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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
----- EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 1998
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
----- SECURITIES EXCHANGE ACT OF 1934
For the Transition Period Type From: To:
---------- -----------
Commission File No.: 0-9233
AMERICAN MANAGEMENT SYSTEMS, INCORPORATED
(Exact name of registrant as specified in its charter)
State of Incorporation: Delaware I.R.S. Employer
Identification No.: 54-0856778
4050 Legato Road
Fairfax, Virginia 22033
(Address of principal executive office)
Registrant's Telephone No., Including Area Code: (703) 267-8000
Securities Registered Pursuant to Section 12(b) of the Act: None
Securities Registered Pursuant to Section 12(g) of the Act: Common Stock
Par Value $0.01
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. ____
The aggregate market value of voting stock held by non-affiliates of the
Registrant as of March 18, 1999 was $1,412,430,756.
As of March 18, 1999, 42,535,290 shares of common stock were outstanding.
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DOCUMENTS INCORPORATED BY REFERENCE
1. Pursuant to Form 10-K General Instruction G(2), registrant hereby
incorporates by reference those portions of the American Management Systems,
Incorporated 1998 Financial Report necessary to respond to items 5, 6, 7, 7A
and 8 of this Form 10-K.
2. Pursuant to Form 10-K General Instruction G(3), registrant hereby
incorporates by reference those portions of the American Management Systems,
Incorporated definitive Proxy Statement for the Annual Meeting of
Shareholders to be held May 21, 1999 necessary to respond to items 10, 11,
12, and 13 of this Form 10-K.
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CONTENTS
Page
----
Part I Item 1. Business..................................................................... 1
Item 2. Properties................................................................... 4
Item 3. Legal Proceedings............................................................ 4
Item 4. Submission of Matters to a Vote of Security Holders.......................... 4
Part II Item 5. Market for the Registrant's Common Stock
and Related Stockholder Matters.............................................. 5
Item 6. Selected Financial Data...................................................... 5
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.......................................... 5
Item 7A. Quantitative and Qualitative Disclosures About Market Risk................... 5
Item 8. Financial Statements and Supplementary Data.................................. 5
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure....................................... 5
Part III Item 10. Directors and Executive Officers of the Registrant........................... 7
Item 11. Executive Compensation....................................................... 7
Item 12. Security Ownership of Certain Beneficial Owners
and Management............................................................... 7
Item 13. Certain Relationships and Related Transactions............................... 7
Part IV Item 14. Exhibits, Financial Statements and Schedules,
and Reports on Form 8-K...................................................... 8
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PART I
ITEM 1. BUSINESS
OVERVIEW
The business of American Management Systems, Incorporated and its
wholly-owned subsidiaries ("AMS" or the "Company") is to partner with
clients to achieve breakthrough performance through the intelligent use of
information technology. AMS provides a full range of consulting services
from strategic business analysis to the full implementation of solutions
that produce genuine results, on time and within budget. AMS measures
success based on the results and business benefits achieved by its clients.
AMS is a trusted business partner for many of the largest and most
respected organizations in the markets in which it specializes. Each year,
approximately 85-90% of the Company's business comes from clients it worked
with in previous years.
The Company, which operates as one segment, focuses on clients in
specific sectors which are referred to as target markets. Organizations in
AMS's target markets -- telecommunications firms; financial services
institutions; state and local governments and education organizations;
federal government agencies; and other corporate clients -- have a crucial
need to exploit the potential benefits of information and systems
integration technology. The Company helps clients fulfill this need by
continuing to build a professional staff which is composed of experts in the
necessary technical and functional disciplines; managers who can lead large,
complex systems integration projects; and business and computer analysts who
can devise creative solutions to complex problems.
Another significant component of AMS's business is the development
of proprietary software products, either with its own funds or on a jointly
funded basis with other organizations. These products are principally
licensed as elements of custom tailored systems, and, to a lesser extent, as
stand-alone applications. The Company expended $77.4 million in 1998, $50.6
million in 1997, and $30.4 million in 1996 for research and development
associated with proprietary software. The Company expensed in the
accompanying consolidated financial statements $35.4 million in 1998, $30.7
million in 1997, and $26.0 million in 1996 for research and development
associated with proprietary software. As a percentage of revenues, license
and maintenance fee revenues were less than 10% during each of the last
three years.
