UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended April 30, 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: 1-10308
CUC International Inc.
(Exact name of registrant as specified in its charter)
Delaware 06-0918165
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
707 Summer Street
Stamford, Connecticut 06901
(Address of principal executive offices) (Zip Code)
(203) 324-9261
(Registrant's telephone number, including area code)
Not applicable
(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 ISSUERS INVOLVED
IN BANKRUPTCY PROCEEDINGS DURING
THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
Yes 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.
Common Stock, $.01 par value - 191,537,342 shares as of May 31,
1996
INDEX
CUC INTERNATIONAL INC. AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION PAGE
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets - April 30, 1996
and January 31, 1996. 3
Condensed Consolidated Statements of Income - Three months
ended April 30, 1996 and 1995. 4
Condensed Consolidated Statements of Cash Flows -
Three months ended April 30, 1996 and 1995. 5
Notes to Condensed Consolidated Financial Statements. 6
Independent Accountants' Review Report. 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security
Holders 13
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 17
INDEX TO EXHIBITS 18
PART I. FINANCIAL INFORMATION
CUC INTERNATIONAL INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
April 30, January 31,
1996 1996
Assets (Unaudited)
Current Assets
Cash and cash equivalents $286,344 $269,987
Receivables 305,380 297,842
Prepaid membership materials 42,302 39,061
Prepaid expenses, deferred taxes
and other 105,702 100,104
Total Current Assets 739,728 706,994
Membership solicitations in process 61,663 60,713
Deferred membership acquisition costs 278,001 273,102
Contract renewal rights and intangible
assets - net of accumulated
amortization of $97,448 and $92,415 281,545 276,047
Properties, at cost, less accumulated
depreciation of $77,698 and $73,575 65,491 61,441
Deferred income taxes and other 40,243 36,111
$1,466,671 $1,414,408
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable and accrued expenses $101,107 $124,902
Federal and state income taxes payable 12,887 24,943
Total Current Liabilities 113,994 149,845
Deferred membership income, net 523,233 513,219
Zero coupon convertible notes - net of
unamortized original issue discount
of $178 and $588 14,709 14,410
Other 9,164 9,722
Shareholders' Equity
Common stock-par value $.01 per share;
authorized 400 million shares;
issued 194,381,429 shares
and 191,820,896 shares 1,944 1,918
Additional paid-in capital 370,389 323,704
Retained earnings 482,657 434,407
Treasury stock, at cost, 3,868,011
shares and 3,410,631 shares (48,161) (30,998)
Foreign currency translation (1,258) (1,819)
Total Shareholders' Equity 805,571 727,212
$1,466,671 $1,414,408
See notes to condensed consolidated financial statements.
CUC INTERNATIONAL INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands, except per share amounts)
Three Months Ended
April 30,
1996 1995
REVENUES
Membership and service fees and other $390,026 $325,114
Total Revenues 390,026 325,114
EXPENSES
Operating 105,801 89,186
Marketing 151,962 128,520
General and administrative 54,408 48,709
Interest income, net (805) (348)
Total Expenses 311,366 266,067
INCOME BEFORE INCOME TAXES 78,660 59,047
Provision for income taxes 30,410 23,001
NET INCOME $48,250 $36,046
Net Income Per Common Share $0.25 $0.19
Weighted Average Number of
Common and Dilutive Common
Equivalent Shares Outstanding 196,736 192,371
See notes to condensed consolidated financial statements.
