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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(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 June 30, 1994
[ ] 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 1-10667
AmeriCredit Corp.
(Exact name of registrant as specified in its charter)
Texas 75-2291093
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
200 Bailey Avenue, Fort Worth, Texas 76107
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (817) 332-7000
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
Common Stock, $.01 par value New York Stock Exchange
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 25,095,757 shares of the Registrant's Common Stock
held by non-affiliates based upon the closing price of the Registrant's Common
Stock on the New York Stock Exchange on September 16, 1994 was approximately
$159,985,451. For purposes of this computation, all officers, directors and 5
percent beneficial owners of the Registrant are deemed to be affiliates. Such
determination should not be deemed an admission that such officers, directors
and beneficial owners are, in fact, affiliates of the Registrant.
There were 28,749,773 shares of Common Stock, $.01 par value outstanding as of
September 16, 1994.
DOCUMENTS INCORPORATED BY REFERENCE
The Registrant's Annual Report to Shareholders for the year ended June 30,
1994 ("the Annual Report") furnished to the Commission pursuant to Rule 14a-
3(b) and the definitive Proxy Statement pertaining to the 1994 Annual Meeting
of Shareholders ("the Proxy Statement") and filed pursuant to Regulation 14A
are incorporated herein by reference into Parts II and IV, and Part III,
respectively.
AMERICREDIT CORP.
INDEX TO FORM 10-K
ITEM PAGE
NO. No.
PART I
1. Business 3
2. Properties 12
3. Legal Proceedings 12
4. Submission of Matters to a Vote of Security Holders 12
PART II
5. Market for Registrant's Common Equity and Related
Stockholder Matters 13
6. Selected Financial Data 13
7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 13
8. Financial Statements and Supplementary Data 13
9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 13
PART III
10. Directors and Executive Officers of the Registrant 14
11. Executive Compensation 14
12. Security Ownership of Certain Beneficial Owners and
Management 14
13. Certain Relationships and Related Transactions 14
PART IV
14. Exhibits, Financial Statement Schedules, and Reports
on Form 8-K 15
SIGNATURES 16
PART I
Item 1. Business
- - -----------------
General
- - -------
AmeriCredit Corp. was incorporated in Texas on May 18, 1988 and succeeded to
the business, assets and liabilities of a predecessor corporation formed under
the laws of Texas on August 1, 1986. The Company's predecessor began the
Company's business in March 1987, and the business has been operated
continuously since that time. As used herein, the term "Company" refers to
the Company, its wholly owned subsidiaries and its predecessor corporation.
The Company's principal executive offices are located at 200 Bailey Avenue,
Fort Worth, Texas, 76107 and its telephone number is (817) 332-7000.
On July 22, 1992, the Company formed a subsidiary, AmeriCredit Financial
Services, Inc. ("AFSI"), a Delaware corporation, to engage in the indirect
consumer lending business. AFSI began operating in the indirect consumer
lending business in September 1992. Through AFSI's branch offices and
marketing representatives, the Company serves as a funding source for
franchised and independent dealers to finance their customers' purchases of
primarily used cars. The Company targets customers who are typically unable
to obtain financing from traditional sources. Consumer finance contracts
originated by the dealers which conform to the Company's credit policies are
purchased by the Company, generally for a non-refundable acquisition fee and
without recourse to the dealer. Such consumer finance loans typically range
in amount from $6,000 to $12,000, with repayment terms usually ranging from 24
to 60 months. The Company services its consumer loan portfolio at its central
facility using automated servicing and collection systems.
The Company formed another subsidiary, AmeriCredit Premium Finance, Inc.
("APFI"), a Delaware corporation, on September 15, 1992 to engage in the
premium finance business. APFI began operating in the premium finance
business in April 1993. APFI finances insurance premiums for consumers
purchasing car liability and physical damage insurance through independent
insurance agents. Such loans typically range in amount from $300 to $1,200
with repayment terms ranging from four to ten months.
The Company previously operated a chain of "we finance" used car retail lots
in Texas, selling used cars and typically financing sales to its customers.
However, in connection with a restructuring during the year ended June 30,
1993, the Company withdrew from the retail used car sales business effective
December 31, 1992. The finance receivables originated in this previous
business are referred to as the direct lending portfolio and are being
liquidated over time as the contracts are collected or charged-off.
On April 24, 1991, the Company entered into a management services agreement
with Rainwater Management Partners, Ltd., ("RMP"). Pursuant to such
agreement, RMP provided certain consulting services related to strategic
analysis of the Company's operations and major policy actions and directions.