During 1998, the Company formed a cross-target market practice
that will focus on delivering high-value, customer-facing Web solutions -
including eBill, eCare and eMarketing - tailored to clients in financial
services, telecommunications, government and utilities. These solutions
will help firms achieve greater cost savings, deliver improved customer
service and leverage cross-sell and up-sell opportunities in their markets.
The new "eCustomer" practice builds upon the Company's existing, significant
eCommerce client base.
In order to serve clients outside of the United States, AMS has
expanded internationally by establishing eighteen subsidiaries or foreign
branches. Exhibit 21 of this Form 10-K provides a complete listing of all
active AMS subsidiaries (and branches), showing name, year organized or
acquired, and place of incorporation. Revenues attributable to AMS's non-US
clients were approximately $208.4 million in 1998, $248.6 million in 1997,
and $278.3 million in 1996. Additional information on revenues and assets
attributable to AMS's geographic areas of operation is provided in Note 12
of the consolidated financial statements appearing in Exhibit 13 of this
Form 10-K.
Founded in 1970, AMS services clients worldwide. AMS's
approximately 8,100 full-time employees serve clients from corporate
headquarters in Fairfax, Virginia and from 57 offices worldwide.
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TELECOMMUNICATIONS FIRMS
AMS markets systems consulting and integration services for order
processing, customer care, billing, accounts receivable, and collections,
both for local exchange and interexchange carriers and for cellular/wireless
telephone companies. Most of the Company's work involves developing and
implementing customized capabilities using AMS's application software
products as a foundation.
FINANCIAL SERVICES INSTITUTIONS
AMS provides information technology consulting and systems
integration services to money center banks, major regional banks, insurance
companies, and other large financial services firms. The Company
specializes in corporate and international banking, consumer credit
management, customer value and global risk management, bank management
information systems, and retirement plan systems.
STATE AND LOCAL GOVERNMENTS AND EDUCATION
AMS markets systems consulting and integration services, and
application software products, to state, county, and municipal governments
for financial management, tax and revenue management, human resources,
social services, public safety and transportation functions, and
environmental systems. The Company also markets services and application
software products to universities and colleges.
FEDERAL GOVERNMENT AGENCIES
The Company's clients include civilian and defense agencies and
aerospace companies. Assignments require knowledge of agency programs and
management practices as well as expertise in computer systems integration.
Services provided by AMS include information technology, consulting,
operations and maintenance support, large scale systems integration and
certain Year 2000 remediation. AMS's work for defense agencies often
involves specialized expertise in engineering and logistics.
OTHER CORPORATE CLIENTS
The Company also solves information systems problems for the
largest firms in other industries, including health care organizations and
firms in the gas and electric utilities industry. AMS has systems
integration and operations projects with several large organizations and
intends to pursue more. AMS provides technical training and technical
consulting services in software technology for large-scale business systems.
PEOPLE
People are AMS's most important asset and its success depends on
its ability to attract, retain and motivate well-qualified people. The
Company's largest investment in recent years has been in recruiting,
assimilating, and developing its people.
AMS recruited and successfully assimilated approximately 2,100 new
staff members in 1998, including 324 in Europe. About 40% of the new staff
members came from the Company's college and university recruiting program.
AMS recruits individuals for a career and hires a balanced mix of
recent university graduates and experienced professionals who have
demonstrated extraordinary technical, analytical, and/or management skills.
A large number have advanced degrees in management, computer science, public
policy, or engineering.
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Individuals are assigned to one of the Company's market-oriented
groups to develop expertise in the areas needed for solving its clients'
problems. Transfers within these groups occur regularly to meet the
shifting needs of client's. Performance, in terms of productivity, quality
of work, and creativity in solving problems, determines an individual's
advancement. This motivates staff members to increase their knowledge of
AMS's clients' businesses and industries, to stay current with the
technology most suited to AMS's clients, and to develop the consulting and
managerial skills needed to produce results.
The Company launched a strategic initiative in 1998 to implement a
more integrated, structured career and leadership development program. To
drive this program the Company established "AMS University" as the focal
point for expanded training and development activities. By linking learning
resources directly to the skills required to perform key roles that drive
the business, and by structuring a development program that includes
required as well as elective courses, the Company believes it can accelerate
the development of individual capabilities and the overall capacity of the
Company to take full advantage of market opportunities.
