SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
Amendment No. 1
(Mark One)
[X] Annual report pursuant to section 13 or 15(d) of the Securities Exchange
Act of 1934 for the fiscal year ended 1999 or
[ ] Transition report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from __________ to ______.
Commission file number 1-10254
TOTAL SYSTEM SERVICES, INC.
(Exact Name of Registrant as specified in its charter)
Georgia 58-1493818
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
1600 First Avenue
Columbus, Georgia 31901
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (706) 649-2204
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
------------------- -----------------------------------------
Common Stock, $.10 Par Value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
NONE
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, 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. [ ]
As of February 11, 2000, 194,832,720 shares of the $.10 par value common
stock of Total System Services, Inc. were outstanding, and the aggregate market
value of the shares of $.10 par value common stock of Total System Services,
Inc. held by non-affiliates was approximately $482,000,000 (based upon the
closing per share price of such stock on said date.)
Portions of the 1999 Annual Report to Shareholders of Registrant are
incorporated in Parts I, II, III and IV of this report. Portions of the Proxy
Statement of Registrant dated March 10, 2000 are incorporated in Part III of
this report.
<PAGE>
The undersigned registrant hereby amends Item 14 of its Annual Report on
Form 10-K for the year ended December 31, 1999 by adding Exhibit 99.1, the
Annual Report on Form 11-K for the Total System Services, Inc. Employee Stock
Purchase Plan for the year ended December 31, 1999, and by adding Exhibit 99.2,
the Annual Report on Form 11-K for the Total System Services, Inc. Director
Stock Purchase Plan for the year ended December 31, 1999, as set forth below and
in the attached exhibits.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) 1. Financial Statements
The following Consolidated Financial Statements of TSYS
are specifically incorporated by reference from pages 26 through 41 of TSYS'
1999 Annual Report to Shareholders to Item 8, Part II, Financial
Statements and Supplementary Data.
Consolidated Balance Sheets - December 31, 1999 and
1998.
Consolidated Statements of Income - Years Ended
December 31, 1999, 1998 and 1997.
Consolidated Statements of Cash Flows - Years Ended
December 31, 1999, 1998 and 1997.
Consolidated Statements of Shareholders' Equity and
Comprehensive Income - Years Ended December 31, 1999,
1998 and 1997.
Notes to Consolidated Financial Statements.
Report of Independent Auditors.
2. Index to Financial Statement Schedules
The following report of independent auditors and
consolidated financial statement schedule of Total System Services, Inc. are
included:
Report of Independent Auditors.
Schedule II - Valuation and Qualifying Accounts -
Years Ended December 31, 1999, 1998 and 1997.
All other schedules are omitted because they are
inapplicable or the required information is included in the Notes to
Consolidated Financial Statements.
3. Exhibits
<PAGE>
Exhibit
Number Description
3.1 Articles of Incorporation of Total System Services,
Inc. ("TSYS"), as amended, incorporated by reference to
Exhibit 4.1 of TSYS' Registration Statement on Form S-8
filed with the Commission on April 18, 1997 (File No.
333-25401).
3.2 Bylaws of TSYS, as amended.
10. EXECUTIVE COMPENSATION PLANS AND ARRANGEMENTS
10.1 Director Stock Purchase Plan of TSYS.
10.2 Group "Y" Key Executive Restricted Stock Bonus Plan of
TSYS, incorporated by reference to Exhibit 10.2 of
TSYS' Annual Report on Form 10-K for the fiscal year
ended December 31, 1992, as filed with the Commission
on March 18, 1993.
10.3 1985 Key Employee Restricted Stock Bonus Plan of TSYS,
incorporated by reference to Exhibit 10.3 of TSYS'
Annual Report on Form 10-K for the fiscal year ended
December 31, 1992, as filed with the Commission on
March 18, 1993.
10.4 1990 Key Employee Restricted Stock Bonus Plan of TSYS,
incorporated by reference to Exhibit 10.4 of TSYS'
Annual Report on Form 10-K for the fiscal year ended
December 31, 1992, as filed with the Commission on
March 18, 1993.
