UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
Amendment No. 1 to Annual Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
For the Fiscal Year Ended October 31, 1994 Commission File No. 1-10411
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SAFECARD SERVICES, INCORPORATED
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(Exact name of Registrant as specified in its charter)
Delaware 13-2650534
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(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
3001 E. Pershing Blvd., Cheyenne, Wyoming 82001
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (307) 771-2700
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Securities registered pursuant to Section 12(b) of the Act:
Title of Class Name of Exchange on Which Registered
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Common Stock, $.01 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 (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes x No
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Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
State the aggregate market value of the voting stock held by non-affiliates
of the Registrant (based on the closing market price on January 13, 1995):
$535,272,000.
Indicate the number of shares outstanding of each of the Registrant's classes
of common stock (as of January 13, 1995): Common Stock, $.01 Par Value -
28,933,599 shares.
Documents Incorporated By Reference
-----------------------------------
Portions of the Proxy Statement for the 1995 Annual Meeting of Stockholders
are incorporated by reference into Part III.
PART IV
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Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
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Certain of the agreements listed below are the subject of litigation
with Peter Halmos and parties related to him.
(a)1. Financial Statements
The Consolidated Financial Statements and Notes thereto required by
Item 8 are listed in the Index set forth in Item 8. Financial Statements
and Supplementary Data.
(a)2. Financial Statement Schedules
The Financial Statement Schedules required by Item 8 are listed in
the Index set forth in Item 8. Financial Statements and Supplementary Data.
(a)3. Exhibits
3(a) SafeCard Services, Incorporated's Certificate of
Incorporation, incorporated by reference to Exhibit 3(a) of the Company's
Annual Report on Form 10-K for its fiscal year ended October 31, 1992.
3(b) SafeCard Services, Incorporated's Certificate of Amendment of
Certificate of Incorporation, as filed with the Secretary of State of
Delaware, Division of Corporations on August 20, 1987, incorporated by
reference to Exhibit 3(g) of the Company's Annual Report on Form 10-K for
its fiscal year ended October 31, 1987.
3(c) SafeCard Services Insurance Company's Certificate of
Incorporation, incorporated by reference to Exhibit 3(e) of the Company's
Annual Report on Form 10-K for its fiscal year ended October 31, 1987.
3(d) SafeCard Services Insurance Company's By-Laws, incorporated by
reference to Exhibit 3(f) of the Company's Annual Report on Form 10-K for
its fiscal year ended October 31, 1987.
3(e) SafeCard Services, Incorporated By-Laws as amended through
December 31, 1994.
Management Contracts and Compensatory Plans
10(a) Form of Non-Qualified Stock Option Agreement dated August
30, 1989 between the Company and an outside director, incorporated by
reference to Exhibit 10(a) of the Company's Quarterly Report on Form 10-Q
for its fiscal quarter ended July 31, 1989.
10(b) Form of Non-Qualified Stock Option Agreement dated
October 16, 1991 between the Company and an outside director, incorporated
by reference to Exhibit 10(n) of the Company's Annual Report on Form 10-K
for its fiscal year ended October 31, 1991.
10(c) Form of Non-Qualified 1991 Employee Stock Option Plan
dated October 16, 1991 between the Company and twenty key employees,
incorporated by reference to Exhibit 10(o) of the Company's Annual Report on
Form 10-K for its fiscal year ended October 31, 1991.
10(d) Board of Directors' Resolution dated December 6, 1991
establishing a non-employee director retirement plan, incorporated by
reference to Exhibit 10(s) of the Company's Annual Report on Form 10-K for
its fiscal year ended October 31, 1991.
10(e) Indemnification Agreements for certain of the Company's
Directors dated October 2, 1992 incorporated by reference to Exhibit 10(x)
to the Company's Annual Report on Form 10-K for its fiscal year ended
October 31, 1992.
10(f) Indemnification Agreements for two of the Company's
Directors dated February 11, 1993 and September 1, 1993, incorporated by
reference to Exhibit 10(ai) of the Company's Annual Report on Form 10-K for
its fiscal year ended October 31, 1993.
10(g) Forms of Non-Qualified Stock Option Agreements dated
February 11, 1993 and September 1, 1993 between the Company and two outside
directors, incorporated by reference to Exhibit 10(aj) of the Company's
Annual Report on Form 10-K for its fiscal year ended October 31, 1993.