COMPETITIVE FACTORS
AMS's competition comes primarily from the management services
units of large public accounting firms and consulting and systems
integration firms. In addition, prospective clients may decide to perform
projects with their in-house staff.
AMS seeks to meet this competition by exploiting its
industry-specific knowledge, its expertise with important business functions
and with new technologies, its proprietary computer application products,
and its experience in managing very large design and implementation
projects. Although price is always a factor in clients' decisions, it is
typically not the major factor. Other important factors are proven
experience, the capabilities of the proposed computer application products,
the quality of the proposed staff, and the proposed completion time for the
project.
AMS is significantly expanding its systems integration
capabilities by augmenting its delivery expertise and establishing key
alliances and partnerships with "best-of-breed" software providers.
Combining this expanded delivery capability with AMS's thought leadership
consulting provides major market growth opportunities.
MARKETING, CONTRACTS, AND SIGNIFICANT CUSTOMERS
Marketing is performed principally by the senior staff (executive
officers, vice presidents, senior principals, and principals) and by a
relatively small number of full-time salespersons for each large market. In
the U.S. Government markets, AMS replies selectively to requests for
proposals, concentrating on those closely related to previous work done for
the same or similar customers. Certain of the Company's software products
and computer services are sold by a small group of full-time salespersons
and, for those products and services, AMS advertises in trade publications
and exhibits at industry conventions.
For large systems integration projects, AMS typically contracts
for one phase (design, development, or implementation) at a time. Many
contracts may be canceled by the customer on short notice with appropriate
compensation to the Company for actual work performed. Most contracts with
federal government agencies allow for termination for the convenience of the
government and for an annual audit. No contracts are subject to
renegotiation at the client's option. AMS generally contracts either on the
basis of reimbursement of costs plus a fixed fee, a fixed or ceiling price
for each phase, unit rates for time and materials used, or services sold at
unit prices. In most cases, AMS receives monthly or milestone progress
payments.
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In 1998, the Company worked on projects directly for 109 U.S.
Government clients, representing a total of $224.8 million, or 21% of
revenues. No other customer accounted for 10% or more of revenues in 1998.
ITEM 2. PROPERTIES
Headquartered in Fairfax, Virginia, the Company's principal
operations occupy approximately 859,000 square feet of office space under
leases expiring through 2011. The Company also has other long-term lease
commitments totaling approximately 568,000 square feet with varying
expirations through 2014 at other locations throughout the United States.
Additionally, the Company's international staff occupies
approximately 258,700 square feet of office space outside of the U.S. at
locations under leases expiring through 2006.
With regard to its operating environment, the Company is provided
with a mainframe processor environment at the IBM Dedicated Processor Center
in Irving, Texas. In addition to the peripherals, power, and environmentals
provided by the Dedicated Processor Center, the Company owns other mainframe
peripheral equipment and microcomputers, and leases an IBM communications
processor.
The Company believes its facilities and equipment continue to be
adequate for its business as currently conducted.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of security holders
during the fourth quarter of 1998.
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PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
STOCKHOLDER MATTERS
Market information for the Company's common stock contained in the
Company's 1998 Financial Report is incorporated herein by reference in
accordance with General Instruction G(2) of Form 10-K.
ITEM 6. SELECTED FINANCIAL DATA
Selected financial data contained in the Company's 1998 Financial
Report is incorporated herein by reference in accordance with General
Instruction G(2) of Form 10-K.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Management's discussion and analysis of financial condition and
results of operations contained in the Company's 1998 Financial Report are
incorporated herein by reference in accordance with General Instruction G(2)
of Form 10-K.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS.
