendation with respect to the Exchange Offer.

 

ACI reserves the right to solicit proxies or consents to cause the S1 Board to be reconstituted with director nominees proposed by ACI independently of or in connection with the Exchange Offer. Any such proxy solicitation will be made only pursuant to separate proxy materials in accordance with the rules and regulations of the SEC.

What is the purpose of the Exchange Offer?

 

The Exchange Offer is intended to allow ACI, through Offeror, to acquire all of the issued and outstanding S1 Shares. In connection with consummation of the Exchange Offer, and subject to applicable law, ACI currently expects to replace the existing S1 Board or increase the size of the S1 Board and elect ACI nominees who would in the aggregate constitute a majority of the members of the S1 Board.

 

We intend, as promptly as possible after completion of the Exchange Offer, to consummate a Second-Step Merger of S1 with and into Offeror (the “Second-Step Merger”) pursuant to the General Corporation Law of the State of Delaware, as amended (the “DGCL”). The purpose of the Second-Step Merger is for ACI to acquire all outstanding S1 Shares that are not acquired in the Exchange Offer. In this Second-Step Merger, each remaining S1 Share (other than shares held in treasury by S1 and other than shares held by S1 stockholders who properly exercise applicable dissenters’ rights under Delaware law) would be cancelled and exchanged for the Proration Amount of Cash and Stock Consideration. After this Second-Step Merger, ACI would own all of the issued and outstanding S1 Shares. Please see the sections of this prospectus/offer to exchange titled “The Exchange Offer — Purpose and Structure of the Exchange Offer”; “The Exchange Offer — Second-Step Merger”; and “The Exchange Offer — Plans for S1.”

 

When do you expect the Exchange Offer to be completed?

 

We intend to complete the Exchange Offer as soon as we can. The Expiration Time of the Exchange Offer is 5:00 p.m., Eastern time, on September 28, 2011, subject to the satisfaction or waiver of the conditions to the Exchange Offer. As discussed in “The Exchange Offer — Extension, Termination and Amendment”, Offeror can extend the Expiration Time if such conditions are not satisfied, or amend the terms of the Exchange Offer.

 

What are the conditions of the Exchange Offer?

 

The Exchange Offer is conditioned upon, among other things, the following:

 

 

 

 

 

The Exchange Offer is not conditioned on financing. The Exchange Offer is subject to additional conditions referred to in the section of this prospectus/offer to exchange titled “The Exchange Offer — Conditions of the Exchange Offer,” including that the S1 Board shall not have adopted a stockholder rights plan or similar plan.

 

Subject to applicable law, we may waive certain of the foregoing conditions, including the Delaware 203 Condition. Whether or not we will waive any condition will depend on future circumstances, including the number of S1 Shares tendered pursuant to the Exchange Offer and actions taken by S1, the S1 Board and the S1 stockholders.

 

How does the Exchange Offer relate to the Enhanced ACI Merger Proposal?

 

On July 26, 2011, ACI publicly announced the Original ACI Merger Proposal to combine the businesses of ACI and S1 through a merger transaction in which ACI would acquire all of the issued and outstanding S1 Shares in a cash and stock transaction valued at $9.50 per S1 Share. On August 2, 2011, S1 announced that the S1 Board had rejected the Original ACI Merger Proposal. On August 25, 2011, ACI publicly announced the Enhanced ACI Merger Proposal, which provides for an increase in the cash consideration payable under the Original ACI Merger Proposal by $0.50 per S1 Share, assuming full proration. Based on the closing sales price for ACI Shares on September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange, the blended value of the Cash-Stock Consideration as of the close of trading on September 20, 2011 was $9.33 per S1 Share, assuming full proration.

 

ACI would prefer to acquire S1 in a merger transaction of the type contemplated by the Enhanced ACI Merger Proposal. However, in light of the S1 Board’s rejection of the Original ACI Merger Proposal, ACI, through Offeror, is making the Exchange Offer directly to S1 stockholders on the terms and conditions set forth in this prospectus/offer to exchange as an alternative to the Enhanced ACI Merger Proposal. The amount of cash and the number of ACI Shares offered in this Exchange Offer are the same as in the Enhanced ACI Merger Proposal.

 

If the Exchange Offer is completed and ACI acquires a majority of the outstanding S1 Shares, subject to applicable law, ACI currently expects to seek to replace the existing S1 Board or increase the size of the S1 Board and elect ACI nominees who would in the aggregate constitute a majority of the members of the S1 Board. See Appendix A to this prospectus/offer exchange for information as to the individuals, all of whom are currently directors or officers of ACI, that ACI currently expects it would propose to elect to the S1 Board. In the event that ACI accepts S1 Shares for exchange in the Exchange Offer, ACI intends to acquire any additional outstanding S1 Shares pursuant to the Second-Step Merger through Offeror, although ACI and Offeror also reserve the right, subject to applicable law, to acquire S1 Shares pursuant to other means, including open market purchases and privately negotiated transactions.

For more details regarding the reasons for the Exchange Offer, please see the section of this prospectus/offer to exchange titled “The Proposed Acquisition, Background and Reasons for the Exchange Offer.”

 

Do I need to grant proxies to ACI if I wish to accept the Exchange Offer?

 

No. However, ACI reserves the right to solicit proxies or consents to cause the S1 Board to be reconstituted independently of or in connection with the Exchange Offer.

 

Do I have to vote at any meeting to approve the Exchange Offer or the Second-Step Merger?

 

No. Your vote is not required in connection with the Exchange Offer.

 

Has the S1 Board made a recommendation concerning the Exchange Offer?

 

Yes. On September 13, 2011, S1 filed a Solicitation/Recommendation Statement on Schedule 14D-9, reporting that the S1 Board has determined to unanimously recommend that S1 stockholders reject the Exchange Offer and not tender their S1 Shares to us.

 

On September 16, 2011, S1 filed an amendment to its Solicitation/Recommendation Statement on Schedule 14D-9, reporting that despite S1’s determination to terminate the Fundtech Merger Agreement, the S1 Board has not changed its recommendation with respect to the Exchange Offer.

 

What will be the composition of the S1 Board following the Exchange Offer and the Second-Step Merger?

 

If the Exchange Offer is completed and ACI acquires a majority of the outstanding S1 Shares, subject to applicable law, ACI currently expects to seek to replace the existing S1 Board or increase the size of the S1 Board and elect ACI nominees who would in the aggregate constitute a majority of the members of the S1 Board. See Appendix A to this prospectus/offer exchange for information as to the individuals, all of whom are currently directors or officers of ACI, that ACI currently expects it would propose to elect to the S1 Board.

 

Will I have to pay any fee or commission to exchange S1 Shares?

 

If you are the record owner of your S1 Shares and you tender your S1 Shares in the Exchange Offer, you will not have to pay any brokerage fees, commissions or similar expenses. If you own your S1 Shares through a broker, dealer, commercial bank, trust company or other nominee and your broker, dealer, commercial bank, trust company or other nominee tenders your S1 Shares on your behalf, your broker, dealer, commercial bank, trust company or other nominee may charge a fee for doing so. You should consult your broker, dealer, commercial bank, trust company or other nominee to determine whether any charges will apply.

 

Is ACI’s financial condition relevant to my decision to tender S1 Shares in the Exchange Offer?

 

Yes. ACI’s financial condition is relevant to your decision to tender your S1 Shares because the consideration you will receive if your S1 Shares are exchanged in the Exchange Offer will consist of a combination of ACI Shares and cash. You should therefore consider ACI’s financial condition before you decide to become one of ACI’s stockholders through the Exchange Offer. You should also consider the likely effect that ACI’s acquisition of S1 will have on ACI’s financial condition. This prospectus/offer to exchange contains financial information regarding ACI and S1, as well as pro forma financial information (which does not reflect any of our expected synergies) for the acquisition of all of the issued and outstanding S1 Shares by ACI, all of which we encourage you to review.

 

Does ACI have the financial resources to complete the Exchange Offer and the Second-Step Merger?

 

The Exchange Offer consideration will consist of ACI Shares and cash (including, cash paid in lieu of any fractional ACI Shares to which any S1 stockholder may be entitled). The Exchange Offer and the Second-Step Merger are not conditioned upon any financing arrangements or contingencies.

ACI has received a commitment letter from Wells Fargo Securities, LLC (“Wells Fargo”) and Wells Fargo Bank, N.A. (“Wells Fargo Bank”), to provide, subject to certain conditions, up to $450 million for the purpose of financing a portion of the cash component of the consideration to be paid for each S1 Share, as well as for other payments made in connection with the Exchange Offer and refinancing of ACI’s existing revolving facility. No other plans or arrangements have been made to finance or repay such financing after the consummation of the Exchange Offer and the Second-Step Merger. No alternative financing arrangements or alternative financing plans have been made in the event such financings fail to materialize. Please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Source and Amount of Funds.”

 

The estimated amount of cash required is based on ACI’s due diligence review of S1’s publicly available information to date and is subject to change. For a further discussion of the risks relating to ACI’s limited due diligence review, please see the section of this prospectus/offer to exchange titled “Risk Factors — Risk Factors Relating to the Exchange Offer and the Second-Step Merger.”

 

What percentage of ACI Shares will former S1 stockholders own after the Exchange Offer?

 

Based on ACI’s and S1’s respective capitalizations as of September 20, 2011 and the exchange ratio of 0.2800, ACI estimates that if all S1 Shares are exchanged pursuant to the Exchange Offer and/or the Second-Step Merger, former S1 stockholders would own, in the aggregate, approximately 14.5% of the aggregate ACI Shares on a fully diluted basis. For a detailed discussion of the assumptions on which this estimate is based, please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Ownership of ACI After the Exchange Offer.”

 

When does the Exchange Offer expire?

 

The Exchange Offer is scheduled to expire at 5:00 p.m., Eastern time, on Wednesday, September 28, 2011, which is the Expiration Time, unless further extended by Offeror. When we make reference to the “Expiration Time” anywhere in this prospectus/offer to exchange, this is the time to which we are referring, including when applicable, any extension period that may apply. As discussed in “The Exchange Offer — Extension, Termination and Amendment”, Offeror can extend the Expiration Time if such conditions are not satisfied, or amend the Exchange Offer. For more information, please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Extension, Termination and Amendment.”

 

Can the Exchange Offer be extended and, if so, under what circumstances?

 

Offeror may, in its sole discretion, extend the Exchange Offer at any time or from time to time until 9:00 a.m., Eastern time, on the first business day after the previously scheduled Expiration Time. For instance, the Exchange Offer may be extended if any of the conditions specified in “The Exchange Offer — Conditions of the Exchange Offer” are not satisfied prior to the scheduled Expiration Time. The Expiration Time may also be subject to multiple extensions and any decision to extend the Exchange Offer, and if so, for how long, will be made by Offeror.

 

Any decision by Offeror to extend the Exchange Offer will be made public by an announcement regarding such extension as described in the section of this prospectus/offer to exchange titled “The Exchange Offer — Extension, Termination and Amendment.”

