SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM 10-K
(AMENDMENT NO. 1)
(Mark One)
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 000-33379
----------
CHICAGO MERCANTILE EXCHANGE HOLDINGS INC.
(Exact name of registrant as specified in its charter)
DELAWARE 36-4459170
(State or Other Jurisdiction of (IRS Employer Identification No.)
Incorporation or Organization)
30 SOUTH WACKER DRIVE, CHICAGO, ILLINOIS 60606
(Address of Principal Executive Offices) (Zip Code)
----------
Registrant's telephone number, including area code: (312) 930-1000
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Class A common
stock, Class A, $.01 par value; Class A common stock, Class A-1, $.01 par value;
Class A common stock, Class A-2, $.01 par value; Class A common stock, Class
A-3, $.01 par value; Class A common stock, Class A-4, $.01 par value (in each
case, including rights to acquire Series A Junior Participating Preferred Stock
pursuant to our rights plan).
----------
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 the voting stock held by nonaffiliates of the
registrant as of May 31, 2002 was approximately $1.4 billion. The number of
shares outstanding of each of the registrant's classes of common stock as of May
31, 2002 was as follows: 7,222,776 shares of Class A common stock, Class A-1,
$.01 par value; 7,222,776 shares of Class A common stock, Class A-2, $.01 par
value; 7,222,574 shares of Class A common stock, Class A-3, $.01 par value;
7,219,436 shares of Class A common stock, Class A-4, $.01 par value; 625 shares
of Class B common stock, Class B-1, $.01 par value; 813 shares of Class B common
stock, Class B-2, $.01 par value; 1,287 shares of Class B common stock, Class
B-3, $.01 par value; and 413 shares of Class B common stock, Class B-4, $.01 par
value.
DOCUMENTS INCORPORATED BY REFERENCE:
None.
EXPLANATORY NOTE: Pursuant to Rule 12b-15 of the Securities Exchange Act of
1934, as amended, Chicago Mercantile Exchange Holdings Inc. hereby amends its
Annual Report of Form 10-K for the year ended December 31, 2001 (the "Annual
Report"), filed with the Securities and Exchange Commission on March 28, 2002,
to include the Report of Independent Public Accounts (the "Opinion") covering
the financial statement schedules included in Item 14 of the Annual Report. Set
forth below in its entirety is Item 14 of the Annual Report with the only
modifications being (i) the inclusion of the Opinion and (ii) the updating of
the exhibit list to reflect (a) the incorporation by reference of exhibits filed
with the Annual Report and (b) the filing as exhibits of the Certificate of
Amendment to the Amended and Restated Certificate of Incorporation of Chicago
Mercantile Exchange Holdings Inc. and the Second Amended and Restated Bylaws of
Chicago Mercantile Exchange Holdings Inc. on a Current Report on Form 8-K, dated
May 16, 2002. All other portions of the Annual Report remain in effect as filed.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) Financial Statements and Financial Statement Schedules
(1) Financial Statements
The Consolidated Financial Statements listed below are contained in
Exhibit 13.
Report of Management
Report of Independent Public Accountants
Consolidated Balance Sheets at December 31, 2001 and 2000
Consolidated Statements of Income for the years ended
December 31, 2001, 2000 and 1999
Consolidated Statements of Shareholders' Equity and Comprehensive
Income for the years ended December 31, 2001, 2000 and 1999
Consolidated Statements of Cash Flows for the years ended
December 31, 2001, 2000 and 1999
Notes to Consolidated Financial Statements
2
(2) Financial Statement Schedules
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF CHICAGO MERCANTILE EXCHANGE
HOLDINGS INC.:
We have audited in accordance with auditing standards generally accepted in the
United States, the consolidated financial statements included in the Chicago
Mercantile Holdings Inc.'s annual report to shareholders incorporated by
reference in this Form 10-K, and have issued our report dated February 19, 2002.
Our audit was made for the purpose of forming an opinion on those statements
taken as a whole. The Schedules (Schedule I - Condensed Financial Information of
Registrant for the Year Ended December 31, 2001 and Schedule II - Valuation and
Qualifying Accounts for the years ended December 31, 2001, 2000 and 1999) are
the responsibility of the company's management and are presented for the
purposes of complying with the Securities and Exchange Commission's rules and
are not a part of the basic financial statements. These schedules have been
subjected to the auditing procedures applied in the audit of the basic financial
statements and, in our opinion, fairly state in all material respects the
financial data required to be set forth therein in relation to the basic
financial statements taken as a whole.
