Item 1. Business..........................................................1 Item 2.
ITEM 2. PROPERTIES.
All principal properties of the Company are leased. The following table provides certain summary information with respect to such principal properties as of June 30, 2001:
In addition to the principal facilities listed above, BISYS also leases certain other office and data processing facilities with leases expiring periodically over the next sixteen years.
BISYS owns or leases central processors and associated peripheral equipment used in its data processing operations and communications network, 401(k) business and electronic banking business.
BISYS believes that its existing facilities and equipment, together with expansion in the ordinary course of business, are adequate for its present and foreseeable needs.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS.
BISYS is involved in litigation arising in the ordinary course of business. Management believes that BISYS has adequate defenses and/or insurance coverage against claims arising in such litigation and that the outcome of these proceedings, individually or in the aggregate, will not have a material adverse effect upon BISYS financial position, results of operations or cash flows.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matter was submitted to a vote of security holders of the Company during the fourth quarter of fiscal 2001.
PART II
ITEM 5.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
Certain of the information required in Item 5 is incorporated herein by reference to page 40 of the Company's 2001 Annual Report under the heading "Market Price Information" and Note 4 to the Company's consolidated financial statements included therein. The Company has not paid or declared any cash dividends during its most recent two fiscal years. Portions of the Annual Report incorporated by reference in this report are included in this report as Exhibit 13.
On March 13, 2001 and March 26, 2001, BISYS issued an aggregate of $300 million principal amount of 4% Convertible Subordinated Notes due 2006 (the "Notes"). The initial purchasers of the Notes were Bear, Stearns & Co. Inc. and Credit Suisse First Boston. After giving effect to the initial purchaser's discount of $7.5 million and other expenses of the private placement, the sale of the notes resulted in approximately $292.0 million in net proceeds to the Company. In connection with the issuance of the Notes, BISYS relied on exemptions from registration under Rule 144A and Regulation S, both under the Securities Act of 1933, as amended. The Notes are convertible into shares of Common Stock at a rate of 14.9729 shares per each $1,000 principal amount of Notes, subject to adjustment under certain circumstances.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA.
The information required by this Item 6 is incorporated herein by reference to page 20 of the Annual Report, included in this report as Exhibit 13.
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The information required by this Item 7 is incorporated herein by reference to pages 21 through 24 of the Annual Report, included in this report as Exhibit 13.
ITEM 7A.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
BISYS does not have material exposure to market risk from derivative or non-derivative financial instruments. BISYS does not utilize such instruments to manage market risk exposures or for trading or speculative purposes. The Company does, however, invest available cash and cash equivalents in highly-liquid financial instruments with original maturities of three month or less. As of June 30, 2001, BISYS had
approximately $159.4 million of cash and cash equivalents invested in highly-liquid debt instruments purchased with original maturities of three months or less, including $22.5 million of overnight repurchase agreements. BISYS believes that potential near-term losses in future earnings, fair values and cash flows from reasonably possible near-term changes in the market rates for such instruments are not material to BISYS.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The information required by this Item 8 is incorporated herein by reference to pages 25 through 39 of the Annual Report, included in this report as Exhibit 13.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS IN ACCOUNTING AND FINANCIAL DISCLOSURE.
Not applicable.
PART III
Pursuant to Instruction G(3) to Form 10-K, the information required by Items 10 through 13 of this report is incorporated by reference from the Company's definitive proxy statement, which is expected to be filed with the SEC pursuant to Regulation 14A within 120 days after the end of the Registrant's fiscal year.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a)(1) Financial Statements
The consolidated financial statements of the Company as of June 30, 2001 and 2000 and for each of the three fiscal years for the period ended June 30, 2001, together with the report of PricewaterhouseCoopers LLP dated July 30, 2001, are incorporated herein by reference to pages 25 through 39 of the Annual Report, included in this report as Exhibit 13.
(a)(2) Financial Statement Schedules
All financial statement schedules are omitted for the reason that they are either not applicable or not required or because the information required is contained in the consolidated financial statements or notes thereto.
(a)(3) Exhibits:
3.1* -- Amended and Restated Certificate of Incorporation of The BISYS Group, Inc., as amended by Certificate of Amendment to Amended and Restated Certificate of Incorporation of The BISYS Group, Inc.
