FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 1996
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 0-14112
JACK HENRY & ASSOCIATES, INC.
(Exact name of registrant as specified in its charter)
Delaware 43-1128385
(State or other jurisdiction of incorporation) (I.R.S. Employer
Identification No.)
663 Highway 60, P. O. Box 807, Monett, MO 65708
(Address of principal executive offices)
(Zip Code)
417-235-6652
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last
report)
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
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Class Outstanding at April 30, 1996
Common Stock, $.01 par value 11,820,304
JACK HENRY & ASSOCIATES, INC.
CONTENTS
Page No.
PART I. FINANCIAL INFORMATION
Item I - Financial Statements
Condensed Consolidated Balance Sheets -
March 31, 1996, (Unaudited) and June
30, 1995 3-4
Condensed Consolidated Statements of
Operations for the Three Months and
Nine Months Ended March 31, 1996
and 1995 (Unaudited) 5
Condensed Consolidated Statements of Cash
Flows for the Nine Months Ended March 31,
1996 and 1995 (Unaudited) 6
Notes to the Condensed Consolidated Financial
Statements 7
Item 2 - Management's Discussion and Analysis of
Results of Operations and Financial
Condition 8-10
Part II. OTHER INFORMATION
Item 5 - Other Information 11
Part I. Financial Information
Item 1. Financial Statements
JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands of Dollars, Except Share Data)
March 31,
1996 June 30,
(Unaudited) 1995
ASSETS
Current assets:
Cash $ 4,573 $ 3,423
Short-term investments 2,633 4,650
Receivables 8,362 16,740
Prepaid expenses and other 3,180 2,661
Total current assets $18,748 $27,474
Property and equipment, net 13,705 10,302
Other assets:
Intangible assets, net of amortization $17,406 $17,790
Computer software 1,774 1,740
Investments and other 1,003 1,415
Total other assets $20,183 $20,945
Total assets
$52,636 $58,721
March 31,
1996 June 30,
(Unaudited) 1995
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,439 $ 5,124
Accrued expenses 2,773 2,468
Income taxes 564 -
Accrued acquisition costs - 5,398
Deferred revenue 10,171 15,150
Total current liabilities $15,947 $28,140
Deferred income taxes 986 1,097
Total liabilities $16,933 $29,237
Stockholders' equity:
Preferred stock - $1.00 par value;
500,000 shares authorized;
none issued - -
Common stock - $0.01 par value;
30,000,000 shares authorized;
11,768,971 issued @ 3/31/96
11,732,028 issued @ 6/30/95 $ 118 $ 117
Additional paid-in capital 9,200 9,425
Retained earnings 26,385 19,942
Total stockholders' equity $35,703 $29,484
Total liabilities and
stockholders' equity $52,636 $58,721
The accompanying notes are an integral part of these consolidated financial
statements.
JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In Thousands of Dollars, Except Per Share Data)
<TABLE>
<S><C> Quarter Ended Nine Months Ended
March 31, March 31,
1996 1995 1996 1995
Revenues:
Software licensing & installation $ 4,430 $ 3,685 $13,307 $11,310
Maintenance/support & service 5,749 2,645 16,750 7,689
Hardware sales & commissions 6,382 4,075 19,173 12,460
Total revenues $16,561 $10,405 $49,230 $31,459
Cost of sales:
Cost of hardware $ 4,551 $ 2,950 $12,989 $ 9,025
Cost of services 4,170 1,983 11,913 5,850
Total cost of sales $ 8,721 $ 4,933 $24,902 $14,875
Gross profit $ 7,840 $ 5,472 $24,328 $16,584
Operating expenses:
Selling and marketing $ 1,785 $ 1,347 $ 5,424 $ 3,956
Research and development 446 280 1,371 826
General and administrative 1,338 1,208 4,099 3,457
Total operating expenses $ 3,569 $ 2,835 $10,894 $ 8,239
Operating income $ 4,271 $ 2,637 $13,434 $ 8,345
Other income (expense):
Interest and dividend income, net $ 123 $ 191 $ 410 $ 547
Other, net 77 22 102 7
Total other income $ 200 $ 213 $ 512 $ 554
Income before income taxes $ 4,471 $ 2,850 $13,946 $ 8,899
Provision for income taxes 1,710 1,076 5,331 3,288
Net income $ 2,761 $ 1,774 $ 8,615 $ 5,611
Per share information (Note 4):
Net income $ .22 $ .15 $ .69
$ .47
Weighted avg. shares outstanding 12,510 12,054 12,433 12,007
The accompanying notes are an integral part of these consolidated financial
statements.