/s/ Arthur Andersen LLP
Arthur Andersen LLP
Chicago, Illinois
February 19, 2002
CHICAGO MERCANTILE EXCHANGE HOLDINGS INC. AND SUBSIDIARIES
SCHEDULE I--CONDENSED FINANCIAL INFORMATION OF REGISTRANT
FOR THE YEAR ENDED DECEMBER 31, 2001
Chicago Mercantile Exchange Holdings Inc., the registrant, has only one
asset, its investment in its wholly owned subsidiary, Chicago Mercantile
Exchange Inc., or CME, in the amount of $250,369,000 at December 31, 2001. Net
income from this investment on the equity basis of accounting amounted to
$68,302,000 for the year ended December 31, 2001. Net income is reflected as if
the registrant had been in existence for the entire year even though it was
formed during the year and became the parent of CME through a reorganization of
entities under common control as described in Note 1 to the financial statements
in Exhibit 13. The registrant has no liabilities, material contingencies or
guarantees. The registrant has received no cash dividends from CME.
CME renewed its committed line of credit with a consortium of banks on
October 19, 2001. The line of credit is a secured credit facility in the amount
of $500.0 million. Under the terms of the credit agreement, CME is required to
maintain at all times a tangible net worth of not less than $90.0 million, which
is 35.9% of the net assets of CME.
3
CHICAGO MERCANTILE EXCHANGE HOLDINGS INC. AND SUBSIDIARIES
SCHEDULE II--VALUATION AND QUALIFYING ACCOUNTS
FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999
(DOLLARS IN THOUSANDS)
BALANCE AT CHARGED TO BALANCE AT
BEGINNING COSTS AND CHARGED TO END OF
DESCRIPTION OF PERIOD EXPENSES REVENUES DEDUCTIONS(1) PERIOD
----------- ---------- ---------- ---------- ------------- ----------
Year ended December 31, 2001:
Allowance for doubtful accounts ... $ 1,700 $ 1,733 $ -- $ (2,471) $ 962
Accrued fee adjustments ........... 5,215 -- 12,149 (15,123) 2,241
Year ended December 31, 2000:
Allowance for doubtful accounts ... $ 350 -- $ 1,350 $ -- $ 1,700
Accrued fee adjustments ........... 1,615 -- 9,494 (5,894) 5,215
Year ended December 31, 1999:
Allowance for doubtful accounts ... $ 135 -- $ 326 $ (111) $ 350
Accrued fee adjustments ........... 1,885 -- 5,343 (5,613) 1,615
----------
(1) Includes write-offs of doubtful accounts and payments for fee adjustments.
All other schedules have been omitted because the information required to
be set forth in those schedules is not applicable or is shown in the
consolidated financial statements or notes thereto.
(b) Reports on Form 8-K
Chicago Mercantile Exchange Holdings Inc. filed a Current Report on Form
8-K, dated December 4, 2001, reporting the completion of the transactions
associated with its reorganization into a holding company structure.
(c) Exhibits
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
------ ----------------------
2.1 Agreement and Plan of Merger, dated as of October 1, 2001, between
Chicago Mercantile Exchange Inc., Chicago Mercantile Exchange Holdings
Inc. and CME Merger Subsidiary Inc. (incorporated by reference to
Exhibit 2.1 to Chicago Mercantile Exchange Holdings Inc.'s Form S-4,
filed with the SEC on August 7, 2001, File No. 33-66988).
3.1 Amended and Restated Certificate of Incorporation of Chicago
Mercantile Exchange Holdings Inc. (incorporated by reference to
Exhibit 3.1 to Chicago Mercantile Exchange Holdings Inc.'s Current
Report on Form 8-K, filed with the SEC on December 4, 2001, File No.
0-33379).
3.2 Certificate of Amendment to the Amended and Restated Certificate of
Incorporation of Chicago Mercantile Exchange Holdings Inc.
(incorporated by reference to Exhibit 3.2 to Chicago Mercantile
Exchange Holdings Inc.'s Current Report on Form 8-K, filed with the
SEC on May 16, 2002, File No. 0-33379).
3.3 Second Amended and Restated Bylaws of Chicago Mercantile Exchange
Holdings Inc. (incorporated by reference to Exhibit 3.3 to Chicago
Mercantile Exchange Holdings Inc.'s Current Report on Form 8-K, filed
with the SEC on May 16, 2002, File No. 0-33379).
4.1 Rights Agreement, dated as of November 30, 2001, between Chicago
Mercantile Exchange Holdings Inc. and Mellon Investor Services LLC
(incorporated by reference to Exhibit 4.1 to Chicago Mercantile
Exchange Holding's Inc.'s Form 8-A, filed with the SEC on December 4,
2001).
10.1 Chicago Mercantile Exchange Holdings Inc. Omnibus Stock Plan,
effective February 7, 2000 (incorporated by reference to Exhibit 10.1
to Chicago Mercantile Exchange Inc.'s Form S-4, filed with the SEC on
March 10, 2000, File No. 33-95561).
10.2 Chicago Mercantile Exchange Holdings Inc. Senior Management
Supplemental Deferred Savings Plan, including First Amendment thereto,
dated December 14, 1994, Second Amendment thereto, dated
4
December 8, 1998 and Administrative Guidelines thereto (incorporated
by reference to Exhibit 10.2 to Chicago Mercantile Exchange Inc.'s
Form S-4, filed with the SEC on February 24, 2000, File No. 33-95561).
