-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RZN4V9NVIPPSek5yoNIhbcdK9rf4OpqLp5rgIFOhZdJygxg5ILh8vH43sCtZU+ek OB+eNr6/nmiOouMMrozOfg== 0000068480-99-000012.txt : 19991124 0000068480-99-000012.hdr.sgml : 19991124 ACCESSION NUMBER: 0000068480-99-000012 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990924 ITEM INFORMATION: FILED AS OF DATE: 19991123 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MOTOR CLUB OF AMERICA CENTRAL INDEX KEY: 0000068480 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 220747730 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 000-00671 FILM NUMBER: 99762837 BUSINESS ADDRESS: STREET 1: 95 ROUTE 17 SOUTH CITY: PARAMUS STATE: NJ ZIP: 07653 BUSINESS PHONE: 2012912000 MAIL ADDRESS: STREET 1: 95 ROUTE 17 SOUTH CITY: PARAMUS STATE: NJ ZIP: 07653-0931 8-K/A 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): September 24, 1999 MOTOR CLUB OF AMERICA ----------------------------------------------------- (Exact Name of Registrant as specified in its charter) New Jersey 0-671 22-0747730 - ----------------------------- ----------- ------------------- (State or other jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 95 Route 17 South, Paramus, New Jersey 07653-0931 -------------------------------------------------- (Address of principal executive offices)(Zip Code) Registrant's telephone number, including area code(201) 291-2000 __________________________________________________________ (Former name or former address, if changed since last report) The purpose of this amended filing is to reflect additional unaudited pro forma information in Item 7. See current report on Form 8-K dated and filed September 28, 1999, which is being amended hereby. ITEM 7 - FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (b) Pro Forma Financial Information Unaudited ProForma Condensed Combined Statement of Income for the nine months ended September 30, 1999 and year ended December 31, 1998. The Registrant has previously filed a Condensed Consolidated Balance Sheet as of September 30, 1999 in its Report on Form 10-Q dated November 15, 1999, which includes North East. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. MOTOR CLUB OF AMERICA By: /s/Patrick J. Haveron Patrick J. Haveron Executive Vice President Chief Executive Officer and Chief Financial Officer Date: November 22, 1999 MOTOR CLUB OF AMERICA AND NORTH EAST INSURANCE COMPANY UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 __________
Historical ------------------- Motor North Pro Forma Pro Forma Club East Adjustments Combined ------ ------ ------------ --------- REVENUES Insurance premiums $39,643,239 $10,195,317 $49,838,556 Net investment income 3,600,727 614,393 4,215,120 Realized gains (losses) on sales of investments (net) 5,365 (32,938) (27,573) Other revenues 109,579 - 109,579 ----------- ----------- -------- ----------- Total revenues 43,358,910 10,776,772 - 54,135,682 ----------- ----------- -------- ----------- LOSSES AND EXPENSES Losses and loss expenses incurred 28,413,303 6,767,370 35,180,673 Amortization of deferred policy acquisition costs 11,658,039 4,109,790 15,767,829 Interest expense 177,479 - 618,933(C) 796,412 Merger-related expenses 800,000 1,117,933 1,917,933 Other operating expenses 696,848 668,731 66,263(B) 1,431,842 ----------- ----------- --------- ----------- Total losses and expenses 41,745,669 12,663,824 685,196 55,094,689 ----------- ----------- --------- ----------- Income (loss) before Federal income taxes 1,613,241 (1,887,052) (685,196) (959,007) Benefit for Federal income taxes (513,558) (630,399) (232,967) (1,376,924) ---------- ----------- -------- ----------- Net income (loss) $ 2,126,799 ($1,256,653) (452,229) $ 417,917 =========== =========== ======== ===========
Net income (loss) per share: Basic $1.01 ($.41) $.20 (D) ===== ===== ==== Diluted $1.00 ($.41) $.20 (D) ===== ===== ==== Weighted coverage common and potential common shares outstanding: Basic 2,116,429 3,049,089 2,124,387 (D) ========= ========= ========= Diluted 2,140,275 3,049,089 2,124,387 (D) ========= ========= =========
The accompanying notes are an integral part of these pro forma condensed combined financial statements. MOTOR CLUB OF AMERICA AND NORTH EAST INSURANCE COMPANY UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 1998 __________