10(h) 1994 Long Term Stock-Based Incentive Plan, incorporated
by reference to the Company's 1993 definitive proxy statement.
10(i) Second Amendment to the 1994 Long Term Stock-Based
Incentive Plan.
10(j) Employment Agreement, effective as of December 1, 1993,
between the Company and Paul G. Kahn, incorporated by reference to Exhibit
1 of the Company's Current Report on Form 8-K filed on December 6, 1993.
10(k) Employment Agreement, effective as of February 1, 1994,
between the Company and Francis J. Marino, incorporated by reference to the
Company's Quarterly Report on Form 10-Q for the fiscal quarter ended January
31, 1994.
10(l) Amendment to Exhibit 3 of the Employment Agreement,
effective as of February 1, 1994, between the Company and Francis J. Marino.
10(m) Employment Agreement as of May 2, 1994, between the
Company and G. Thomas Frankland, incorporated by reference to Exhibit 10(a)
of the Company's Quarterly Report for its fiscal quarter ended April 30,
1994.
10(n) Amendment to Exhibit 3 of the Employment Agreement,
effective as of May 2, 1994, between the Company and G. Thomas Frankland.
10(o) Indemnification Agreement as of April 7, 1994, between
the Company and one outside director, incorporated by reference to Exhibit
10(b) of the Company's Quarterly Report for its fiscal quarter ended April
30, 1994.
10(p) Non-Qualified Stock Option Agreement as of April 7, 1994,
between the Company and one outside director, incorporated by reference to
Exhibit 10(c) of the Company's Quarterly Report for its fiscal quarter ended
April 30, 1994.
10(q) Employment Agreement, effective as of September 14, 1994,
between the Company and John R. Birk.
10(r) Amendment, effective as of January 1, 1995, to Employment
Agreement, between the Company and John R. Birk.
10(s) Executive Deferred Compensation Plan.
10(t) Form of Executive Agreement between the Company and
certain senior officers.
10(u) Form of Non-Qualified Stock Option Agreement under the
1994 Long Term Stock-Based Incentive Plan between the Company and certain
officers of the Company.
Other Material Contracts
10(v) Termination Agreement dated as of May 26, 1994 between
the Company and Steven J. Halmos and Recission Agreement made and entered
into as of June 9, 1994 between the Company and Steven J. Halmos,
incorporated by reference to Exhibit 10(e) from the Company's Quarterly
Report on Form 10-Q for the fiscal quarter ended July 31, 1994.
10(w) Agreement with Citicorp (South Dakota), N.A., effective
January 1, 1989, incorporated by reference to the Company's Form 8 Amendment
No. 3, dated November 10, 1989, to its Quarterly Report on Form 10-Q for its
fiscal quarter ended April 30, 1989.
10(x) Second Amendment to Agreement with Citicorp (South
Dakota), N.A. dated March 31, 1992 incorporated by reference to Exhibit
10(b) to the Company's Quarterly Report on Form 10-Q for its fiscal quarter
ended April 30, 1992.
10(y) Third Amendment to the Agreement with Citibank (South
Dakota), N.A., dated August 30, 1993, incorporated by reference to Exhibit
10(ah) of the Company's Annual Report on Form 10-K for its fiscal year ended
October 31, 1993.
10(z) Agreement with Peter Halmos, dated November 1, 1988,
regarding a marketing license for credit information services, incorporated
by reference to Exhibit 10(e) of the Company's Annual Report on Form 10-K,
for its fiscal year ended October 31, 1988.
10(aa) First Amendment to Agreement, dated January 25, 1991,
regarding marketing license for credit information services, incorporated by
reference to Exhibit 10(m) of the Company's Annual Report on Form 10-K for
its fiscal year ended October 31, 1990.
10(ab) Letter Agreement dated January 27, 1992, between
CreditLine Corporation and the Company, incorporated by reference to Exhibit
10(q) of the Company's Annual Report on Form 10-K for its fiscal year ended
October 31, 1991.
10(ac) Confirmation Agreement between Peter Halmos, High Plains
Capital Corporation, CreditLine Corporation and the Company dated January
27, 1992, incorporated by reference to Exhibit 10(r) of the Company's Annual
Report on Form 10-K for its fiscal year ended October 31, 1991.
