1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31,1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
------------------ -------------------
Commission file number 0-21602
LCI INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 13-3498232
(State or other Jurisdiction of Incorporation or (I.R.S. Employer Identification Number)
Organization)
8180 GREENSBORO DRIVE, SUITE 800 22102
McLEAN, VA (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: 1-800-296-0220
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on Which Registered
------------------- -----------------------------------------
Common Stock, $.01 par value New York Stock Exchange, Inc.
Securities registered pursuant to Section 12(g) of the Act:
None
(title of class)
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
-----
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. [ X ]
The aggregate market value of the voting stock held by non-affiliates of
LCI International, Inc. was $1,596,251,000 at February 28, 1997.
As of February 28, 1997, there were 77,617,276 shares of LCI International,
Inc. Common Stock (par value $.01 per share) outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the 1996 Annual Report to Shareowners - Part II
Portions of the Proxy Statement for the 1997 Annual Meeting of Shareowners -
Part III
2
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) Documents filed as part of this report:
(1) Financial Statements:
Pages in 1996
Annual Report
--------------
Report of Independent Public Accountants 24
Consolidated Statements of Operations 25
Consolidated Balance Sheets 26 - 27
Consolidated Statements of Shareowners' Equity 28
Consolidated Statements of Cash Flows 29
Notes to Consolidated Financial Statements 30 - 43
(2) Financial Statement Schedules
All supporting schedules other than those listed below have
been omitted because they are not required or the information
to be set forth therein is included in the financial statements
or in the notes thereto. The following additional financial
data should be read in conjunction with the financial
statements incorporated by reference herein.
Report of Independent Public Accountants on Financial Statement
Schedule
Schedule II - Valuation and Qualifying Accounts
(3) Exhibits.
The exhibits filed or incorporated by reference as part of
this report are set forth in the Index of Exhibits on page E-1
of this Annual Report.
(b) Reports on Form 8-K: The Company did not file any reports on
Form 8-K during the three months ended December 31, 1996.
(c) See Item 14(a)(3) above.
(d) See Item 14(a)(2) above.
3
INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- ------- ----------------------
2.1 - Agreement of purchase of sale of assets dated December 17, 1995 by and between LCI International Telecom Corp. and
Teledial America, Inc. (d/b/a U.S. Signal Corporation) (16)
3(i)(a) - Amended and Restated Certificate of Incorporation. (19)
3(i)(b) - Certificate of Designation of 5% Cumulative Convertible Exchangeable Preferred Stock.(2)
3(ii) - Amended and Restated By-laws.+
4(a)(i) - Specimen Preferred Stock Certificate. (2)
4(a)(ii) - Specimen Common Stock Certificate. (1)
4(b) - Registration Rights Agreement, effective as of November 15, 1988, among LCI Communications Holdings Co., LCI
Communications, Inc., Warburg, Pincus Capital Company, L.P., Primus Capital Fund and Primus Capital Fund II, L.P.(1)
4(c) - Credit Agreement, dated as of December 30, 1993, by and among LCI International, Inc., First Union National Bank of
North Carolina and Nationsbank of Texas, N.A.(5)
4(c)(i) - First Amendment and Confirmation, dated as of March 3, 1994, by and among LCI International, Inc., LCI International
Management Services, Inc., LCI International of New Hampshire, Inc., 1056974 Ontario Inc., First Union National Bank
of North Carolina and Nationsbank of Texas, N.A. (5)
4(c)(ii) - Unconditional Guaranty Agreement, dated as of January 19, 1994, by and between LCI International Management Services,
Inc. and First Union National Bank of North Carolina. (5)
4(c)(iii) - Unconditional Guaranty Agreement, dated as of January 19, 1994, by and between LCI International of New Hampshire,
Inc. and First Union National Bank of North Carolina.(5)
4(c)(iv) - Unconditional Guaranty Agreement, dated as of January 19, 1994, by and between 1056974 Ontario Inc. and First Union
National Bank of North Carolina.(5)