 

Offeror may also elect to provide a “subsequent offering period” for the Exchange Offer. A subsequent offering period would not be an extension of the Exchange Offer. Rather, a subsequent offering period would be an additional period of time, beginning after Offeror has accepted for exchange all S1 Shares tendered during the Exchange Offer, during which S1 stockholders who did not tender their S1 Shares in the Exchange Offer may tender their S1 Shares and receive the same consideration provided in the Exchange Offer. Offeror does not currently intend to include a subsequent offering period, although it reserves the right to do so.

How do I tender my S1 Shares?

 

To tender your S1 Shares represented by physical certificates into the Exchange Offer, you must deliver the certificates representing your S1 Shares, together with a completed letter of election and transmittal and any other documents required by the letter of election and transmittal, to Wells Fargo Bank, the exchange agent for the Exchange Offer, not later than the Expiration Time. The letter of election and transmittal is enclosed with this prospectus/offer to exchange.

 

If your S1 Shares are held in “street name” (i.e., through a broker, dealer, commercial bank, trust company or other nominee), your S1 Shares can be tendered by your nominee by book-entry transfer through The Depository Trust Company.

 

If you are unable to deliver any required document or instrument to the exchange agent by the Expiration Time, you may have a limited amount of additional time by having a broker, a bank or other fiduciary that is an eligible guarantor institution guarantee that the missing items will be received by the exchange agent by using the enclosed notice of guaranteed delivery circulated with this prospectus/offer to exchange (the “Notice of Guaranteed Delivery”). For the tender to be valid, however, the exchange agent must receive the missing items within three NASDAQ trading days after the date of execution of such Notice of Guaranteed Delivery. In all cases, an exchange of tendered S1 Shares will be made only after timely receipt by the exchange agent of certificates for such S1 Shares (or of a confirmation of a book-entry transfer of such shares) and a properly completed and duly executed letter of election and transmittal and any other required documents.

 

For a complete discussion on the procedures for tendering your S1 Shares, please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Procedure for Tendering.”

 

Until what time can I withdraw tendered S1 Shares?

 

You may withdraw previously tendered S1 Shares any time prior to the Expiration Time, and, if Offeror has not accepted your S1 Shares for exchange by the Expiration Time, at any time following 60 days from commencement of the Exchange Offer. S1 Shares tendered during the subsequent offering period, if one is provided, may not be withdrawn. For a complete discussion on the procedures for withdrawing your S1 Shares, please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Withdrawal Rights.”

 

How do I withdraw previously tendered S1 Shares?

 

To withdraw previously tendered S1 Shares, you must deliver a written or facsimile notice of withdrawal with the required information to the exchange agent while you still have the right to withdraw. If you tendered S1 Shares by giving instructions to a broker, dealer, commercial bank, trust company or other nominee, you must instruct the broker, dealer, commercial bank, trust company or other nominee to arrange for the withdrawal of your S1 Shares. For a complete discussion on the procedures for withdrawing your S1 Shares, please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Withdrawal Rights.”

 

When and how will I receive the Exchange Offer consideration in exchange for my tendered S1 Shares?

 

Offeror will exchange all validly tendered and not properly withdrawn S1 Shares promptly after the Expiration Time, subject to the terms thereof and the satisfaction or waiver of the conditions to the Exchange Offer, as set forth in the section of this prospectus/offer to exchange titled “The Exchange Offer — Conditions of the Exchange Offer.” Offeror will deliver the consideration for your validly tendered and not properly withdrawn S1 Shares by depositing the consideration therefore with the exchange agent, which will act as your agent for the purpose of receiving the Exchange Offer consideration from Offeror and transmitting such consideration to you. In all cases, an exchange of tendered S1 Shares will be made only after timely receipt by the exchange agent of certificates for such S1 Shares (or of a confirmation of a book-entry transfer of such S1 Shares as set forth in the section of this prospectus/offer to exchange titled “The Exchange Offer — Procedure for Tendering”) and a properly completed and duly executed letter of election and transmittal (or Agent’s Message (as defined below)) and any other required documents.

Will S1 continue as a public company following the Exchange Offer?

 

If the Second-Step Merger occurs, S1 will become a wholly owned subsidiary of ACI and will no longer be publicly owned. Even if the Second-Step Merger does not occur, if Offeror exchanges all S1 Shares which have been tendered, there may be so few remaining stockholders and publicly held shares that S1 Shares will no longer be eligible to be traded on the NASDAQ or any other securities market, there may not be a public trading market for such shares, and S1 may cease making filings with the SEC or otherwise cease being required to comply with applicable law and SEC rules relating to publicly held companies. Please see the sections of this prospectus/offer to exchange titled “The Exchange Offer — Plans for S1” and “The Exchange Offer — Effect of the Exchange Offer on the Market for S1 Shares; NASDAQ Listing; Registration Under the Securities Exchange Act of 1934; Margin Regulations.”

 

Are dissenters’ or appraisal rights available in either the Exchange Offer and/or the Second-Step Merger?

 

No dissenters’ or appraisal rights are available in connection with the Exchange Offer. However, upon consummation of the Second-Step Merger, S1 stockholders who have not tendered their S1 Shares in the Exchange Offer and who, if a stockholder vote is required, vote against approval of the Second-Step Merger will have rights under Delaware law to dissent from the Second-Step Merger and demand appraisal of their S1 Shares. Stockholders at the time of a “short form” merger under Delaware law would also be entitled to exercise dissenters’ rights pursuant to such a “short form” merger. Stockholders who perfect dissenters’ rights by complying with the procedures set forth in Section 262 of the DGCL will be entitled to receive a cash payment equal to the “fair value” of their S1 Shares, as determined by a Delaware court. Please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Appraisal/Dissenters’ Rights.”

 

What is the market value of my S1 Shares as of a recent date?

 

On September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange, the closing price of an S1 Share was $8.96. S1 stockholders are encouraged to obtain a recent quotation for S1 Shares before deciding whether or not to tender such S1 Shares pursuant to the Exchange Offer, whether to exercise withdrawal rights as provided herein and, with respect to the election, whether to receive the Cash Consideration or the Stock Consideration or some combination thereof.

 

Why does the cover page state that the Exchange Offer is subject to change and that the registration statement filed with the SEC is not yet effective? Does this mean that the Exchange Offer has not commenced?

 

No. Completion of this preliminary prospectus/offer to exchange and effectiveness of the registration statement are not necessary for the Exchange Offer to commence. ACI, through Offeror, commenced the Exchange Offer on August 30, 2011. Offeror cannot, however, accept for exchange any S1 Shares tendered in the Exchange Offer or exchange any S1 Shares until the registration statement is declared effective by the SEC and the other conditions to the Exchange Offer have been satisfied or waived.

 

Where can I find more information on ACI and S1?

 

You can find more information about ACI and S1 from various sources described in the section of this prospectus/offer to exchange titled “Where You Can Find More Information.”

 

Who can I contact with any additional questions about the Exchange Offer?

 

You can call the information agent or the dealer manager for the Exchange Offer.

The information agent for the Exchange Offer is:

 

 

501 Madison Avenue, 20th Floor
New York, New York 10022
Stockholders May Call Toll Free: (888) 750-5834
Banks and Brokers May Call Collect: (212) 750-5833

 

 

The dealer manager for the Exchange Offer is:

 

 

Wells Fargo Securities, LLC
375 Park Avenue, 4^th Floor
New York, New York 10022
Call Toll-Free: (800) 532-2916

 

SUMMARY OF THE EXCHANGE OFFER

 

The Companies
(See page 28)

 

The Exchange Offer
(See page 41)

	•	0.2800 of an ACI Share (Stock Consideration); or
	•	$10.00 in cash, without interest (Cash Consideration),

 

Reasons for the Exchange Offer
(See page 37)

		Assuming No Proration								Assuming Full Proration
																		Value of
Assumed ACI		Value of				Value of				Value of				Value of				Cash-Stock
Share Price		Stock Consideration				Cash Consideration				Stock Consideration				Cash Consideration				Consideration
$37.93(1)		$	10.62			$	10.00			$	4.04			$	6.20			$	10.24
$35.70(2)		$	10.00			$	10.00			$	3.80			$	6.20			$	10.00
$30.49(3)		$	8.54			$	10.00			$	3.24			$	6.20			$	9.44
$29.40(4)		$	8.23			$	10.00			$	3.13			$	6.20			$	9.33
$20.45(5)		$	5.73			$	10.00			$	2.18			$	6.20			$	8.38

(1)		Represents highest sales price for ACI Shares in the 52-Week Period.
(2)		Represents closing sales price for ACI Shares on July 25, 2011, the last trading day prior to the announcement of the Original ACI Merger Proposal.
(3)		Represents closing sales price for ACI Shares on August 29, 2011, the last trading day prior to the commencement of the Exchange Offer.

(4)		Represents closing sales price for ACI Shares on September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange.

(5)		Represents the lowest sales price for ACI Shares in the 52-Week Period.

	•	Highly Complementary Product and Customer Bases:  Combined, ACI and S1 would provide a rich set of capabilities and a broad portfolio of products to customers across the entire electronic payments spectrum. In particular, ACI believes that the acquisition of S1 would provide breadth and additional capabilities to what ACI does today, including: (1) expand ACI’s retailer business beyond North America; (2) increase ACI’s retail banking payments business down into lower and mid-tier financial institutions; and (3) add function and global reach to ACI’s online business banking offering, including new capabilities around branch banking and trade. The acquisition of S1 would support ACI’s position as a leading provider of the most unified payments solution to serve retail banking, wholesale banking, processors and retailers and would enable its customers to lower their operational costs and improve time-to-market.

	•	Enhanced Scale and Global Position:  ACI’s and S1’s principal competitors are substantially larger companies with greater financial resources than ACI and S1 have. The combined ACI and S1 would have revenue of $683 million and adjusted EBITDA of $123 million for the 12 months ended June 30, 2011. This scale advantage would enable the combined ACI and S1 to more effectively serve its combined global customer base and compete against the very large companies which operate in the electronic payments software business.

	•	Significant Synergy Opportunities:  ACI expects the combination of ACI and S1 will generate a significant amount of operational efficiencies and cost savings that will drive margin expansion for the acquired S1 business and earnings accretion for the combined company. ACI estimates that the annual pre-tax cost savings related to the Exchange Offer would be more than $24 million, primarily attributable to elimination of S1’s public company costs and rationalization of duplicate general and administrative functions, sales/marketing functions and costs, occupancy costs, product management and R&D functions. In addition, ACI expects to consolidate the combined company’s hosting data centers and infrastructure. Further, ACI expects the cost savings will improve S1’s margins in line with ACI’s margins for adjusted EBITDA. Assuming that the Exchange Offer is closed in the fourth calendar quarter of this year, ACI anticipates the cost savings would be fully realizable in 2012.

	•	Strong Financial Position:  ACI would continue to have a strong financial profile driven by a solid balance sheet with substantial liquidity and a recurring revenue model that generates significant free cash flows, allowing for further future investments in the business. In addition, ACI expects the transaction to be accretive to full year earnings in 2012.

	•	ACI has produced a stockholder return of approximately 90% over the past three years, significantly outperforming the relevant peer group;
	•	ACI has increased its 60-month backlog to $1.6 billion in 2010, up $350 million since 2006;
	•	ACI has driven monthly recurring revenue to 68% in 2010, up nearly 29% since 2007; and
	•	ACI has increased adjusted EBITDA margin to 21% in 2010, from 7% in 2007.