CUC INTERNATIONAL INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In thousands)
APRIL 30,
THREE MONTHS ENDED 1996 1995
OPERATING ACTIVITIES:
Net income $48,250 $36,046
Adjustments to reconcile net income to
net cash provided by (used in)
operating activities:
Membership acquisition costs (122,372) (83,874)
Amortization of membership
acquisition costs 117,473 97,205
Deferred membership income 9,776 (10,762)
Membership solicitations in process (950) (4,659)
Amortization of contract renewal 5,033 4,503
rights and excess cost
Deferred income taxes (2,007) 3,784
Amortization of original issue
discount on convertible notes 406 426
Depreciation 4,287 3,765
Changes in working capital items, net of acquisitions:
Increase in receivables (7,538) (13,725)
(Increase) decrease in prepaid
membership materials (3,241) 2,130
Increase in prepaid expenses (5,598) (11,323)
Net decrease in accounts payable
& accrued expenses and federal
& state income taxes payable (13,235) (20,746)
Other, net (1,987) (2,852)
Net cash provided by (used in) operating
activities 28,297 (82)
INVESTING ACTIVITIES:
Acquisitions, net of cash acquired (10,668) (51,172)
Acquisitions of properties (7,962) (7,617)
Net cash used in investing activities (18,630) (58,789)
FINANCING ACTIVITIES:
Issuance of Common Stock 5,463 10,017
Repayments of long-term obligations 1,227 378
Net cash provided by financing activities 6,690 10,395
Net increase (decrease) in cash and cash
equivalents 16,357 (48,476)
Cash and cash equivalents at beginning of
period 269,987 209,054
Cash and cash equivalents at end of
period $286,344 $160,578
See notes to condensed consolidated financial statements.
CUC INTERNATIONAL INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 -- BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with generally
accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted
accounting principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation
have been included. Operating results for the three months ended
April 30, 1996 are not necessarily indicative of the results that
may be expected for the year ending January 31, 1997. For
further information, refer to the financial statements and
footnotes thereto included in the Company's Form 10-K filing for
the year ended January 31, 1996. The condensed consolidated
financial statements at April 30, 1996 and for the three months
ended April 30, 1996 and 1995 are unaudited, but have been
reviewed by independent accountants and their report is included
herein. Certain balance sheet amounts were reclassified to
conform with the April 30, 1996 presentation.
NOTE 2 -- MERGERS AND ACQUISITIONS
During February 1996, the Company entered into two separate
Agreements and Plans of Merger to acquire Davidson & Associates,
Inc. ("Davidson") and Sierra On-Line, Inc. ("Sierra")
(collectively, the "Software Mergers"). Under the terms of the
respective agreements, the Company plans to issue .85 of one
share of its common stock, par value $.01 per share ("Common
Stock") for each share of Davidson common stock issued and
outstanding and 1.225 shares of its Common Stock for each share
of Sierra common stock issued and outstanding, immediately prior
to the respective effective dates of the Software Mergers. The
consummations of the Software Mergers are subject to certain
customary closing conditions, including the approval of the
holders of Davidson and Sierra common stock, respectively.
Additionally, the Boards of Directors of Davidson and Sierra
have the right (but are not required) to terminate the respective
merger agreements if the average price per share of the Company's
Common Stock in specified periods prior to their respective
stockholders' meetings is below $29. Neither transaction is
contingent upon the consummation of the other transaction. The
transactions will be accounted for under the pooling-of-interests
method of accounting and are expected to be completed during the
second quarter of fiscal 1997.
During April 1996, the Company entered into an Agreement and Plan
of Merger to acquire Ideon Group, Inc. ( the "Ideon Merger"). In
the Ideon Merger, each share of Ideon Group, Inc. ("Ideon")
common stock outstanding on the effective date of the Ideon
Merger will be converted into Common Stock at a value of $13.50
per share, subject to certain adjustments if the average stock
price of a share of Common Stock falls outside of a specified
range. The consummation of the Ideon Merger is subject to
certain customary closing conditions, including the approval of
the holders of Ideon common stock. The Company expects upon
closing of the Ideon Merger to reserve for costs to be incurred
related to the Ideon Merger, which will include integration and
transaction costs as well as costs relating to certain
outstanding litigation matters previously discussed in Ideon's
public filings. This transaction will be accounted for under the
pooling-of-interests method of accounting and is expected to be
completed during the second or third quarter of fiscal 1997.