</TABLE>
JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CASH FLOWS
(In Thousands of Dollars)
(Unaudited)
Nine Months Ended
March 31,
1996 1995
Cash flows - operating activities:
Cash received from customers $52,707 $32,570
Cash paid to suppliers and employees (36,110) (22,079)
Interest and dividends received 482 585
Income taxes paid (4,646) (3,174)
Other, net - 19
Net cash provided by operating
activities $12,433 $ 7,921
Cash flows from investing activities:
Proceeds on sale of property & equipment $ 2 $ 1
Capital expenditures (4,448) (1,893)
Short-term investment activity, net 1,946 (1,504)
Long-term investment activity, net (3) (40)
Capitalized software development (327) (165)
Acquisition costs, net (5,807) (1,370)
Net cash used in investing activities $(8,637) $(4,971)
Cash flows from financing activities:
Proceeds from issuance of common stock
upon exercise of stock options $ 399 $ 100
Dividends paid (2,172) (1,841)
Purchase of Treasury Stock (873) -
Net cash used in financing activities $(2,646) $(1,741)
Net increase (decrease) in cash $ 1,150 $ 1,209
Cash at beginning of period 3,423 1,942
Cash at end of period $ 4,573 $ 3,151
The accompanying notes are an integral part of these consolidated financial
statements.
JACK HENRY & ASSOCIATES, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Summary of Significant Accounting Policies
Description of the Company - Jack Henry & Associates, Inc. ("JHA" or the
"Company") is a computer software company which has developed several banking
software systems. It markets those systems to financial institutions worldwide
along with the computer equipment (hardware) and provides the conversion and
software customization services necessary for a financial institution to install
a JHA software system. It also provides continuing support and maintenance
services to customers using the system. All of these related activities are
currently considered a single business segment.
Consolidation - The consolidated financial statements include the accounts of
JHA and its wholly-owned subsidiaries. All significant intercompany accounts
and transactions have been eliminated in the consolidation.
Other Significant Accounting Policies - The accounting policies followed by
the Company are set forth in Note 1 to the Company's consolidated financial
statements included in its Annual Report on Form 10-K ("Form 10-K") for the
fiscal year ended June 30, 1995.
2. Interim Financial Statements
The accompanying condensed financial statements have been prepared in accor-
dance with the instructions to Form 10-Q of the Securities and Exchange Commis-
sion and in accordance with generally accepted accounting principles applicable
to interim financial statements, and do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. The financial statements should be read in conjunction
with the audited consolidated financial statements and accompanying notes of the
Company for the year ended June 30, 1995, which are included in its Form 10-K.
In the opinion of management of the Company, the accompanying condensed
financial statements reflect all adjustments necessary (consisting solely of
normal recurring adjustments) to present fairly the financial position of the
Company as of March 31, 1996, and the results of its operations and its cash
flows for the three-month and nine-month periods then ended.
The results of operations for the periods ended March 31, 1996, are not
necessarily indicative of the results to be expected for the entire year.
3. Additional Interim Footnote Information
None.
4. Income Per Share Information
Earnings per common share are computed by dividing income by the weighted
average number of shares of common stock and dilutive common stock equivalents
outstanding for the quarters and nine month periods ended March 31, 1996 and
1995.
Item 2. - Management's Discussion and Analysis of Results of
Operations and Financial Condition
RESULTS OF OPERATIONS
Background and Overview
Jack Henry & Associates, Inc. ("JHA" or the "Company") is a leading provider
of in-house integrated computer systems that perform data processing for banks
and related financial institutions. The Company was founded in 1976. Its
proprietary applications software, which operates on IBM computers, is offered
under two systems: CIF 20/20 1, typically for small to mid-size community
banks, and the Silverlake System 2, for medium to large-size community banks.
Domestically, JHA frequently sells computer hardware with its software
products. It also provides customer support and related services. The Company's
software systems have been installed at over 1240 banks and financial
institutions worldwide.
A detailed discussion of the major components of the results of operations for
the quarter and the nine months ended March 31, 1996, as compared to the same
periods in the previous year follows.
Revenues
Revenues increased 59% to $16,561,000, in the third quarter ended March 31,
1996. Software licensing and installation increased 20%, which renders the
highest profit margin of the three revenue groups. Maintenance, support and
service revenues increased 117% to $5,749,000, growing with new customer
additions and the addition of Sector and Liberty. Hardware sales were
$6,382,000, up 57% from last year's quarter. Overall, revenues continue to be
strong because demand for the Company's products and services remains high.
The nine months ended March 31, 1996, had a 56% increase in revenues over the
same period a year earlier. Software licensing and installation revenues are up
18% over FY '95's third quarter. Maintenance/support and service revenues were
118% above last year's quarter with hardware revenues increasing 54% over the
same period last year. Nine month revenues increased for similar reasons as the
quarter.
The $11,523,000, backlog of sales at March 31, 1996, reflects an increase of
49% above last year's level.
Cost of Sales
There was an overall increase in total cost of sales of 77% for the quarter
and a 67% increase for the nine months compared to the same periods last year.
Cost of hardware for the quarter increased 54%, reflecting a small decline in
margin. Cost of services increased 110%, which varies primarily from the non-
1CIF 20/20 is a trademark of Jack Henry & Associ-
ates, Inc.
2Silverlake System is a registered trademark of
Jack Henry & Associates, Inc.
hardware revenues increase of 61%. This variance is due to increased costs from
the Sector and Liberty acquisitions and increased costs due to continued growth
in the Company's application systems.
Cost of hardware increased 44% for the nine months ended March 31, 1996. This
is on a 54% increase in hardware revenue, thus an increase in margin. Cost of
services increased 104% for the nine months compared to the 59% increase in non-
hardware revenues. These changed for similar reasons to the quarterly changes.