 

Conditions of the Exchange Offer
(See page 57)

	•	S1 stockholders shall have validly tendered and not withdrawn prior to the Expiration Time at least that number of S1 Shares that, when added to the S1 Shares then owned by ACI, Offeror or any of ACI’s

		other subsidiaries, shall constitute a majority of the then-outstanding number of S1 Shares on a fully diluted basis.

	•	The registration statement of which this prospectus/offer to exchange is a part shall have become effective under the Securities Act, no stop order suspending the effectiveness of the registration statement shall have been issued and no proceedings for that purpose shall have been initiated or threatened by the SEC, and ACI shall have received all necessary state securities law or “blue sky” authorizations.

	•	The S1 Board shall have approved the acquisition of the S1 Shares pursuant to the Exchange Offer and the Second-Step Merger under Section 203 of the DGCL, or ACI shall be satisfied that Section 203 of the DGCL does not apply to or otherwise restrict such acquisition or the Second-Step Merger.
	•	The ACI Shares to be issued to S1 stockholders as a portion of the Exchange Offer consideration in exchange for S1 Shares in the Exchange Offer and the Second-Step Merger shall have been authorized for listing on the NASDAQ Global Select Market, subject to official notice of issuance.
	•	There shall be no threatened or pending litigation, suit, claim, action, proceeding or investigation by or before any Governmental Authority that, in the judgment of ACI, is reasonably expected to, directly or indirectly, restrain or prohibit (or which alleges a violation of law in connection with) the Exchange Offer or the Second-Step Merger, is reasonably expected to prohibit or limit the full rights of ownership of S1 Shares by ACI or any of its affiliates or is reasonably likely to result in a material liability imposed on S1 or ACI.
	•	Since December 31, 2010, there shall not have been any event, change, effect, development, condition or occurrence that, in the reasonable judgment of ACI, is materially adverse on or with respect to the business, financial condition or continuing results of operations of S1 and its subsidiaries, taken as a whole.
	•	Each of S1 and its subsidiaries shall have carried on their respective businesses in the ordinary course consistent with past practice at all times on or after December 31, 2010 and prior to the Expiration Time.
	•	Any applicable waiting period under the HSR Act, and, if applicable, any agreement with the FTC or the Antitrust Division, not to accept S1 Shares for exchange in the Exchange Offer, shall have expired or shall have been terminated prior to the Expiration Time.
	•	Any clearance, approval, permit, authorization, waiver, determination, favorable review or consent of any Governmental Authority, other than in connection with the matters set forth in the foregoing bullet point, shall have been obtained and such approvals shall be in full force and effect, or any applicable waiting periods for such clearances or approvals shall have expired.

 

Ownership of ACI After the Exchange Offer

 

Comparative Market Price and Dividend Information

										Assuming Full Proration
		Assuming No Proration																Value of
Assumed ACI		Value of				Value of				Value of				Value of				Cash-Stock
Share Price		Stock Consideration				Cash Consideration				Stock Consideration				Cash Consideration				Consideration
$37.93(1)		$	10.62			$	10.00			$	4.04			$	6.20			$	10.24
$35.70(2)		$	10.00			$	10.00			$	3.80			$	6.20			$	10.00
$30.49(3)		$	8.54			$	10.00			$	3.24			$	6.20			$	9.44
$29.40(4)		$	8.23			$	10.00			$	3.13			$	6.20			$	9.33
$20.45(5)		$	5.73			$	10.00			$	2.18			$	6.20			$	8.38

(1)		Represents highest sales price for ACI Shares in the 52-Week Period.
(2)		Represents closing sales price for ACI Shares on July 25, 2011, the last trading day prior to the announcement of the Original ACI Merger Proposal.
(3)		Represents closing sales price for ACI Shares on August 29, 2011, the last trading day prior to the commencement of the Exchange Offer.

(4)		Represents closing sales price for ACI Shares on September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange.

(5)		Represents the lowest sales price for ACI Shares in the 52-Week Period.

 

Interest of Executive Officers and Directors of ACI in the Exchange Offer

 

Source and Amount of Funds; Financing
(See page 61)

 

Appraisal/Dissenters’ Rights
(See page 54)

 

Certain Material Federal Income Tax Consequences
(See page 50)

 

Accounting Treatment
(See page 71)

 

Regulatory Approval and Status
(See page 67)

 

 

Comparison of Stockholders’ Rights
(See page 74)

 

Expiration Time of the Exchange Offer
(See page 42)

 

Extension, Termination and Amendment
(See page 42)

	•	to extend, for any reason, the period of time during which the Exchange Offer is open;
	•	to delay acceptance for exchange of or exchange of any S1 Shares in order to comply in whole or in part with applicable law;
	•	to terminate the Exchange Offer without accepting for exchange, or exchanging, any S1 Shares if any of the individually subheaded conditions referred to in the section of this prospectus/offer to exchange titled “The Exchange Offer — Conditions of the Exchange Offer” have not been satisfied immediately prior to the Expiration Time or if any event specified in the section of this prospectus/offer to exchange titled “The Exchange Offer — Conditions of the Exchange Offer” under the subheading “Other Conditions” has occurred;
	•	to amend or terminate the Exchange Offer without accepting for exchange, or exchanging, any S1 Shares if ACI or any of its affiliates enters into a definitive agreement or announces an agreement in principle with S1 providing for a merger, acquisition or other business combination or transaction with or involving S1 or any of its subsidiaries, or the purchase or exchange of securities or assets of S1 or any of its subsidiaries, or ACI and S1 reach any other agreement or understanding, in either case, pursuant to which it is agreed or provided that the Exchange Offer will be terminated; and
	•	to amend the Exchange Offer or waive any conditions to the Exchange Offer;

 

Procedure for Tendering Shares
(See page 46)

 

Withdrawal Rights
(See page 49)

 

Acceptance for Exchange and Exchange of S1 Shares; Delivery of Exchange Offer Consideration
(See page 44)

 

Cash in Lieu of Fractional ACI Shares
(See page 45)

 

Elections and Proration
(See page 45)

 

Risk Factors
(See page 22)

 

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF ACI

																						Three Months
																						Ended
		Six Months Ended June 30,								Years Ended December 31,(3)												December 31,				Years Ended September 30,
		2011				2010				2010				2009				2008				2007				2007				2006
		(In thousands, except per share data)
Income Statement Data
Total revenues		$	217,909			$	180,166			$	418,424			$	405,755			$	417,653			$	101,282			$	366,218			$	347,902
Net income (loss)		$	11,422			$	(2,239	)		$	27,195			$	19,626			$	10,582			$	(2,016	)		$	(9,131	)		$	55,365
Earnings (loss) per share:
Basic		$	0.34			$	(0.07	)		$	0.81			$	0.57			$	0.31			$	(0.06	)		$	(0.25	)		$	1.48
Diluted		$	0.33			$	(0.07	)		$	0.80			$	0.57			$	0.30			$	(0.06	)		$	(0.25	)		$	1.45
Shares used in computing earnings (loss) per share:
Basic			33,383				33,612				33,560				34,368				34,498				35,700				36,933				37,369
Diluted			34,120				33,612				33,870				34,554				34,795				35,700				36,933				38,237

		As of June 30,								As of December 31,(3)																As of September 30,
		2011				2010				2010				2009				2008				2007				2007				2006
Balance Sheet Data
Working capital(2)		$	22,509			$	76,409			$	24,045			$	78,662			$	80,260			$	39,585			$	17,358			$	67,932
Total assets			613,647				552,516				601,529				590,043				552,842				570,458				506,741				539,365
Current portion of debt(2)			75,000				—				75,000				—				—				—				—				—
Debt (long-term portion)(1)(2)			1,745				78,126				2,790				77,408				76,014				75,911				76,546				78,093
Stockholders’ equity		$	279,540			$	217,267			$	255,623			$	236,063			$	213,841			$	241,039			$	225,012			$	267,212

(1)		Debt (long-term portion) includes long-term capital lease obligations of $1.3 million, $2.4 million, $1.8 million, $1.5 million, $1.0 million, $0.9 million, $1.5 million, and $3.1 million as of June 30, 2011 and 2010, December 31, 2010, 2009, 2008 and 2007, and September 30, 2007 and 2006, respectively, which is included in other noncurrent liabilities in the consolidated balance sheets.

(2)		ACI’s revolving credit facility has a maturity date of September 29, 2011; therefore, it has moved to current from long-term. The commitment letter from Wells Fargo Securities and Wells Fargo Bank described in the section of this prospectus/offer to exchange titled “The Exchange Offer — Source and Amount of Funds” would refinance ACI’s existing indebtedness in addition to provide cash to be used (in addition to ACI’s cash on hand) to finance the cash portion of the Exchange Offer.
(3)		On February 27, 2007, ACI’s Board of Directors approved a change in ACI’s fiscal year from a September 30 fiscal year-end to a December 31 fiscal year-end, effective as of January 1, 2008 for the year ended December 31, 2008.

 

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF S1

		Six Months Ended June 30,								Years Ended December 31,
		2011				2010				2010(3)				2009				2008				2007				2006(4)
		(In thousands, except per share data)
Statement of Operations Data:
Total revenue		$	121,165			$	102,933			$	209,086			$	238,927			$	228,435			$	204,925			$	192,310
(Loss) income from continuing operations			2,189				(2,830	)			(6,283	)			30,423				21,850				19,495				(12,239	)
Income from discontinued operations			—				—				—				—				—				—				30,141
Net (loss) income			2,189				(2,830	)			(6,283	)			30,423				21,850				19,495				17,902
Revenue from significant customer(1)			10,636				14,698				25,168				38,402				42,084				43,425				47,898
Stock-based compensation expense			2,485				1,182				3,700				1,602				8,092				8,522				5,663
Basic (loss) income per share:
Continuing operations		$	0.04			$	(0.05	)		$	(0.12	)		$	0.56			$	0.38			$	0.32			$	(0.17	)
Discontinued operations			—				—				—				—				—				—			$	0.42
Net (loss) income		$	0.04			$	(0.05	)		$	(0.12	)		$	0.56			$	0.38			$	0.32			$	0.25
Diluted (loss) income per share:
Continuing operations		$	0.04			$	(0.05	)		$	(0.12	)		$	0.55			$	0.38			$	0.32			$	(0.17	)
Discontinued operations			—				—				—				—				—				—			$	0.42
Net (loss) income		$	0.04			$	(0.05	)		$	(0.12	)		$	0.55			$	0.38			$	0.32			$	0.25

		As of June 30,								As of December 31,
		2011				2010				2010(3)				2009				2008				2007				2006(4)
		(In thousands, except per share data)
Balance Sheet Data:
Cash and cash equivalents		$	71,720			$	51,707			$	61,917			$	61,784			$	63,840			$	45,011			$	69,612
Working capital(5)(6)			59,094				50,300				48,843				82,942				55,804				64,318				83,227
Goodwill			148,236				145,325				147,544				126,605				124,362				125,281				125,300
Total assets			327,113				305,767				309,653				300,066				278,686				281,844				307,805
Debt obligations, excluding current portion			27				14				35				5,026				6,126				8,805				4,119
Total liabilities			83,430				70,151				72,040				61,425				69,946				71,939				83,576
Stockholders’ equity			243,683				235,616				237,613				238,641				208,740				209,905				224,229