CUC INTERNATIONAL INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(continued)
NOTE 3 -- SHAREHOLDERS' EQUITY
Net income per share, assuming the conversions of the zero coupon
convertible notes during the three months ended April 30, 1996
occurred at the beginning of such period, would not differ
significantly from the Company's actual earnings per share for
such period.
NOTE 4 -- INCOME TAXES
The Company's effective tax rate differs from the Federal
statutory rate principally because of state income taxes and non-
deductible amortization of the excess of cost over net assets
acquired.
Independent AccountantsO Review Report
Shareholders and Board of Directors
CUC International Inc.
We have reviewed the accompanying condensed consolidated balance
sheet of CUC International Inc. as of April 30, 1996, and the
related condensed consolidated statements of income and cash
flows for the three-month periods ended April 30, 1996 and 1995.
These financial statements are the responsibility of the
CompanyOs management.
We conducted our reviews in accordance with standards established
by the American Institute of Certified Public Accountants. A
review of interim financial information consists principally of
applying analytical procedures to financial data, and making
inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing
standards, which will be performed for the full year with the
objective of expressing an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such
an opinion.
Based on our reviews, we are not aware of any material
modifications that should be made to the accompanying condensed
consolidated financial statements referred to above for them to
be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the consolidated balance sheet of CUC
International Inc. as of January 31, 1996, and the related
consolidated statements of income, shareholders' equity and cash
flows for the year then ended, not presented herein, and in our
report dated March 19, 1996, we expressed an unqualified opinion
on those consolidated financial statements. In our opinion, the
information set forth in the accompanying condensed consolidated
balance sheet as of January 31, 1996, is fairly stated, in all
material respects, in relation to the consolidated balance sheet
from which it has been derived.
ERNST & YOUNG LLP
Stamford, Connecticut
May 22, 1996
ITEM 2. CUC INTERNATIONAL INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Three Months Ended April 30, 1996 vs.
Three Months Ended April 30, 1995
The Company's overall membership base continues to grow at a
rapid rate (from 36.9 million members at April 30, 1995 to 48
million members at April 30, 1996), which is the largest
contributing factor to the 20% increase in revenues (from $325.1
million for the quarter ended April 30, 1995 to $390 million for
the quarter ended April 30, 1996). While the overall membership
base increased by approximately 1.5 million members during the
quarter, the average annual fee collected for the Company's
membership services increased by 1%. The Company divides its
memberships into three categories: individual, wholesale and
discount program memberships. Individual memberships consist of
members that pay directly for the services and the Company pays
for the marketing costs to solicit the member primarily using
direct marketing techniques. Wholesale memberships include
members that pay directly for the services to their sponsor and
the Company does not pay for the marketing costs to solicit the
members. Discount program memberships are generally marketed
through a direct sales force, participating merchant or general
advertising and the related fees are either paid directly by the
member or the local retailer. All of these categories share
various aspects of the Company's marketing and operating
resources.
Compared to the previous year's first quarter, individual,
wholesale and discount program memberships grew by 16%, 20% and
61%, respectively, including members which came from acquisitions
completed during fiscal 1996 (members resulting from acquisitions
being "Acquired Members"). Discount program memberships have
incurred the largest increase from Acquired Members, principally
from Advance Ross Corporation, acquired in fiscal 1996, which
provides local discounts to consumers. For the quarter ended
April 30, 1996, individual, wholesale and discount coupon program
memberships represented 63%, 14% and 23% of revenues,
respectively. The Company maintains a flexible marketing plan so
that it is not dependent on any one service for the future growth
of the total membership base.
As the Company's services continue to mature, a greater
percentage of the total individual membership base is in its
renewal years. This results in increased profit margins for the
Company due to the significant decrease in certain marketing
costs incurred on renewing members. Improved response rates for
new members also favorably impact profit margins. As a result,
operating income before interest and taxes ("EBIT") increased
from $58.7 million to $77.9 million, and EBIT margins improved
from 18.1% to 20%.