4(c)(v) - Pledge Agreement, dated as of December 30, 1993, by and between LCI International, Inc. and First Union National Bank
of North Carolina.(5)
4(c)(vi) - Pledge Agreement, dated as of January 19, 1994, by and between LCI International Management Services, Inc. and First
Union National Bank of North Carolina.(5)
4(c)(vii) - Pledge Agreement, dated as of January 19, 1994, by and between LCI International, Inc. and First Union National Bank
of North Carolina.(5)
4(c)(viii) - Second Amendment, dated April 7, 1994, to the Credit Agreement, dated December 30, 1993 by and among LCI
International, Inc., First Union National Bank of North Carolina and Nationsbank of Texas, N.A.(6)
4(c)(ix) - Third Amendment, dated September 28, 1994, to the Credit Agreement, dated December 30, 1993 by and among LCI
International, Inc., First Union Bank of North Carolina and Nationsbank of Texas, N.A.(8)
4(c)(x) - Unconditional Guaranty Agreement, dated as of September 1, 1994, by and between LCI Telecom South, Inc. and First
Union National Bank of North Carolina.(8)
4(c)(xi) - Unconditional Guaranty Agreement, dated as of September 1, 1994, by and between LCI International Telecom Corp., and
First Union National Bank of North Carolina.(8)
4(c)(xii) - Fourth Amendment, dated October 21, 1994, to the Credit Agreement, dated December 30, 1993 by and among LCI
International, Inc., First Union Bank of North Carolina and Nationsbank of Texas, N.A.(11)
4(c)(xiii) - Amended and Restated Credit Agreement, dated as of June 6, 1995, by and among LCI International, Inc., First Union
National Bank of North Carolina, and Nationsbank of Texas, N.A.(13)
4
4(c)(xiv) - Second Amended and Restated Credit Agreement, dated as of February 14, 1996, by and among LCI International, Inc.,
First Union National Bank of North Carolina, and Nationsbank of Texas, N.A. (18)
4(d) - Registration Rights Agreement, dated as of November 15, 1988, by and among LCI Communications Holdings Co., Warburg,
Pincus Capital Company, L.P., APT Holdings Corporation and Creditanstalt-Bankverein.(1)
4(e) - Registration Rights Agreement, dated as of December 30, 1988, by and among LCI Communications Holdings Co., Warburg,
Pincus Capital Company, L.P., PNC Venture Corp. and PNC Venture Group I, L.P.(1)
4(f) - Registration Rights Agreement, dated as of January 16, 1989, by and among LCI Communications Holdings Co., Warburg,
Pincus Capital Company, L.P., and Trustees of General Electric Pension Trust.(1)
4(g) - $64,262,707 Subordinated Term Note, dated June 17, 1993, issued by LiTel Communications, Inc.(2)
10(a)(i) - License Agreement, dated November 19, 1984, between the Ohio Turnpike Commission and Litel Telecommunications
Corporation.(1)
10(a)(ii) - Right-of-Way Agreement, dated October 31, 1984, among Grand Trunk Western Railroad Company and Litel
Telecommunications Corporation.(1)
10(a)(iii) - Right-of-Way Agreement, dated May 14, 1985, between Indiana Department of Highways Toll Road Division and Litel
Telecommunications Corporation.(1)
10(b) - Lease Agreement, dated September 27, 1984, by and between Terminal Management Inc. and LiTel, Inc.(1)
10(c) - Indenture of Lease and License Agreement, dated November 1985, by and between Drytraub of Illinois, Inc., Drytraub
Office Management, Inc. and Litel Telecommunications Corporation, as amended.(1)
10(d) - Lease Agreement, dated March 3, 1989, by and between The Equitable Life Assurance Society (successor in interest to
180 East Broad Partnership) and Litel Telecommunications Corporation, as amended.(1)
10(e) - Lease Agreement, dated August 14, 1989, by and between Duke Associates No. 70 Limited Partnership and LCI Management
Services, Inc., as amended.(1)
10(f) - Agreement Regarding Additional Space, dated August 14, 1989, among Duke Associates No. 70 Limited Partnership and LCI
Management Services, Inc., as amended.(1)
10(g) - Lease Agreement, dated as of October 11, 1993, by and between Eighty-One Eighty Greensboro Associates Limited
Partnership and LCI International, Inc.(4)
10(g)(i) - Lease, dated May 19, 1986, by and between 13th and L Associates and Long-Distance Services of Washington, Inc.(2)
10(g)(ii) - Amendment No. 1 to Lease, dated December 20, 1988, by and between 13th and L Associates and Long Distance Service of
Washington, Inc.(4)
10(g)(iii) - Second Amendment to Retail Lease, dated June 6, 1991, by and between 13th and L Associates and Long Distance Service