10.5 Total System Services, Inc. 1992 Long-Term Incentive
Plan, which was renamed the Total System Services, Inc.
2000 Long- Term Incentive Plan, incorporated by
reference to Exhibit 10.5 of TSYS' Annual Report on
Form 10-K for the fiscal year ended December 31, 1992,
as filed with the Commission on March 18, 1993.
10.6 Excess Benefit Agreement of TSYS, incorporated by
reference to Exhibit 10.6 of TSYS' Annual Report on
Form 10-K for the fiscal year ended December 31, 1992,
as filed with the Commission on March 18, 1993.
10.7 Wage Continuation Agreement of TSYS, incorporated by
reference to Exhibit 10.7 of TSYS' Annual Report on
Form 10-K for the fiscal year ended December 31, 1992,
as filed with the Commission on March 18, 1993.
<PAGE>
10.8 Incentive Bonus Plan of Synovus Financial Corp. in
which executive officers of TSYS participate,
incorporated by reference to Exhibit 10.8 of TSYS'
Annual Report on Form 10-K for the fiscal year ended
December 31, 1992, as filed with the Commission on
March 18, 1993.
10.9 Agreement in connection with use of aircraft,
incorporated by reference to Exhibit 10.9 of TSYS'
Annual Report on Form 10-K for the fiscal year ended
December 31, 1992, as filed with the Commission on
March 18, 1993.
10.10 Split Dollar Insurance Agreement of TSYS, incorporated
by reference to Exhibit 10.10 of TSYS' Annual Report on
Form 10-K for the fiscal year ended December 31, 1993,
as filed with the Commission on March 22, 1994.
10.11 Synovus Financial Corp. 1994 Long-Term Incentive Plan
in which executive officers of TSYS participate,
incorporated by reference to Exhibit 10.11 of TSYS'
Annual Report on Form 10-K for the fiscal year ended
December 31, 1994, as filed with the Commission on
March 9, 1995.
10.12 Synovus Financial Corp. Executive Bonus Plan in which
executive officers of TSYS participate, incorporated by
reference to Exhibit 10.12 of TSYS' Annual Report on
Form 10-K for the fiscal year ended December 31, 1995,
as filed with the Commission on March 19, 1996.
10.13 Change of Control Agreements for executive officers of
TSYS, incorporated by reference to Exhibit 10.13 of
TSYS' Annual Report on Form 10-K for the fiscal year
ended December 31, 1995, as filed with the Commission
on March 19, 1996.
10.14 Stock Option Agreement of Samuel A. Nunn, incorporated
by reference to Exhibit 10.14 of TSYS' Annual Report on
Form 10-K for the fiscal year ended December 31, 1996,
as filed with the Commission on March 20, 1997.
10.15 Lease Agreement between First Security Bank, National
Association, and TSYS incorporated by reference to
Exhibit 10.15 of TSYS' Annual Report on Form 10-K for
the fiscal year ended December 31, 1997, as filed with
the Commission on March 23, 1998.
10.16 Synovus Financial Corp. 2000 Long-Term Incentive Plan
in which executive officers of TSYS participate.
13.1 Certain specified pages of TSYS' 1999 Annual Report to
Shareholders which are specifically incorporated herein
by reference.
<PAGE>
20.1 Proxy Statement for the Annual Meeting of Shareholders
of TSYS to be held on April 13, 2000, certain pages of
which are specifically incorporated herein by
reference.
21.1 Subsidiaries of Total System Services, Inc.
23.1 Independent Auditors' Consents.
24.1 Powers of Attorney contained on the signature pages of
the 1999 Annual Report on Form 10-K.
27.1 Financial Data Schedule (for SEC use only).
99.1 Annual Report on Form 11-K for the Total System
Services, Inc. Employee Stock Purchase Plan for the
year ended December 31, 1999.
99.2 Annual Report on Form 11-K for the Total System
Services, Inc. Director Stock Purchase Plan for the
year ended December 31, 1999.
(b) Reports on Form 8-K
On October 4, 1999, TSYS filed a Form 8-K with the Commission
announcing a common stock repurchase program.