Individual membership usage continues to increase, which
contributes to additional service fees and indirectly contributes
to the Company's strong renewal rate. Historically, an increase
in overall membership usage has had a favorable impact on renewal
rates. The Company records its deferred revenue net of estimated
cancellations which are anticipated in the Company's marketing
programs.
CUC INTERNATIONAL INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (continued)
Three Months Ended April 30, 1996 vs.
Three Months Ended April 30, 1995
Operating costs increased 19% (from $89.2 million to $105.8
million). The major components of the Company's operating costs
continue to be personnel, telephone, computer processing,
participant insurance premiums (the cost of obtaining insurance
coverage for members) and travel cash awards. Travel members are
entitled to receive cash awards based on travel booked with the
Company. For the quarter ended April 30, 1996, these awards
represent less than 5% of total operating costs. The increase in
overall operating costs is due principally to the variable nature
of many of these costs and, therefore, the additional costs
incurred to support the growth in the membership base.
Historically, the Company has seen a direct correlation between
providing a high level of service to its members and improved
retention.
Marketing costs decreased as a percentage of revenue (from 40% to
39%). This decrease is primarily due to improved per member
acquisition costs and an increase in renewing members. Membership
acquisition costs incurred increased 46% (from $83.9 million to
$122.4 million) as a result of the increased marketing effort
which resulted in an increased number of new members acquired.
Marketing costs include the amortization of membership
acquisition costs and other marketing costs, which primarily
consist of membership communications and sales expenses.
Amortization of membership acquisition costs increased by 21%
(from $97.2 million to $117.5 million). Other marketing costs
increased by 10% (from $31.3 million to $34.5 million). These
increases resulted primarily from the costs of servicing a larger
membership base. The marketing functions for the Company's
consumer services are combined for its various services and,
accordingly, there are no significant changes in marketing costs
by service.
The Company routinely reviews all renewal rates and has not seen
any material change over the last year in the average renewal
rate. Renewal rates are calculated by dividing the total number
of renewing members not requesting a refund during their renewal
year by the total members up for renewal.
General and administrative costs decreased as a percentage of
revenue (from 15% to 14%). This is principally the result of the
Company's ongoing ability to control overhead. Interest income,
net, increased from $.3 million to $.8 million primarily due to
the reduced level of amortization associated with the Company's
zero coupon convertible notes and the net interest income from
the increased level of cash generated by the Company for
investment.
CUC INTERNATIONAL INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (continued)
Membership Information
The following chart sets forth the approximate number of members
and net additions for the respective periods.
Net New Member
Number of Additions
Period Members for the Period
Quarter Ended April 30, 1996 48,015,000 1,535,000
Year Ended January 31, 1996 46,480,000 12,630,000*
Quarter Ended April 30, 1995 36,850,000 3,000,000**
Year Ended January 31, 1995 33,850,000 3,000,000
*Includes approximately 8 million Acquired Members.
**Includes approximately 1.7 million Acquired Members.
The membership acquisition costs incurred applicable to obtaining
a new member, for memberships other than coupon book memberships,
generally approximate the initial membership fee. Initial
membership fees for coupon book memberships generally exceed the
membership acquisition costs incurred applicable to obtaining a
new member.
Membership cancellations processed by certain of the Company's
clients report membership information only on a net basis.
Accordingly, the Company does not receive actual numbers of gross
additions and gross cancellations for certain types of
memberships. In calculating the number of members, the Company
has deducted its best estimate of cancellations which may occur
during the trial membership periods offered in its marketing
programs. Typically these periods range from one to three
months.