		Six Months Ended June 30,								Years Ended December 31,
		2011				2010				2010(3)				2009				2008				2007				2006(4)
		(In thousands, except per share data)
Other Selected Data:
Cash provided by operating activities		$	16,938			$	23,311			$	37,249			$	16,035			$	34,147			$	31,332			$	3,460
Cash (used in) provided by investing activities			(3,039	)			(32,371	)			(37,704	)			(7,688	)			15,765				(13,893	)			31,626
Cash used in financing activities(2)			(4,176	)			(815	)			(364	)			(12,172	)			(27,488	)			(42,490	)			(50,671	)
Weighted average common shares outstanding — basic			53,475				51,791				52,495				52,584				55,734				59,746				70,780
Weighted average common shares outstanding — diluted			54,277				51,791				52,495				53,291				56,449				60,596				70,780

(1)		Revenue from State Farm.
(2)		Cash used in financing activities included the repurchase of common stock of $9.6 million in 2009, $25.1 million in 2008, $51.0 million in 2007 and $55.8 million in 2006 pursuant to authorized stock repurchase programs.
(3)		S1’s 2010 selected financial data reflects, as of their respective dates of acquisition, S1’s purchase of PM Systems Corporation for approximately $29.2 million, net of cash acquired, in March 2010 and certain assets from a reseller in Latin America for approximately $1.9 million, net of cash acquired, in August 2010.
(4)		In 2004, S1 acquired Mosaic Software Holdings Limited and S1 paid an additional acquisition cost of $14.0 million as earn-out consideration in 2006. Discontinued operations included S1’s Risk and Compliance business sold in 2006 for approximately $32.6 million.
(5)		Working capital includes deferred revenue of $50.0 million and $38.0 million as of June 30, 2011 and December 31, 2010, respectively.
(6)		Working capital includes deferred revenue of $36.8 million and $26.8 million as of June 30, 2010 and December 31, 2009, respectively.

 

SUMMARY SELECTED UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

		Six Months Ended				Year Ended
		June 30, 2011				December 31, 2010
Revenues:
Software license fees		$	107,768			$	190,796
Maintenance fees			105,373				198,557
Services			75,870				139,169
Software hosting fees			50,063				98,988
Total revenues			339,074				627,510
Expenses:
Cost of software license fees			8,702				14,833
Cost of maintenance, services, and hosting fees			123,857				227,505
Research and development			64,234				109,584
Selling and marketing			55,574				98,725
General and administrative			48,478				97,230
Depreciation and amortization			15,929				30,489
Total expenses			316,774				578,366
Operating income			22,300				49,144
Other income (expense):
Interest income			547				879
Interest expense			(5,534	)			(11,303	)
Other, net			(970	)			(4,982	)
Total other income (expense)			(5,957	)			(15,406	)
Income before income taxes			16,343				33,738
Income tax expense			5,534				18,580
Net income		$	10,809			$	15,158

		June 30,
		2011
ASSETS
Cash and cash equivalents		$	142,527
Billed receivables, net			116,348
Accrued receivables			19,081
Income taxes receivable			1,953
Deferred income taxes, net			13,931
Prepaid expenses			19,143
Other current assets			14,637
Total current assets			327,620
Property and equipment, net			43,488
Software, net			28,455
Goodwill			643,524
Other intangible assets, net			29,075
Deferred income taxes, net			28,776
Other noncurrent assets			27,483
TOTAL ASSETS		$	1,128,421
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable		$	24,678
Accrued employee compensation			39,137
Deferred revenue			181,753
Income taxes payable			2,159
Alliance agreement liability			1,600
Current portion of note payable			8,750
Accrued and other current liabilities			23,415
Total current liabilities			281,492
Deferred revenue			30,035
Long term note payable			336,238
Alliance agreement noncurrent liability			20,667
Other noncurrent liabilities			20,818
Total liabilities			689,250
Stockholders’ equity
Preferred stock			—
Common stock			263
Common stock warrants			24,003
Treasury stock			(167,286	)
Additional paid-in capital			490,310
Retained earnings			102,668
Accumulated other comprehensive loss			(10,787	)
Total stockholders’ equity			439,171
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	1,128,421

 

HISTORICAL AND PRO FORMA PER SHARE INFORMATION

		Six Months Ended June 30, 2011
										Combined
		Historical				Historical				Company				Equivalent
		ACI				S1				Pro Forma				Pro Forma
Basic earnings per share		$	0.34			$	0.04			$	0.28			$	0.03
Diluted earnings per share			0.33				0.04				0.27				0.03
Cash Dividends declared per share			—				—				—				—
Book Value per diluted share at the end of the period			8.19				4.49				10.97				n/a

		Year Ended December 31, 2010
										Combined
		Historical				Historical				Company				Equivalent
		ACI				S1				Pro Forma				Pro Forma
Basic earnings (loss) per share		$	0.81			$	(0.12	)		$	0.38			$	0.04
Diluted earnings (loss) per share			0.80				(0.12	)			0.38				0.04
Cash Dividends declared per share			—				—				—				—
Book Value per diluted share at the end of the period			7.55				4.53				n/a				n/a

 

COMPARATIVE MARKET PRICE AND DIVIDEND INFORMATION

		ACI								S1
		High				Low				High				Low
Year Ended December 31, 2011
Third Quarter (through September 20, 2011)		$	37.93			$	25.76			$	9.47			$	6.84
Second Quarter		$	34.65			$	28.70			$	7.75			$	6.50
First Quarter		$	33.03			$	24.96			$	7.33			$	5.90
Year Ended December 31, 2010
Fourth Quarter		$	28.15			$	22.28			$	7.24			$	5.16
Third Quarter		$	22.39			$	18.31			$	6.18			$	4.73
Second Quarter		$	21.03			$	17.79			$	6.80			$	5.45
First Quarter		$	21.59			$	15.32			$	6.84			$	5.80
Year Ended December 31, 2009
Fourth Quarter		$	17.97			$	14.39			$	6.60			$	5.65
Third Quarter		$	15.98			$	13.20			$	7.43			$	5.87
Second Quarter		$	20.32			$	13.28			$	7.42			$	5.04
First Quarter		$	19.14			$	15.90			$	8.00			$	4.75

										Assuming Full Proration
Assumed ACI		Assuming No Proration																Value of
Assumed ACI		Value of				Value of				Value of				Value of				Cash-Stock
Share Price		Stock Consideration				Cash Consideration				Stock Consideration				Cash Consideration				Consideration
$37.93(1)		$	10.62			$	10.00			$	4.04			$	6.20			$	10.24
$35.70(2)		$	10.00			$	10.00			$	3.80			$	6.20			$	10.00
$30.49(3)		$	8.54			$	10.00			$	3.24			$	6.20			$	9.44
$29.40(4)		$	8.23			$	10.00			$	3.13			$	6.20			$	9.33
$20.45(5)		$	5.73			$	10.00			$	2.18			$	6.20			$	8.38

(1)		Represents highest sales price for ACI Shares in the 52-Week Period.
(2)		Represents closing sales price for ACI Shares on July 25, 2011, the last trading day prior to the announcement of the Original ACI Merger Proposal.
(3)		Represents closing sales price for ACI Shares on August 29, 2011, the last trading day prior to the commencement of the Exchange Offer.

(4)		Represents closing sales price for ACI Shares on September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange.

(5)		Represents the lowest sales price for ACI Shares in the 52-Week Period.

 

In addition to the risk factors set forth below, you should read and consider other risk factors specific to each of the ACI and S1 businesses that will also affect ACI after consummation of the Exchange Offer and the Second-Step Merger, described in Part I, Item 1A of each company’s annual report on Form 10-K for the year ended December 31, 2010 and other documents that have been filed with the SEC, all of which are incorporated by reference into this prospectus/offer to exchange. If any of the risks described below or in the reports incorporated by reference into this prospectus/offer to exchange actually occurs, the respective businesses, financial results, financial conditions, operating results or share prices of ACI or S1 could be materially adversely affected.

 

The value of the ACI Shares that the S1 stockholders could receive in the Exchange Offer as Stock Consideration will vary as a result of the fixed exchange ratio and possible fluctuations in the price of ACI Shares.

 

Upon consummation of the Exchange Offer, each S1 Share validly tendered into the Exchange Offer and accepted by Offeror for exchange will be exchanged for ACI Shares at a fixed exchange ratio of 0.2800 of an ACI Share for each S1 Share, subject to proration. The market value of the ACI Shares issued in exchange for S1 Shares in the Exchange Offer will depend upon the market price of an ACI Share at the date the Exchange Offer is consummated. If the price of ACI Shares declines, S1 stockholders who receive the Stock Consideration could receive less value for their S1 Shares upon the consummation of the Exchange Offer than the value calculated pursuant to the exchange ratio as of the date of this prospectus/offer to exchange. Stock price changes may result from a variety of factors that are beyond the companies’ control, including general market conditions, changes in business prospects, catastrophic events, both natural and man-made, and regulatory considerations. In addition, the ongoing business of ACI may be adversely affected by actions taken by ACI in connection with the Exchange Offer, including as a result of (1) the attention of management of ACI having been diverted to the Exchange Offer instead of being directed solely to ACI’s own operations and pursuit of other opportunities that could have been beneficial to ACI and the combined entity and (2) payment by ACI of certain costs relating to the Exchange Offer, including certain legal, accounting and financial and capital markets advisory fees.

 

Because the Exchange Offer and the Second-Step Merger will not be completed until certain conditions have been satisfied or, where relevant, waived (please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Conditions of the Exchange Offer”), a period of time, which may be significant, may pass between the commencement of the Exchange Offer and the time that Offeror accepts S1 Shares for exchange. Therefore, at the time when you tender your S1 Shares pursuant to the Exchange Offer, you will not know the exact market value of the ACI Shares that will be issued if Offeror accepts such S1 Shares for exchange. However, tendered S1 Shares may be withdrawn at any time prior to the Expiration Time and at any time following 60 days from commencement of the Exchange Offer. Please see the sections of this prospectus/offer to exchange titled “Comparative Market Price and Dividend Information” for the historical high and low closing prices of ACI Shares and S1 Shares for each quarter of the period 2009 through the date of this prospectus/offer to exchange and “The Exchange Offer — Withdrawal Rights.”

 

Furthermore, in connection with the Exchange Offer and the Second-Step Merger, ACI will need to issue approximately 5.9 million ACI Shares. The increase in the number of ACI Shares may lead to sales of such ACI Shares or the perception that such sales may occur, either of which may adversely affect the market for, and the market price of, ACI Shares.

 

S1 stockholders are urged to obtain market quotations for ACI Shares and S1 Shares when they consider whether to tender their S1 Shares pursuant to the Exchange Offer. Please see the section of this prospectus/offer to exchange titled “Comparative Market Price and Dividend Information.”

The Exchange Offer may adversely affect the liquidity and value of non-tendered S1 Shares.