The information set forth on pages 11-13 of the Company's 1998
Financial Report, under the captions "Foreign Currency Hedging" and "Notes
Payable and Capitalized Lease Obligations," is incorporated herein by
reference in accordance with General Instruction G(2) of form 10-K.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The consolidated financial statements of the Company, together
with the reports thereon of Deloitte & Touche LLP and PricewaterhouseCoopers
LLP, and the supplementary financial information, contained in the Company's
1998 Financial Report, are incorporated herein by reference in accordance
with General Instruction G(2) of Form 10-K.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
On July 31, 1998, at the Company's regularly scheduled meetings of
its Board of Directors and the Audit Committee of the Board of Directors,
the Company accepted the resignation of PricewaterhouseCoopers LLP because
of conflicts of interest resulting from the July 1, 1998 merger of Price
Waterhouse LLP and Coopers & Lybrand LLP. The Company and Coopers & Lybrand
LLP have long-standing business relationships which both parties wish to
continue. In view of the independence requirements of the Securities and
Exchange Commission regarding the independence of certifying public
accountants, the Company and PricewaterhouseCoopers LLP mutually determined
that it would be inappropriate for PricewaterhouseCoopers LLP to continue as
the Company's accountants. Price Waterhouse LLP was the Company's
independent certifying accountants for 28 years. As a result of the
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above circumstances, the Audit Committee and Board of Directors thereupon
appointed Deloitte & Touche LLP as the Company's independent certifying
accountant for fiscal year 1998.
During the two fiscal years ended December 31, 1997 and December
31, 1996, the reports of PricewaterhouseCoopers LLP on the annual financial
statements have neither contained any adverse opinions or disclaimers of
opinions, nor have they been qualified or modified. During such two year
period, and through July 31, 1998 there were no disagreements with
PricewaterhouseCoopers LLP on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure,
which disagreements, if not resolved to the satisfaction of
PricewaterhouseCoopers LLP, would have caused PricewaterhouseCoopers LLP to
make reference to the subject matter of the disagreement in connection with
its reports on the financial statements for such years.
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PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information relating to the directors and executive officers of
the Company contained in the Company's definitive Proxy Statement for the
Annual Meeting of Shareholders to be held May 21, 1999, is incorporated
herein by reference. The Company's definitive Proxy Statement will be filed
within 120 days after the close of the Company's fiscal year in accordance
with General Instruction G(3) of Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION
Information relating to executive compensation contained in the
Company's definitive Proxy Statement for the Annual Meeting of Shareholders
to be held May 21, 1999, is incorporated herein by reference. The Company's
definitive Proxy Statement will be filed within 120 days after the close of
the Company's fiscal year in accordance with General Instruction G(3) of
Form 10-K.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
Information relating to the security ownership of certain
beneficial owners and management contained in the Company's definitive Proxy
Statement for the Annual Meeting of Shareholders to be held May 21, 1999, is
incorporated herein by reference. The Company's definitive Proxy Statement
will be filed within 120 days after the close of the Company's fiscal year
in accordance with General Instruction G(3) of Form 10-K.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information relating to certain relationships and related
transactions contained under the headings "Principal Stockholders" and
"Compensation Committee Interlocks and Insider Participation" in the
Company's definitive Proxy Statement for the Annual Meeting of Shareholders
to be held May 21, 1999, is incorporated herein by reference. The Company's
definitive Proxy Statement will be filed within 120 days after the close of
the Company's fiscal year in accordance with General Instruction G(3) of
Form 10-K.
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PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS AND SCHEDULES, AND REPORTS
ON FORM 8-K
(a) 1. FINANCIAL STATEMENTS
The consolidated financial statements of American Management
Systems, Incorporated and subsidiaries filed are as follows:
Consolidated Statements of Operations for 1998 - 1996
Consolidated Balance Sheets as of December 31, 1998
and 1997
Consolidated Statements of Cash Flows for 1998 - 1996
Consolidated Statements of Changes in Stockholders'
Equity for 1998 - 1996
Consolidated Statements of Comprehensive Income
1998 - 1996
Notes to Consolidated Financial Statements
Reports of Independent Accountants
2. FINANCIAL STATEMENT SCHEDULE
The financial statement schedule of American Management
Systems, Incorporated and subsidiaries filed is as follows:
Reports of Independent Accountants on financial
statement schedules
Schedule II - Valuation and Qualifying Accounts for
1998-1996
All other schedules are omitted because they are not
applicable, or the required information is shown in the financial statements
or the notes thereto.
Individual financial statements of the Company and each of
its subsidiaries are omitted because the Company is primarily an operating
company, and all subsidiaries included in the consolidated financial
statements being filed, in the aggregate, do not have a minority equity
interest in and/or indebtedness to any person other than the Company or its
consolidated subsidiaries in amounts which together exceed five percent of
the total assets as shown by the most recent year-end consolidated balance
sheet.