3.2 -- Amended and Restated By-Laws of The BISYS Group, Inc., (Incorporated by reference to Exhibit 3.2 to the Registrant's Annual Report on Form 10-K for the year ended June 30, 1997.)
4.1 -- Rights Agreement, dated as of May 8, 1997, by and between The BISYS Group, Inc. and The Bank of New York, as Rights Agent (including the form of Rights Certificate as Exhibit A). (Incorporated by reference to Exhibit 2.1 of Form 8-A filed on May 8, 1997 with the SEC.)
4.2 -- Indenture, dated as of March 13, 2001, between The BISYS Group, Inc. and Chase Manhattan Trust Company, National Association, as trustee (Incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K dated March 15, 2001, Commission File No. 0-19922.)
10.1 -- Letter Agreement dated May 12, 1995 between the Registrant and Lynn J. Mangum. (Incorporated by reference to Exhibit 10.18 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1995, Commission File No. 0-19922.)
10.2 -- Deferred Compensation Plan (Incorporated by reference to Exhibit 10.2 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, Commission File No. 0-19922.)
10.3 -- Executive Life Insurance Plan (Incorporated by reference to Exhibit 10.3 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, Commission File No. 0-19922.)
10.4 -- The BISYS Group, Inc. Executive Officer Annual Incentive Plan. (Incorporated by reference to Exhibit C to Registrant's proxy statement for its 1999 annual meeting of stockholders, Commission File No. 0-19922.)
10.5 -- The BISYS Group, Inc. Amended and Restated Stock Option and Restricted Stock Purchase Plan. (Incorporated by reference to Exhibit 10.23 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1994, Commission File No. 0-19922.)
10.6 -- The BISYS Group, Inc. 1995 Stock Option Plan. (Incorporated by reference to Exhibit A to the Registrant's proxy statement for its 1995 annual meeting of stockholders, Commission File No. 0-19922.)
10.7 -- The BISYS Group, Inc. 1996 Stock Option Plan. (Incorporated by reference to Exhibit A to Registrant's proxy statement for its 1996 annual meeting of stockholders, Commission File No. 0-19922.)
10.8 -- The BISYS Group, Inc. 1999 Equity Participation Plan. (Incorporated by reference to Exhibit B to Registrant's proxy statement for its 1999 annual meeting of stockholders, Commission File No. 0-19922.)
10.9 -- BISYS 401(k) Savings Plan. (Incorporated by reference to Exhibit 10.7 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1999, Commission File No. 0-19922.)
10.10 -- The BISYS Group, Inc. Non-Employee Directors' Stock Option Plan, as amended (Incorporated by reference to Exhibit 10.8 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, Commission File No. 0-19922.)
10.11 -- Executive Loan Agreement (Incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999, Commission File No. 0-19922.)
10.12 -- Lease of Cherry Hill, New Jersey facility dated November 29, 1990. (Incorporated by reference to Exhibit 10.25 of the Registrant's Registration Statement No. 33-45417.)
10.13 -- Lease Renewal for Cherry Hill, New Jersey facility dated August 17, 2000. (Incorporated by reference to Exhibit 10.15 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2000, Commission File No. 0-19922).
10.14 -- Lease of Lombard, Illinois facility dated May 29, 1990. (Incorporated by reference to Exhibit 10.27 of the Registrant's Registration Statement No. 33-45417.)
10.15 -- Lease Amendment for Lombard, Illinois facility dated March 28, 2000. (Incorporated by reference to Exhibit 10.17 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2000, Commission File No. 0-19922).
10.16 -- Lease of Houston, Texas facility dated June 30, 1986. (Incorporated by reference to Exhibit 10.28 of the Registrant's Registration Statement No. 33-45417.)
10.17 -- Lease of Ambler, Pennsylvania facility dated April 4, 1989. (Incorporated by reference to Exhibit 10.29 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1993, Commission File No. 0-19922.)
10.18* -- Lease of Columbus, Ohio facility dated May 17, 2001.
10.19 -- Lease of New York, New York facility dated February 26, 1998 (Incorporated by reference to Exhibit 10.15 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, Commission File No. 0-19922.)
10.20* -- Lease of Harrisburg, Pennsylvania facility dated February 23, 2000.
10.21 -- Lease of Atlanta, Georgia facility dated December 9, 1999. (Incorporated by reference to Exhibit 10.23 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2000, Commission File No. 0-19922).
10.22* -- Lease of Salt Lake City, Utah facility dated September 15, 1999.