As part of the transaction, the Company issued to RMP a stock option to
purchase up to 3.5 million shares of the Company's common stock at an exercise
price of $3.218 per share. Ten percent of the option was exercisable at the
time of issuance, and the balance became exercisable over an 18-month period.
On April 4, 1994, the Company purchased and cancelled this stock option for
$1.782 per option share, or $6,237,000. The management services agreement with
RMP was also terminated.
On October 25, 1990, the Company entered into a joint venture arrangement with
certain entities and individuals for the purpose of establishing and operating
retail used car sales lots in the state of California. The joint venture en-
tity, Pacific Automart Inc., was owned 50% by the Company and 50% by the other
investors. On August 3, 1993, the Company sold its entire interest in the joint
venture to Pacific Automart Inc. for $11,300,000 in cash. No gain or loss was
recognized on the sale.
Indirect Consumer Finance Operations
- - ------------------------------------
Target Market. The Company's indirect lending programs are designed to serve
consumers who have limited access to traditional car financing. The Company's
typical borrower may have had previous financial difficulties, but is now
attempting to re-establish credit, or may not yet have a sufficient credit
history. Because the Company serves consumers who are unable to meet the credit
standards imposed by most traditional car financing sources, the Company
generally charges interest at rates which are higher than those charged by
traditional car financing sources. The Company also expects to sustain a higher
level of credit losses than that experienced by traditional car financing
sources since the Company provides financing in a relatively high risk market.
Dealer Relationships. When buying a car, consumers are customarily directed to
a dealer's finance and insurance department to finalize their purchase agreement
and review potential financing sources. If the consumer elects to pursue
financing at a dealer, an application is taken for submission to the dealer's
financing sources. The dealers are generally familiar with the lending policies
of their financing sources and develop both traditional and secondary financing
sources. In the event that a consumer may not qualify for traditional car
financing, a dealer typically submits such buyer's application to one or more
secondary financing sources, such as the Company, for review.
Since the Company is an indirect lender, the Company's financing programs are
marketed directly to the dealers rather than to the consumer. The marketing
process involves personal contacts with the owners, general managers and finance
managers of the dealers and distribution of the Company's promotional
materials. The Company also establishes relationships with dealers through
referrals from other participating dealers.
The Company has established relationships with a variety of car dealers located
in the markets in which the Company has branch offices or marketing
representatives. While the Company occasionally finances purchases of new cars,
substantially all of the Company's finance receivables are originated in
connection with consumers' purchases of used cars. Of the finance contracts
purchased by the Company during the year ended June 30, 1994, approximately 76%
were originated by manufacturer-franchised dealers with used car operations and
24% by independent dealers specializing in used car sales. The Company pur-
chased contracts from 429 dealers during the year ended June 30, 1994. No
dealer accounted for more than 10% of the total volume of contracts purchased
by the Company for the year ended June 30, 1994.
Prior to entering into a relationship with a dealer, the Company evaluates the
dealer's operating history. The credit profile and performance of contracts
purchased from a dealer are continually monitored to determine the viability of
the Company's relationship with the dealer. Dealer relationships are maintained
through frequent contacts by the Company's representatives and by providing a
high level of service, including prompt and consistent credit application
processing, timely contract funding and competitive financing terms and fees.
Finance contracts are generally purchased by the Company without recourse to the
dealer, and accordingly, the dealer usually has no liability to the Company if
the consumer defaults on the finance contract. To mitigate the Company's risk
from potential credit losses, the Company charges the dealers an acquisition fee
when purchasing finance contracts. Such acquisition fees are negotiated with
dealers on a contract-by-contract basis and are usually non-refundable. Al-
though finance contracts are purchased without recourse to the dealer, the deal-
er typically makes certain representations as to the validity of the contract
and compliance with certain laws, and indemnifies the Company against any
claims, defenses and set-offs that may be asserted against the Company because
of assignment of the contract.
Branch Offices. The Company's branch offices are responsible for solicitation
and development of dealer relationships and execution of credit decisions.
Branch locations are typically staffed by an area general manager and one or
more customer service representatives. Larger branches may also have an
assistant area manager and/or a dealer marketing representative. Area general
managers are compensated with base salaries, annual incentives based on overall
branch performance and stock option grants. The area general managers report to
a regional manager.
The Company's regional managers monitor branch office compliance with the
Company's underwriting guidelines and review and approve all transactions that
exceed the underwriting guidelines. The Company's automated application
processing system and loan accounting system provide the regional managers
access to credit application information enabling them to consult with the area
general managers on day to day credit decisions. The regional managers also
make periodic visits to the branch offices to conduct operating reviews. The
regional managers report to the Senior Vice President and Director of Consumer
Finance.