of Washington, Inc.(4)
10(h) - Master License and Services Agreement, dated as of March 1, 1993, among LiTel Communications, Inc. and the
Subsidiaries named in Schedule I thereto.(1)
10(h)(i) - First Amendment to Master License and Services Agreement, dated as of April 29, 1993, among LiTel Communications,
Inc., Litel Telecommunications Corporation, Afford-A-Call Corp. and LDS Telecommunications Corp. f/k/a New Cable
Inc.(1)
10(h)(ii) - Management Services Agreement dated as of April 1, 1993, between LCI International, Inc. and LiTel Communications,
Inc.(1)
10(i) - Agreement for Purchase of Assets between LiTel Communications, Inc. and Long Distance Service of Washington, Inc. and
Richard J. Rice, dated February 1, 1993.(1)
5
10(j)(i) - Interim Loan Agreement, dated as of October 15, 1993, between LCI International, Inc. and STN Incorporated.(3)
10(j)(ii) - Secured Demand Note, dated as of October 15, 1993, between LCI International, Inc. and STN Incorporated.(3)
10(j)(iii) - Note Pledge Agreement, dated as of October 15, 1993, between LCI International, Inc. and STN Incorporated.(3)
10(j)(iv) - Debenture Purchase Agreement, dated as of October 15, 1993, between LCI International, Inc. and STN Incorporated.(3)
10(j)(viii) - TransPrairie Option Agreement, dated as of October 15, 1993, by and among LCI International, Inc., TransPrairie Energy
Management Partnership and certain persons named on the signature pages thereof.(3)
10(j)(ix) - Services Agreement and License, dated as of October 26, 1993, between LCI International Management Services, Inc. and
STN Incorporated.(3)
10(j)(x) - Traffic Exchange Agreement, dated as of October 26, 1993, between LCI International Telecom Corp. and STN
Incorporated.(3)
10(j)(xii) - Promissary note dated April 29, 1994 between LCI International Telecom Corp. and STN Incorporated.(6)
10(j)(xiii)- Promissary Note dated May 12, 1994 between LCI International Telecom Corp. and STN Incorporated.(6)
10(j)(xiv) - Debenture Purchase Agreement Amendment, dated as of June 1, 1994, between LCI International, Inc., and STN
Incorporated.(7)
10(j)(xv) - Loan Agreement, dated June 1, 1994, between STN Incorporated and LCI International, Inc.(7)
10(j)(xix) - Form of Share Option Agreement, dated May 31, 1994, between LCI International, Inc. and Robey Company Limited, Vanier
Company Limited and Yarker Company Limited.(7)
10(j)(xx) - Debenture Purchase Agreement Second Amendment, dated July 7, 1994, between LCI International, Inc. and STN
Incorporated.(7)
10(j)(xxi) - Debenture Purchase Agreement Third Amendment, dated July 22, 1994, between LCI International, Inc. and STN
Incorporated.(7)
10(j)(xxii) - Loan Agreement Amendment, dated July 7, 1994, between LCI International, Inc. and STN Incorporated.(7)
10(j)(xxiii)- Loan Agreement Second Amendment, dated July 22, 1994, between LCI International, Inc. and STN Incorporated.(7)
10(j)(xxvi) - Promissory Note dated June 30, 1994 between LCI International, Inc. and STN Incorporated.(7)
10(j)(xxvii)- Agreement of Purchase and Sale of Assets dated as of March 31, 1994 by and among LCI International Management
Services, Inc., T.M. Sepulveda, Inc. and Gene Elmore.(10)
10(j)(xxviii)-Agreement of Purchase and Sale of Assets dated as of March 31, 1994 by and among LCI International Management
Services, Inc., Premium Access, Inc. and Gene Elmore.(10)
10(j)(xxvix)- Amendment No. 1 dated July 11, 1994 to Agreement of Purchase and Sale of Assets of Glendale Gene, Inc. (formerly known
as T.M. Sepulveda, Inc.).(10)
10(j)(xxx) - Amendment No. 1 dated July 11, 1994 to Agreement of Purchase and Sale of Assets of Glendale Access International,
Inc. (formerly known as Premium Access, Inc.).(10)
10(j)(xxxi) - Assignment of T.M. Sepulveda, Inc. Agreement of Purchase and Sale of Assets from LCI International Management
Services, Inc. to LCI International Telecom Corp. dated April 4, 1994.(10)
10(j)(xxxii)- Assignment of Premium Access, Inc. Agreement of Purchase and Sale of Assets from LCI International Management
Services, Inc. to LCI International Telecom Corp. dated April 4, 1994.(10)
10(j)(xxxiii)-Promissory Note of STN Incorporated, dated as of December 21, 1994, for Cnd. $6,951,500.(11)
6
10(j)(xxxiv)- General Security Agreement, dated as of December 21, 1994, between STN Incorporated and LCI International, Inc.