10.23* -- Lease of Indianapolis, Indiana facility dated June 3, 1999, as amended by First Lease Amendment dated December 8, 2000.
10.24* -- Lease of Brainerd, Minnesota facility dated July 14, 1998.
10.25 -- Credit Agreement by and among The BISYS Group, Inc., the Lenders party thereto, The Chase Manhattan Bank, The First National Bank of Chicago, First Union National Bank and Fleet Bank, National Association, as co-Agents, and The Bank of New York, as Administrative Agent, with BNY Capital Markets, Inc., as Arranger, dated as of June 30, 1999, without exhibits. (Incorporated by reference to Exhibit 10.17 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1999, Commission File No. 0-19922.)
10.26 -- Stock Purchase Agreement dated as of May 26, 2000, between The BISYS Group, Inc. and PRIMEDIA, Inc. relating to the acquisition of Pictorial, Inc. (Incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K dated July 1, 2000, Commission File No. 0-19922.)
13* -- Pages 20 - 40 of the Registrant's 2001 Annual Report to Shareholders.
21* -- List of significant subsidiaries of The BISYS Group, Inc.
23* -- Consent of PricewaterhouseCoopers LLP.
*Filed herewith.
(b) Reports on Form 8-K
On June 6, 2001, the Registrant filed a Current Report on Form 8-K disclosing the acquisition of all of the outstanding capital stock of Universal Pensions, Inc., a Minnesota corporation.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
The BISYS Group, Inc.
Date: September 28, 2001 By: /s/ Andrew C. Corbin ------------------------------- Andrew C. Corbin Senior Vice President and Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on the 28th day of September, 2001.
INDEX TO EXHIBITS FILED HEREWITH
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a)(1) Financial Statements
The consolidated financial statements of the Company as of June 30, 2001 and 2000 and for each of the three fiscal years for the period ended June 30, 2001, together with the report of PricewaterhouseCoopers LLP dated July 30, 2001, are incorporated herein by reference to pages 25 through 39 of the Annual Report, included in this report as Exhibit 13.
(a)(2) Financial Statement Schedules
All financial statement schedules are omitted for the reason that they are either not applicable or not required or because the information required is contained in the consolidated financial statements or notes thereto.
(a)(3) Exhibits:
3.1* -- Amended and Restated Certificate of Incorporation of The BISYS Group, Inc., as amended by Certificate of Amendment to Amended and Restated Certificate of Incorporation of The BISYS Group, Inc.
3.2 -- Amended and Restated By-Laws of The BISYS Group, Inc., (Incorporated by reference to Exhibit 3.2 to the Registrant's Annual Report on Form 10-K for the year ended June 30, 1997.)
4.1 -- Rights Agreement, dated as of May 8, 1997, by and between The BISYS Group, Inc. and The Bank of New York, as Rights Agent (including the form of Rights Certificate as Exhibit A). (Incorporated by reference to Exhibit 2.1 of Form 8-A filed on May 8, 1997 with the SEC.)
4.2 -- Indenture, dated as of March 13, 2001, between The BISYS Group, Inc. and Chase Manhattan Trust Company, National Association, as trustee (Incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K dated March 15, 2001, Commission File No. 0-19922.)
10.1 -- Letter Agreement dated May 12, 1995 between the Registrant and Lynn J. Mangum. (Incorporated by reference to Exhibit 10.18 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1995, Commission File No. 0-19922.)
10.2 -- Deferred Compensation Plan (Incorporated by reference to Exhibit 10.2 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, Commission File No. 0-19922.)
10.3 -- Executive Life Insurance Plan (Incorporated by reference to Exhibit 10.3 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, Commission File No. 0-19922.)
10.4 -- The BISYS Group, Inc. Executive Officer Annual Incentive Plan. (Incorporated by reference to Exhibit C to Registrant's proxy statement for its 1999 annual meeting of stockholders, Commission File No. 0-19922.)
10.5 -- The BISYS Group, Inc. Amended and Restated Stock Option and Restricted Stock Purchase Plan. (Incorporated by reference to Exhibit 10.23 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1994, Commission File No. 0-19922.)
10.6 -- The BISYS Group, Inc. 1995 Stock Option Plan. (Incorporated by reference to Exhibit A to the Registrant's proxy statement for its 1995 annual meeting of stockholders, Commission File No. 0-19922.)