Liquidity And Capital Resources; Inflation; Seasonality
Funds for the Company's operations and acquisitions have been
provided through cash flow from operations. The Company also has
a credit agreement, dated March 26, 1996, with certain banks
signatory thereto; The Chase Manhattan Bank, N.A., Bank of
Montreal, Morgan Guaranty Trust Company of New York and The
Sakura Bank, Limited, as Co-Agents; and The Chase Manhattan Bank,
N.A., as Administrative Agent (the "Credit Agreement"). The
Credit Agreement provides for a $500 million revolving credit
facility with a variety of different types of loans available
thereunder. The Credit Agreement contains certain customary
restrictive covenants including, without limitation, financial
covenants and restrictions on certain corporate transactions, and
also contains various event of default provisions including,
without limitation, defaults arising from certain changes in
control of the Company. The amount of borrowings available to
the Company under the Credit Agreement was $500 million at April
30, 1996, as there were no borrowings under the Credit Agreement
at that date. The Credit Agreement is scheduled to expired March
26, 2001.
CUC INTERNATIONAL INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (continued)
Liquidity And Capital Resources; Inflation; Seasonality
(continued)
The Company invested approximately $10.7 million in acquisitions,
net of cash acquired, during the three months ended April 30,
1996. These acquisitions have been fully integrated into the
Company's operations. The Company is not aware of any trends,
demands or uncertainties that will have a material effect on the
Company's liquidity. The Company anticipates that cash flow from
operations and the Credit Agreement will be sufficient to achieve
its current long-term objectives.
The Company does not anticipate any material capital expenditures
for the next year. Total capital expenditures were $8 million
for the three months ended April 30, 1996.
The Company intends to continue to review potential acquisitions
that it believes would enhance the Company's growth and
profitability. Any acquisitions paid for in cash will initially
be financed through excess cash flow from operations and the
Credit Agreement. However, depending on the financing necessary
to complete an acquisition, additional funding may be required.
To date, the overall impact of inflation on the Company has not
been material. Except for the cash receipts from the sale of
coupon book memberships, the Company's business is generally not
seasonal. Most cash receipts from these coupon book memberships
are received in the fourth quarter and, to a lesser extent, in
the first and the third quarters of each fiscal year.
For the three months ended April 30, 1996, the Company's
international businesses represented less than 5% of EBIT.
Operating in international markets involves dealing with
sometimes volatile movements in currency exchange rates. The
economic impact of currency exchange rate movements on the
Company is complex because it is linked to variability in real
growth, inflation, interest rates and other factors. Because the
Company operates in a mix of membership services and numerous
countries, management believes currency exposures are fairly well
diversified. To date, currency exposure has not been a
significant competitive factor at the local market operating
level. As international operations continue to expand and the
number of cross-border transactions increases, the Company
intends to continue monitoring its currency exposures closely and
take prudent actions as appropriate.
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Matters as specified in the Company's Proxy Statement dated May
3, 1996, a copy of which has previously been filed with the
Securities and Exchange Commission, were considered and approved
by the Company's shareholders at the annual shareholders' meeting
held on June 5, 1996. The results of such matters are as follows:
Proposal 1: To elect Messrs. T. Barnes Donnelley, Christopher
K. McLeod and Stanley M. Rumbough, Jr. to the
Board of Directors of the Company, each for a
term to expire at the 1999 Annual Meeting.
Results: Total Vote For Total Vote Withheld
T. Barnes Donnelley 161,779,934 487,560
Christopher K. McLeod 161,780,685 486,809
Stanley M. Rumbough, Jr. 161,696,624 570,870
The terms of office as a director of each of Bartlett Burnap,
Walter A. Forbes, Stephen A.Greyser, Burton C. Perfit, Robert
P. Rittereiser and E. Kirk Shelton continued after the meeting.
Proposal 2: To amend the Company's Restated Certificate of
Incorporation to increase the number of shares of
Common Stock authorized for issuance.
Results: For Against Abstain
156,774,873 4,560,166 932,455
Proposal 3: To amend the Company's 1992 Directors Stock Option
Plan.
