SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-K/A-1
( X ) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934:
For the fiscal year ended September 30, 1998 Commission File No. 0-12329
LCS INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 13-2648333
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(State of incorporation) (I.R.S. employer identification number)
120 Brighton Road
Clifton, New Jersey 07012
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(Address of principal executive offices) (zip code)
Registrant's telephone number: (973) 778-5588
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock ($.01 par value)
(Title of class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [ X ] No [ ]
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. [ ]
Aggregate market value of the voting and non-voting Common Stock
held by non-affiliates of the registrant, based on the average of high and low
sales prices for December 1, 1998: $54,473,637. The number of shares of Common
Stock ($.01 par value) outstanding as of December 1, 1998: 4,898,447.
DOCUMENTS INCORPORATED BY REFERENCE
None.
<PAGE>
Introduction
On December 29, 1998, LCS Industries, Inc. ("LCS" or the
"Company"), a Delaware corporation, filed with the Securities and Exchange
Commission (the "Commission") its Annual Report on Form 10-K for its fiscal year
ended September 30, 1998 (the "1998 Form 10-K"). Pursuant to General Instruction
3 to Form 10-K ("General Instruction 3"), the information called for by Item 10
(insofar as it relates to Directors of the Company) and by Items 11, 12 and 13
of Part III of Form 10-K was not included in the body of the 1998 Form 10-K as
filed, but was incorporated by reference to the Company's Proxy Statement which
was expected to be filed with the Commission within the 120-day period referred
to in General Instruction 3. Because the Company is not in fact filing its Proxy
Statement within such 120-day period, this Form 10- K/A-1 amends the 1998 Form
10-K by deleting therefrom the caption and first paragraph of Item 10 and Items
11, 12 and 13 in their entirety, and substituting therefore the following
additions to Item 10 and the following replacements for Items 11, 12 and 13.
<PAGE>
Item 10. Directors, Executives Officers and Significant Employees
of the Registrant.
The following is a list, as of December 1, 1998, showing the
names and ages of all the members of the Board of Directors, all positions and
offices with the Company held by each of them and the year from which each said
office has been continuously held.
<TABLE>
<CAPTION>
Position With the Company
Name Age and Date From Which Held
---- --- ------------------------
<S> <C> <C>
Joseph R. Barbaro(1)(2)(3) 53 Director - 1996
Bernard Ouziel(1)(2)(3)(4) 60 Director - 1983
William Rella(4)(5) 56 Chief Executive Officer - 1998
President, Chief Operating Officer and
Director - 1997
President - Fulfillment Services - 1994
Marvin Cohen(5) 64 Senior Vice President and Secretary-1981
Director - 1969
</TABLE>
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(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
(3) Member of the Stock Option Committee.
(4) Member of the 1994 Employee Stock Purchase Plan Committee.
(5) Member of the Non-Employee Directors Stock Option Committee.
Mr. Ouziel has been a practicing attorney in private practice for
more than the last five years. Mr. Barbaro has been a partner in the accounting
firm of Phillips Gold and Company, LLP for more than the last five years.
<PAGE>
Item 11. Executive Compensation.
Summary Compensation Table
The following table sets forth, for the fiscal years indicated,
the cash and other compensation provided by the Company and its subsidiaries to
each of the named executive officers of the Company in all capacities in which
they served.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term All Other
Annual Compensation (1) Compensation Compensation
------------------------------------ ------------ ------------
Other Annual Awards
Name and Fiscal Salary Bonus Compensation Options
Principal Position Year ($) ($) ($) (#)(2), ($)(3),
- ------------------ ---- --- --- --- ------- -------
<S> <C> <C> <C> <C> <C> <C>
WILLIAM RELLA ......... 1998 360,000 640,000 0 0 40,725
President & Chief ..... 1997 360,000 640,000 0 40,000 19,054
Executive Officer ..... 1996 360,000 437,576 0 0 14,679
MARVIN COHEN .......... 1998 287,614 163,626 0 0 35,140
Senior Vice President & 1997 277,648 116,511 0 0 16,965
Secretary ............. 1996 274,143 125,457 0 0 16,965
PAT R. FRUSTACI ....... 1998 167,019 50,000 0 10,000 26,026
Vice President-Finance 1997 147,116 40,000 0 0 9,602
& Treasurer ........... 1996 135,673 30,000 0 0 9,599
LON MANDEL ............ 1998 180,000 414,386 0 0 26,741
President & CEO, ...... 1997 180,000 449,747 0 0 8,894
The SpeciaLISTS Ltd. .. 1996 180,000 506,609 0 0 8,876
JAMES E. QUINLAN ...... 1998 100,316 10,000 0 2,000 2,816
Controller ............ 1997 93,528 7,500 0 2,500 2,256
1996 88,865 7,500 0 5,000 2,379
</TABLE>
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(1) Compensation deferred at the election of a named executive officer is
included in the category and year it would have been reported had it not
been deferred.
(2) The Company does not grant stock appreciation rights. All options granted
were incentive stock options or non-qualified stock options.
(3) Consists of (i) with the exception of Mr. Rella in 1996, the Company's
matching contributions to the 401(k) Plan (as defined below), (ii) as to
Messrs. Cohen and Rella, the total premiums on split- dollar insurance
policies during such fiscal year, (iii) as to Mr. Rella in 1998 and 1997
and Messrs. Frustaci, Mandel and Quinlan, an automobile allowance and/or
associated costs, and (iv) as to the named individuals in 1998, the
Company's matching contributions under its deferred compensation plans.
<PAGE>
Stock Option Grants
The following table sets forth information concerning incentive
stock options granted during fiscal 1998 to certain named executive officers.
