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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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 DECEMBER 31, 1997 OR
[_]TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE TRANSITION PERIOD FROM TO .
COMMISSION FILE NUMBER 1-14348
METROMAIL CORPORATION 1997 EMPLOYEE STOCK PURCHASE PLAN
(FULL TITLE OF PLAN)
METROMAIL CORPORATION
360 EAST 22ND STREET
LOMBARD, IL 60148-4989
(NAME OF ISSUER OF THE SECURITIES HELD PURSUANT TO THE PLAN AND THE ADDRESS OF
ITS PRINCIPAL EXECUTIVE OFFICE)
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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders of Metromail Corporation and Affiliates:
We have audited the accompanying statement of net assets of the Metromail
Corporation 1997 Employee Stock Purchase Plan as of December 31, 1997, and the
related statement of changes in net assets for the six months ended December
31, 1997. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the changes in net assets of the Plan as of December
31, 1997 and the six months ended December 31, 1997, in conformity with
generally accepted accounting principles.
/s/ Arthur Andersen LLP
Arthur Andersen LLP
Chicago, Illinois
March 24, 1998
F-1
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METROMAIL CORPORATION
1997 EMPLOYEE STOCK PURCHASE PLAN
STATEMENT OF NET ASSETS
DECEMBER 31, 1997
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Assets:
Cash................................................................ $ 20,667
Liabilities:
Refundable participants' contributions.............................. (20,667)
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Net assets............................................................ $ --
========
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The accompanying Notes to Financial Statements are an integral part of these
statements.
F-2
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METROMAIL CORPORATION
1997 EMPLOYEE STOCK PURCHASE PLAN
STATEMENT OF CHANGES IN NET ASSETS
FOR THE PERIOD JULY 1, 1997 (EFFECTIVE DATE) TO DECEMBER 31, 1997
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Net assets at beginning of the period................................. $ --
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Additions:
Participants' contributions......................................... 426,645
Metromail Corporation contribution.................................. 70,998
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497,643
Deductions:
Stock purchased on behalf of participants........................... 473,940
Refunds made to participants........................................ 3,026
Refunds due to participants......................................... 20,677
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Total deductions.................................................. 497,643
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Net assets at end of period........................................... $ --
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The accompanying Notes to Financial Statements are an integral part of these
statements.
F-3
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METROMAIL CORPORATION AND AFFILIATES
EMPLOYEE STOCK PURCHASE PLAN
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD JULY 1, 1997 (EFFECTIVE DATE) TO DECEMBER 31, 1997
NOTE 1) DESCRIPTION OF PLAN
The Plan was adopted by the Board of Directors of the Company on January 30,
1997 and was approved by the stockholders of the Company on April 24, 1997.
The Plan became effective on July 1, 1997. The maximum number of shares of
Common Stock available under the Plan is 300,000, subject to appropriate
adjustment in the event of a stock dividend, stock split-up or combination of
shares. Shares of Common Stock sold under the Plan may be treasury shares,
authorized and unissued shares, or a combination thereof. Participation in the
Plan is open to each employee of the Participating Companies (as defined in
the Plan) (a) who has been continuously employed by the Participating
Companies for at least six months, (b) whose customary employment by the
Participation Companies is greater than 20 hours per week; and (c) whose
customary employment by the Participating Companies is more than five months
in any calendar year. The Plan description provides only general information.
Participants should refer to the Plan for a more comprehensive description of
the Plan's provisions.
NOTE 2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accompanying financial statements have been prepared using the accrual
method of accounting. The preparation of the financial statements in
conformity with generally accepted accounting principles requires the Plan's
management to use estimates and assumptions that affect the accompanying
financial statements and disclosures. Actual results could differ from these
estimates.
Contributions
The amounts deposited by participating employees are accumulated during a
Purchase Period. "Purchase Period" shall consist of the three month period
beginning on each July 1, October 1, January 1, and April 1, each commencing
on or after the effective date and prior to termination of the Plan. The
amounts deposited by the participating employees do not bear interest during
the Purchase Period. The stock purchased on behalf of the participating
employee is considered to be issued and outstanding to their credit as of the
close of business on the last day of each Purchase Period.
Administrative Expenses
The Company pays for all the administrative expenses of the Plan.
NOTE 3) PLAN TERMINATION
Metromail Corporation (the "Company") anticipates and believes that the Plan
will continue without interruption but reserves the right to discontinue the
Plan at its discretion. In the event of any change in control the then current
purchase period shall thereupon end, and all participants purchase accounts
shall be applied to purchase shares and the Plan shall immediately thereafter
terminate.
On March 13, 1998, the Company announced that it and The Great Universal
Stores P.L.C. ("GUS") had signed a definitive merger agreement pursuant to
which GUS has agreed to acquire all of the outstanding common stock of the
Company. The Plan will terminate immediately prior to the effective time of
the merger contemplated by such merger agreement.
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NOTE 4) FEDERAL INCOME TAXES
Tax Status of the Plan--The Plan is a trust but does not qualify for tax
exempt status under Section 501 of the Internal Revenue Code (the "Code").
However, the Plan incurs no tax liability since all Plan income is distributed
to the participants.
Tax Status of Each Participant--Since the Plan qualifies as an "employee
stock purchase plan" under the Code, but not as a "stock bonus plan" under
Section 401(a) of the Code, the participant realizes income equal to his or
her share of the Participating Company's contributions and cash distributions
on shares issued to the participants during the calendar year.
F-5
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PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
HUMAN RESOURCES COMMITTEE OF THE BOARD OF DIRECTORS OF METROMAIL CORPORATION
HAS DULY CAUSED THIS ANNUAL REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
Metromail Corporation 1997 Employee
Stock Purchase Plan
/s/ Robert C. McCormack
Date: March 27, 1998 _____________________________________
Name: Robert C. McCormack
Title: Chairman, Human Resources
Committee
F-6
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EXHIBIT INDEX
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EXHIBIT
NO. DESCRIPTION
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23 Consent of Arthur Andersen LLP
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F-7
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EXHIBIT 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants we hereby consent to the use of our report
dated March 24, 1998, included in the Form 11-K of the Metromail Corporation
1997 Employee Stock Purchase Plan (the "Plan") for the period ended December
31, 1997. We also hereby consent to the incorporation by reference in
Registration Statement No. 333-66265 on Form S-8, Registration Statement No.
333-28143 on Form S-8 and Registration Statement No. 333-28137 on Form S-8 of
our report dated March 24, 1998 covering the financial statements of the Plan
included in the Plan's Form 11-K for the period ended December 31, 1997
(Commission File number 1-14348).
/s/ Arthur Andersen LLP
Arthur Andersen LLP
March 24, 1998