On January 11, 2000, TSYS filed a Form 8-K with the Commission
in connection with the announcement of its earnings for the year ended December
31, 1999.
filings\tsys\tsys9911k-a.wpd
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, Total System Services, Inc. has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
TOTAL SYSTEM SERVICES, INC.
(Registrant)
April 26, 2000 By:/s/James H. Blanchard
---------------------
James H. Blanchard,
Chairman of the
Executive Committee
<PAGE>
INDEX TO EXHIBITS
Sequentially
Exhibit Numbered
Number Description Page
23.1 Accountants' Consents
99.1 Annual Report on Form 11-K for the Total System Services, Inc.
Employee Stock Purchase Plan for the year ended December 31,
1999.
99.2 Annual Report on Form 11-K for the Total System Services, Inc.
Director Stock Purchase Plan for the year ended December 31,
1999.
Independent Auditors' Consent
We consent to incorporation by reference in the Registration Statement (No.
2-92497) on Form S-8 of Total System Services, Inc. of our report dated March
31, 2000, relating to the statement of financial condition of the Total System
Services, Inc. Employee Stock Purchase Plan as of December 31, 1999 and 1998,
and the related statements of operations and changes in plan equity for each of
the years in the three-year period ended December 31, 1999, which report appears
in the 1999 annual report on Form 11-K of the Total System Services, Inc.
Employee Stock Purchase Plan, included as Exhibit 99.1 to the 1999 annual report
on Form 10-K/A of Total System Services, Inc.
Atlanta, Georgia
April 24, 2000
Independent Auditors' Consent
We consent to incorporation by reference in the Registration Statement (No.
33-17376) on Form S-8 of Total System Services, Inc. of our report dated March
31, 2000, relating to the statement of financial condition of the Total System
Services, Inc. Director Stock Purchase Plan as of December 31, 1999 and 1998,
and the related statements of operations and changes in plan equity for each of
the years in the three-year period ended December 31, 1999, which report appears
in the 1999 annual report on Form 11-K of the Total System Services, Inc.
Director Stock Purchase Plan, included as Exhibit 99.2 to the 1999 annual report
on Form 10-K/A of Total System Services, Inc.
Atlanta, Georgia
April 24, 2000
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended 1999
-------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
---------------------- -----------------
Commission file number 1-10254
--------------------
TOTAL SYSTEM SERVICES, INC. EMPLOYEE STOCK PURCHASE PLAN
TOTAL SYSTEM SERVICES, INC.
1200 FIRST AVENUE
COLUMBUS, GEORGIA 31901
(706) 649-2204
Exhibit 99.1
<PAGE>
TOTAL SYSTEM SERVICES, INC.
EMPLOYEE STOCK PURCHASE PLAN
Financial Statements
December 31, 1999, 1998, and 1997
(With Independent Auditors' Report Thereon)
<PAGE>
Independent Auditors' Report
The Plan Administrator
Total System Services, Inc. Employee
Stock Purchase Plan:
We have audited the accompanying statements of financial condition of the Total
System Services, Inc. Employee Stock Purchase Plan as of December 31, 1999 and
1998, and the related statements of operations and changes in plan equity for
each of the years in the three-year period ended December 31, 1999. These
financial statements are the responsibility of the Plan's administrator. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial condition of the Total System Services,
Inc. Employee Stock Purchase Plan as of December 31, 1999 and 1998, and the
results of its operations and changes in its plan equity for each of the years
in the three-year period ended December 31, 1999 in conformity with generally
accepted accounting principles.
Atlanta, Georgia
March 31, 2000
TOTAL SYSTEM SERVICES, INC.
EMPLOYEE STOCK PURCHASE PLAN
Statements of Financial Condition
December 31, 1999 and 1998
<TABLE>
<CAPTION>
Assets 1999 1998
------------------- -------------------
<S> <C> <C>
Common stock of Total System Services, Inc. at market value -
1,557,070 shares (cost $19,032,710) in 1999 and
1,460,648 shares (cost $14,900,070) in 1998 $ 25,399,712 34,325,229
Dividends receivable 15,573 14,599
Contributions receivable 326,837 335,028
------------------- -------------------
$ 25,742,122 34,674,856
=================== ===================
Plan Equity
Plan equity (5,072 and 4,064 participants at
December 31, 1999 and 1998, respectively) $ 25,742,122 34,674,856
=================== ===================
See accompanying notes to financial statements.