 

In the event that not all S1 Shares are tendered in the Exchange Offer and we accept for exchange those S1 Shares tendered into the Exchange Offer, the number of stockholders and the number of S1 Shares held by individual holders will be greatly reduced. As a result, Offeror’s acceptance of S1 Shares for exchange in the Exchange Offer could adversely affect the liquidity and could also adversely affect the market value of the remaining S1 Shares held by the public. Additionally, subject to the rules of the NASDAQ, ACI may delist the S1 Shares on the NASDAQ. As a result of such delisting, each issued and outstanding S1 Share not tendered pursuant to the Exchange Offer may become illiquid and may be of reduced value. Please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Plans for S1.”

 

The receipt of ACI Shares pursuant to the Exchange Offer and the Second-Step Merger would be taxable based on the price of ACI Shares as of September 20, 2011 and could be taxable to S1 stockholders depending on facts surrounding the Exchange Offer and the Second-Step Merger.

 

Based on closing trading prices of ACI Shares as of the date of this prospectus/offer to exchange, the Exchange Offer would be taxable to you.

 

If the Exchange Offer and the Second-Step Merger qualified as component parts of an integrated transaction that constitute a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), your exchange of S1 Shares for the Stock Consideration should be tax free, except to the extent that you also receive cash. Whether or not they will so qualify is dependent on whether certain factual requirements are met, including that the Exchange Offer and Second-Step Merger are “interdependent” (that is, ACI would not undertake the Exchange Offer without the intention and expectation of completing the Second-Step Merger). In addition, there must be a “continuity of interest” of holders of S1 Shares in the combined company. ACI believes that this test should be satisfied if the total value of the Stock Consideration represents at least 40% of the total value of the consideration received by holders of S1 Shares, and may be satisfied at a slightly lower percentage. If market prices for ACI Shares upon consummation of the Exchange Offer are less than $38.75, the Stock Consideration would represent less than 40% of the total value of the Exchange Offer consideration. You are urged to obtain current trading price information prior to making any decision with respect to the Exchange Offer. We cannot provide any assurance as to whether these conditions will be satisfied at this time, since it may be affected, among other things, by the total value of the Stock Consideration at the time of the consummation of the Exchange Offer and the Second-Step Merger.

 

If the integrated transaction does not qualify as a reorganization, your exchange of S1 Shares for the Stock Consideration in the Exchange Offer or the Second-Step Merger could be a taxable transaction, depending on the surrounding facts. If the integrated transaction constitutes a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, any gain (but not loss) you realize on the transaction will be treated as a taxable capital gain or dividend in an amount equal to the lesser of (1) the excess of the sum of the Cash Consideration and the fair market value of the Stock Consideration you receive in the transaction over your basis in your shares and (2) the amount of cash you receive in the transaction, including any cash you receive in lieu of a fractional ACI Share, depending on your circumstances. If the offer does not constitute part of an integrated transaction that qualifies as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code, you will recognize a capital gain or a capital loss to the extent of the difference between your adjusted tax basis in your shares and the sum of the Cash Consideration and the fair market value of the Stock Consideration you receive. For more information, please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Certain Material Federal Income Tax Consequences.”

ACI must obtain governmental and regulatory approvals to consummate the Exchange Offer, which, if delayed or not granted, may jeopardize or delay the Exchange Offer, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the combination contemplated by the Exchange Offer and the Second-Step Merger.

 

The Exchange Offer is conditioned on the receipt of all governmental and regulatory authorizations, consents, orders and approvals determined to be necessary or advisable by ACI, including without limitation, the expiration or termination of the applicable waiting period under the HSR Act. If ACI does not receive these approvals, then Offeror will not be obligated to accept S1 Shares for exchange in the Exchange Offer.

 

The governmental and regulatory agencies from which ACI will seek these approvals have broad discretion in administering the applicable governing regulations. As a condition to their approval of the transactions contemplated by this prospectus/offer to exchange, agencies may impose requirements, limitations or costs or require divestitures or place restrictions on the conduct of the combined company’s business. These requirements, limitations, costs, divestitures or restrictions could jeopardize or delay the consummation of the Exchange Offer or may reduce the anticipated benefits of the combination contemplated by the Exchange Offer. Further, no assurance can be given that the required consents and approvals will be obtained or that the required conditions to the Exchange Offer will be satisfied, and, if all required consents and approvals are obtained and the conditions to the consummation of the Exchange Offer are satisfied, no assurance can be given as to the terms, conditions and timing of the consents and approvals. If ACI agrees to any material requirements, limitations, costs, divestitures or restrictions in order to obtain any consents or approvals required to consummate the Exchange Offer, these requirements, limitations, additional costs or restrictions could adversely affect ACI’s ability to integrate the operations of ACI and S1 or reduce the anticipated benefits of the combination contemplated by the Exchange Offer. This could have a material adverse effect on the business, financial condition and results of operations of the combined company and the market value of ACI Shares after the acquisition. In addition, a third party could attempt to intervene in any governmental or regulatory filings to be made by ACI or otherwise object to the granting to ACI of any such governmental or regulatory authorizations, consents, orders or approvals, which may cause a delay in obtaining, or the imposition of material requirements, limitations, costs, divestitures or restrictions on, or the failure to obtain, any such authorizations, consents, orders or approvals. Please see the section titled “The Exchange Offer — Conditions of the Exchange Offer” for a discussion of the conditions to the Exchange Offer and the section titled “The Exchange Offer — Certain Legal Matters; Regulatory Approvals” for a description of the regulatory approvals necessary in connection with the Exchange Offer and the Second-Step Merger.

 

The Exchange Offer remains subject to other conditions that ACI cannot control.

 

The Exchange Offer is subject to other conditions, including tender without withdrawal of a sufficient number of S1 Shares to satisfy the Minimum Tender Condition, the Delaware 203 Condition, no material adverse effect having occurred with respect to S1 and its subsidiaries, S1 and its subsidiaries continuing to operate in the ordinary course of business consistent with past practice and the registration statement of which this prospectus/offer to exchange is a part becoming effective. There are no assurances that all of the conditions to the Exchange Offer will be satisfied. In addition, the S1 Board may seek to take actions that will delay, or frustrate, the satisfaction of one or more conditions. If the conditions to the Exchange Offer are not met, then Offeror may allow the Exchange Offer to expire, or could amend or extend the Exchange Offer.

 

Please see the section of this prospectus/offer to exchange titled “The Exchange Offer — Conditions of the Exchange Offer” for a discussion of the conditions to the Exchange Offer.

 

Even if the Exchange Offer is completed, full integration of S1’s operations with ACI may be delayed if Offeror does not hold at least 90% of the outstanding S1 Shares following consummation of the Exchange Offer.

 

The Exchange Offer is subject to the Minimum Tender Condition, which provides that, prior to the Expiration Time, S1 stockholders shall have validly tendered and not withdrawn at least that number of S1 Shares that, when added to the S1 Shares then owned by ACI, Offeror or any of ACI’s other subsidiaries,

shall constitute a majority of the then-outstanding number of S1 Shares on a fully diluted basis. If Offeror accepts S1 Shares for exchange and owns 90% or more of the outstanding S1 Shares after the Exchange Offer is completed, the Second-Step Merger can be effected as a “short form” merger under Delaware law without the consent of any stockholder (other than ACI) and without the approval of the S1 Board. If Offeror does not acquire at least 90% of the outstanding S1 Shares in the Exchange Offer or otherwise, then both S1 Board approval and S1 stockholder approval will be required to effect the Second-Step Merger. While the requirements of an S1 stockholder and S1 Board approval would not prevent the Second-Step Merger from occurring, because Offeror would hold sufficient S1 Shares to approve the Second-Step Merger, it could delay the consummation of the Second-Step Merger and could delay the realization of some or all of the anticipated benefits from integrating S1’s operations with ACI, including, among others, achieving some or all of the synergies associated with the acquisition of S1 by ACI.

 

You may be unable to assert a claim against S1’s independent auditors under Section 11 of the Securities Act.

 

Section 11(a) of the Securities Act provides that if part of a registration statement at the time it becomes effective contains an untrue statement of a material fact or omits a material fact required to be stated therein or necessary to make the statements therein not misleading, any person acquiring a security pursuant to such registration statement (unless it is proved that at the time of such acquisition such person knew of such untruth or omission) may assert a claim against, among others, any accountant or expert who has consented to be named as having certified any part of the registration statement or as having prepared any report for use in connection with the registration statement. Although audit reports were issued on S1’s historical financial statements and are included in S1’s filings with the SEC, S1’s independent auditors have not yet permitted the use of their reports in ACI’s registration statement of which this prospectus/offer to exchange forms a part. ACI has requested and has, as of the date hereof, not received the consent of such independent auditors. ACI reserves the right to apply for a waiver of this requirement under Rule 437 of the Securities Act should such consent not be made available. Accordingly, you may not be able to assert a claim against S1’s independent auditors under Section 11 of the Securities Act.

 

You should read and consider other risk factors specific to S1’s businesses that will also affect ACI after the acquisition contemplated by this prospectus/offer to exchange, described in Part I, Item 1A of the S1 10-K and other documents that have been filed by S1 with the SEC and which are incorporated by reference into this document. See the section of this prospectus/offer to exchange titled “Where You Can Find More Information.”

 

You should read and consider other risk factors specific to ACI’s businesses that will also affect ACI after the acquisition contemplated by this prospectus/offer to exchange, described in Part I, Item 1A of the ACI 10-K and other documents that have been filed by ACI with the SEC and which are incorporated by reference into this prospectus/offer to exchange. See the section of this prospectus/offer to exchange titled “Where You Can Find More Information.”

 

ACI may experience difficulties integrating S1’s businesses, which could cause ACI to fail to realize the anticipated benefits of the acquisition.

 

If ACI’s acquisition of S1 is consummated, achieving the anticipated benefits of the acquisition will depend in part upon whether the two companies integrate their businesses in an effective and efficient manner. The companies may not be able to accomplish this integration process smoothly or successfully. The integration of certain operations following the acquisition will take time and will require the dedication of

significant management resources, which may temporarily distract management’s attention from the routine business of the combined entity.

 

Any delay or inability of management to successfully integrate the operations of the two companies could compromise the combined entity’s potential to achieve the anticipated long-term strategic benefits of the acquisition and could have a material adverse effect on the business, financial condition and results of operations of the combined company and the market value of ACI Shares after the acquisition.

 

ACI may be subject to unknown liabilities of S1 which may have a material adverse effect on ACI’s profitability, financial condition and results of operations.

 

The consummation of the Exchange Offer may constitute a default, or an event that, with or without notice or lapse of time or both, would constitute a default, or result in the acceleration or other change of any right or obligation (including, without limitation, any payment obligation) under agreements of S1 that are not publicly available. As a result, after the consummation of the Exchange Offer, ACI may be subject to unknown liabilities of S1, which may have a material adverse effect on the business, financial condition and results of operations of the combined company and the market value of ACI Shares after the acquisition.