relating to the Promissory Note.(11)
10(j)(xxxv) - Form of Acknowledgment and Promise to Pay, by STN Incorporated, to be dated as of December 21, 1994, evidencing
amount owed to LCI International Management Services, Inc. for certain services rendered prior to October 1, 1994.(11)
10(j)(xxxvi)- Form of General Security Agreement, dated as of December 21, 1994, relating to Acknowledgment and Promise to
Pay.(11)
10(j)(xxxvii)-Indemnification Agreement, dated as of January 6, 1995, between STN Incorporated and LCI International, Inc.(11)
10(j)(xxxviii)General Security Agreement, dated as of January 6, 1995 between STN Incorporated and LCI International, Inc.,
relating to the Indemnification Agreement.(11)
10(j)(xxxix)- Agreement and Plan Of Merger dated July 10, 1995 among LCI International Inc., LCI Telemanagement Corp., Corporate
Telemanagement Group, Inc. and the Warrant Holders listed on the signature pages thereto.(15)
10(k)(i) - Letter Agreement, dated February 9, 1993, between H. Brian Thompson and Warburg, Pincus Capital Company, L.P.(1)*
10(k)(ii) - Letter Agreement, dated February 9, 1993, between Thomas J. Wynne and Warburg, Pincus Capital Company, L.P.(1)*
10(k)(iii) - Letter Agreement, dated February 9, 1993, between Marshall W. Hanno and Warburg, Pincus Capital Company, L.P.(1)*
10(l)(v) - Employment Agreement, dated as of October 18, 1993, between LCI International Management Services, Inc. and Joseph A.
Lawrence.(11)*
10(l)(vi) - Form of LCI International, Inc. 1994 Executive Perquisite Program. (5) *
10(l)(vii) - LCI International, Inc. 1992 Stock Option Plan.(1)*
10(l)(viii) - LiTel Communications, Inc. 1993 Stock Option Plan.(1)*
10(l)(ix) - LCI International, Inc. 1994/1995 Stock Option Plan.(5)*
10(l)(x) - LiTel Communications, Inc. Stock Purchase Plan.(1)*
10(l)(xi) - LCI International, Inc. and Subsidiaries Nonqualified Stock Option Plan for Directors.(2)*
10(l)(xii) - LCI International, Inc. 1995/1996 Stock Option.(9)*
10(l)(xiii) - LCI International, Inc. Amended and Restated Employee Stock Purchase Plan.(9)*
10(l)(xiv) - Employment Agreement, dated as of March 20, 1994, between LCI International, Inc. and H. Brian Thompson.(11) *
10(l)(xv) - Employment Agreement, dated as of March 20, 1994, between LCI International, Inc. and Thomas J. Wynne.(11)*
10(l)(xvi) - Form of Employment Agreement, dated as of March 20, 1994, between LCI International, Inc. and Marshall W. Hanno.(11) *
10(l)(xvii) - LCI International Management Services, Inc. Supplemental Executive Retirement Plan.(12)*
10(l)(xviii)- Employment Agreement, dated as of October 1, 1995 between LCI International Management Services, Inc., and Larry
Bouman.(18) *
10(l)(xix) - Employement Agreement, dated as of September 18, 1995 between LCI Telemanagement Corp. and Charles S. Houser.(18) *
10(l)(xx) - Employement Agreement, dated as of March 19, 1996 between LCI Management Services, Inc. and Roy Gamse.(19) *
10(l)(xxi) - 1997/1998 LCI International, Inc. Stock Option Plan.+
10(l)(xxii) - LCI International, Inc. and Subsidiaries Executive Incentive Compensation Plan*+
10(m) - Lease Agreement dated as of July 1, 1994 by and between LCI International Management Services, Inc. and Bank Building
Limited Partnership.(6)
10(n) - Lease Agreement dated April 14, 1994 by and between LCI International Management Services, Inc.