As of June 30, 1994, the Company operated eighteen indirect consumer finance
branch offices in thirteen states. The Company's branch offices are located in
Dallas-Fort Worth, Houston, San Antonio, Phoenix, Colorado Springs, Denver, Salt
Lake City, Atlanta, Chicago, Kansas City, San Jose, Indianapolis, Detroit,
Oklahoma City, Las Vegas, St. Louis, San Diego and Nashville.
The Company selects markets for branch office locations based upon the
availability of qualified area general managers and evaluation of regulatory,
competitive and demographic factors. Branch offices are typically situated in
office buildings which are accessible to consumers and local car dealers.
Marketing Representatives. The Company initiated a marketing representative
program in fiscal 1994 and as of June 30, 1994, the Company had ten marketing
representatives. These marketing representatives cover territories in
Washington, Oregon, Texas, Oklahoma, Missouri and Maryland.
The marketing representatives are responsible for solicitation and development
of dealer relationships primarily in markets where the Company does not have a
branch presence. Unlike the Company's area general managers, the marketing
representatives do not have credit authority. Credit applications solicited by
the marketing representatives are underwritten at a central purchasing office.
The Company's marketing representatives may be either employees or independent
contractors. After a training and development period, the marketing
representatives are compensated based primarily upon finance contract
originations. The Company's marketing representative program is managed by the
Vice President and Director of Sales and Marketing.
Finance Contract Acquisition. The Company purchases individual finance con-
tracts through its branch offices based on a decentralized credit approval
process tailored to local market conditions. The Company's central purchasing
office, which underwrites applications solicited by the marketing representa-
tives, operates in a manner similar to the branch office network.
All credit extensions are executed at the branch level. Each area general
manager has a specific credit authority based upon their experience and
historical loan portfolio results. Any extension of credit outside these limits
is reviewed and approved by a regional manager. Although the credit approval
process is decentralized, all credit decisions are guided by the Company's
overall credit and underwriting policies and procedures.
The Company implemented a credit scoring system across its branch network in
late fiscal 1994. The credit scoring system is designed to empirically assess
the credit quality of a consumer applicant. While the Company's use of credit
scoring is still evolving, the system is intended to supplement the branch level
judgmental credit approval process.
Loan application packages completed by prospective borrowers are received via
facsimile at the branch offices from the dealers. Application data is entered
into the Company's automated application processing system. A credit bureau
report is automatically generated and a credit score is computed. Depending on
the credit quality of the applicant, a customer service representative may then
investigate the residence, employment and credit history of the applicant or
forward the application package directly to the area general manager. In either
case, all applications are investigated prior to loan funding. The area general
manager reviews the application package and determines whether the applicant has
been approved, approved subject to any conditions that must be met, or denied.
In certain cases, a regional manager may review and approve the area general
manager's credit decision. The Company estimates that approximately 50% of
applicants are denied credit by the Company typically because of their credit
histories or because their income levels are not sufficient to support the
proposed level of monthly car payments. The dealer is contacted regarding
credit decisions by telefax and/or telephone. Declined applicants are also
provided with appropriate notification of the decision.
Once a credit approval has been received from the Company and any other financ-
ing sources to which the application package was submitted, the dealer selects a
financing source. The ability of the financing source to provide a rapid credit
decision and the amount of the contract fees and customer advance are of primary
importance to the dealer in choosing a financing source. The interest rate in
the finance contract is generally of secondary importance.
Completed loan packages are received from the dealers at the branch office.
Loan terms are reverified with the consumer by branch personnel and the loan
packages are forwarded to the Company's centralized loan services department
where the package is reviewed for proper documentation and regulatory
compliance. The loans are entered into the Company's loan accounting system and
a daily report of loans is generated. The loan services department issues a
funding check to the dealer. Upon funding of the contract, the Company acquires
a perfected security interest in the car that was financed. All of the
Company's finance contracts are fully amortizing with substantially equal
monthly installments. Consumers receive monthly statements from the Company and
remit payments directly to the Company. Payments are processed centrally by the
loan services department.
Collections and Repossessions. Collection activity on finance contracts is
performed by the Company's collection personnel ("collectors") at the Company's
headquarters facility. The collectors follow standardized collection policies
and procedures. Collectors monitor the finance receivables portfolio through a
computer assisted collection system and typically take action on delinquencies
on the fifth day after delinquency occurrence.
A collector's action is typically telephone contact with the consumer utilizing
the Company's automated predictive dialing system. This system dials multiple
telephone numbers simultaneously based upon parameters set by management. When
a telephone connection is made, the delinquent consumer's account information is
displayed on a collector's computer terminal. The collector then attempts to
work out the delinquency with the consumer.