10.7 -- The BISYS Group, Inc. 1996 Stock Option Plan. (Incorporated by reference to Exhibit A to Registrant's proxy statement for its 1996 annual meeting of stockholders, Commission File No. 0-19922.)
10.8 -- The BISYS Group, Inc. 1999 Equity Participation Plan. (Incorporated by reference to Exhibit B to Registrant's proxy statement for its 1999 annual meeting of stockholders, Commission File No. 0-19922.)
10.9 -- BISYS 401(k) Savings Plan. (Incorporated by reference to Exhibit 10.7 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1999, Commission File No. 0-19922.)
10.10 -- The BISYS Group, Inc. Non-Employee Directors' Stock Option Plan, as amended (Incorporated by reference to Exhibit 10.8 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, Commission File No. 0-19922.)
10.11 -- Executive Loan Agreement (Incorporated by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999, Commission File No. 0-19922.)
10.12 -- Lease of Cherry Hill, New Jersey facility dated November 29, 1990. (Incorporated by reference to Exhibit 10.25 of the Registrant's Registration Statement No. 33-45417.)
10.13 -- Lease Renewal for Cherry Hill, New Jersey facility dated August 17, 2000. (Incorporated by reference to Exhibit 10.15 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2000, Commission File No. 0-19922).
10.14 -- Lease of Lombard, Illinois facility dated May 29, 1990. (Incorporated by reference to Exhibit 10.27 of the Registrant's Registration Statement No. 33-45417.)
10.15 -- Lease Amendment for Lombard, Illinois facility dated March 28, 2000. (Incorporated by reference to Exhibit 10.17 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2000, Commission File No. 0-19922).
10.16 -- Lease of Houston, Texas facility dated June 30, 1986. (Incorporated by reference to Exhibit 10.28 of the Registrant's Registration Statement No. 33-45417.)
10.17 -- Lease of Ambler, Pennsylvania facility dated April 4, 1989. (Incorporated by reference to Exhibit 10.29 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1993, Commission File No. 0-19922.)
10.18* -- Lease of Columbus, Ohio facility dated May 17, 2001.
10.19 -- Lease of New York, New York facility dated February 26, 1998 (Incorporated by reference to Exhibit 10.15 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1998, Commission File No. 0-19922.)
10.20* -- Lease of Harrisburg, Pennsylvania facility dated February 23, 2000.
10.21 -- Lease of Atlanta, Georgia facility dated December 9, 1999. (Incorporated by reference to Exhibit 10.23 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 2000, Commission File No. 0-19922).
10.22* -- Lease of Salt Lake City, Utah facility dated September 15, 1999.
10.23* -- Lease of Indianapolis, Indiana facility dated June 3, 1999, as amended by First Lease Amendment dated December 8, 2000.
10.24* -- Lease of Brainerd, Minnesota facility dated July 14, 1998.
10.25 -- Credit Agreement by and among The BISYS Group, Inc., the Lenders party thereto, The Chase Manhattan Bank, The First National Bank of Chicago, First Union National Bank and Fleet Bank, National Association, as co-Agents, and The Bank of New York, as Administrative Agent, with BNY Capital Markets, Inc., as Arranger, dated as of June 30, 1999, without exhibits. (Incorporated by reference to Exhibit 10.17 to the Registrant's Annual Report on Form 10-K for the fiscal year ended June 30, 1999, Commission File No. 0-19922.)
10.26 -- Stock Purchase Agreement dated as of May 26, 2000, between The BISYS Group, Inc. and PRIMEDIA, Inc. relating to the acquisition of Pictorial, Inc. (Incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K dated July 1, 2000, Commission File No. 0-19922.)
13* -- Pages 20 - 40 of the Registrant's 2001 Annual Report to Shareholders.
21* -- List of significant subsidiaries of The BISYS Group, Inc.
23* -- Consent of PricewaterhouseCoopers LLP.
*Filed herewith.
(b) Reports on Form 8-K
On June 6, 2001, the Registrant filed a Current Report on Form 8-K disclosing the acquisition of all of the outstanding capital stock of Universal Pensions, Inc., a Minnesota corporation.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
The BISYS Group, Inc.
Date: September 28, 2001 By: /s/ Andrew C. Corbin ------------------------------- Andrew C. Corbin Senior Vice President and Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on the 28th day of September, 2001.
INDEX TO EXHIBITS FILED HEREWITH