 

In addition, the Exchange Offer may also permit a counter-party to an agreement with S1 to terminate that agreement because completion of the Exchange Offer or the Second-Step Merger would cause a default or violate an anti-assignment, change of control or similar clause. If this happens, ACI may have to seek to replace that agreement with a new agreement. ACI cannot assure you that it will be able to replace a terminated agreement on comparable terms or at all. Depending on the importance of a terminated agreement to S1’s business, failure to replace that agreement on similar terms or at all may increase the costs to ACI of operating S1’s business or prevent ACI from operating part or all of S1’s business.

 

Future results of the combined company may differ materially from the Selected Unaudited Condensed Consolidated Pro Forma Financial Information of ACI and S1 presented in this prospectus/offer to exchange.

 

The future results of ACI following the consummation of the Exchange Offer may be materially different from those shown in the Selected Unaudited Condensed Consolidated Pro Forma Financial Information presented in this prospectus/offer to exchange, which show only a combination of ACI’s and S1’s historical results after giving effect to the Exchange Offer. ACI has estimated that it will record approximately $25.8 million in transaction expenses, as described in the notes to the Selected Unaudited Condensed Consolidated Pro Forma Financial Information included in this prospectus/offer to exchange. In addition, the final amount of any charges relating to acquisition accounting adjustments that ACI may be required to record will not be known until following the consummation of Exchange Offer and Second-Step Merger. These and other expenses and charges may be higher or lower than estimated.

Our business, which depends heavily on revenue from customers in the banking and insurance industries and other financial services firms, may be materially adversely impacted by volatile U.S. and global market and economic conditions, which could adversely affect the value of ACI Shares received as part of the Exchange Offer.

 

For the foreseeable future, we expect to continue to derive most of our revenue from products and services we provide to the banking and insurance industries and other financial services firms and retailers. Given the concentration of our business activities in financial industries, we may be particularly exposed to economic downturns in those industries. U.S. and global market and economic conditions have been disrupted and volatile over the past several years. General business and economic conditions that could affect us and our customers include fluctuations in debt and equity capital markets, liquidity of the global financial markets, the availability and cost of credit, investor and consumer confidence, and the strength of the economies in which our customers operate. A poor economic environment could result in significant decreases in demand for our products and services, including the delay or cancellation of current or anticipated projects, and adversely affect our operating results. In addition to mergers and acquisitions in the banking industry, we have seen an increased level of bank closures and government supervised consolidation transactions. Our existing customers may be acquired by or merged into other financial institutions that have their own financial software solutions, be closed by regulators, or decide to terminate their relationships with us for other reasons. As a result, our sales could decline if an existing customer is merged with or acquired by another company or closed. Additionally, our investment portfolio is generally subject to credit, market, liquidity and interest rate risks and the value and liquidity of our investments may be adversely impacted by U.S. and global market and economic conditions including bank closures.

 

ACI is a Delaware corporation with its principal executive offices located at 120 Broadway, Suite 3350, New York, New York 10271. The telephone number of ACI is (646) 348-6700. ACI develops, markets, installs and supports a broad line of software products and services primarily focused on facilitating electronic payments. In addition to its own products, ACI distributes, or acts as a sales agent for, software developed by third parties. These products and services are used principally by financial institutions, retailers and electronic payment processors, both in domestic and international markets. Most of ACI’s products are sold and supported through distribution networks covering three geographic regions — the Americas, Europe/Middle East/Africa and Asia/Pacific. As of June 30, 2011, ACI had total stockholders’ equity of approximately $280 million and total assets of approximately $614 million. ACI Shares are listed on the NASDAQ Global Select Market under the ticker symbol “ACIW” and, as of September 20, 2011, the last practicable date prior to the date of this prospectus/offer to exchange, ACI had a market capitalization of approximately $984 million. As of December 31, 2010, ACI had a total of approximately 2,134 employees, of whom 1,124 were in the Americas reportable segment, 591 were in the Europe/Middle East/Africa reportable segment and 419 were in the Asia/Pacific reportable segment.

 

As of the date of this prospectus/offer to exchange with the SEC, ACI was the beneficial owner of 1,107,000 S1 Shares, or 2.0% of the amount outstanding.

 

Offeror, a Delaware limited liability company, is a wholly-owned subsidiary of ACI. Offeror is newly formed, and was organized for the purpose of making the Exchange Offer and consummating the Second-Step Merger. Offeror has engaged in no business activities to date and it has no material assets or liabilities of any kind, other than those incident to its formation and those incurred in connection with the Exchange Offer and the Second-Step Merger.

 

S1 is a leading global provider of payments and financial services software solutions. S1 offers payments solutions for ATM and retail point-of-sale driving, card management, and merchant acquiring, as well as financial services solutions for consumer, small business and corporate online banking, trade finance, mobile banking, voice banking, branch and call center banking. S1 sells its solutions primarily to banks, credit unions, retailers and transaction processors and also provides software, custom software development, hosting and other services to State Farm Mutual Automobile Insurance Company, a relationship that will conclude by the end of 2011. Founded in 1996, S1 started the world’s first Internet bank, Security First Network Bank. In 1998, S1 sold the banking operations and focused on software development, implementation and support services. For several years, S1’s core business was primarily providing Internet banking and insurance applications. Then, through a series of strategic acquisitions and product development initiatives, S1 expanded its solution set to include applications that deliver financial services across multiple channels and provide payments and card management functionality.

 

S1 Shares are listed on the NASDAQ under the ticker symbol “SONE.” S1’s principal executive offices are located at 705 Westech Drive, Norcross, Georgia 30092 and its telephone number is (404) 923-3500.

 

In its effort to consummate the acquisition of S1, ACI is pursuing the following alternative transactions:

 

(1) the Enhanced ACI Merger Proposal (the S1 Board rejected the Original ACI Merger Proposal on or about August 2, 2011); and

 

(2) the Exchange Offer.

 

The Enhanced ACI Merger Proposal and the Exchange Offer are alternative methods for ACI to acquire S1. Ultimately, only one of these transactions can be pursued to completion. ACI intends to seek to acquire S1 by whichever method ACI determines is most likely to be completed.

 

On July 26, 2011, ACI publicly announced the Original ACI Merger Proposal to combine the businesses of ACI and S1 through a merger transaction in which ACI would acquire all of the issued and outstanding S1 Shares in a cash and stock transaction. Based on the $35.70 closing trading price per ACI Share on July 25, 2011, the last trading day prior to the Original ACI Merger Proposal, the relative value of the Cash-Stock Consideration reflected by the Original ACI Merger Proposal as of such date consisted of $5.70 in cash and $3.80 in ACI Shares per S1 Share (or an implied exchange ratio of 0.1064 shares), assuming full proration, or an aggregate value of $9.50 per S1 Share. On August 2, 2011, S1 announced that the S1 Board had rejected the Original ACI Merger Proposal, stating:

 

“S1 Corporation (Nasdaq: SONE) announced today that its Board of Directors, after thorough consideration and consultation with its legal and financial advisors, has rejected ACI Worldwide, Inc.’s (“ACI”) previously announced proposal to acquire S1. The Board unanimously concluded that pursuing discussions with ACI at this time is not in the best financial or strategic interests of S1 and its stockholders. In doing so, the Board affirmed its commitment to S1’s pending business combination with Fundtech.

 

‘The S1 Board gave careful consideration to each of the proposed terms and conditions of ACI’s proposal. In the end, the Board determined that ACI’s proposal is not in the best interests of S1 and its stockholders. We believe that continuing to execute on our long-term business plan, which includes the business combination with Fundtech, will best help us maximize stockholder value and achieve our strategic goals,’ stated John W. Spiegel, Chairman of the Board of Directors of S1.”

 

On August 25, 2011, ACI publicly announced the Enhanced ACI Merger Proposal, increasing the cash consideration payable under the Original ACI Merger Proposal by $0.50 per S1 Share, assuming full proration (which, based on the closing trading prices as of July 26, 2011, the date of the Original ACI Merger Proposal, would result in a blended value, assuming full proration, of $10.00 per S1 Share). Based on the closing sales price for ACI Shares on September 20, 2011, the last trading day prior to the date of this prospectus/offer to exchange, the blended value of the Cash-Stock Consideration as of the close of trading on September 20, 2011 was $9.33 per S1 Share, assuming full proration.

 

ACI would prefer to acquire S1 in a merger transaction of the type contemplated by the Enhanced ACI Merger Proposal. However, in light of the S1 Board’s rejection of the Original ACI Merger Proposal, ACI is making the Exchange Offer directly to S1 stockholders on the terms and conditions set forth in this prospectus/offer to exchange as an alternative to the Enhanced ACI Merger Proposal. The amount of cash and the number of ACI Shares offered in this Exchange Offer are the same as in the Enhanced ACI Merger Proposal.

 

On September 15, 2011, S1 announced that Fundtech had delivered to S1 a notice of its intent to change its recommendation with respect to the pending merger with S1, to terminate the Fundtech Merger Agreement and to enter into a written definitive agreement with entities formed by GTCR Fund X/A LP and its affiliated entities. The S1 Board determined not to revise S1’s proposal to acquire Fundtech and instead to terminate the Fundtech Merger Agreement. S1 announced on September 16, 2011 that it had terminated the Fundtech Merger Agreement and received an $11.9 million termination fee from Fundtech. S1 also announced that its Special Meeting of Stockholders scheduled for October 13, 2011 was canceled.

In the event that Offeror accepts S1 Shares for exchange in the Exchange Offer, ACI, through Offeror, intends to acquire any additional outstanding S1 Shares pursuant to the Second-Step Merger, although ACI, through Offeror, also reserves the right, subject to applicable law, to acquire S1 Shares pursuant to other means, including open market purchases and privately negotiated transactions. If Offeror accepts S1 Shares for exchange and, pursuant to the Exchange Offer or otherwise, owns 90% or more of the outstanding S1 Shares, the Second-Step Merger can be effected as a “short form” merger under Delaware law without the consent of any stockholder (other than ACI) and without the approval of the S1 Board. However, if Offeror does not acquire at least 90% of the outstanding S1 Shares in the Exchange Offer or otherwise, then both S1 Board approval and S1 stockholder approval would be required to effect the Second-Step Merger.

 

If the Exchange Offer is completed and Offeror acquires a majority of the outstanding S1 Common Stock, subject to applicable law, ACI currently expects to seek to replace the existing S1 Board or increase the size of the S1 Board and elect ACI nominees who would in the aggregate constitute a majority of the members of the S1 Board. See Appendix A to this prospectus/offer exchange for information as to the individuals, all of whom are currently directors or officers of ACI, that ACI currently expects it would propose to elect to the S1 Board. S1’s certificate of incorporation provides for staggered director terms. Under Delaware law, the members of the S1 Board cannot be removed during their respective terms in office other than for cause. However, S1’s certificate of incorporation also permits stockholders to act by written consent in lieu of a meeting, and ACI believes that it could act by written consent to change the composition of the S1 Board. ACI reserves the right, subject to applicable law, to commence a consent solicitation or take other action prior to or after the Expiration Time of the Exchange Offer to seek to change the composition of the S1 Board. ACI’s director nominees pursuant to such consent solicitation, if it occurs, may include persons other than those identified on Appendix A. Any such consent solicitation will be made only pursuant to separate consent solicitation materials filed with and in accordance with the requirements of the rules and regulations of the SEC.