Gross Profit
Gross profit increased to $7,840,000 and $24,328,000, respectively, in the
third quarter and the nine months ended March 31, 1996, compared to $5,472,000
and $16,584,000, for the same periods last year. Total gross profit increased
43% and 47% for the quarter and nine month periods, respectively, which is
relatively consistent with the revenue percentage increases. The gross margin
percentage was 47% of sales for the quarter and 49% for the nine month period,
down from the previous year periods of 53% for the quarter and year-to-date
periods. Generally, this percentage will fluctuate with hardware sales - as
they go down it will trend upward and vice versa. The gross margin percentage
is also impacted in both the three and nine month periods from the increase in
costs and thus, decrease in margin, from the Sector and Liberty acquisitions.
Operating Expenses
Total operating expenses increased 26%. This is a favorable picture, since
gross profit increased 43%, thus the Company continues to gain efficiencies
through growth.
Operating expenses for the nine months ended March 31, 1996, experienced an
increase of 32% from the same period a year ago.
Other Income and Expense
Other income for the quarter and nine-months ended March 31, 1996, reflects a
net 6% and 8% decrease, respectively when compared to the same periods last
year.
Net Income
Net income for the third quarter was $2,761,000, or $.22 per share, compared
to $1,774,000, or $.15 per share, in the corresponding quarter last year.
Net income for the nine months ended March 31, 1996, was $8,615,000, or $.69
per share compared to $5,611,000, or $.47 per share, in the same period last
year.
FINANCIAL CONDITION
Liquidity
The Company's cash and short-term investments decreased to $7,206,000, at
March 31, 1996, from $18,073,000, at June 30, 1995. The decrease results from a
combination of normal business activities and cash outlays related to June 1995
acquisitions.
JHA has available credit lines totaling $2,215,000, although the Company
continues to expect their use to be minimal during FY '96. The Company current-
ly has no short-term or long-term debt obligations.
Capital Requirements and Resources
JHA generally uses existing resources and funds generated from operations to
meet its capital requirements. Capital expenditures totalling $1,237,000 for
the third quarter ended March 31, 1996, were made for additional equipment. The
consolidated capital expenditures of JHA totaled $4,448,000 for the nine month
period ending March 31, 1996. These were funded from cash generated by opera-
tions.
The Company paid a $.07 per share cash dividend on March 14, 1996 to stock-
holders of record on February 22, 1996 which was funded from working capital.
In addition, the Company's Board of Directors, subsequent to March 31, 1995,
declared a quarterly cash dividend of $.07 per share on its common stock payable
on May 29, 1996, to stockholders of record on May 13, 1996. This will be funded
out of working capital.
CONCLUSION
JHA's results of operations and its financial position continued to be quite
favorable during the quarter and nine months ended March 31, 1996. This
reflects the continuing attitude of cooperation and commitment by each employee,
management's ongoing cost control efforts and commitment to deliver top quality
products and services to the markets served.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
3.2 Restated and Amended Bylaws effective May 1, 1996, attached at page 13.
(Remainder of page intentionally left blank)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Quarterly Report on Form 10-Q to be signed on
behalf by the undersigned thereunto duly authorized.
JACK HENRY & ASSOCIATES, INC.
Date: May 15, 1996 /s/ Michael E. Henry
Michael E. Henry
Chairman of the Board
Chief Executive Officer
Date: May 15, 1996 /s/ Terry W. Thompson
Terry W. Thompson
Vice President and
Chief Financial Officer
Exhibit A
RESTATED AND AMENDED
BYLAWS OF
JACK HENRY & ASSOCIATES, INC.
(EFFECTIVE MAY 1, 1996)
ARTICLE I
Section 1.1 Registered Office. The registered office of the corporation
shall be Corporation Trust Center, 1209 Orange Street, City of Wilmington,
County of New Castle, State of Delaware.
Section 1.2 Corporate Office. The corporation may have its office (or
offices) at such place (or places) as the board of directors, in its discretion,
may from time to time determine, or wherever the business of the corporation may
require.
ARTICLE II
Meeting of Stockholders
Section 2.1 Time and Place. Any meeting of the stockholders may be held
at such time and place, either within or outside the State of Delaware, as shall
be designated from time to time by resolution of the board of directors or as
shall be stated in a duly authorized notice, or in a duly executed waiver of
notice, of the meeting.
Section 2.2 Annual Meeting. The annual meeting of the stockholders,
commencing with the year 1986, shall be held on the second Tuesday in November
of each year or on such other date as the board of directors may determine, for
the purpose of electing a board of directors and transacting such other business
as may properly be brought before the meeting.