<TABLE>
<CAPTION>
Potential Realizable Value
At Assumed Annual Rates of
Stock Price Appreciation for
Individual Grants Option Term
% of Total
Options
Granted to Exercise or
Options Employees in Base Price Expiration
Name Granted (#) Fiscal Year ($/Sh) Date 5% ($) 10% ($)
---- ----------- ----------- ------ ---- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C>
Pat R. Frustaci 10,000 7 14.00 12/22/07 228,050 363,120
James E. Quinlan 2,000 1 14.00 12/22/07 45,610 72,624
</TABLE>
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Stock Option Exercises and Holdings
The following table sets forth information concerning incentive
stock options exercised during fiscal year 1998 and stock options held as of the
end of fiscal 1998 by the named executive officers.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN FISCAL 1998 AND
FISCAL 1998 YEAR-END OPTIONS VALUES
Number of Value of Unexercised
Unexercised In-the-Money Options
Options at at
FY-End (#) FY-End ($)
Shares Acquired Exercisable/ Exercisable/
Name on Exercise (#) Value Realized ($) Unexercisable Unexercisable
---- --------------- ------------------ ------------- -------------
<S> <C> <C> <C> <C>
William Rella 0 0 128,000/40,000 935,968/0
Marvin Cohen 22,000 380,248 86,000/0 297,500/0
Pat R. Frustaci 0 0 33,000/21,000 309,755/103,251
James E. Quinlan 4,400 54,868 3,125/6,375 313/938
</TABLE>
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<PAGE>
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth, to the knowledge of the Company,
certain information regarding beneficial ownership of the Company's Common Stock
as of December 1, 1998: (i) by each person or group who owns beneficially more
than five percent of the Company's Common Stock; (ii) by each director of the
Company; (iii) by each of the five most highly compensated executive officers
and other significant employees (the "named executive officers") of the Company
during the fiscal year ended September 30, 1998 ("fiscal 1998"); and (iv) by all
directors, officers and other significant employees of the Company as a group.
<PAGE>
<TABLE>
<CAPTION>
Number of Percent
Name and Address(1) Shares(2)(3) of Class
- ------------------- ------------ --------
<S> <C> <C>
Heartland Advisors, Inc.
790 Milwaukee Street
Milwaukee, WI 53202 986,816(4) 20.1%
Gerald A. King
248 West Brow Road
Lookout Mountain, TN 37350 284,005 5.8%
Estate of Arnold J. Scheine
189 Deerfield Lane North
Pleasantville, NY 10570 409,477(5) 8.4%
Joseph R. Barbaro
1140 Avenue of the Americas
New York, NY 10036 12,400 *
Bernard Ouziel
120 Brighton Road
Clifton, NJ 07012 96,400 1.9%
William Rella
120 Brighton Road
Clifton, New Jersey 07012 214,629 4.0%
Marvin Cohen
120 Brighton Road
Clifton, New Jersey 07012 444,054(6) 8.9%
Lon Mandel
1200 Harbor Boulevard
Weehawken, New Jersey 07087 25,472 *
Pat R. Frustaci
120 Brighton Road
Clifton, NJ 07012 46,500 *
James E. Quinlan
120 Brighton Road
Clifton, NJ 07012 11,502 *
All officers, Directors and
other significant employees
as a group (8 persons) 1,134,962 21.7%
</TABLE>
<PAGE>
(1) Except as described below, the persons named in this table possess
sole voting and dispositive power with respect to their Shares.
(2) In this table, it is assumed for only each person who holds stock
options that he has exercised those stock options to the extent they are
exercisable within 60 days of the date of this table. The number of
Shares that each such person may acquire upon exercise of such options is
as follows: Mr. Barbaro -- 6,400; Mr. Ouziel -- 56,800; Mr. Rella --
128,000; Mr. Cohen -- 86,000; Mr. Frustaci -- 46,500; Mr. Quinlan --
5,500; all directors and officers as a group -- 329,200.
(3) Does not take into account stock options exercisable for an
additional 69,900 shares that will become exercisable upon the
consummation of the Merger, as announced on December 17, 1998, or a
similar transaction.
(4) Based on information obtained directly from Heartland Advisors, Inc.
(5) Includes 7,330 Shares owned of record and beneficially by Mrs.
Scheine and 175,000 Shares registered in the name of HAS Investments,
L.P. and 31,814 Shares registered in the name of Scheine Holdings, L.P.,
two limited partnerships created for estate planning purposes.
(6) Includes 2,200 Shares owned of record and beneficially by Mr. Cohen's
wife as to which Shares he disclaims beneficial ownership.
* Less than 1%.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Mr. Ouziel, Director, performed legal services for the Company
during the fiscal year ended September 30, 1998, and was paid therefor the
aggregate sum of $58,336. The firm of Phillips Gold and Company, LLP, of which
Mr. Barbaro, Director, is a partner, performed accounting, tax and other
consulting services during the fiscal year ended September 30, 1998 and was paid
therefor the aggregate sum of $131,869.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
LCS INDUSTRIES, INC.
By: /s/William Rella
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William Rella
President
Date: January 26, 1999
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on January 26, 1999.
Signature Title
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/s/William Rella President (Principal Executive Officer) and Director
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William Rella
/s/Pat R. Frustaci Vice President - Finance, Chief Financial Officer,
- ------------------ Treasurer and Assistant Secretary (Principal
Pat R. Frustaci Accounting Officer)
/s/Marvin Cohen Senior Vice President and Secretary
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Marvin Cohen
/s/Joseph R. Barbaro Director
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Joseph R. Barbaro
/s/Bernard Ouziel Director
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Bernard Ouziel
