<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
--- SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended March 31, 1998
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
--- SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
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Commission file number 0-12829
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GRADCO SYSTEMS, INC.
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(Exact name of registrant as specified in its charter)
Nevada 95-3342977
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3753 Howard Hughes Pkwy, Ste 200, Las Vegas, Nevada 89109
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (702) 892-3714
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Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
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None None
- ------------------------------------- -------------------------------------
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, No par value
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(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
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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.
------
The aggregate market value of voting stock held by non-affiliates of the
Registrant (based on the closing sales price of Gradco common stock on the
NASDAQ National Market System on June 19, 1998) was $54,000,361.
The number of outstanding shares of each class of the Registrant's common stock
outstanding at June 19, 1998 was: common stock, no par value--7,854,598 shares.
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Item 6. SELECTED FINANCIAL DATA.
The following selected financial data should be read in conjunction
with the consolidated financial statements of Gradco and the notes thereto
included elsewhere herein.
<TABLE>
<CAPTION>
YEARS ENDED MARCH 31,
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1998 1997 1996 1995 1994
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(In thousands, except per share amounts)
<S> <C> <C> <C> <C> <C>
Statement of income data:
Operating revenues: $120,999 $100,887 $100,596 $82,838 $53,148
-------- -------- -------- ------- -------
Costs and expenses:
Cost of sales....................................... 95,019 79,271 77,497 64,919 41,163
Other operating expenses............................ 14,274 14,770 15,785 14,186 11,677
Interest income, net................................ (160) (183) (226) (55) (32)
Investment (gains) losses........................... -- -- (53) 205 52
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109,133 93,858 93,003 79,255 52,860
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Earnings before income taxes and
minority interest................................... 11,866 7,029 7,593 3,583 288
Income taxes............................................ 4,378 2,983 2,748 1,331 535
Minority interest....................................... 1,102 1,194 1,585 800 (241)
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Net earnings (loss)..................................... $ 6,386 $ 2,852 $ 3,260 $ 1,452 $ (6)
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Basic earnings per common share......................... $ .82 $ .36 $ .42 $ .19 $ --
-------- -------- -------- ------- -------
-------- -------- -------- ------- -------
Average shares outstanding, basic EPS................... 7,809 7,799 7,796 7,784 7,784
Diluted earnings per common share....................... $ .79 $ .36 $ .42 $ .19 $ --
-------- -------- -------- ------- -------
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Average shares outstanding, diluted EPS................. 8,051 7,832 7,813 7,798 7,784
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Balance sheet data:
Working capital..................................... $ 17,240 $ 19,418 $ 18,979 $16,727 $10,208
Total assets........................................ 48,471 58,086 58,015 64,383 41,796
Long-term debt...................................... 2 15 25 35 --
Shareholders' equity................................ 21,473 15,339 16,201 16,997 11,137
</TABLE>
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PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
(a) See index to financial statements and financial statement schedules.
See list of exhibits in paragraph (c) below.
(b) 8-K Reports - None.
(c) Exhibits:
2 Agreement and Plan of Merger dated July 25, 1991 regarding
reincorporation of Gradco in Nevada, incorporated by reference from
definitive Proxy Statement dated September 18, 1991, Exhibit C.
3.1 Articles of Incorporation of Gradco as reincorporated in Nevada,
incorporated by reference from definitive Proxy Statement dated
September 18, 1991, Exhibit D.
3.2 By-laws of Gradco as reincorporated in Nevada, incorporated by
reference from Form 10-K for the fiscal year ended March 31, 1992,
Exhibit 3.2.
10.1 Agreement between Gradco and Minolta Camera Co., Ltd.
dated March 19, 1984, incorporated by reference from Form 10-K for
the fiscal year ended April 7, 1984, Exhibit 10.16.
10.2 Amended and Restated License Agreement between Gradco
(Japan) Ltd. and Minolta Camera Co., Ltd. dated July 1, 1991
(Japanese original and English Translation), incorporated by
reference from Form 10-K for the fiscal year ended March 31, 1992,
Exhibit 10.2.
10.3 General Agreement between Gradco and Ricoh Company, Ltd.
dated July 1, 1984, incorporated by reference from Form 10-K for the
fiscal year ended March 31, 1985, Exhibit 10.19.
10.4 Amended and Restated License Agreement between Gradco (Japan) Ltd.
and Ricoh Company, Ltd. dated April 1, 1991 (Japanese original and
English Translation), incorporated by reference from Form 10-K for
the fiscal year ended March 31, 1992, Exhibit 10.4.
10.5 Agreement between Gradco Systems, Inc., and Canon, Inc.,
dated as of July 1, 1988, incorporated by reference from Form 8-K
for July 1, 1988, Exhibit 10.62.
30
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10.6 Agreement between Gradco/Dendoki Inc. and Canon Inc. dated
February 25, 1983, incorporated by reference from Form 10-K for the
fiscal year ended March 31, 1986, Exhibit 19.0.
10.7 Agreement between Gradco/Dendoki Inc. and Canon Inc. dated
February 25, 1983, incorporated by reference from Form 10-K for the
fiscal year ended March 31, 1986, Exhibit 19.3.
10.8 Agreement among Gradco, Gradco (Japan) Ltd. and Canon,
Inc. dated April 1, 1991, incorporated by reference from Form 10-K
for the fiscal year ended March 31, 1992, Exhibit 10.12.