 

Under Section 203 of the DGCL, ACI may not effect the Second-Step Merger for a period of three years following the acquisition of S1 Shares in the Exchange Offer unless (1) ACI obtains the approval of the S1 Board prior to obtaining beneficial ownership of more than 15% of the S1 Shares, (2) ACI acquires beneficial ownership of at least 85% of the outstanding S1 Shares in the Exchange Offer or another transaction in which it acquires greater than 15% ownership of S1, or (3) if either the conditions set forth in clause (1) or (2) is not satisfied, the Second-Step Merger is approved by the S1 Board and the holders of at least two-thirds of the outstanding S1 Shares not owned by ACI. The completion of the Exchange Offer is subject to the Delaware 203 Condition, which means either that (1) or (2) must apply. Whether or not ACI will waive this condition will depend on future facts which cannot presently be ascertained, including how many S1 Shares are tendered pursuant to the Exchange Offer and actions taken by S1 or the S1 Board.

 

For more details relating to the structure of the Exchange Offer, please see the section of this prospectus/offer to exchange titled “The Exchange Offer.”

 

As part of the ongoing evaluation of its businesses, ACI regularly considers strategic acquisitions, capital investments, divestitures and other possible transactions. In connection with such strategic evaluation, ACI has in the past considered a potential business combination transaction involving S1 and in connection therewith engaged in discussions with representatives of S1 over an approximately one-year period beginning in the Summer of 2010.

 

On August 30, 2010, Philip G. Heasley, ACI’s Chief Executive Officer, met in Atlanta, Georgia, with Johann Dreyer, S1’s Chief Executive Officer. During that meeting, Mr. Heasley expressed an interest in pursuing a possible acquisition of S1 by ACI.

 

On September 30, 2010, members of ACI’s senior management met in Atlanta, Georgia with members of S1’s senior management to discuss a possible acquisition of S1 by ACI. In that meeting, the representatives of ACI indicated a possible price range of $7.50 to $8.00 per S1 Share. The closing sales price for S1 Shares as reported on the NASDAQ Market was $5.25 per share on September 29, 2010, the last trading day prior to

that meeting. At the meeting, Mr. Dreyer indicated that he did not believe that it was opportune timing for S1 to be sold, but S1 might consider an enhanced proposal.

 

On October 6, 2010, representatives of S1 and ACI had a follow-up conversation in which the representatives of S1 informed the representatives of ACI that, after reviewing the matter with the S1 Board, S1 was not for sale and the S1 Board did not desire to initiate a sale process. They also mentioned that they believed that the price range that ACI had indicated was too low, but indicated that the S1 Board might be willing to consider a transaction at an increased valuation. ACI interpreted that communication as meaning that S1 would consider a transaction at a higher price other than the $7.50-$8.00 per share range that ACI had indicated, although there can be no assurance that this was intended. In the October 6, 2010 call, the representatives of S1 also said that the S1 Board acknowledged the rationale for a possible combination of S1 and ACI, but indicated that S1 would be willing to continue discussions only if the parties signed a standstill agreement.

 

On October 22, 2010, S1 and ACI signed an agreement that restricted ACI’s ability to acquire S1 Shares or make any tender offer or other proposal to acquire S1. These restrictions expired prior to July 26, 2011. During the standstill period, ACI did not buy any S1 Shares and made proposals to acquire S1 confidentially.

 

On October 25, 2010, representatives of ACI’s and S1’s managements and financial advisors met in Atlanta, Georgia to discuss the S1 business and a possible transaction. From time to time thereafter, certain of S1’s senior managers, representatives of S1’s financial advisor and S1’s counsel held additional discussions with members of ACI’s senior management team and legal and financial advisors concerning a possible transaction.

 

On November 19, 2010, ACI submitted a written proposal to S1 to acquire S1 in an all-cash transaction at a price of $8.40 per S1 Share, subject to confirmatory due diligence. ACI included a letter from a major financial institution stating that such institution was highly confident that ACI could raise the funds necessary to acquire S1 in an all-cash transaction at $8.40 per share. In the November 19, 2010 proposal, ACI noted, among other things, “[w]e believe our proposal constitutes an extremely attractive opportunity for your stockholders. Our price represents a premium of 38% over the current market price of S1’s common stock and a premium of 42% over the average market price over the past year.” After ACI submitted the proposal letter, S1 representatives raised concerns about ACI’s ability to finance an all-cash acquisition of S1 and regulatory considerations. ACI representatives indicated that ACI believed that it could satisfy any such concerns, and undertook to do so.

 

On December 9, 2010, Mr. Heasley spoke with Messrs. Dreyer and John W. Spiegel, Chairman of the S1 Board, regarding ACI’s November 19th proposal. The parties also discussed ACI and S1’s overlapping stockholder base and the potential for a mix of stock and cash consideration in an ACI-S1 transaction. On December 20, 2010, ACI delivered a draft merger agreement to S1. The draft merger agreement contemplated the payment of the purchase price in cash or stock, as elected by S1 stockholders.

 

From time to time between December 2010 and February 2011, representatives of ACI’s management and ACI’s legal and financial advisors held additional discussions with representatives of S1’s management and S1’s legal and financial advisors concerning a possible transaction. On January 13, 2011, ACI sent a follow-up letter to S1 in an effort to progress the dialogue between the parties and to commence due diligence. During January 2011, S1’s financial advisor on several times rescheduled a lender due diligence session, which was finally scheduled for March 3, 2011 but cancelled after S1 sent a letter to ACI on February 18, 2011 stating among other things that S1 was terminating discussions with ACI as the S1 Board had “determined that it is in the best interests of S1 and its stockholders to focus our efforts on executing our long-term business plan.”

 

On March 10, 2011, S1 published its 2010 earnings release and provided public guidance with respect to its 2011 outlook. In late March 2011, Mr. Heasley initiated contact with S1 in an effort to continue discussion regarding a possible transaction. On April 5, 2011, Mr. Heasley met in person with Messrs. Dreyer and Spiegel in Atlanta, Georgia. On April 12, 2011, ACI submitted an acquisition proposal (including a revised draft of a definitive merger agreement) at a price of $8.40 per S1 Share, 55% of which was to be paid in cash and 45% in ACI Shares. In its proposal, ACI noted, among other things, “[t]his proposal represents a premium of 26.1%

over the current market price of S1’s common stock and a premium of 37.4% over the average market price over the past year. We believe that this price is at a level at which your stockholders would enthusiastically support such a transaction.”

 

On April 15, 2011, representatives of ACI’s financial advisor held a discussion with representatives of S1’s financial advisor regarding ACI’s proposal. The financial advisors had additional contacts from time to time concerning the proposal between April 15, 2011 and June 14, 2011.

 

On June 14, 2011, Mr. Heasley spoke with Messrs. Dreyer and Spiegel regarding ACI’s proposal. During the call, Mr. Spiegel informed Mr. Heasley that S1 was not interested in pursuing a possible transaction with ACI. No mention was made that S1 was simultaneously pursuing discussions with Fundtech relating to a possible merger transaction. Later that day, Mr. Heasley sent a follow-up letter to Mr. Spiegel requesting a response from the S1 Board regarding ACI’s proposed valuation and other key terms. The June 14, 2011 letter, in relevant part, is as follows:

 

“June 14, 2011

 

Mr. John W. Spiegel

Chairman of the Board of Directors

S1 Corporation

705 Westech Drive

Norcross, Georgia 30092

 

Dear John,

 

I appreciated your feedback during our call this morning. I was surprised by your Board’s lack of response to our April 12th proposal.

 

ACI and our advisors have complied with all of the process requirements that S1 management and your advisors have communicated to us since last Fall. First, our financing advisors, Goldman Sachs and Wells Fargo, have had multiple interactions with S1 management and your advisor providing you with certainty of the financial structure we proposed. Second, our legal advisor, Jones Day, has had several conversations with your external counsel to address any regulatory concerns around the proposed transaction. Also, Jones Day submitted on December 20, 2010, a fair and balanced merger agreement and a revised version on April 12, 2011, to which we have still not received any feedback.

 

We have studied the regulatory backdrop applicable to the proposed transaction. As reflected in the April 12th merger agreement, we believe the regulatory review process will not impact the certainty of closing and we have outlined measures in the agreement that demonstrate our confidence in this view.

 

To date, your Board has not provided any response to our proposed valuation or other key terms. We would have liked to have had a discussion on value, but are now left to determine valuation based on publicly available information. With the nine-month standstill period expiring on July 22nd, we still believe it would be in the best interests of S1 and your Board to engage with ACI to maximize value for S1’s shareholders.

 

The combination of ACI and S1 would create a leading global player in the enterprise payments software industry. As I have indicated, the combination of our companies would not only benefit your shareholders, but would also offer more and better options to customers within our marketplace. We sincerely hope that we will move forward in a negotiated transaction which can be presented to your stockholders as the joint effort of ACI and S1 Boards of Directors and management teams.

This opportunity has the highest priority for us and we are committed to work with S1 and your Board in any way we can to expeditiously move this forward.

 

Sincerely,

 

President and CEO

ACI Worldwide, Inc.

 

cc: Mr. Johann Dreyer, Chief Executive Officer, S1 Corporation”

 

On June 27, 2011, S1 and Fundtech announced that they had entered into the Fundtech Merger Agreement.

 

On July 26, 2011, ACI delivered a proposal letter containing the Original ACI Merger Proposal to the S1 Board and issued a press release announcing the Original ACI Merger Proposal. The letter read as follows:

 

“July 26, 2011

 

Board of Directors

S1 Corporation

705 Westech Drive

Norcross, Georgia 30092

Attn: Mr. John W. Spiegel, Chairman of the Board

 

Gentlemen:

 

We are pleased to submit the following proposal by which ACI Worldwide and S1 Corporation would combine to create a leading global enterprise payments company. We propose to acquire 100% of the issued and outstanding common stock of S1 in a cash and stock transaction valued at $9.50 per share. This equates to a 33% premium to S1’s closing market price on July 25, 2011, a 32% premium to S1’s 90-day volume weighted average price and a 23% premium to S1’s 52-week high. Our proposal is being made pursuant to and in accordance with the superior offer provisions you provided for in your June 26, 2011 merger agreement with Fundtech.

 

Given the overlapping shareholder base of our companies, we believe that a cash and stock transaction is ideal for all stakeholders, as it provides a mix of immediate value, tax efficiency and the ability to benefit from significant synergies. Accordingly, the form of consideration in our proposal consists of 40% in ACI stock and 60% in cash. In addition, our proposal includes a cash election feature, subject to proration, designed to provide your shareholders with the optimal consideration of cash and/or stock for their individual circumstances and preferences. Upon completion of our proposed transaction and based on the most recent closing price of ACI’s common stock, S1 shareholders would own approximately 15% of the combined company on a fully diluted basis.

 

We believe the combination of ACI and S1 provides specific tangible benefits to the combined shareholders, including, among others:

 

 

We believe that our premium stock and cash proposal is both financially and strategically superior to your proposed transaction with Fundtech. Our proposal offers substantially greater current financial value to S1 shareholders in the form of a meaningful premium to the current stock price and a clearer, more expedient path to value creation over the long-term through the realization of significant synergies, with less risk and uncertainty than the Fundtech transaction. Additionally, our proposed combination creates a more diverse, long-term shareholder base for the pro forma company.