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3. EXHIBITS
The exhibits to the Annual Report on Form 10-K of American
Management Systems, Incorporated filed are as follows:
3. Articles of Incorporation and By-laws
3.1 Second Restated Certificate of Incorporation of
the Company (incorporated herein by reference to the Company's Form 8-A
filed on August 4, 1998).
3.2 Certificate of Designation of Series A Junior
Participating Preferred Stock (incorporated herein by reference to Exhibit 2
to the Company's Registration Statement on Form 8-A filed on August 4, 1998).
3.3 By-Laws of the Company, as amended and restated
February 27, 1998 (incorporated herein by reference to Exhibit 3.2 of the
Company's 1997 Annual Report on Form 10-K).
4. Instruments Defining the Rights of Security Holders
4.1 Specimen Common Stock Certificate (incorporated
herein by reference to Exhibit 4.1 of the Company's quarterly report on Form
10-Q for the quarter ended March 31, 1997).
4.2 Rights Agreement dated as of July 31, 1998,
between the Company and ChaseMellon Shareholder Services L.L.C. as Rights
Agent (incorporated herin by reference to the Company's Form 8-A filed on
August 4, 1998, including form of Rights Certificate).
10. Material Contracts
10.1 1996 Amended Stock Option Plan F (incorporated
herein by reference to Exhibit A to the Company's definitive Proxy Statement
filed on April 11, 1997).
10.2 Outside Directors Stock-for-Fees Plan
(incorporated herein by reference to Exhibit C to the Company's definitive
Proxy Statement filed on April 10, 1996).
10.3 1992 Amended and Restated Stock Option Plan E,
as amended (incorporated herein by reference to Exhibit B to the Company's
definitive Proxy Statement filed on April 17, 1995).
10.4 Executive Deferred Compensation Plan, as amended
September 1, 1997 (incorporated herein by reference to Exhibit 10.4 of the
Company's 1997 Annual Report on Form 10-K).
10.5 Outside Director Deferred Compensation Plan,
effective January 1, 1997 (incorporated herein by reference to Exhibit 10.5 of
the Company's 1997 Annual Report on Form 10-K).
10.6 Multi-Currency Revolving Credit Agreement dated
as of January 9, 1998 among the Company, certain of the Company's
subsidiaries, the Lenders named therein, and NationsBank N.A. as
administrative agent and Wachovia Bank N.A., as documentation agent
(incorporated herein by reference to Exhibit 10.6 of the Company's 1997
Annual Report on Form 10-K).
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10.7 Agreement of Lease between Joshua Realty
Corporation and the Company, dated August 10, 1992, as amended (incorporated
herein by reference to Exhibit 10.7 of the Company's 1997 Annual Report on
Form 10-K).
10.8 Office Lease Agreement between Hyatt Plaza
Limited Partnership and the Company, dated August 12, 1993, as amended
(incorporated herein by reference to Exhibit 10.8 of the Company's 1997
Annual Report on Form 10-K).
10.9 Lease Agreement between Fairfax Gilbane, L.P.
and the Company, dated February 15, 1994, as amended (incorporated herein by
reference to Exhibit 10.9 of the Company's 1997 Annual Report on Form 10-K).
10.10 Deed of Lease between Principal Mutual Life
Insurance Company and the Company, dated December 1996 (incorporated
herein by reference to Exhibit 10.10 of the Company's 1997 Annual Report
on Form 10-K).
10.11 1996 Incentive Compensation Plan for
Executive Officers.
13. 1998 Financial Report
21. Subsidiaries of the Company
23. Consents of Independent Accountants
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of PricewaterhouseCoopers LLP
27. Financial Data Schedules
27.1 Financial Data Schedule for the twelve months
ended December 31, 1998.
27.2 Restated Financial Data Schedule for the
twelve months ended December 31, 1997.
27.3 Restated Financial Data Schedule for the three
months ended March 31, 1998.
27.4 Restated Financial Data Schedule for the nine
months ended September 30, 1997.
27.5 Restated Financial Data Schedule for the six
months ended June 30, 1997.
27.6 Restated Financial Data Schedule for the three
months ended March 31, 1997.
(b) REPORTS ON FORM 8-K
None.