</TABLE>
2
TOTAL SYSTEM SERVICES, INC.
EMPLOYEE STOCK PURCHASE PLAN
Statements of Operations and Changes in Plan
Equity Years ended December 31, 1999,
1998, and 1997
<TABLE>
<CAPTION>
1999 1998 1997
------------------ ------------------ ------------------
<S> <C> <C> <C>
Dividend income $ 60,016 54,247 43,042
Realized gain on distributions to participants
(note 4) 2,576,977 3,410,267 2,613,432
Unrealized appreciation (depreciation) of common
stock of Total System Services, Inc. (note 3) (13,058,157) 6,909,967 (4,514,084)
Contributions (notes 1 and 2):
Participants 5,141,574 4,179,393 3,554,948
Employer:
Total System Services, Inc. 2,071,247 1,695,051 1,454,293
Columbus Depot Equipment Company 411 358 334
TSYS Total Solutions, Inc. 183,889 79,930 67,093
Columbus Productions, Inc. 54,768 47,502 45,105
TSYS Canada, Inc. 17,887 10,438 --
Vital Processing Services, L.L.C. 248,987 211,072 155,937
------------------ ------------------ ------------------
Total employer contributions 2,577,189 2,044,351 1,722,762
------------------ ------------------ ------------------
(2,702,401) 16,598,225 3,420,100
Withdrawals by participants - common stock of
Total System Services, Inc. at
market value (321,694 shares in 1999,
281,516 shares in 1998, and 250,185
shares in 1997) -
(notes 2 and 4) (6,230,333) (6,405,895) (4,350,111)
------------------ ------------------ ------------------
Increase (decrease) in Plan equity
for the year (8,932,734) 10,192,330 (930,011)
Plan equity at beginning of year 34,674,856 24,482,526 25,412,537
------------------ ------------------ ------------------
Plan equity at end of year $ 25,742,122 34,674,856 24,482,526
================== ================== ==================
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
TOTAL SYSTEM SERVICES, INC.
EMPLOYEE STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1999, 1998, and 1997
(1) Description of the Plan
The Total System Services, Inc. Employee Stock Purchase Plan (the Plan)
was implemented as of October 1, 1984. The Plan is designed to enable
participating Total System Services, Inc. (TSYS) employees to purchase
shares of common stock of TSYS at prevailing market prices from
contributions made by them and TSYS.
Synovus Service Corp. serves as the Plan administrator. State
Street Bank and Trust Company serves as the Plan agent, hereafter
referred to as "Agent."
All employees who work twenty hours per week or more are eligible to
participate in the Plan after completing three months of continuous
employment prior to the beginning of a calendar quarter. Participants who
have previously withdrawn shares from their Plan account remain eligible
to participate, but with certain exceptions, are precluded from receiving
matching contributions from the Plan sponsor for a specified period of
time. A participant may contribute to the Plan based on a formula through
payroll deductions in multiples of $1 with a minimum deduction of $10 per
month and a maximum deduction not to exceed a specified percentage of
compensation (ranging from 3% to 7%). Effective January 1, 1999,
participants initially joining the Plan, requesting reinstatement in the
Plan or making a change under the Plan must select their payroll
deduction amount as a percentage of compensation, with a minimum
contribution level of 0.5%. Participants in the Plan prior to January 1,
1999 may continue contributing to the Plan through payroll deductions in
whole dollar amounts. Contributions to the Plan are to be made by TSYS in
an amount equal to one-half of each participant's contribution.
Participants are immediately vested in their contributions and TSYS'
matching contributions.
The Plan provides, among other things, that all expenses of the Plan and
its administration shall be paid by TSYS with the exception of brokers'
fees, commissions, postage, and transaction costs which are included in
the cost of each participant's investment in common stock of TSYS.