 

Our proposal contemplates that, following the completion of the transaction, S1 shareholders would have a meaningful ownership stake in ACI, which has:

 

 

Not only have we executed our historical business plan, as evidenced by our strong second quarter earnings, we have raised our 2011 guidance and are firmly committed to achieving our five-year strategy.

 

Our proposal includes committed financing from Wells Fargo Bank for the cash portion of the transaction. As such, the proposed transaction is not subject to any financing condition. In addition, we have completed a review of applicable regulatory requirements and, while we do not expect any issues to delay closing, our merger agreement contains appropriate undertakings by us to assure HSR clearance.

 

Our proposal is subject to the negotiation of a mutually acceptable definitive merger agreement, a draft of which we are including as part of our proposal. Consummation of the transaction is subject to satisfaction of customary closing conditions, including expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act. You will see that our draft is the same as the Fundtech Merger Agreement except for changes required in order to effect our transaction. We are prepared to promptly conclude our confirmatory due diligence and to give you and your representatives immediate due diligence access to us.

 

We believe that our proposal represents a Parent Superior Offer that clearly meets the standards set forth in Section 6.7(a) of your Fundtech Merger Agreement as it is more favorable to S1 shareholders from a financial point of view than the Fundtech transaction, and it is likely to be completed, taking into account all financial, regulatory, legal and other aspects of our proposal. Accordingly, we believe that you must, consistent with the Fundtech Merger Agreement, provide us with confidential information and participate in discussions and negotiations with us to finalize a transaction.

 

We stand ready and willing to promptly engage with S1 on this transaction, so that together we can effect a transaction that benefits both companies’ shareholders. That said, we are committed to making this transaction a reality.

 

Our Board of Directors has unanimously approved the submission of this proposal. We and our financial and legal advisors are prepared to move forward immediately with you and your advisors to finalize a mutually beneficial agreement, and make the combination of S1 and ACI a reality, for the benefit of both companies’ shareholders.

We look forward to hearing from you.

 

Sincerely,

 

President and CEO

ACI Worldwide, Inc.

 

Enclosures”

 

On July 27, 2011, ACI filed a Notification and Report Form with the FTC and Antitrust Department under the HSR Act relating to the Original ACI Merger Proposal.

 

On August 2, 2011, S1 announced that the S1 Board had rejected the Original ACI Merger Proposal based on the S1 Board’s determination that pursuing discussions with ACI at this time “is not in the best financial or strategic interests of S1 and its stockholders.” According to S1’s August 2, 2011 press release, Mr. Spiegel said:

 

“The S1 Board gave careful consideration to each of the proposed terms and conditions of ACI’s proposal. In the end, the Board determined that ACI’s proposal is not in the best interests of S1 and its stockholders. We believe that continuing to execute on our long-term business plan, which includes the business combination with Fundtech, will best help us maximize stockholder value and achieve our strategic goals.”

 

On August 11, 2011, S1 announced that it had set August 18, 2011 as the record date and September 22, 2011 as the date of the S1 Special Stockholder Meeting. On August 22, 2011, S1 filed its definitive proxy statement with the SEC and reported that it had commenced mailing its proxy statement to S1 stockholders on or about August 22, 2011.

 

On August 25, 2011, ACI delivered a proposal letter to S1’s Board containing the Enhanced ACI Merger Proposal, increasing the cash consideration by $0.50 per S1 Share, assuming full proration, and issued a press release announcing the Enhanced ACI Merger Proposal. The letter read as follows:

 

“August 25, 2011

 

PERSONAL AND CONFIDENTIAL

ELECTRONIC DELIVERY

 

John W. Spiegel

Chairman of the Board of Directors

S1 Corporation

705 Westech Drive

Norcross, Georgia 30092

 

Dear John:

 

We remain committed to acquiring S1 Corporation and are pleased to inform you that we have enhanced our proposal in order to provide S1 shareholders with additional value certainty for their investment. Given the recent significant market volatility, ACI Worldwide, Inc. has increased its cash and stock proposal from $5.70 per share plus 0.1064 ACI shares to $6.20 per share, plus 0.1064 ACI shares, assuming full proration.

 

We are confident that your shareholders will find our enhanced proposal to be superior to the Fundtech Ltd. transaction, and we stand ready and willing to promptly engage with S1 to consummate a transaction that benefits both companies’ shareholders. Based on the closing price of ACI stock on July 25, 2011, the day prior to our initial proposal, our enhanced proposal provides a per share consideration of $10.00 to each S1 shareholder. Based on the closing price of ACI stock on August 24, 2011, our enhanced proposal provides a per share consideration of $9.29 to each S1 shareholder. ACI’s enhanced proposal also equates to a:

 

 

 

When evaluating our enhanced proposal, we strongly encourage you to consider at what price levels S1 would be trading absent the ACI proposal. Since we made our proposal on July 26, 2011, the NASDAQ Index has declined by 13% while S1’s stock price, affected by the value of the ACI proposal, has generally avoided the declines experienced in the overall market. Furthermore, we believe that your shareholders know that, had ACI not made its proposal, S1’s share price would have been affected by the overall decline in stock market valuations. We also believe that the S1 shareholder reaction to our proposal, despite the significant ensuing market volatility, underscores its strength.

 

Your August 22, 2011, shareholder letter questioned whether we had the financing for the cash portion of our merger proposal as well as our commitment to obtain clearance under the Hart-Scott-Rodino (HSR) Act. To resolve these issues, we have a fully executed commitment letter from Wells Fargo Bank, N.A. sufficient to fund the cash required by our proposal and to finance our ongoing operations, and we would be pleased to provide a copy of such commitment letter upon request. In addition, we reiterate that we are willing to provide appropriate assurance of satisfaction of the HSR Act condition, including a divestiture commitment (if required) and substantial break-up compensation. However, it does not withstand scrutiny for S1 to, on the one hand, refuse to engage with us on these issues and, on the other hand, point to these issues as a reason for not engaging in the first place.

 

As S1 has been unwilling to engage, we are taking the actions we believe necessary to consummate our proposed transaction. We are filing our definitive proxy statement to begin solicitation of votes against the proposed Fundtech transaction and, rest assured, we will take all actions necessary to advance our proposal. We would, however, strongly prefer to begin a direct dialogue with S1’s management and advisors.

 

We believe that our proposal represents a Parent Superior Offer that clearly meets the standards set forth in Section 6.7(a) of the Fundtech merger agreement as it is more favorable to S1 shareholders from a financial point of view than the Fundtech transaction and it is likely to be completed, taking into account all financial, regulatory, legal and other aspects of our proposal.

 

We remain convinced of the strategic benefits of this transaction and strongly believe that it is in the best interests of both ACI’s and S1’s shareholders. We look forward to your prompt reply.

 

Sincerely,

 

President and CEO

 

cc: Johann Dreyer, Chief Executive Officer, S1 Corporation”

 

On August 25, 2011, ACI filed with the SEC and began mailing its proxy statement soliciting votes “AGAINST” the Fundtech Merger Proposals.

 

On August 26, 2011, ACI withdrew its initial HSR filing and refiled it on August 29, 2011 in order to permit the Antitrust Division to have additional time to review the filing. The 30-calendar day waiting period recommenced in connection with such refiling so that it now expires, unless terminated earlier or extended at 11:59 p.m., Eastern Time on September 28, 2011.

 

On August 29, 2011, a representative of S1 contacted a representative of ACI with respect to the value and certainty of closure of the Enhanced ACI Merger Proposal. There can be no assurance that such inquiry will lead to discussions, or that any such discussions, if conducted in the future, will lead to a transaction. If they were to lead to a transaction, however, the Exchange Offer could be terminated or amended. See “The Exchange Offer — Extension, Termination and Amendment” and “The Exchange Offer — Conditions of the Exchange Offer.”

On August 30, 2011, ACI filed this prospectus/offer to exchange with the SEC with respect to the Exchange Offer.

 

Between August 31, 2011 and September 20, 2011, senior managers and representatives of ACI and S1 had additional discussions regarding the Enhanced ACI Merger Proposal, however, as of September 20, 2011, no agreement had been reached between the parties.

 

On September 13, 2011, S1 filed a Solicitation/Recommendation Statement on Schedule 14D-9, reporting that the S1 Board has determined to unanimously recommend that S1 stockholders reject the Exchange Offer and not tender their S1 Shares to us.

 

On September 15, 2011, ACI filed with the SEC an amendment to its Registration Statement on Form S-4 of which this prospectus/offer to exchange forms a part.

 

On September 15, 2011, S1 announced that Fundtech had delivered to S1 a notice of its intent to change its recommendation with respect to the pending merger with S1, to terminate the Fundtech Merger Agreement and to enter into a written definitive agreement with entities formed by GTCR Fund X/A LP and its affiliated entities. The S1 Board determined not to revise S1’s proposal to acquire Fundtech and instead to terminate the Fundtech Merger Agreement. S1 announced on September 16, 2011 that it had terminated the Fundtech Merger Agreement and received an $11.9 million termination fee from Fundtech. S1 also announced that its Special Meeting of Stockholders scheduled for October 13, 2011 was canceled.

 

On September 16, 2011, S1 filed an amendment to its Solicitation/Recommendation Statement on Schedule 14D-9, reporting that the S1 Board has not changed its recommendation with respect to the Exchange Offer.

 

On September 21, 2011, ACI filed with the SEC an amendment to its Registration Statement on Form S-4 of which this prospectus/offer to exchange forms a part.

 

While ACI continues to hope that it is possible to reach a consensual transaction with S1, ACI, through Offeror, is making this Exchange Offer directly to S1 stockholders in light of the S1 Board’s rejection of the Original ACI Merger Proposal on August 2, 2011.

 

Value:

 

At the $9.33 per S1 Share value of the Cash-Stock Consideration as of September 20, 2011, assuming full proration, the Exchange Offer represents (1) a 30.9% premium to the closing sales price of S1 Shares on July 25, 2011, the last trading day prior to the public announcement of the Original ACI Merger Proposal, (2) a 29.4% premium to the volume weighted average closing price of S1 Shares over the previous 90 days prior to the announcement of the Original ACI Merger Proposal, and (3) a 20.4% premium to the 52-week high of S1 Shares for the 52-week period ending July 25, 2011.

 

S1 stockholders who elect the Cash-Stock Consideration contemplated by the Exchange Offer will be subject to proration. Since the value of ACI Shares fluctuates, the per S1 Share Stock Consideration necessarily could have a value that is different than the per S1 Share Cash Consideration. As a consequence, in the Exchange Offer, S1 stockholders could receive a combination of Cash-Stock Consideration with a value that is different from the value of such consideration on the date of the Exchange Offer and the date of the consummation of a transaction with ACI.

 

The elections of other S1 stockholders would affect whether S1 stockholders received solely the type of consideration they had elected or whether a portion of the consideration S1 stockholders elected were exchanged for another form of consideration as a result of the pro ration procedures contemplated by the Exchange Offer.

Solely for purposes of illustration, the following table indicates the value of the Cash Consideration, the Stock Consideration and the blended value of the Cash-Stock Consideration based on different assumed prices for ACI Shares.