Section 2.3 Special Meetings. Special meetings of the stockholders, for
any purpose or purposes, may be called by the chairman of the board or the
president, and shall be called by the chairman of the board, the president or
any vice-President or the secretary, when directed to do so by resolution of the
board of directors. A special meeting of the stockholders shall also be called
by the president or secretary at the request in writing of stockholders owning
at least two-thirds of the stock of the corporation entitled to vote. Any
request of the stockholders for a special meeting shall state the purpose or
purposes of the proposed meeting. Business transacted at any special meeting of
the stockholders shall be limited to the purposes stated in the notice
Section 2.4 Notices. Written notice stating the place, date and hour of
the meeting and, in case of a special meeting, the purpose or purposes for which
the meeting is called, shall be given not less than 10 nor more than 60 days
before the date of the meeting, except as otherwise required by statute or the
certificate of incorporation, either personally, by mail, or by prepaid tele-
gram, telex, cablegram or radiogram, to each stockholder of record entitled to
vote at such meeting. If mailed, such notice shall be deemed to be given when
deposited in the official government mail of any country, postage prepaid,
addressed to the stockholder at his address as it appears on the stock records
of the corporation. If given personally, or otherwise than by mail, such notice
shall be deemed to be given when either handed to the stockholder or delivered
to the stockholder s address as it appears on the stock records of the corpora-
tion.
Section 2.5 Record Date. In order that the corporation may determine the
stockholders entitled to notice of or to vote at any meeting, or any adjournment
of a meeting, of stockholders, or to express consent to corporate action in
writing without a meeting, or entitled to receive payment of any dividend or
other distribution or allotment of any rights, or entitled to exercise any
rights in respect of any change, conversion or exchange of stock or for the
purpose of any other lawful action, the board of directors may fix, in advance,
a record date, which shall not be more than 60 nor less than 15 days before the
date of such meeting, nor more than 60 days prior to any other action. If no
record date is fixed, the record date for determining stockholders shall be at
the close of business on the day next preceding the day on which notice is
given, and the record date for determining stockholders for any other purpose
shall be at the close of business on the day on which the board of directors
adopts the resolution relating to such other purpose. A determination of
stockholders of record entitled to notice of or to vote at a meeting of stock-
holders shall apply to any adjournment of the meeting; provided, however, that
the board of directors may fix a new record date for the adjourned meeting.
Section 2.6 Voting List. The secretary of the corporation shall prepare
and make, at least ten days before every meeting of stockholders, a complete
list of the stockholders entitled to vote at the meeting, arranged in alphabeti-
cal order and showing the address and the number of shares registered in the
name of each stockholder. Such list shall be open to the examination of any
stockholder, for any purpose germane to the meeting, during ordinary business
hours, for a period of at least ten days prior to the meeting, either at a place
within the city where the meeting is to be held, which place shall be specified
in the notice of the meeting, or, if not so specified, at the place where the
meeting is to be held. The list shall be produced and kept at the time and
place of the meeting during the whole time thereof to be open to the inspection
of any stockholder who is present.
Section 2.7 Quorum. The holders of a majority of the stock issued and
outstanding and entitled to vote at the meeting, present in person or represent-
ed by proxy, shall constitute a quorum at all meetings of the stockholders for
the transaction of business except as otherwise provided by statute or by the
Certificate of Incorporation. If, however, such a quorum shall not be present
at any meeting of stockholders, the stockholders entitled to vote, present in
person or represented by proxy, shall have the power to adjourn the meeting from
time to time, without notice if the time and place are announced at the meeting,
until a quorum shall be present. At such adjourned meeting at which a quorum
shall be present any business may be transacted which might have been transacted
at the original meeting. If the adjournment is for more than 30 days, or if
after the adjournment a new record date is fixed for the adjourned meeting, a
notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.
Section 2.8 Voting and Proxies. Each stockholder shall at every meeting
of the stockholders be entitled to one vote in person or by proxy for each share
of the capital stock having voting power held by such stockholder, but no proxy
shall be voted on after three years from its date, unless the proxy provides for
a longer period. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which, by express provision of the statutes or
of the Certificate of Incorporation, a different vote is required, in which case
such express provision shall govern.
Section 2.9 Waiver. Attendance of a stockholder of the corporation,
either in person or by proxy, at any meeting, either annual or special, shall
constitute waiver of notice of such meeting, except where a stockholder attends
a meeting for the express purpose of objecting, at the beginning of the meeting,
to the transaction of any business because the meeting is not lawfully called or
convened. A written waiver of notice of any such meeting signed by a stockhold-
er or stockholders entitled to such notice, whether before, at or after the time
stated in such notice, shall be equivalent to notice.
Section 2.10 Conduct of Stockholder Meetings. At every meeting of
stockholders, the chairman of the board, or in his absence, the president, or in
his absence, a vice-president, or if none be present, the appointee of the
meeting, shall act as chairman of the meeting, the secretary, or in the absence
an assistant secretary, or if none be present, the appointee of the chairman of
the meeting shall act as secretary of the meeting. The chairman of the meeting
shall call the meeting to order, and shall make such rulings and determinations
as shall be necessary or convenient for the orderly conduct of the meeting,
including but not limited to setting the place and agenda, imposing reasonable
time limits on speakers, determining when the polls shall open and close, the
method of voting and the manner in which votes are counted, the sufficiency and
interpretation of any proxy, the propriety of any matter submitted for stock-
holder action, and the time of adjournment.
Section 2.11 Notice of Stockholder Business and Nominations.
(A) Annual Meeting of Stockholders.