and RFG Co., LTD.(6)
7
10(o) - Forth Amendment to Lease and Consent to Assignment dated as of June 28, 1994 by and between LCI International Telecom
Corp. and One Wilshire Arcade Imperial, LTD.(8)
10(p) - Network Services Agreement dated December 22, 1994 between MCI Telecommunications Corporation and LCI International
Telecom Corp.(11),(22)
10(q)(i) - Contractor Agreement dated January 18, 1993 by and between LCI International Telecom Corp. and American Communications
Network, Inc. (14),(22)
10(q)(ii) - Addendum to Contractor Agreement by and between American Communications Network, Inc. and LCI International Telecom
Corp. dated January 18, 1993.(14)
10(q)(iii) - Amendment No.1 to Contractor Agreement by and between LCI International Telecom Corp. and American Communications
Network, Inc. dated _______, 1994. (14),(22)
10(q)(iiii) - Contractor Agreement dated May 1, 1996 between LCI International Telecom Corp. and American Communications Network,
Inc. (21), (22)
10(r)(i) - Transfer and Administrative Agreement among Enterprise Funding Corporation, LCI SPC I, Inc., LCI International Telecom
Corp., NationsBank, N.A. and certain other parties thereto, dated August 29, 1996. (20)
10(r)(ii) - Receivables Purchase Agreement dated August 29, 1996, among LCI International Telecom Corp. LCI SPC I, Inc. (20)
10(r)(iii) - Subordinated Intercompany Revolving Note, date August 29, 1996, issued to LCI International Telecom Corp. by LCI SPC
I, Inc. (20)
10(r)(iv) - Support Agreement, dated August 29, 1996, by LCI International, Inc. in favor of LCI SPC I, Inc. (28)
10(s)(i) - Participation Agreement dated as of November, 1996 among LCI International, Inc., as the Construction Agent and as the
Lessee, First Security Bank, National Association, as the Owner Trustee under the Stuart Park Trust, the various banks
and lending institutions which are parties thereto from time to time as the Holders, the various banks and lending
institutions which are parties thereto from time to time, as the Lenders and NationsBank of Texas, N.A., as the Agent
for the Lenders.+
10(s)(ii) - Unconditional Guaranty Agreement dated as of November 15, 1996 made by LCI International, Inc., as Guarantor in favor
of NationsBank of Texas, N.A., as Agent for the ratable benefit of the Tranche A Lenders.+
10(s)(iii) - Agency Agreement between LCI Internationl, Inc., as the Construction Agent and First Security Bank, National
Association, as the Owner Trustee under the Stuart Park Trust as the Lessor dated as of November 15, 1996.+
10(s)(iv) - Deed of Lease Agreement dated as of November 15, 1996 between First National Bank, National Association as the Owner
Trsutee under the Stuart Park Trust, as Lessor and LCI International, Inc. as Lessee.+
11 - Statement re computation of per share earnings+
13 - LCI International, Inc. 1996 Annual Report to Shareowners++
21 - Subsidiaries of LCI International, Inc.+
23 - Consent of Arthur Andersen LLP++
27 - Financial Data Schedule+
(1) Incorporated by reference to the Company's Registration Statement No. 33-60558.
(2) Incorporated by reference to the Company's Registration Statement No. 33-67368.
(3) Incorporated by reference to the Company's Form 8-K dated October 17, 1993.
(4) Incorporated by reference to the Company's Registration Statement No. 33-71500.
(5) Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 1993.
(6) Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1994.
8
(7) Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1994.
(8) Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1994.
(9) Incorporated by reference to the Company's Proxy Statement for the 1995 Annual Meeting of Shareowners.
(10) Incorporated by reference to the Company's Form 8-K dated July 11, 1994.
(11) Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 1994.
(12) Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1995.
(13) Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1995.
(14) Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1995.
(15) Incorporated by reference to the Company's Form 8-K dated July 10, 1995.
(16) Incorporated by reference to the Company's Form 8-K dated December 17, 1995.
(17) Incorporated by reference to the Company's Registration Statement No. 33-96186.
(18) Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 1995.
(19) Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1996.
(20) Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1996.
(21) Incorporated by reference to the Company's Quarterly Report on Form 10-Q/A for the quarter ended June 30, 1996.
(22) Confidential treatment has been requested for portions of this exhibit.
* Indicates a management contract or compensatory plan or arrangement required to be filed pursuant to Item 14(c) of Form 10-K.
+ Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 1996.
++ Filed herewith.
9
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.
LCI International, Inc.
By: /s/ JOSEPH A. LAWRENCE
----------------------------------
Joseph A. Lawrence
Chief Financial Officer
Senior Vice President-Finance
and Development
Date: June 6, 1997
S - 1