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REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULE
To the Board of Directors and Stockholders of
American Management Systems, Incorporated
Fairfax, Virginia
We have audited the consolidated financial statements of American
Management Systems, Incorporated and subsidiaries (the "Company") as of
December 31, 1998, and for the year then ended, and have issued our report
thereon dated February 17, 1999 (incorporated by reference in this Annual
Report on Form 10-K). Our audit also included the financial statement schedule
for the year ended December 31, 1998 listed in Item 14(a) of this Form 10-K.
This financial statement schedule is the responsibility of the Company's
management. Our responsibility is to express an opinion based on our audit. In
our opinion, such financial statement schedule, when considered in relation to
the basic consolidated financial statements taken as a whole, presents fairly
in all material respects the information set forth therein.
DELOITTE & TOUCHE LLP
Washington, D.C.
February 17, 1999
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REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULE
To the Board of Directors of
American Management Systems, Incorporated
Our audits of the consolidated financial statements referred to in our
report dated February 18, 1998 appearing on page 24 of the 1998 Financial
Report of American Management Systems, Incorporated (which report and
consolidated financial statements are incorporated by reference in this Annual
Report on Form 10-K) also included an audit of the Financial Statement
Schedule for the years ended December 31, 1997 and 1996 listed in Item 14(a)
of this Form 10-K. In our opinion, this Financial Statement Schedule presents
fairly, in all material respects, the information set forth therein when read
in conjunction with the related consolidated financial statements.
PRICEWATERHOUSECOOPERS LLP
Washington, D.C.
February 18, 1998
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Schedule II
American Management Systems, Incorporated
VALUATION AND QUALIFYING ACCOUNTS
For the Year Ended December 31 (In millions) 1998 1997 1996
- ------------------------------------------------------------------------------------------------
Allowance for Doubtful Accounts
-------------------------------
Balance at Beginning of Period $ 5.0 $ 18.9 $ 4.9
Allowance Accruals 10.9 10.6 15.2
Charges Against Allowance (6.1) (24.5) (1.2)
----- ------- ------
Balance at End of Period $ 9.8 $ 5.0 $ 18.9
===== ======= ======
Deferred Tax Asset Valuation Allowance
--------------------------------------
Balance at Beginning of Period $ 0.5 $ 0.4 $ 2.8
Allowance Accruals 0.6 0.1 0.4
Charges Against Allowance - - (2.8)
----- ------- ------
Balance at End of Period $ 1.1 $ 0.5 $ 0.4
===== ======= ======
Provision for Contract Losses
-----------------------------
Balance at Beginning of Period $ - $ 18.5 $ -
Allowance Accruals 7.3 - 18.5
Charges Against Provision - (18.5) -
----- ------- ------
Balance at End of Period $ 7.3 $ - $18.5
===== ======= ======
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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 the 26th of
March, 1999.
American Management Systems, Incorporated
by s/Paul A. Brands
------------------------------------
Paul A. Brands
Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following officers and directors of
the Registrant in the capacities and on the date indicated.
Signature Title Date
--------- ----- ----
(i) Principal Executive Officer:
s/Paul A. Brands Chairman and March 26, 1999
------------------------- Chief Executive
Paul A. Brands Officer
(ii) Principal Financial Officer:
s/Ronald L. Schillereff Treasurer and March 26, 1999
------------------------- Chief Financial
Ronald L. Schillereff Officer
(iii) Principal Accounting Officer:
s/Nancy Yurek Controller March 26, 1999
-------------------------
Nancy Yurek
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Signature Title Date
--------- ----- ----
(iv) Directors:
s/Daniel J. Altobello Director March 26, 1999
-------------------------
Daniel J. Altobello
s/Paul A. Brands Director March 26, 1999
-------------------------
Paul A. Brands
s/James J. Forese Director March 26, 1999
-------------------------
James J. Forese
s/Patrick W. Gross Director March 26, 1999
-------------------------
Patrick W. Gross
s/Dorothy Leonard Director March 26, 1999
-------------------------
Dorothy Leonard
s/W. Walker Lewis Director March 26, 1999
-------------------------
W. Walker Lewis
s/Frederic V. Malek Director March 26, 1999
-------------------------
Frederic V. Malek
s/Frank A. Nicolai Director March 26, 1999
-------------------------
Frank A. Nicolai
s/Alan G. Spoon Director March 26, 1999
-------------------------
Alan G. Spoon
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EXHIBIT INDEX
Exhibit
Number Description
------ -----------
3.1 Second Restated Certificate of Incorporation of the Company *
(incorporated herein by reference to the Company's
Form 8-A filed on August 4, 1998).