(1) Nominations of persons for election to the board of directors of the
corporation and the proposal of business to be considered by the stockholders
may be made at an annual meeting of stockholders (a) by or at the direction of
the board of directors or (b) by any stockholder of the corporation who is
entitled to vote at the meeting, who complies with the notice procedures set
forth in clauses (2) and (3) of paragraph (A) of this Section 2.11 and who is
a stockholder of record at the time such notice is delivered to the secretary
of the corporation.
(2) For nominations or other business to be properly brought before the
annual meeting by a stockholder pursuant to clause (b) of paragraph (A)(1) of
this Section 2.11, the stockholder must have given timely notice thereof in
writing to the secretary of the corporation and such business must be a proper
subject for stockholder action under the Delaware General Corporation Law. To
be timely, a stockholder s notice shall be delivered to the
secretary at the principal executive offices of the corporation not less
-15-
than 70 days nor more than 90 days prior to the first anniversary of the
preceding year s annual meeting; provided, however, that in the event that the
date of the annual meeting is advanced by more than 20 days, or delayed by more
than 70 days, from such anniversary notice by the stockholder to be timely must
be so delivered not earlier than the 90th day prior to such annual meeting and
not later than the close of business following the day on which public announce-
ment of the date of such meeting is first made. Such stockholders notice shall
set forth (a) as to each person whom the stockholder proposes to nominate for
election or reelection as a director all information relating to such person
that is required to be disclosed in solicitations of proxies for election of
directors, or is otherwise required, in each case pursuant to Regulation 14A
under the Securities Exchange Act of 1934, as amended (the Exchange Act ),
including such person s written consent to being named in the proxy statement as
a nominee and to serving as a director if elected; (b) as to any other business
that the stockholder proposes to bring before the meeting, a brief description
of the business desired to be brought before the meeting, the reasons for
conducting such business at the meeting and any material interest in such
business of such stockholder and the beneficial owner, if any, on whose behalf
the proposal is made; and (c) as to the stockholder giving the notice and the
beneficial owner, if any, on whose behalf the nomination or proposal is made (I)
the name and address of such stockholder, as they appear on the corporation s
books, and of such beneficial owner and (ii) the class and number of shares of
the corporation which are owned beneficially and of record by such stockholder
and such beneficial owner.
(3) Notwithstanding anything in the second sentence of paragraph (A)(2) of
this Section 2.11 to the contrary, in the event that the number of directors
to be elected to the board of directors is increased and there is no public
announcement naming all of the nominees for director or specifying the size of
the increased board of directors made by the corporation at least 80 days
prior to the first anniversary of the preceding year s annual meeting, a
stockholder s notice required by this paragraph (A)(2) of this Section 2.11
shall also be considered timely, but only with respect to nominees for any new
positions created by such increase, if it shall be delivered to the secretary
at the principal executive offices of the corporation not later than the close
of business on the 10th day following the day on which such public announce-
ment is first made by the corporation.
(B) Special Meeting of the Stockholders. Nominations of persons for
election to the board of directors may be made at a special meeting of
stockholders at which directors are to be elected (I) by or at the direction
of the board of directors or (ii) by any stockholder of the corporation who is
entitled to vote at the meeting, who complies with the notice procedures set
forth in this paragraph (B) and who is a stockholder of record at the time
such notice is delivered to the secretary of the corporation. Nominations by
stockholders of persons for election to the board of directors may be made at
such a special meeting of stockholders if the stockholder s notice as required
by paragraph (A)(2) of this Section 2.11 shall be delivered to the secretary
at the principal executive offices of the corporation not earlier than the
90th day prior to such special meeting and not later than the close of
business on the later of the 70th day prior to such special meeting or the
10th day following the date on which public announcement is first made of the
date of the special meeting and of the nominees proposed by the board of
directors to be elected at such meeting.
(C) General.
(1) Only persons who are nominated in accordance with the procedures set
forth in this Section 2.11 shall be eligible to serve as directors and only such
business shall be conducted at a meeting of stockholders as shall have been
brought before the meeting in accordance with the procedures set forth in this
Section 2.11.
(2) Except as otherwise provided by law, the Certificate of Incorporation or
this Section 2.11, the chairman of the meeting shall have the power and duty
to determine whether a nomination or any business proposed to be brought
before the meeting was made in accordance with the procedures set forth in
this Section 2.11 and, if any proposed nomination or business is not in
compliance with this Section 2.11 to declare that such defective proposal or
nomination shall be disregarded.
(3) For purposes of this Section 2.11, public announcement shall mean
disclosure in a press release reported by the Dow Jones News Service, Associ-
ated Press or comparable national news service or in a document publicly filed
by the corporation with the Securities and Exchange Commission pursuant to
Section 13, 14 or 15(d) of the Exchange Act.
(4) Notwithstanding the foregoing provisions of this Section 2.11, a
stockholder shall also comply with all applicable requirements of the Exchange
Act and the rules and regulations thereunder with respect to the matters set
forth in this Section 2.11. Nothing in this Section 2.11 shall be deemed to
affect any rights of stockholders to request inclusion of proposals in the
corporation s proxy statement pursuant to Rule 14a-8 under Exchange Act.