The Plan provides that upon withdrawal from the Plan, each participant
may elect to receive the proceeds from his account balance in the form of
shares of common stock of TSYS and a check for any fractional shares and
cash held, a lump-sum cash distribution, or a combination of both.
TSYS expects to maintain the Plan indefinitely, but reserves the right to
terminate or amend the Plan at any time, provided, however, that no
termination or amendment shall affect or diminish any participant's right
to the benefit of contributions made by him or TSYS prior to the date of
such amendment or termination.
On April 16, 1998, the TSYS Board of Directors approved a three-for-two
stock split which was effected on May 8, 1998 in the form of a 50% stock
dividend to shareholders of record as of April 27, 1998.
4 (Continued)
<PAGE>
TOTAL SYSTEM SERVICES, INC.
EMPLOYEE STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1999, 1998, and 1997
All share and per share data for all periods presented in the
accompanying financial statements and related notes has been restated to
reflect the additional shares resulting from these stock splits.
(2) Summary of Accounting Policies
The investment in common stock of TSYS is stated at market value. The
1999 and 1998 market values are based on the closing price at year-end.
The December 31, 1999 and 1998 market values were $16.31 and $23.50 per
share, respectively.
The realized gain on distributions to participants is determined by
computing the difference between the average cost per common stock share
and the market value per share at the date of the distribution to the
participants.
Contributions to and withdrawals from the Plan are accounted for on the
accrual basis. Common stock contributions are recorded at fair value.
During the years ended December 31, 1999, 1998, and 1997, TSYS
contributed one share of stock to each new employee, upon reaching three
months of employment with TSYS. Such contributions were made to the
employees' accounts with the Plan, and resulted in an increase of
employer contributions of approximately $25,000, $21,000, and $23,000 for
the years ended December 31, 1999, 1998, and 1997, respectively.
Dividend income is accrued on the record date.
The Plan is not qualified under Sections 401(a) or 501(a) of the Internal
Revenue Code of 1986, as amended. The Plan does not provide for income
taxes because any income is taxable to the participants. Participants in
the Plan must treat as compensation income their pro rata share of
contributions made to the Plan by TSYS. Cash dividends paid on common
stock of TSYS purchased under the Plan will be taxed to the participants
on a pro rata basis for Federal and state income tax purposes during the
year any such dividend is received by the participant or the Plan. Upon
disposition of the common stock of TSYS purchased under the Plan,
participants must treat any gain or loss as long-term or short-term
capital gain or loss depending upon when such disposition occurs.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets, liabilities, and
changes therein, and disclosure of contingent assets and liabilities.
Actual results could differ from those estimates.
5 (Continued)
<PAGE>
TOTAL SYSTEM SERVICES, INC.
EMPLOYEE STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1999, 1998, and 1997
(3) Unrealized Appreciation (Depreciation) in Common Stock of TSYS
Changes in unrealized appreciation (depreciation) in common stock of TSYS
are as follows:
<TABLE>
<CAPTION>
1999 1998 1997
---------------- --------------- ---------------
<S> <C> <C> <C>
Unrealized appreciation at end of year $ 6,367,002 19,425,159 12,515,192
Unrealized appreciation at beginning of
year
19,425,159 12,515,192 17,029,276
---------------- --------------- ---------------
Unrealized appreciation
(depreciation) for the year
$ (13,058,157) 6,909,967 (4,514,084)
================ =============== ===============
</TABLE>
(4) Realized Gain on Withdrawal Distributions to Participants
The gain realized on withdrawal distributions to participants is
summarized as follows:
<TABLE>
<CAPTION>
1999 1998 1997
------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Market value at dates of distribution or
redemption of shares of common stock
of TSYS $ 6,230,333 6,405,895 4,350,111
Less cost (computed on an average
cost basis) of shares of common
stock of TSYS distributed or
redeemed 3,653,356 2,995,628 1,736,679
------------- ---------------- ----------------
Total realized gain $ 2,576,977 3,410,267 2,613,432
============= ================ ================
</TABLE>
6
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended 1999
-------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
---------------------- -----------------
Commission file number 1-10254
--------------------
TOTAL SYSTEM SERVICES, INC. DIRECTOR STOCK PURCHASE PLAN
TOTAL SYSTEM SERVICES, INC.