3.2 Certificate of Designation of Series A Junior Participating Preferred *
Stock (incorporated herein by reference to Exhibit 2 to the Company's
Registration Statement on Form 8-A filed on August 4, 1998).
3.3 By-laws of the Company, as amended and restated February *
27, 1998 (incorporated herein by reference to Exhibit 3.2 of the
Company's 1997 Annual Report on Form 10-K).
4.1 Specimen Common Stock Certificate (incorporated herein by *
reference to Exhibit 4.1 of the Company's quarterly report on
Form 10-Q for the Quarter ended March 31, 1997).
4.2 Rights Agreement dated as of July 31, 1998, between the Company *
and ChaseMellon Shareholder Services L.L.C. as Rights Agent
(incorporated herein by reference to the Company's Form 8-A filed
on August 4, 1998, including form of Rights Certificate).
10.1 1996 Amended Stock Option Plan F (incorporated herein by *
reference to Exhibit A to the Company's definitive Proxy
Statement filed on April 11, 1997).
10.2 Outside Directors Stock-for-Fees Plan (incorporated herein by *
reference to Exhibit C to the Company's definitive Proxy
Statement filed on April 10, 1996).
10.3 1992 Amended and Restated Stock Option Plan E, as amended *
(incorporated herein by reference to Exhibit B to the Company's
definitive Proxy Statement filed on April 17, 1995).
10.4 Executive Deferred Compensation Plan, as amended *
September 1, 1997 (incorporated herein by reference to Exhibit
10.4 of the Company's 1997 Annual Report on Form 10-K).
10.5 Outside Director Deferred Compensation Plan, effective *
January 1, 1997 (incorporated herein by reference to Exhibit
10.5 of the Company's 1997 Annual Report on Form 10-K).
10.6 Multi-Currency Revolving Credit Agreement dated as of *
January 9, 1998 among the Company, certain of the Company's
subsidiaries, the Lenders named therein, and NationsBank N.A.
as administrative agent and Wachovia Bank N.A., as
Documentation agent. (incorporated herein by reference to Exhibit
10.6 of the Company's 1997 Annual Report on Form 10-K).
16
20
EXHIBIT INDEX
Exhibit
Number Description
------ -----------
10.7 Agreement of Lease between Joshua Realty Corporation and the *
Company, dated August 10, 1992, as amended (incorporated herein
by reference to Exhibit 10.7 of the Company's 1997 Annual Report
on Form 10-K).
10.8 Office Lease Agreement between Hyatt Plaza Limited Partnership *
and the Company, dated August 12, 1993, as amended (incorporated
herein by reference to Exhibit 10.8 of the Company's 1997 Annual
Report on Form 10-K).
10.9 Lease Agreement between Fairfax Gilbane, L.P. and the Company, *
dated February 15, 1994, as amended (incorporated herein by
reference to Exhibit 10.9 of the Company's 1997 Annual Report on
Form 10-K).
10.10 Deed of Lease between Principal Mutual Life Insurance Company *
and the Company, dated December 1996 (incorporated herein by
reference to Exhibit 10.10 of the Company's 1997 Annual Report
on Form 10-K).
10.11 1996 Incentive Compensation Plan for Executive Officers
13. 1998 Financial Report
21. Subsidiaries of the Company
23. Consents of Independent Accountants
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of PricewaterhouseCoopers LLP
27. Financial Data Schedules
27.1 Financial Data Schedule for the twelve months ended December 31, 1998
27.2 Restated Financial Data Schedule for the twelve months ended December 31, 1997
27.3 Restated Financial Data Schedule for the three months ended March 31, 1998
27.4 Restated Financial Data Schedule for the nine months ended September 30, 1997
27.5 Restated Financial Data Schedule for the six months ended June 30, 1997
27.6 Restated Financial Data Schedule for the three months ended March 31, 1997
- ------------
*Previously filed.
17