ARTICLE III
Directors
Section 3.1 Number. The number of directors shall be eight, or such other
number (one or more), as fixed from time to time by resolution of the board of
directors.
Section 3.2 Elections. Except as provided in Section 3.3 of this Article,
the board of directors shall be elected at the annual meeting of the stock-
holders or at a special meeting called for that purpose. Each director shall be
elected to serve until the next annual meeting of stockholders or until his
successor shall be elected and qualified.
Section 3.3 Vacancies. Any vacancy occurring on the board of directors
and any directorship to be filled by reason of an increase in the board of
directors may be filled only by the affirmative vote of a majority of the
remaining directors, though less than a quorum of the board of directors. Such
newly elected director shall hold office until the next annual meeting of
stockholders or until his successor shall be elected and qualified.
Section 3.4 Meetings. The first meeting of each newly elected board of
directors shall be held immediately after, and at the same place as, the annual
meeting of the stockholders. No notice of such meeting shall be necessary to
the newly elected directors in order to legally constitute the meeting, provided
a quorum shall be present. The board of directors may, by resolution, establish
a place and time for regular meetings which may thereafter be held without call
or notice.
Section 3.5 Notice of Special Meetings. Special meetings may be called by
the president or any two members of the board of directors. Such notice may be
given to each member of the board of directors by mail by the secretary, the
president or the members of the board calling the meeting by depositing the same
in the mail at least 7 days before the meeting, addressed to the director at the
last address he has furnished to the corporation for this purpose, and any
notice so mailed shall be deemed to have been given at the time when mailed.
Notice may also be given at least 48 hours before the meeting in person, or by
telephone, prepaid telegram, telex, cablegram or radiogram addressed as stated
above; and such notice shall be deemed to have been given at the time when such
telegram, telex, cablegram or radiogram is delivered to the last address of the
director for this purpose, or when such personal or telephone conversation
occurs.
Section 3.6 Quorum. At all meetings of the board, a majority of the
directors then in office shall constitute a quorum for the transaction of
business, and the act of a majority of the directors present at any meeting at
which a quorum is present shall be the act of the board of directors, except as
otherwise specifically required by statute, the certificate of incorporation, or
these bylaws. If less than a quorum be present, the director or directors
present may adjourn the meeting from time to time without further notice.
Voting by proxy is not permitted at meetings of the board of directors.
Section 3.7 Waiver. Attendance of a director at a meeting of the board of
directors shall constitute a waiver of notice of such meeting, except where a
director attends a meeting for the express purpose of objecting to the transac-
tion of any business because the meeting is not lawfully called or convened. A
written waiver of notice or manner of calling any such meeting signed by a
director entitled to such notice, whether before, at, or after the time stated
in such notice, shall be equivalent to the giving of such notice.
Section 3.8 Action Without Meeting. Any action required or permitted to
be taken at a meeting of the board of directors may be taken without a meeting
if a consent in writing setting forth the action so taken shall be signed by all
of the directors and filed with the minutes of proceedings of the board of
directors.
Section 3.9 Attendance by Telephone. Members of the board of directors or
any committee of the corporation may participate in a meeting of such board or
committee by means of conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other,
and such participation in a meeting shall constitute presence in person at such
meeting.
Section 3.10 Removal. Any director may be removed from office at any time,
but only for cause or upon the affirmative vote of the holders of at least two-
thirds of the corporation s stock entitled to vote thereon.
ARTICLE IV
Officers
Section 4.1 Election. The corporation shall have such officers with such
duties as the board of directors determines by resolution. The officers shall
be elected or appointed at least annually by the board of directors at its first
meeting after each annual meeting of stockholders.
Section 4.2 Removal, Resignation and Vacancies. Any officer elected or
appointed by the board of directors may be removed at any time by the affirma-
tive vote of a majority of the board of directors. Any officer may resign at
any time by giving written notice of his resignation to the president or to the
secretary, and acceptance of such resignation shall not be necessary to make it
effective, unless the notice so provides. Any vacancy occurring in any office
may be filled by the board of directors.
Section 4.3 Chairman of the Board. The board of directors may, in its
sole discretion, elect a chairman of the board. If elected, the chairman of the
board shall preside at all meetings of shareholders and of the board of direc-
tors. In the event a chief executive officer (CEO) of the corporation is not
elected or appointed by the board of directors, the chairman of the board shall
be the chief executive officer of the corporation. Subject to the direction and
control of the board of directors, the chairman of the board, coextensively with
the president, the CEO, and the chief operating officer (COO), shall have the
general and active management of the business of the corporation and shall see
that all orders and resolutions of the board of directors are carried into
effect, and he/she may execute contracts, deeds and other instruments on behalf
of the corporation as are necessary and appropriate. He/she shall perform such
additional functions and duties as are appropriate and customary for the office
of the chairman of the board and as the board of directors may prescribe from
time to time.
Section 4.4 Vice Chairman of the Board. In the absence, disability or
vacancy of the chairman of the board, the vice chairman of the board shall serve
as chairman of the board.