10(ad) Public Relations Consulting Agreement dated October 25,
1994 between the Dilenschneider Group, Inc. and the Company.
10(ae) Special Projects Public Relations Consulting Agreement
dated December 14, 1994 between the Company and the Dilenschneider Group,
Inc.*
11(a) Computation of Primary Earnings Per Share.
11(b) Computation of Fully Diluted Earnings Per Share.
22 Subsidiaries of the Registrant.
23 Consent of Independent Accountants to incorporation by
reference of their report in Prospectuses constituting part of Registration
Statements on Forms S-3 and S-8.
24 Powers of Attorney.
27 Financial Data Schedule
(b) Reports on Form 8-K
(b)1 Announcement of the completion of the acquisition of Wright
Express Corporation of South Portland, Maine dated September 29, 1994.
* Portions of exhibit 10(ae) have been omitted and filed separately with the
Commission pursuant to a confidential treatment request.
SIGNATURES
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Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.
SAFECARD SERVICES, INCORPORATED
By: FRANCIS J. MARINO
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Francis J. Marino
Vice Chairman
February 9, 1995
Exhibit Index
Exhibit Page Numbers
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3(a) SafeCard Services, Incorporated's Incorporated by reference to
Certificate of Incorporation. Exhibit 3(a) of the Company's
Annual Report on Form 10-K for
its fiscal year ended October 31,
1992.
3(b)SafeCard Services, Incorporated's Incorporated by reference to
Certificate of Amendment of Certificate Exhibit 3(g) of the Company's
of Incorporation, as filed with the Annual Report on Form 10-K for
Secretary of State of Delaware, Division its fiscal year ended October 31,
of Corporations on August 20, 1987. 1987.
3(c) SafeCard Services Insurance Incorporated by reference to
Company's Certificate of Incorporation. Exhibit 3(e) of the Company's
Annual Report on Form 10-K for
its fiscal year ended October 31,
1987.
3(d) SafeCard Services Insurance Incorporated by reference to
Company's By-Laws. Exhibit 3(f) of the Company's
Annual Report on Form 10-K for
its fiscal year ended October 31,
1987.
3(e) SafeCard Services, Incorporated
By-Laws as amended through December 60 - 71
31, 1994.
Management Contracts and Compensatory Plans
10(a) Form of Non-Qualified Stock Option Incorporated by reference to
Agreement dated August 30, 1989 between Exhibit 10(a) of the Company's
the Company and an outside director. Quarterly Report on Form 10-Q for
its fiscal quarter ended July 31,
1989.
10(b) Form of Non-Qualified Stock Option Incorporated by reference to
Agreement dated October 16, 1991 between Exhibit 10(n) of the Company's
the Company and an outside director. Annual Report on Form 10-K for
its fiscal year ended October 31,
1991.
10(c) Form of Non-Qualified 1991 Employee Incorporated by reference to
Stock Option Plan dated October 16, 1991 Exhibit 10(o) of the Company's
between the Company and twenty key Annual Report on Form 10-K for
employees. its fiscal year ended October 31,
1991.
10(d) Board of Directors' Resolution Incorporated by reference to
dated December 6, 1991 establishing a Exhibit 10(s) of the Company's
non-employee director retirement plan. Annual Report on Form 10-K for
its fiscal year ended October 31,
1991.
10(e) Indemnification Agreements for Incorporated by reference to
certain of the Company's Directors Exhibit 10(x) to the Company's
dated October 2, 1992. Annual Report on Form 10-K for
its fiscal year ended October 31,
1992.
Exhibit Index
Exhibit Page Numbers
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10(f) Indemnification Agreements for Incorporated by reference to
two of the Company's Directors dated Exhibit 10(ai) of the Company's
February 11, 1993 and September 1, 1993. Annual Report on Form 10-K for
its fiscal year ended October 31,
1993.
10(g) Forms of Non-Qualified Stock Option Incorporated by reference to
Agreements dated February 11, 1993 and Exhibit 10(aj) of the Company's
September 1, 1993 between the Company and Annual Report on Form 10-K for
two outside directors. its fiscal year ended October 31,
1993.