Results: For Against Abstain
139,888,891 21,179,183 1,199,420
Proposal 4: To amend the Company's 1994 Directors Stock Option
Plan.
Results: For Against Abstain
139,317,819 21,728,586 1,221,089
Proposal 5: To ratify the appointment of Ernst & Young LLP as
the Company's Independent Auditors for the fiscal
year ending January 31, 1997.
Results: For Against Abstain
161,874,573 102,457 290,464
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit
No. Description
3.1 Amended and Restated Certificate of Incorporation
of the Company, as filed June 5, 1996.
10.1-10.16 Management Contracts, Compensatory Plans and
Arrangements
10.1 Form of Employment Contract with E. Kirk Shelton
and Christopher K. McLeod, dated February 1, 1987, as
amended November 1, 1991 (filed as Exhibit 10.1 to the
Company's Annual Report on Form 10-K for the fiscal
year ended January 31, 1994).*
10.2 Amendment to Employment Contract with E. Kirk
Shelton, dated February 1, 1996 (filed as Exhibit 10.2
to the Company's Annual Report on Form 10-K for the
fiscal year ended January 31, 1996).*
10.3 Amendment to Employment Contract with Christopher
K. McLeod, dated February 1, 1996 (filed as Exhibit
10.3 to the Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 1996).*
10.4 Employment Contract with Walter A. Forbes, dated
January 1, 1987, as amended January 1, 1991, January 1,
1993 and October 1, 1993 (filed as Exhibit 10.2 to the
Company's Annual Report on Form 10-K for the fiscal
year ended January 31, 1994) (the "Forbes Employment
Agreement").*
10.5 Fourth Amendment to Forbes Employment Agreement,
dated as of June 1, 1994 (filed as Exhibit 10.3 to the
Company's Form 10-Q for the period ended July 31,
1994).*
10.6 Agreement with Cosmo Corigliano, dated February 1,
1994 (filed as Exhibit 10.6 to the Company's Annual
Report on Form 10-K for the fiscal year ended January
31, 1995).*
10.7 Amendment to Agreement with Cosmo Corigliano,
dated February 21, 1996 (filed as Exhibit 10.7 to the
Company's Annual Report on Form 10-K for the fiscal
year ended January 31, 1996).*
10.8 Agreement with Amy N. Lipton, dated February 1,
1996 (filed as Exhibit 10.8 to the Company's Annual
Report on Form 10-K for the fiscal year ended January
31, 1996).*
10.9 Form of Employee Stock Option under the 1987 Stock
Option Plan (filed as Exhibit 10.6 to the Company's
Form 10-Q for the period ended April 30, 1995).*
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (continued)
10.10 Form of Director Stock Option for 1990 and
1992 Directors Stock Options Plans (filed as Exhibit
10.4 to the Company's Annual Report for the fiscal
year ended January 31, 1991, as amended December 12,
1991 and December 19, 1991).*
10.11 Form of Director Stock Option for 1994
Directors Stock Option Plan, as amended.
10.12 1987 Stock Option Plan, as amended (filed
as Exhibit 10.9 to the Company's Form 10-Q for the
period ended April 30, 1995).*
10.13 1990 Directors Stock Option Plan, as
amended (filed as Exhibit 10.10. to the Company's
Form 10-Q for the period ended April 30, 1995).*
10.14 1992 Directors Stock Option Plan, as amended.
10.15 1994 Directors Stock Option Plan, as amended.