If a consumer continues to be delinquent, the Company's policy is to work out
suitable payment arrangements with the consumer. However, if the consumer
becomes seriously delinquent or deals in bad faith with the Company, the Company
may ultimately have to repossess the consumer's car and generally will take
prompt action to do so. Repossessions are handled by independent repossession
firms engaged by the Company. All repossessions are approved by collection
managers.
The Company follows prescribed legal procedures for repossessions, which include
peaceful repossession, one or more consumer notifications, a prescribed waiting
period prior to disposition of the repossessed car, and return of personal items
to the consumer.
Upon repossession and after any prescribed waiting period, the repossessed car
is typically sold at auction. Unearned finance charges and any recoveries are
credited against the finance contract, and the remaining balance is charged off
against the Company's allowance for losses. The Company will pursue collection
of deficiencies when it deems such action to be appropriate.
Insurance and Other Products. The Company requires all consumers to obtain or
provide evidence that they carry current comprehensive and collision insurance.
Through a third party administrator, the Company tracks the insurance status of
each finance contract and sends notices to consumers when collateral becomes
uninsured. If no action is taken by the borrower to insure the collateral,
continuing efforts are made to persuade the consumer to comply with the insur-
ance requirements of the finance contract. Although it has the right, the
Company rarely repossesses a car due to it being uninsured. The Company also
does not typically force place insurance coverage and add the premium to the
consumer's obligation, although it has the right to do so under the terms of the
finance contracts.
The Company will also finance other insurance products including credit life,
credit accident and health and extended service contracts at the option of the
consumer. The consumer may obtain such products from sources provided by the
Company, dealers or from other third parties. The Company may receive
compensation related to these products, but the Company does not assume any
primary insurance risk.
Risk Management. With its decentralized credit approval process, the Company
has developed procedures to evaluate and supervise the operations of each branch
office. The Company's centralized risk management department is responsible for
monitoring the origination process and supporting the supervisory role of branch
management. This group tracks key variables via databases that contain loan
applicant data, credit bureau and credit score information, loan structures and
terms and payment history. The residual value of the collateral underlying the
Company's loan portfolio is updated monthly with a loan by loan link to national
wholesale auction values. This data is used for evaluating collateral
disposition activities as well as for reserve analysis models.
The risk management department prepares a periodic credit indicator package
reviewing portfolio performance at various levels of detail including total
company, branch and dealer. A sample of loans are reviewed periodically to
audit compliance with policies and procedures. Various daily reports and
analytical data are also generated by the Company's management information
systems. This information is used to monitor credit quality as well as to
constantly refine the structure and mix of new loan production. Projected
portfolio returns are reviewed not only on a consolidated basis, but also at
the branch, dealer and transaction levels.
Premium Finance Operations
- - --------------------------
The Company's premium finance receivables portfolio and related assets
represented approximately 5% of the Company's total assets as of June 30, 1994.
While the Company has grown the premium finance business through June 30, 1994,
the Company has determined that it will reduce its investment in this business
in the future in order to concentrate its resources on its core indirect consum-
er lending business. The size of the market for indirect consumer lending is
substantially greater than the market for premium finance, and the Company
believes that the potential returns are more favorable in the indirect consumer
lending business as compared to the premium finance business.
The Company offers financing primarily to consumers who purchase non-standard
car liability and physical damage coverages and who are unable or unwilling
to pay the full amount of their insurance premium in advance. Consumers
generally look to their agent to locate a financing source for their insurance
premiums. While many large insurance agencies operate captive premium finance
companies, other agents refer their customers to independent premium finance
sources such as the Company.
The Company markets its financing program to insurance agents in Texas and
Louisiana. The key factors in obtaining business from agents include frequent
contacts, quality service, delivering materials and instructions that facilitate
the financing transaction, providing a steady source of funding and offering
competitive payment terms.
Insurance agents participating in the Company's referral program are provided a
supply of premium finance contracts and the Company's rate books and are trained
to initiate notes on behalf of the Company. The agent assists the customer in
completing the premium finance contract by using the Company's rate books, which
set forth payment terms and finance charge rates by premium amount. The Company
has minimum down payment requirements and generally charges the maximum allow-
able interest rate.