10(h) 1994 Long Term Stock-Based Incorporated by reference to the
Incentive Plan. Company's 1993 definitive proxy
statement.
10(i) Second Amendment to the 1994 Long 72
Term Stock-Based Incentive Plan.
10(j) Employment Agreement, effective as Incorporated by reference to
of December 1, 1993, between the Company Exhibit 1 of the Company's
and Paul G. Kahn. Current Report on Form 8-K filed
on December 6, 1993.
10(k) Employment Agreement, effective as Incorporated by reference to the
of February 1, 1994, between the Company Company's Quarterly Report on
and Francis J. Marino. Form 10-Q for the fiscal quarter
ended January 31, 1994.
10(l) Amendment to Exhibit 3 of the
Employment Agreement, effective as of 73 - 78
February 1, 1994, between the Company
and Francis J. Marino.
10(m) Employment Agreement as of May 2, Incorporated by reference to
1994, between the Company and G. Thomas Exhibit 10(a) of the Company's
Frankland. Quarterly Report for its fiscal
quarter ended April 30, 1994.
10(n) Amendment to Exhibit 3 of the
Employment Agreement, effective as of 79 - 84
May 2, 1994, between the Company and
G. Thomas Frankland.
10(o) Indemnification Agreement as of Incorporated by reference to
April 7, 1994, between the Company and Exhibit 10(b) of the Company's
one outside director. Quarterly Report for its fiscal
quarter ended April 30, 1994.
10(p) Non-Qualified Stock Option Incorporated by reference to
Agreement as of April 7, 1994, between Exhibit 10(c) of the Company's
the Company and one outside director. Quarterly Report for its fiscal
quarter ended April 30, 1994.
Exhibit Index
Exhibit Page Numbers
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10(q) Employment Agreement, effective
as of September 14, 1995, between the 85 - 125
Company and John R. Birk.
10(r) Amendment, effective as of
January 1, 1995, to Employment Agreement, 126 - 135
between the Company and John R. Birk.
10(s) Executive Deferred Compensation Plan. 136 - 146
10(t) Form of Executive Agreement between 147 - 157
the Company and certain senior officers.
10(u) Form of Non-Qualified Stock Option
Agreement under the 1994 Long Term Stock 158 - 163
- -Based Incentive Plan between the Company
and certain officers of the Company.
Other Material Contracts
10(v) Termination Agreement dated as of Incorporated by reference to
May 26, 1994 between the Company and Exhibit 10(e) from the Company's
Steven J. Halmos and Recission Agreement Quarterly Report on Form 10-Q for
made and entered into as of June 9, 1994 the fiscal quarter ended July 31,
between the Company and Steven J. Halmos. 1994.
10(w) Agreement with Citicorp (South Incorporated by reference to the
Dakota), N.A., effective January 1, 1989. Company's Form 8 Amendment No. 3,
dated November 10, 1989, to its
Quarterly Report on Form 10-Q for
its fiscal quarter ended April
30, 1989.
10(x) Second Amendment to Agreement Incorporated by reference to
with Citicorp (South Dakota), N.A. Exhibit 10(b) to the Company's
dated March 31, 1992. Quarterly Report on Form 10-Q for
its fiscal quarter ended April
30, 1992.
10(y) Third Amendment to the Agreement Incorporated by reference to
with Citibank (South Dakota), N.A., Exhibit 10(ah) of the Company's
dated August 30, 1993. Annual Report on Form 10-K for
its fiscal year ended October 31,
1993.
Exhibit Index
Exhibit Page Numbers
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10(z) Agreement with Peter Halmos, Incorporated by reference to
dated November 1, 1988, regarding a Exhibit 10(e) of the Company's
marketing license for credit information Annual Report on Form 10-K, for
services. its fiscal year ended October 31,
1988.
10(aa) First Amendment to Agreement, Incorporated by reference to
dated January 25, 1991, regarding Exhibit 10(m) of the Company's
marketing license for credit information Annual Report on Form 10-K for
services. its fiscal year ended October 31,
1990.
10(ab) Letter Agreement dated January Incorporated by reference to
27, 1992, between CreditLine Corporation Exhibit 10(q) of the Company's
and the Company. Annual Report on Form 10-K for
its fiscal year ended October 31,
1991.