10.9 Gradco 1988 Stock Option Plan, incorporated by reference
from Form 8-K for July 1, 1988, Exhibit 19.3, and amendment thereto
dated July 24, 1991, incorporated by reference from Form 10-Q for
quarter ended June 30, 1991, Exhibit 19.2.
10.10 Gradco 1997 Stock Option Plan, incorporated by reference
from its Registration Statement on Form S-8 filed February 3, 1998,
Exhibit 4.
10.11 Amended Umbrella Agreement dated as of December 5, 1990
among Gradco, Gradco (Japan) Ltd. and Gradco (USA) Inc.,
incorporated by reference from Form 8-K for December 5, 1990,
Exhibit 28.
10.12 Agreement between Gradco and Gradco (Japan) Ltd. dated
March 1, 1991, incorporated by reference from Form 8-K for March 1,
1991, Exhibit 28.
10.13 Letter Agreement dated March 29, 1991 between Gradco Systems, Inc.
and Gradco (Japan) Ltd., incorporated by reference from Form 10-K
for the fiscal year ended March 31, 1991, Exhibit 10.31.
10.14 Lease Agreement between Venture Engineering, Inc. and
Aetna Life Insurance Company, Inc. (formerly Trammell Crow Company)
dated October 1, 1988 and subsequent amendments dated July 1, 1989,
August 1, 1989, February 1, 1990 and March 1, 1991, incorporated
herein by reference from Form 10-K for fiscal year ended March 31,
1991, Exhibit 19.3.
10.15 Basic Agreement between Gradco (Japan) Ltd. and Ikegami
Tsushinki Co. Ltd. dated as of January 1, 1996 (English Translation
of Japanese original), incorporated by
31
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reference from Form 10-K for fiscal year ended March 31, 1996,
Exhibit 10.16.
10.16 Agreement between Gradco (Japan) Ltd. and Lexmark International,
Inc. dated September 1, 1992, incorporated by reference from Form 10-K
for the fiscal year ended March 31, 1993, Exhibit 10.22.
10.17 Regulations of Retirement Allowance for Board of Directors
and Auditors of Gradco Japan, adopted June 3, 1994 (English
translation of Japanese original), incorporated by reference from
Form 10-K for the fiscal year ended March 31, 1995, Exhibit 10.22.
10.18 Agreement among Gradco (Japan) Ltd., Gradco (USA) Inc.,
and Xerox Canada Ltd. dated as of August 17, 1995, incorporated by
reference from Form 10-K for fiscal year ended March 31, 1996,
Exhibit 10.19.
21 List of Significant Subsidiaries
(i) Gradco (Japan) Ltd. (Japan)
(ii) Venture Engineering, Inc. (Texas)
(iii) Gradco (USA) Inc. (California)
23 Consent of Price Waterhouse LLP, previously filed
27 Financial Data Schedule, previously filed
32
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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.
Dated: July 21, 1998
GRADCO SYSTEMS, INC.
By: /s/ Martin E. Tash
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Martin E. Tash
Chairman of the Board, President and
Chief Executive Officer
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 and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
Chairman of the Board,
President and Chief
/s/ Martin E. Tash Executive Officer (Principal
- ----------------------- Executive Officer) July 21, 1998
Martin E. Tash
Executive Vice President,
Chief Financial Officer
(Principal Financial
/s/ Harland L. Mischler and Accounting Officer)
- ----------------------- and Director July 21, 1998
Harland L. Mischler
/s/ Bernard Bressler
- ----------------------- Secretary, Treasurer and July 21, 1998
Bernard Bressler Director
/s/ Robert J. Stillwell
- ----------------------- Director July 21, 1998
Robert J. Stillwell
/s/ Thomas J. Burger
- ----------------------- Director July 21, 1998
Thomas J. Burger
33
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/s/ Mark Takeuchi
- ----------------------- Director July 21, 1998
Mark Takeuchi
34
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GRADCO SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
<TABLE>
<CAPTION>
March 31,
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1998 1997
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<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 8,691 $18,335
Accounts receivable, less allowance for
doubtful accounts of $108 and $59 29,930 24,583
Inventories 1,608 1,759
Deferred income taxes 552 252
Other current assets 166 327
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Total current assets 40,947 45,256
Furniture, fixtures and equipment, net 1,290 2,054
License repurchase, net of accumulated
amortization of $10,700 and $10,994 130 4,069
Excess of cost over acquired net assets, net
of accumulated amortization of $495 and $451 1,234 1,278
Deferred income taxes 1,571 --
Other assets 3,299 5,429
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$48,471 $58,086
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 10,241 $ 10,939
Notes payable to suppliers 9,849 12,608
Accrued expenses 1,077 684
Income taxes payable 2,527 1,596
Current installments of long-term debt 13 11
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Total current liabilities 23,707 25,838
Long-term debt, excluding current installments 2 15
Non-current liabilities 1,024 889
Deferred income taxes -- 1,833
Excess of fair value of net assets acquired over
cost, net of accumulated amortization of $200 1,600 --
Minority interest 665 14,172
Commitments and contingencies (Note 7)
Shareholders' equity:
Preferred stock, no par value; authorized
7,500,000 shares, none issued
Common stock, no par value; authorized 30,000,000
shares, issued 7,854,598 and 7,798,909 45,325 44,618
Accumulated deficit (23,972) (30,358)
Currency translation adjustments 120 1,079
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Total shareholders' equity 21,473 15,339
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$ 48,471 $ 58,086
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</TABLE>
See accompanying notes to consolidated financial statements.
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