Under the terms of the finance contract, the customer is required to repay the
loan in equal monthly installments over four to ten months depending upon the
term of the insurance policy. Customers receive monthly statements and mail
payments directly to the Company. The finance contract provides the Company the
right to cancel the insurance policy and obtain a refund of the unearned premium
directly from the insurance carrier in the event of a payment default. Upon
receipt of the unearned premium from the insurance company, the Company deducts
the principal balance of the note and applicable late charges and returns the
excess, if any, to the customer. While the Company's down payment requirements
and monthly payment schedule are designed so that the unearned premium value of
the policy generally exceeds the unpaid principal balance of the note, charge-
offs may still result from untimely policy cancellations, short rate premium
refunds, non-refundable fees, insurance company or agency insolvencies or other
factors.
Direct Lending Portfolio
- - ------------------------
Prior to September 1992, the Company's finance receivables consisted solely of
finance contracts originated in connection with the sale of used cars at the
Company's former retail locations. These finance receivables are referred to as
the direct lending portfolio. Since the Company has exited the retail used car
business, the direct lending portfolio is being liquidated over time as the
contracts are collected or charged-off.
Distressed Receivables Joint Ventures
- - -------------------------------------
During fiscal 1994, the Company entered into certain joint venture arrangements
with third parties to acquire and collect distressed receivables portfolios.
While the Company's capital investment in these joint ventures is not material,
the Company has provided office facilities, computer systems and administrative
support to the joint ventures.
Trade Names
- - -----------
The Company has obtained federal trademark protection for the "AmeriCredit" name
and the logo that incorporates the "AmeriCredit" name.
Competition
- - -----------
Because the Company's target market consists of consumers who generally have
limited access to traditional financing sources, the Company usually does not
compete directly with banks, savings and loans, credit unions, the manufactur-
ers' captive finance companies and other traditional sources of consumer
credit.
However, the Company encounters intense competition in its segment of the market
from other local, regional and national consumer finance companies, some of
which have access to greater financial resources than the Company. In addition,
there can be no assurance that traditional financial institutions will not, in
the future, become more active in providing financing to the Company's targeted
customer base.
The Company plans to expand its indirect consumer finance business by adding
additional branch offices and marketing representatives and expanding loan
production capacity at existing branches. The success of this strategy is
dependent upon the Company's ability to hire and retain qualified area general
managers and other personnel and develop relationships with more dealers. The
Company confronts intense competition in attracting key personnel and
establishing relationships with dealers. Dealers often already have favorable
secondary financing sources, which may restrict the Company's ability to develop
dealer relationships and delay the Company's growth. In addition, the
competitive conditions in the Company's markets may result in a reduction in the
contract fees that the Company charges the dealers or a decrease in contract
acquisition volume, which would adversely affect the Company's profitability.
Regulation
- - ----------
The Company's operations are subject to regulation, supervision, and licensing
under various federal, state and local statutes, ordinances and regulations.
The consumer credit authority in each state in which the Company operates has
primary responsibility for regulation and enforcement of laws relating to
consumer lenders and sales finance agencies such as the Company. Such rules and
regulations generally provide for licensing of lenders, limitations on the
amount, duration and charges, including interest rates, for various categories
of loans, requirements as to the form and content of finance contracts and other
documentation and restrictions on collection practices and creditors' rights.
In certain states, the Company's branch offices are subject to periodic
examination by state regulatory authorities.
The Company is also subject to extensive federal regulation, including the Truth
in Lending Act, the Equal Credit Opportunity Act and the Fair Credit Reporting
Act. These laws require the Company to provide certain disclosures to
prospective borrowers, prohibit misleading advertising and protect against
discriminatory lending practices and unfair credit practices. The principal
disclosures required under the Truth in Lending Act include the terms of
repayment, the total finance charge and the annual percentage rate charged on
each loan. The Equal Credit Opportunity Act prohibits creditors from
discriminating against loan applicants on the basis of race, color, sex, age or
marital status. Pursuant to Regulation B promulgated under the Equal Credit
Opportunity Act, creditors are required to make certain disclosures regarding
consumer rights and advise consumers whose credit applications are not approved
of the reasons for the rejection. The Fair Credit Reporting Act requires the
Company to provide certain information to consumers whose credit applications
are not approved on the basis of a report obtained from a consumer reporting
agency.
The dealers who originate car loans purchased by the Company also must comply
with both state and federal credit and trade practice statutes and regulations.
Failure of the dealers to comply with such statutes and regulations could result
in consumers having rights of rescission and other remedies that could have an
adverse effect on the Company.
Management believes that it maintains all licenses and permits required for its
current operations and is in substantial compliance with all applicable local,
state, and federal regulations. There can be no assurance, however, that the
Company will be able to maintain all requisite licenses and permits and the
failure to satisfy those and other regulatory requirements could have a material
adverse effect on the operations of the Company. Further, the adoption of
additional, or the revision of existing rules and regulations could have a
material adverse effect on the Company's business.