10(ac) Confirmation Agreement between Incorporated by reference to
Peter Halmos, High Plains Capital Exhibit 10(r) of the Company's
Corporation, CreditLine Corporation Annual Report on Form 10-K for
and the Company dated January 27, 1992. its fiscal year ended October 31,
1991.
10(ad) Public Relations Consulting
Agreement dated October 25, 1994 between 164 - 169
the Dilenschneider Group, Inc.
and the Company.
10(ae) Special Projects Public Relations
Consulting Agreement dated December 14, 170 - 172
1994 between the Company and the
Dilenschneider Group, Inc.*
11(a) Computation of Primary Earnings 173
Per Share.
11(b) Computation of Fully Diluted 174
Earnings Per Share.
22 Subsidiaries of the Registrant 175
23 Consent of Independent Accountants to
incorporation by reference of their report in 176
Prospectuses constituting part of Registration
Statements on Forms S-3 and S-8.
24 Powers of Attorney 177 - 181
27 Financial Data Schedule 182
* Portions of exhibit 10(ae) have been omitted and filed separately with the
Commission pursuant to a confidential treatment request.
EXHIBIT 10(AE)
December 14, 1994
Robert L. Dilenschneider
Dilenschneider Group, Inc.
200 Park Avenue
26th Floor
New York, New York 10166
Re: Petros and Poolside Engagement Agreement
Dear Bob:
Reference is made to the engagement and client relationship
letter agreement dated October 25, 1994 between the Dilenschneider
Group, Inc. ("DGI") and SafeCard Services, Inc. (the "Company"),
under which DGI will provide corporate public relations and public
affairs services to the Company in 1995.
DGI has also presented the Company with proposals to provide,
and has provided, market communications and promotion/publicity
services in connection with the market introduction of three new
businesses developed by the Company:
(1) a business code-named "Petros" that (confidential
treatment requested) for which DGI will provide specific services
to be agreed to by the parties within ten days of this letter (the
"Petros Services");
(2) a business code-named "Poolside" that (confidential
treatment requested) for which DGI will provide specific services
to be agreed to by the parties within ten days of this letter (the
"Poolside Services"); and
(3) a business in connection with the PGA for which DGI will
provide no further services or assistance.
The Company accepts proposals for both Petros and Poolside,
and in consideration of DGI's agreement herein and the services
to be performed by DGI hereunder agrees to immediately pay DGI
$180,000.00 to be applied by DGI to work and expenses that have
already been performed or incurred on those projects. To the extent
that work and expenses performed or incurred to date on these
projects is less than $180,000.00, DGI will apply the remainder
toward future services and expenses. Within 10 days DGI shall
render to the Company a statement in accordance with the next
paragraph of this letter setting forth the services performed on
Petros and Poolside to the date of this letter.
Any additional amounts due DGI for future Petros Services or
Poolside Services shall be billed by DGI in accordance with the
next paragraph of this letter based on the hourly rates of DGI
staff members as set forth on Schedule A; expenses incurred by DGI
shall be billed and paid for under the terms and conditions of the
October 1994 Engagement Letter.
All statements for DGI's services should include a summary of
the kinds of services rendered during the relevant period
accompanied by a detailed statement in computerized or equivalent
form describing the services performed, the time expended each day
by each person, the hourly rates charged therefor, total number of
hours worked by each person and total dollar amounts charged by
each person.
Please review the terms of this agreement carefully and if you
have any questions concerning the foregoing conditions do not
hesitate to contact me. If this agreement is acceptable please
acknowledge that you have reviewed it, understand it, and desire to
represent the Company on the basis of the terms of this agreement
by signing and delivering to me the enclosed copy. We recommend
that you keep a copy of this agreement in your files.
Very truly yours,
SAFECARD SERVICES, INC.
By: PAUL G. KAHN
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Paul G. Kahn
THE ABOVE AGREEMENT IS ACCEPTED AND AGREED TO
THE DILENSCHNEIDER GROUP, INC.
By: ROBERT L. DILENSCHNEIDER
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Robert L. Dilenschneider
Schedule A - DGI Discounted Hourly Rates
Senior Management Time $240.00 Per Hour
Principal Time $164.00 Per Hour
Account Staff/Consultants $ 60.00-100.00 Per Hour