1200 FIRST AVENUE
COLUMBUS, GEORGIA 31901
(706) 649-2204
Exhibit 99.2
<PAGE>
TOTAL SYSTEM SERVICES, INC.
DIRECTOR STOCK PURCHASE PLAN
Financial Statements
December 31, 1999, 1998, and 1997
(With Independent Auditors' Report Thereon)
<PAGE>
Independent Auditors' Report
The Plan Administrator
Total System Services, Inc. Director
Stock Purchase Plan:
We have audited the accompanying statements of financial condition of the Total
System Services, Inc. Director Stock Purchase Plan as of December 31, 1999 and
1998, and the related statements of operations and changes in plan equity for
each of the years in the three-year period ended December 31, 1999. These
financial statements are the responsibility of the Plan's administrator. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial condition of the Total System Services,
Inc. Director Stock Purchase Plan as of December 31, 1999 and 1998, and the
results of its operations and changes in its plan equity for each of the years
in the three-year period ended December 31, 1999 in conformity with generally
accepted accounting principles.
Atlanta, Georgia
March 31, 2000
TOTAL SYSTEM SERVICES, INC.
DIRECTOR STOCK PURCHASE PLAN
Statements of Financial Condition
December 31, 1999 and 1998
<TABLE>
<CAPTION>
Assets 1999 1998
---------------- ---------------
<S> <C> <C>
Common stock of Total System Services, Inc. at market value -
122,465 shares (cost $474,192) in 1999 and
139,116 shares (cost $487,160) in 1998 $ 1,997,710 3,269,225
Dividends receivable 1,225 1,391
---------------- ---------------
$ 1,998,935 3,270,616
================ ===============
Plan Equity
Plan equity (13 and 11 participants at December 31, 1999 and
1998, respectively) $ 1,998,935 3,270,616
================ ===============
</TABLE>
See accompanying notes to financial statements.
2
TOTAL SYSTEM SERVICES, INC.
DIRECTOR STOCK PURCHASE PLAN
Statements of Operations and Changes in Plan Equity
Years ended December 31, 1999, 1998, and 1997
<TABLE>
1999 1998 1997
------------------ ------------------ ------------------
<S> <C> <C> <C>
Dividend income $ 5,428 5,019 4,355
Realized gain on distributions to participants
(notes 2 and 4) 277,688 356,245 --
Unrealized appreciation (depreciation) in
common stock of Total System Services, Inc.
(note 3) (1,258,547) 710,468 (217,211)
Contributions (notes 1 and 2):
Participants 38,333 35,333 29,334
Total System Services, Inc. 19,167 17,667 14,667
------------------ ------------------ ------------------
(917,931) 1,124,732 (168,855)
Withdrawals by participants - common stock of
Total System Services, Inc. at market value
(20,000 shares in 1999, 19,366 shares in
1998, and -0- shares in 1997) - (notes 2 and 4) (353,750) (420,001) --
------------------ ------------------ ------------------
Increase (decrease) in Plan equity
for the year (1,271,681) 704,731 (168,855)
Plan equity at beginning of year 3,270,616 2,565,885 2,734,740
------------------ ------------------ ------------------
Plan equity at end of year $ 1,998,935 3,270,616 2,565,885
================== ================== ==================
See accompanying notes to financial statements.
</TABLE>
3
<PAGE>
TOTAL SYSTEM SERVICES, INC.
DIRECTOR STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1999, 1998, and 1997
(1) Description of the Plan
The Total System Services, Inc. Director Stock Purchase Plan (Plan) was
implemented as of October 15, 1987. The Plan is designed to enable
participating Total System Services, Inc. (TSYS) directors to purchase
shares of common stock of TSYS at prevailing market prices from
contributions made by them and TSYS.
Synovus Service Corp. serves as the Plan administrator. State Street
Bank and Trust Company serves as the Plan agent, hereafter referred to
as "Agent."