Employees
- - ---------
At June 30, 1994, the Company employed 183 persons.
Executive Officers
- - ------------------
The following sets forth certain data concerning the executive officers of the
Company and AFSI, all of whom are elected on an annual basis.
Name Age Position
Clifton H. Morris, Jr. 59 Chairman of the Board, Chief
Executive Officer and President
Dennis R. Adams 39 Senior Vice President, Director of
Collections of AFSI
Michael R. Barrington 35 Vice President and President and
Chief Operating Officer of AFSI
Daniel E. Berce 40 Vice President, Chief Financial
Officer and Treasurer
Chris A. Choate 31 General Counsel and Secretary
Edward H. Esstman 53 Senior Vice President, Director of
Consumer Finance of AFSI
CLIFTON H. MORRIS, JR. has been Chairman of the Board and Chief Executive
Officer of the Company since May 1988, and was also President of the Company
from such date until April 1991 and from April 1992 to the present. Mr. Morris
is also a director of Service Corporation International, a publicly held company
that owns and operates funeral homes and related businesses, and Cash America
International, Inc., a publicly held pawn brokerage company.
DENNIS R. ADAMS has been Senior Vice President, Director of Collections of AFSI
since AFSI's formation in July 1992. Mr. Adams was also Vice President,
Director of Collections and Customer Service of the Company from July 1991 until
July 1992. From September 1985 until July 1991, Mr. Adams acted in various
management capacities at Citicorp National Services, most recently as Collection
Center Manager for Citicorp's National P&L Recovery Center in Dallas, Texas.
MICHAEL R. BARRINGTON has been President and Chief Operating Officer of AFSI
since AFSI's formation in July 1992. Mr. Barrington has also been Vice
President of the Company since May 1991. Mr. Barrington was Assistant to the
Chairman of the Company from July 1989 until May 1991 and Vice President, Credit
and Finance Operations from July 1990 until May 1991. From December 1984 until
July 1989, Mr. Barrington was employed at Bank One, Texas, N.A. (previously
MBank Fort Worth, N.A.) in various capacities, most recently as Senior Vice
President and Manager of Commercial Lending.
DANIEL E. BERCE is a certified public accountant and has been Vice President,
Chief Financial Officer and Treasurer for the Company since May 1991. Mr. Berce
was Vice President, Chief Financial Officer from May 1990 until May 1991. Prior
to that, he was a partner of Coopers & Lybrand, certified public accountants,
for four years and with such firm for fifteen years.
CHRIS A. CHOATE has been General Counsel and Secretary of the Company since
January 1993. From July 1991 until January 1993, Mr. Choate was Assistant
General Counsel. Prior to that, he was an associate with the law firm of Jones,
Day, Reaves & Pogue in Dallas, Texas from January 1990 until July 1991 and an
associate with the law firm of Jenkens & Gilchrist in Dallas, Texas from
September 1988 until January 1990.
EDWARD H. ESSTMAN has been Senior Vice President, Director of Consumer Finance
of AFSI since AFSI's formation in July 1992. From April 1984 until June 1992,
Mr. Esstman acted in various management capacities at Mercury Finance Company,
most recently as Vice President of Administration.
Item 2. Properties
- - -------------------
The Company's executive offices are located at 200 Bailey Avenue, Fort Worth,
Texas, in a 43,000 square foot building purchased by the Company in February
1994. All of the Company's branch office facilities are leased under lease
agreements with original terms of two to four years.
Item 3. Legal Proceedings
- - --------------------------
Four lawsuits were filed against the Company, several of its current and former
officers and directors, and certain other defendants, alleging violations of
federal securities and other laws. The suits were originally filed in July
1990, and in October 1991, the four lawsuits were consolidated into one action.
In May 1993, the U.S. District Court for the Northern District of Texas, Dallas
Division, dismissed with prejudice all claims alleging violations of federal
securities laws. The plaintiffs' state claims were dismissed for want of
jurisdiction. The plaintiffs appealed the dismissal to the Court of Appeals for
the Fifth Circuit. On August 8, 1994, the Court of Appeals for the Fifth
Circuit affirmed the U.S. District Court's dismissal of the lawsuit.
The Company is involved in other lawsuits in the normal course of business. In
the opinion of management, resolution of these matters will not have a material
adverse effect on the Company's consolidated financial position, results of
operations or liquidity.
Item 4. Submission of Matters to a Vote of Security Holders
- - ------------------------------------------------------------
There were no matters submitted to a vote of the Company's security holders
during the fourth quarter ended June 30, 1994.