Section 4.5 Chief Executive Officer. The board of directors, in its sole
discretion, may elect a chief executive officer (CEO). Subject to the direction
and control of the board of directors, the CEO coextensively with the chairman
of the board, the president, and the COO, shall have the general and active
management of the business of the corporation and shall see that all orders and
resolutions of the board of directors are carried into effect; and he/she may
execute contracts, deeds and other instruments on behalf of the corporation as
are necessary and appropriate. He/she shall perform such additional functions
and duties as are appropriate and customary for the office of COO and as the
board of directors may prescribe from time to time.
Section 4.6 President. In the absence, disability or vacancy of the
chairman of the board and the vice chairman of the board, the President shall
preside at all meetings of the shareholders and of the board of directors. In
the absence, disability or vacancy of the CEO, the president shall serve as
CEO. Subject to the direction and control of the board of directors, the
president, coextensively with the chairman of the board, the CEO, and the COO,
shall have the general and active management of the business of the corporation
and shall see that all orders and resolutions of the board of directors are
carried into effect; and he/she may execute contracts, deeds and other
instruments on behalf of the corporation as are necessary and appropriate.
He/she shall perform such additional functions and duties as are appropriate and
customary for the office of president and as the board of directors may pre-
scribe from time to time.
Section 4.7 Chief Operating Officer. The board of directors, in its sole
discretion, may elect a chief operating officer (COO). Subject to the direction
and control of the board of directors, the COO, coextensively with the chairman
of the board, the CEO, and the president, shall have the general and active
management of the business of the corporation and shall see that all orders and
resolutions of the board of directors are carried into effect; and he/she may
execute contracts, deeds and other instruments on behalf of the corporation as
are necessary and appropriate. He/she shall perform such additional functions
and duties as are appropriate and customary for the office of COO and as the
board of directors may prescribe from time to time.
Section 4.8 Executive Vice President. The board of directors, in its sole
discretion, may elect an executive vice president, who shall report to and
assist the president, and who shall serve as president in the absence, disabili-
ty or vacancy of the president.
Section 4.9 Senior Vice President. The board of directors, in its sole
discretion, may elect one or more senior vice presidents, who shall report to
and assist the president and executive vice president.
Section 4.10 Vice President. The board of directors, in its sole discre-
tion, may elect one or more vice presidents, who shall report to and assist the
president, executive vice president and senior vice presidents.
Section 4.11 Assistant Vice President. The board of directors, in its sole
discretion, may elect one or more assistant vice presidents, who shall report to
and assist the president, executive vice president, senior vice presidents and
vice presidents.
Section 4.12 Secretary. The secretary shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the board of
directors, keep the minutes of such meetings, have charge of the corporate seal
and stock records, be responsible for the maintenance of all corporate files and
records and the preparation and filing of reports to governmental agencies,
other than tax returns, have authority to affix the corporate seal to any
instrument requiring it (and, when so affixed, it may be attested by his or her
signature), and perform such other duties as may from time to time be prescribed
by the board of directors and the president.
Section 4.13 Assistant Secretary. The assistant secretary or, if there be
more than one, the assistant secretaries in the order determined by the presi-
dent shall, in the absence or disability of the secretary, or in case such
duties are specifically delegated to him/her by the board of directors, the
president or the secretary, perform the duties and exercise the powers of the
secretary and shall, under the supervision of the secretary, perform such other
duties and have such other powers as the secretary, the board of directors or
the president may from time to time prescribe.
Section 4.14 Chief Financial Officer. The chief financial officer (CFO)
shall have control of the funds and the care custody of all the stocks, bonds,
and other securities of the corporation, and be responsible for the preparation
and filing of tax returns. He/she shall receive all moneys paid to the corpora-
tion and shall have authority to give receipts and vouchers, to sign and endorse
checks and warrants in its name and on its behalf, and give full discharge for
the same. He/she shall also have charge of the disbursement of the funds of the
corporation, and shall keep full and accurate records of the receipts and
disbursements. He/she shall deposit all moneys and other valuable effects in
the name and to the credit of the corporation in such depositories as shall be
designated by the board of directors, and shall perform such other duties and
have such other powers as the board of directors or the president may from time
to time prescribe.
Section 4.15 Treasurer. The treasurer shall report to and assist the CFO,
and the board of directors, chairman of the board, CEO, president and COO.
Section 4.16 Assistant Treasurer. The assistant treasurer or, if there be
more than one, the assistant treasurers in the order determined by the president
shall, in the absence or disability of the treasurer, or in case such duties are
specifically delegated to him/her by the board of directors, president or trea-
surer, perform the duties and exercise the powers of the treasurer and shall,
under the supervision of the treasurer, perform such other duties and have such
other powers as the treasurer, the board of directors or the president may from
time to time prescribe.
Section 4.17 Compensation. Officers shall receive such compensation for
their services as may be authorized or ratified by the board of directors.
Election or appointment of an officer shall not of itself create a contract
right to compensation for services performed as such officer.
ARTICLE V
Committees
The board of directors may establish committees for the performance of
delegated or designated functions to the extent permitted by law. The board of
directors may provide, by resolution or amendment to the bylaws, such powers,
limitations, and procedures for committees as the board of directors deems
advisable.