10.16 Restricted Stock Plan and Form of
Restricted Stock Plan Agreement (filed as Exhibit
10.24 to the Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 1991, as amended
December 12, 1991 and December 19, 1991).*
10.17 Credit Agreement, dated as of March 26,
1996, among: CUC International Inc.; the Banks
signatory thereto; The Chase Manhattan Bank, N.A.,
Bank of Montreal, Morgan Guaranty Trust Company of
New York, and The Sakura Bank, Limited as Co-Agents;
and The Chase Manhattan Bank, N.A., as Administrative
Agent (filed as Exhibit 10.17 to the Company's Annual
Report on Form 10-K for the fiscal year ended January
31, 1996).*
10.18 Agreement and Plan of Merger, dated
October 17, 1995, among CUC International Inc.,
Retreat Acquisition Corporation and Advance Ross
Corporation (filed as Exhibit 2 to the Company's
Registration Statement on Form S-4, Registration No.
33-64801, filed on December 7, 1995).*
10.19 Agreement and Plan of Merger, dated as of
February 19, 1996, by and among Davidson &
Associates, Inc., CUC International Inc. and Stealth
Acquisition I Corp. (filed as Exhibit 2(a) to the
Company's Report on Form 8-K filed March 12, 1996).*
10.20 Agreement and Plan of Merger, dated as of
February 19, 1996, by and among Sierra On-Line, Inc.,
CUC International Inc. and Larry Acquisition Corp.
(filed as Exhibit 2(b) to the Company's Report on
Form 8-K filed March 12, 1996).*
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (continued)
10.21 Agreement and Plan of Merger, dated as of
April 19, 1996, by and among Ideon Group, Inc., CUC
International Inc. and IG Acquisition Corp. (filed as
Exhibit 10.21 to the Company's Annual Report on Form
10-K for the fiscal year ended January 31, 1996).*
11. Statement re: Computation of Per Share Earnings
(Unaudited)
15. Letter re: Unaudited Interim Financial
Information
(b) During the quarter ended April 30, 1996, the Company filed
the following Current Reports on Form 8-K:
(1) Current Report on Form 8-K, filed on February 21, 1996,
reporting an Item 5 ("Other Events") event.
(2) Current Report on Form 8-K, filed on February 22, 1996,
reporting an Item 5 ("Other Events") event.
(3) Current Report on Form 8-K, filed on March 12, 1996,
reporting an Item 5 ("Other Events") event.
(4) Current Report on Form 8-K, filed on April 22, 1996,
reporting an Item 5 ("Other Events") event.
*Incorporated by reference
SIGNATURES
Pursuant to the requirements 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.
CUC INTERNATIONAL INC.
(Registrant)
Date: June 14, 1996 By: WALTER A. FORBES
Walter A. Forbes -
Chief Executive Officer
and Chairman of the Board
(Principal Executive Officer)
Date: June 14, 1996 By: COSMO CORIGLIANO
Cosmo Corigliano - Senior Vice
President and Chief Financial
Officer (Principal Financial
and Accounting Officer)
INDEX TO EXHIBITS
Exhibit
No. Description Page
3.1 Amended and Restated Certificate of
Incorporation of the Company, as filed
June 5, 1996.