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters
- - ------------------------------------------------------------------------------
The Company has never paid cash dividends on its common stock. The Company's
bank line of credit contains certain restrictions on the payment of dividends.
While the Company has an accumulated deficit at June 30, 1994, the Company
presently intends to retain future earnings, if any, for purposes of funding
operations.
Information contained under the caption "Common Stock Data" in the Annual
Report is incorporated herein by reference in further response to this Item 5.
Item 6. Selected Financial Data
- - --------------------------------
Information contained under the caption "Summary Financial and Operating
Information" in the Annual Report is incorporated herein by reference in
response to this Item 6.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
- - ------------------------------------------------------------------------
Information contained under the caption "Financial Review" in the Annual Report
is incorporated herein by reference in response to this Item 7.
Item 8. Financial Statements and Supplementary Data
- - ----------------------------------------------------
The Consolidated Financial Statements of the Company included in the Annual
Report and information contained under the caption "Quarterly Data" in the
Annual Report are incorporated herein by reference in response to this Item 8.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
- - -------------------------------------------------------------------------
The Company had no disagreements on accounting or financial disclosure matters
with its independent accountants to report under this Item 9.
PART III
Item 10. Directors and Executive Officers of the Registrant
- - ------------------------------------------------------------
Information contained under the caption "Election of Directors" in the Proxy
Statement is incorporated herein by reference in response to this Item 10.
See Item 1. "Business - Executive Officers" for information concerning
executive officers.
Item 11. Executive Compensation
- - --------------------------------
Information contained under the captions "Executive Compensation" and
"Election of Directors" in the Proxy Statement is incorporated herein by
reference in response to this Item 11.
Item 12. Security Ownership of Certain Beneficial Owners and Management
- - ------------------------------------------------------------------------
Information contained under the caption "Principal Shareholders and Stock
Ownership of Management" in the Proxy Statement is incorporated herein by
reference in response to this Item 12.
Item 13. Certain Relationships and Related Transactions
- - --------------------------------------------------------
Information contained under the caption "Certain Transactions" in the Proxy
Statement is incorporated herein by reference in response to this Item 13.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
- - --------------------------------------------------------------------------
(1) The following Consolidated Financial Statements of the Company and Report
of Independent Accountants are contained in the Annual Report and are
incorporated herein by reference.
Consolidated Financial Statements:
Consolidated Balance Sheets as of June 30, 1994 and 1993.
Consolidated Statements of Operations for the years ended June 30, 1994,
1993 and 1992.
Consolidated Statements of Shareholders' Equity for the years ended June
30, 1994, 1993 and 1992.
Consolidated Statements of Cash Flows for the years ended June 30, 1994,
1993 and 1992.
Notes to Consolidated Financial Statements
Report of Independent Accountants
(2) All schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are either not
required under the related instructions, are inapplicable, or the required
information is included elsewhere in the Consolidated Financial Statements
and incorporated herein by reference.
(3) The exhibits filed in response to Item 601 of Regulation S-K are listed
in the Index to Exhibits on pages 17 and 18.
(4) The Company did not file any reports on Form 8-K during the quarterly
period ended June 30, 1994.
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, on September 27, 1994.
AmeriCredit Corp.
BY: /s/ Clifton H. Morris, Jr.
Clifton H. Morris, Jr.
Chairman of the Board, Chief
Executive Officer and President
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following persons on behalf of the Registrant and in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
/s/ Clifton H. Morris, Jr. Chairman of the Board, September 27, 1994
Clifton H. Morris, Jr. Chief Executive
Officer and President
/s/ Daniel E. Berce Vice President, Chief September 27, 1994
Daniel E. Berce Financial Officer and
Treasurer and Director
/s/ Michael R. Barrington Vice President and September 27, 1994
Michael R. Barrington Director
/s/ James H. Greer Director September 27, 1994
James H. Greer
/s/ Gerald W. Haddock Director September 27, 1994
Gerald W. Haddock
/s/ Kenneth H. Jones, Jr. Director September 27, 1994
Kenneth H. Jones, Jr.
INDEX TO EXHIBITS
The following documents are filed as a part of this report. Those exhibits
previously filed and incorporated herein by reference are identified below.
Exhibits not required for this report have been omitted.