ARTICLE VI
Contracts
Section 6.1 Financial Interest. No contract or transaction between the
corporation and one or more of its directors and officers, or between the
corporation and any other corporation, partnership, association, or other
organization in which one or more of the directors or officers are directors or
officers, or have a financial interest, shall be void or voidable solely for
this reason, or solely because the director or officer is present at or partici-
pates in the meeting of the board or committee thereof which authorizes the
contract or transaction, or solely because his or their votes are counted for
such purpose, if:
(a) The material facts as to his relationship or interest and as to the
contract or transaction are disclosed or are known to the board of directors
or the committee, and the board or committee in good faith authorizes the
contract or transaction by the affirmative votes of a majority of the disin-
terested directors, even though the disinterested directors be less than a
quorum; or
(b) The material facts as to his relationship or interest and as to the
contract or transaction are disclosed or are known to the stockholders
entitled to vote thereon, and the contract or transaction is specifically
approved in good faith by vote of the stockholders; or
(c) The contract or transaction is fair as to the corporation as of the time
it is authorized, approved or ratified by the board of directors, or a
committee thereof, or the stockholders.
Section 6.2 Quorum. Common or interested directors may be counted in
determining the presence of a quorum at a meeting of the board or of a committee
which authorizes the contract or transaction.
ARTICLE VII
Stock
Section 7.1 Certificates. Every holder of stock in the corporation shall
be entitled to have a certificate, signed by or in the name of the corporation
by the president or a vice president and the secretary or an assistant secretary
of the corporation, certifying the number of shares owned by him in the corpora-
tion.
Section 7.2 Facsimile Signatures. Where a certificate is countersigned
(1) by a transfer agent other than the corporation or its employee, or (2) by a
registrar other than the corporation or its employee, any other signature on the
certificate may be facsimile. In case any officer, transfer agent or registrar
who has signed, or whose facsimile signature or signatures have been placed upon
any such certificate shall cease to be such officer, transfer agent or regis-
trar, whether because of death, resignation or otherwise, before such certifi-
cate is issued, it may nevertheless be issued by the corporation with the same
effect as if he were such officer, transfer agent or registrar at the date of
issue.
Section 7.3 Lost Certificates. The board of directors may direct a new
certificate or certificates to be issued in place of any certificate or certifi-
cates issued by the corporation alleged to have been lost or destroyed, upon the
making of an affidavit of that fact by the person claiming the certificate of
stock to be lost or destroyed. When authorizing such issue of a new certificate
or certificates, the board of directors may, in its discretion and as a condi-
tion precedent to the issuance of a new certificate or certificates, require the
owner of such lost or destroyed certificate or certificates, or his legal
representative, to advertise the same in such manner as it shall require and to
give the corporation a bond in such sum as it may direct as indemnity against
any claim that may be made against the corporation with respect to the certifi-
cate alleged to have been lost or destroyed.
Section 7.4 Transfer of Stock. Transfers of shares of capital stock of
the corporation shall be made on the books of the corporation only upon presen-
tation of the certificate or certificates representing such shares properly
endorsed or accompanied by a proper instrument of assignment, except as may
otherwise be expressly provided by the laws of the State of Delaware or by order
by a court of competent jurisdiction. The officers or transfer agents of the
corporation may, in their discretion, require a signature guaranty before making
any transfer.
Section 7.5 Registered Stockholders. The corporation shall be entitled to
treat the person in whose name any shares of stock are registered on its books
as the owner of such shares for all purposes, and shall not be bound to recog-
nize any equitable or other claim or interest in such shares on the part of any
other person, whether or not the corporation shall have notice of such claim or
interest, except as expressly provided by the laws of Delaware.
ARTICLE VII
Seal
The board of directors may adopt and provide a seal which shall be circular in
form and shall bear the name of the corporation and the words SEAL and
DELAWARE, and which, when adopted, shall constitute the corporate seal of the
corporation. The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or manually reproduced.
ARTICLE IX
Fiscal Year
The board of directors, by resolution, may adopt a fiscal year for the
corporation.
ARTICLE X
Amendment
These bylaws may at any time and from time to time be amended, altered or
repealed by the board of directors. These bylaws may also be amended, altered
or repealed at any special meeting of the stockholders if duly called for that
purpose or at any annual meeting, by the affirmative vote of the holders of at
least two-thirds of the corporation s stock entitled to vote thereon.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Jack Henry &
Associates, Inc 3rd Quarter 10-Q for 1996 and is qualified in its entirety by
reference to such 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-END> MAR-31-1996
<CASH> 4573
<SECURITIES> 2633
<RECEIVABLES> 8362
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 18748
<PP&E> 19659
<DEPRECIATION> 5954
<TOTAL-ASSETS> 52636
<CURRENT-LIABILITIES> 15947
<BONDS> 0
<COMMON> 118
0
0
<OTHER-SE> 35585
<TOTAL-LIABILITY-AND-EQUITY> 52636
<SALES> 16561
<TOTAL-REVENUES> 16561
<CGS> 8721
<TOTAL-COSTS> 3569
<OTHER-EXPENSES> (200)
<LOSS-PROVISION> 0
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<INCOME-PRETAX> 4471
<INCOME-TAX> 1710
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</TABLE>