Any person who currently serves or in the future is elected to serve as a
member, advisory member, or emeritus member of the Board of Directors of
TSYS is eligible to participate in the Plan. Cash contributions by a
participant cannot exceed $1,000 per calendar quarter. Contributions to
the Plan are to be made by TSYS in an amount equal to one-half of each
participant's contribution. Participants are immediately vested in their
contributions and TSYS' matching contributions.
The Plan provides, among other things, that all expenses of the Plan and
its administration shall be paid by TSYS with the exception of brokers'
fees, commissions, postage and transaction costs which are included in
the cost of each participant's investment in common stock of TSYS.
The Plan provides that upon withdrawal from the Plan, each participant
may elect to receive the shares of TSYS common stock held on his behalf
by the Agent, together with a check for any fractional share interest and
any remaining cash balance.
TSYS expects to maintain the Plan indefinitely, but reserves the right to
terminate or amend the Plan at any time, provided, however, that no
termination or amendment shall affect or diminish any participant's right
to the benefit of contributions made by him or TSYS prior to the date of
such amendment or termination.
On April 16, 1998, the TSYS Board of Directors approved a three-for-two
stock split which was effected on May 8, 1998 in the form of a 50% stock
dividend to shareholders of record as of April 27, 1998.
All share and per share data for all periods presented in the
accompanying financial statements and related notes has been restated to
reflect the additional shares resulting from these stock splits.
(2) Summary of Accounting Policies
The investment in common stock of TSYS is stated at market value. The
1999 and 1998 market values are based on the closing price at year-end.
The December 31, 1999 and 1998 market values were $16.31 and $23.50 per
share, respectively.
4 (Continued)
<PAGE>
TOTAL SYSTEM SERVICES, INC.
DIRECTOR STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1999, 1998, and 1997
The realized gain on distributions to participants is determined by
computing the difference between the average cost per common stock share
and the market value per share at the date of distribution to the
participants.
Contributions by TSYS and participating directors, as well as
withdrawals, are accounted for on the accrual basis.
Dividend income is accrued on the date of record.
The Plan is not qualified under Sections 401(a) or 501(a) of the Internal
Revenue Code of 1986, as amended. The Plan does not provide for income
taxes because any income is taxable to the participants. Participants in
the Plan must treat as compensation income their pro rata share of
contributions made to the Plan by TSYS. Cash dividends paid on common
stock of TSYS purchased under the Plan will be taxable to the
participants on a pro rata basis for Federal and state income tax
purposes during the year any such dividend is received by the participant
or the Plan. Upon disposition of the common stock of TSYS purchased under
the Plan, participants must treat any gain or loss as long-term or
short-term capital gain or loss depending upon when such disposition
occurs.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets, liabilities, and
changes therein, and disclosure of contingent assets and liabilities.
Actual results could differ from those estimates.
(3) Unrealized Appreciation (Depreciation) in Common Stock of TSYS
Changes in unrealized appreciation (depreciation) in common stock of TSYS
are as follows:
<TABLE>
<CAPTION>
1999 1998 1997
--------------- -------------- -------------
<S> <C> <C> <C>
Unrealized appreciation at end of year $ 1,523,518 2,782,065 2,071,597
Unrealized appreciation at beginning
of year 2,782,065 2,071,597 2,288,808
--------------- -------------- -------------
Unrealized appreciation (depreciation)
for the year $ (1,258,547) 710,468 (217,211)
=============== ============== =============
</TABLE>
5 (Continued)
<PAGE>
TOTAL SYSTEM SERVICES, INC.
DIRECTOR STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1999, 1998, and 1997
(4) Realized Gain on Withdrawal Distributions to Participants
The gain realized on withdrawal distributions to participants is
summarized as follows:
<TABLE>
<CAPTION>
1999 1998
-------------- -------------
<S> <C> <C>
Market value at dates of distribution
or redemption of common stock of TSYS $ 353,750 420,001
Less cost (computed on an average cost basis)
of shares of common stock of
TSYS distributed or redeemed 76,062 63,756
-------------- -------------
Total realized gain $ 277,688 356,245
============== =============
</TABLE>
There were no distributions to participants during 1997.