Exhibit
Number Description
*3.1 -- Articles of Incorporation of the Company, filed May 18,
1988, and Articles of Amendment to Articles of Incorporation,
filed August 24, 1988 (Exhibit 3.1)
*3.2 -- Amendment to Articles of Incorporation, filed October 18,
1989 (Exhibit 3.2)
###3.3 -- Articles of Amendment to the Articles of Incorporation of
the Company, filed November 12, 1992 (Exhibit 3.3)
*3.4 -- Bylaws of the Company (Exhibit 3.4)
#4.1 -- Specimen stock certificate evidencing the Common Stock
(Exhibit 4.1)
*4.2 -- Amended Warrant Agreement, dated September 6, 1989, between
the Company and Alex Brown & Sons Incorporated and Amendment
to Warrant Agreement, dated October 24, 1989 (Exhibit 4.3)
*4.3 -- Amended Warrant Agreement, dated September 6, 1989, between
the Company and Cazenove Inc. and Amendment to Warrant
Agreement, dated October 24, 1989 (Exhibit 4.3)
*10.1 -- 1989 Stock Option Plan for Non-Employee Directors of the
Company (Exhibit 10.4)
*10.2 -- 1989 Stock Option Plan (with Stock Appreciation Rights) for
the Company (Exhibit 10.5)
**10.3 -- Amendment No. 1 to the 1989 Stock Option Plan (with Stock
Appreciation Rights) for the Company (Exhibit 4.6)
*10.4 -- 1987 Incentive Stock Option Plan for the Company (Exhibit
10.6)
***10.5 -- 1990 Stock Option Plan for Non-Employee Directors of the
Company (Exhibit 10.14)
#10.6 -- 1991 Key Employee Stock Option Plan of the Company (Exhibit
10.10)
#10.7 -- 1991 Non-employee Director Stock Option Plan of the Company
(Exhibit 10.11)
#10.8 -- Executive Employment Agreement, dated January 30, 1991,
between the Company and Clifton H. Morris, Jr. (Exhibit 10.18)
#10.9 -- Executive Employment Agreement, dated January 30, 1991,
between the Company and Michael R. Barrington (Exhibit 10.19)
#10.10 -- Executive Employment Agreement, dated January 30, 1991,
between the Company and Daniel E. Berce (Exhibit 10.20)
###10.11 -- Executive Employment Agreement, dated May 20, 1993, between
the Company and Edward H. Esstman
###10.12 -- Executive Employment Agreement, dated August 18, 1993,
between the Company and Dennis R. Adams
##10.13 -- Stock Purchase Agreement By and Between AmeriCredit Corp.,
as Seller, and Pacific Automart Inc., as Buyer, dated April
30, 1993 (Exhibit 10.1)
##10.14 -- Stock Purchase, Release and Confidentiality Agreement By
and Between AmeriCredit Corp. and Pacific Automart Inc., dated
August 3, 1993 (Exhibit 10.2)
INDEX TO EXHIBITS
(Continued)
^10.15 -- Revolving Credit Agreement, dated October 18, 1993, between
AmeriCredit Corp. and subsidiaries and First Interstate Bank
of Texas, N.A. (Exhibit 10.1)
@10.16 -- Stock Option Purchase Agreement, dated April 4, 1994, between
AmeriCredit Corp. and Rainwater Management Partners, Ltd.
@11.1 -- Schedule Re Computation of Per Share Earnings
@13.1 -- 1994 Annual Report to Shareholders of the Company
@21.1 -- Subsidiaries of the Company
@23.1 -- Consent of Coopers & Lybrand
@27.1 -- Financial Data Schedule
_____________________________________________________________________
* Incorporated by reference to the exhibit shown in parenthesis
included in Registration Statement No. 33-31220 on Form S-1 filed by
the Company with the Securities and Exchange Commission.
** Incorporated by reference to the exhibit shown in parenthesis
included in Registration Statement No. 33-41203 on Form S-8 filed by
the Company with the Securities and Exchange Commission.
*** Incorporated by reference to the exhibit shown in parenthesis
included in the Company's Annual Report on Form 10-K for the year
ended June 30, 1990 filed by the Company with the Securities and
Exchange Commission.
# Incorporated by reference to the exhibit shown in parenthesis
included in the Company's Annual Report on Form 10-K for the year
ended June 30, 1991 filed by the Company with the Securities and
Exchange Commission.
## Incorporated by reference to the exhibit shown in parenthesis
included in the Company's Current Report on Form 8-K dated August 3,
1993 filed by the Company with the Securities and Exchange
Commission.
### Incorporated by reference to the exhibit shown in parenthesis included
in the Company's Annual Report on Form 10-K for the year ended June
30, 1993 filed by the Company with the Securities and Exchange
Commission.
^ Incorporated by reference to the exhibit shown in parenthesis included
in the Company's Quarterly Report on Form 10-Q for the quarterly
period ended September 30, 1993 filed by the Company with the
Securities and Exchange Commission.
@ Filed herewith.