10.1-10.16 Management Contracts, Compensatory
Plans and Arrangements
10.1 Form of Employment Contract with E. Kirk
Shelton and Christopher K. McLeod, dated
February 1, 1987, as amended November 1,
1991 (filed as Exhibit 10.1 to the
Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 1994).*
10.2 Amendment to Employment Contract with E.
Kirk Shelton, dated February 1, 1996
(filed as Exhibit 10.2 to the Company's
Annual Report on Form 10-K for the fiscal
year ended January 31, 1996).*
10.3 Amendment to Employment Contract with
Christopher K. McLeod, dated February 1,
1996 (filed as Exhibit 10.3 to the
Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 1996).*
10.4 Employment Contract with Walter A.
Forbes, dated January 1, 1987, as amended
January 1,1991, January 1, 1993 and
October 1, 1993 (filed as Exhibit 10.2 to
the Company's Annual Report on Form 10-K
for the fiscal year ended January 31,
1994) (the "Forbes Employment
Agreement").*
10.5 Fourth Amendment to Forbes Employment
Agreement, dated as of June 1, 1994
(filed as Exhibit 10.3 to the Company's
Form 10-Q for the period ended July 31,
1994).*
10.6 Agreement with Cosmo Corigliano, dated
February 1, 1994 (filed as Exhibit 10.6
to the Company's Annual Report on Form 10-
K for the fiscal year ended January 31,
1995).*
10.7 Amendment to Agreement with Cosmo
Corigliano, dated February 21, 1996
(filed as Exhibit 10.7 to the Company's
Annual Report on Form 10-K for the fiscal
year ended January 31, 1996).*
10.8 Agreement with Amy N. Lipton, dated
February 1, 1996 (filed as Exhibit 10.8
to the Company's Annual Report on Form 10-
K for the fiscal year ended January 31,
1996).*
10.9 Form of Employee Stock Option under the
1987 Stock Option Plan (filed as Exhibit
10.6 to the Company's Form 10-Q for the
period ended April 30, 1995).*
INDEX TO EXHIBITS (continued)
Exhibit
No. Description Page
10.10 Form of Director Stock Option for 1990
and 1992 Directors Stock Options Plans
(filed as Exhibit 10.4 to the Company's
Annual Report for the fiscal year ended
January 31, 1991, as amended December
12, 1991 and December 19, 1991).*
10.11 Form of Director Stock Option for 1994
Directors Stock Option Plan, as amended.
10.12 1987 Stock Option Plan, as amended
(filed as Exhibit 10.9 to the Company's
Form 10-Q for the period ended April 30,
1995).*
10.13 1990 Directors Stock Option Plan, as
amended (filed as Exhibit 10.10. to the
Company's Form 10-Q for the period ended
April 30, 1995).*
10.14 1992 Directors Stock Option Plan, as
amended.
10.15 1994 Directors Stock Option Plan, as
amended.
10.16 Restricted Stock Plan and Form of
Restricted Stock Plan Agreement (filed
as Exhibit 10.24 to the Company's Annual
Report on Form 10-K for the fiscal year
ended January 31, 1991, as amended
December 12, 1991 and December 19,
1991).*
10.17 Credit Agreement, dated as of March 26,
1996, among: CUC International Inc.; the
Banks signatory thereto; The Chase
Manhattan Bank, N.A., Bank of Montreal,
Morgan Guaranty Trust Company of New
York, and the Sakura Bank, Limited as Co-
Agents; and The Chase Manhattan Bank,
N.A., as Administrative Agent (filed as
Exhibit 10.17 to the Company's Annual
Report on Form 10-K for the fiscal year
ended January 31, 1996).*
10.18 Agreement and Plan of Merger, dated
October 17, 1995, among CUC
International Inc., Retreat Acquisition
Corporation and Advance Ross Corporation
(filed as Exhibit 2 to the Company's
Registration Statement on Form S-4,
Registration No. 33-64801, filed on
December 7, 1995).*
10.19 Agreement and Plan of Merger, dated as
of February 19, 1996, by and among
Davidson & Associates, Inc., CUC
International Inc. and Stealth
Acquisition I Corp. (filed as Exhibit
2(a) to the Company's Report on Form 8-
K filed March 12, 1996).*
10.20 Agreement and Plan of Merger, dated as
of February 19, 1996, by and among
Sierra On-Line, Inc., CUC International
Inc. and Larry Acquisition Corp. (filed
as Exhibit 2(b) to the Company's Report
on Form 8-K filed March 12, 1996).*
INDEX TO EXHIBITS (continued)
Exhibit
No. Description Page
10.21 Agreement and Plan of Merger, dated as
of April 19, 1996, by and among Ideon
Group, Inc., CUC International Inc. and
IG Acquisition Corp. (filed as Exhibit
10.21 to the Company's Annual Report on
Form 10-K for the fiscal year ended
January 31, 1996).*
11. Statement re: Computation of Per Share
Earnings (Unaudited)
15. Letter re: Unaudited Interim Financial
Information
*Incorporated by reference