Historical --------------------- Motor North Pro Forma Pro Forma Club East Adjustments Combined ------ ----- ----------- --------- REVENUES Insurance premiums $53,175,663 $12,580,432 $65,756,095 Net investment income 4,304,507 870,548 5,175,055 Realized gains on sales of investments (net) 28,545 54,272 82,817 Other revenues 171,171 - 171,171 ----------- ----------- ------ ----------- Total revenues 57,679,886 13,505,252 - 71,185,138 ----------- ----------- ------ ----------- LOSSES AND EXPENSES Losses and loss expenses incurred 36,479,591 8,357,673 44,837,264 Amortization of deferred policy acquisition costs 13,375,221 3,571,626 16,946,847 Interest expense - - 844,000(C) 844,000 Other operating expenses 2,105,668 1,354,430 88,351(B) 3,548,449 ----------- ----------- -------- ----------- Total losses and expenses 51,960,480 13,283,729 932,351 66,176,560 ----------- ----------- -------- ----------- Income before Federal income taxes 5,719,406 221,523 (932,351) 5,008,578 Provision for Federal income taxes (1,463,615) (63,836) 316,999 (1,210,452) ----------- ---------- --------- ---------- Net income $ 4,255,791 $ 157,687 ($615,352) $3,798,126 =========== ========== ========= ==========
Net income per share: Basic $2.02 $0.05 $1.79 (D) ===== ===== ===== Diluted $1.00 $0.05 $1.57 (D) ===== ===== ===== Weighted coverage common and potential common shares outstanding: Basic 2,108,722 3,048,138 2,116,680 (D) ========= ========= ========= Diluted 2,121,366 3,124,489 2,766,944 (D) ========= ========= =========
The accompanying notes are an integral part of these pro forma condensed combined financial statements. MOTOR CLUB OF AMERICA AND NORTH EAST INSURANCE COMPANY NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS __________ Note A - Basis of Presentation: The unaudited pro forma condensed combined statement of income reflects a combination of: 1) 41,781 of the outstanding shares of North East Insurance Company ("North East") based upon an exchange ratio of 0.19048 of a share of Motor Club of America ("Motor Club") Common Stock for each outstanding share of North East; and 2) the remaining outstanding shares and all other dilutive shares of North East presently issued but not outstanding based upon a cash price of $3.30 per share. The total purchase price is therefore assumed to be approximately $10.483 million. With respect to North East, certain accounts have been reclassified in the financial statements to conform to Motor Club's presentation. Note B - Goodwill: Under the purchase method of accounting for business combinations, the total purchase price is allocated to the acquired assets and liabilities based on their fair values. Any differences between the excess of the cost of the transaction and the fair value of North East's net assets acquired is recorded as goodwill, which will be amortized on a straight-line basis over twenty years after the merger. Note C - Convertible Subordinated Debentures: In connection with its acquisition of North East, on September 23, 1999, Motor Club issued $10 million of Convertible Subordinated Debentures ("Debentures"), in one series, under a plan previously approved by its shareholders. The Debentures are due on September 23, 2009 and bear an interest rate of 8.44%, which is 2.5% over the London Interbank Offered Rate, fixed as of September 23, 1999, the date the series was issued. At each holder's option, the Debenture is convertible at any time, in whole or in part, into 645,578 of Motor Club's common shares ($10 million divided by 130% of the average trading price of Motor Club's common stock over the twenty day period immediately prior to September 23, 1999 ("Conversion Price")). The applicable Conversion Price is $15.49. MOTOR CLUB OF AMERICA AND NORTH EAST INSURANCE COMPANY NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS __________ Note C - Convertible Subordinated Debentures (Continued): Members of Motor Club's Executive Committee purchased $9,253,785 of the $10 million in Debentures issued. If the members of the Executive Committee convert those Debentures, their percentage ownership in Motor Club's common stock will substantially increase. Based on Motor Club's common shares outstanding as of September 30, 1999 and those subsequently issued to North East shareholders as part of their elections under the Merger, the Executive Committee could increase its collective percentage stock ownership from the current 42.2% to 53.8%. Note D - Earnings per Share: The weighted average number of outstanding common shares has been adjusted to reflect the additional Motor Club shares which are assumed to be issued to North East stockholders as described in Note A. The weighted average number of potential outstanding common shares has been adjusted to reflect the conversion of the debentures described in Note C. Net income available to common shareholders for purposes of the diluted earnings per share computation excludes interest expense (net of tax) applicable to the debentures. For the nine months ended September 30, 1999, basic and diluted income per share are the same because the dilutive computation would be anti- dilutive on a per share basis. -----END PRIVACY-ENHANCED MESSAGE-----