10.3 Chicago Mercantile Exchange Holdings Inc. Directors' Deferred
Compensation Plan, including First Amendment thereto, dated December
8, 1998 (incorporated by reference to Exhibit 10.3 to Chicago
Mercantile Exchange Inc.'s Form S-4, filed with the SEC on February
24, 2000, File No. 33-95561).
10.4 Chicago Mercantile Exchange Holdings Inc. Supplemental Executive
Retirement Plan, including First Amendment thereto, dated December 31,
1996, Second Amendment thereto, dated January 14, 1998 and Third
Amendment thereto, dated December 1998 (incorporated by reference to
Exhibit 10.4 to Chicago Mercantile Exchange Inc.'s Form S-4, filed
with the SEC on February 24, 2000, File No. 33-95561).
10.5 Chicago Mercantile Exchange Holdings Inc. Supplemental Executive
Retirement Trust, including First Amendment thereto, dated September
7, 1993 (incorporated by reference to Exhibit 10.5 to Chicago
Mercantile Exchange Inc.'s Form S-4, filed with the SEC on February
24, 2000, File No. 33-95561).
10.6 Agreement, dated February 7, 2000, between Chicago Mercantile Exchange
Holdings Inc. and James J. McNulty (incorporated by reference to
Exhibit 10.8 to Chicago Mercantile Exchange Inc.'s Form S-4, filed
with the SEC on April 21, 2000, File No. 33-95561).
10.7* License Agreement, effective as of September 24, 1997, between
Standard & Poor's, a Division of The McGraw-Hill Companies, Inc., and
Chicago Mercantile Exchange Inc. (incorporated by reference to Exhibit
10.13 to Chicago Mercantile Exchange Inc.'s Form S-4, filed with the
SEC on March 10, 2000, File No. 33-95561).
10.8* License Agreement, effective as of April 3, 1996, including First
Amendment thereto, dated May 5, 1996, between The Nasdaq Stock Market,
Inc., a subsidiary of National Association of Securities Dealers,
Inc., and Chicago Mercantile Exchange Inc. (incorporated by reference
to Exhibit 10.9 to Chicago Mercantile Exchange Holdings Inc.'s Form
S-4, filed with the SEC on August 7, 2001, File No. 33-66988).
10.9* Central Services System (NSC) Software License and Development
Agreement, effective June 5, 1997, including First Amendment thereto,
effective February 24, 1998, Second Amendment thereto, effective July
13, 1998, and Third Amendment thereto, effective January 30, 2001,
between SBF Bourse de Paris and Chicago Mercantile Exchange Inc.
(incorporated by reference to Exhibit 10.10 to Chicago Mercantile
Exchange Holdings Inc.'s Form S-4, filed with the SEC on August 7,
2001, File No. 33-66988).
10.10* CLEARING 21 Software Marketing and Distribution Agreement Restatement,
effective January 30, 2001, between Societe Des Bourses Francaises,
and its successor, Euronext-Paris, and Chicago Mercantile Exchange
Inc. and New York Mercantile Exchange Inc. (incorporated by reference
to Exhibit 10.12 to Chicago Mercantile Exchange Holdings Inc.'s Form
S-4, filed with the SEC on August 7, 2001, File No. 33-66988).
10.11 Lease, dated as of November 11, 1983, between Chicago Mercantile
Exchange Trust (successor to CME Real Estate Co. of Chicago, Illinois)
and Chicago Mercantile Exchange Inc., including amendment thereto,
dated as of December 6, 1989 (incorporated by reference to Exhibit
10.14 to Chicago Mercantile Exchange Inc.'s Form S-4 dated February
24, 2000, File No. 33-95561).
10.12 Lease, dated March 31, 1988, between EOP -- 10 & 30 South Wacker,
L.L.C., as beneficiary of a land trust, dated October 1, 1997, and
known as American National Bank and Trust Company of Chicago Trust No.
123434 (as successor in interest to American National Bank and Trust
Company of Chicago, not individually but solely as trustee under Trust
Agreement dated June 2, 1981 and known as Trust No. 51234) and Chicago
Mercantile Exchange Inc. relating to 10 South Wacker Drive, including
First Amendment thereto, dated as of November 1, 1999 (incorporated by
reference to Exhibit 10.15 to Chicago Mercantile Exchange Inc.'s Form
S-4, filed with the SEC on February 24, 2000, File No. 33-95561).
5
10.13 Lease, dated May 11, 1981, between EOP -- 10 & 30 South Wacker,
L.L.C., as beneficiary of a land trust, dated October 1, 1997, and
known as American National Bank and Trust Company of Chicago Trust No.
123434-06 (as successor in interest to American National Bank and
Trust Company of Chicago, not individually but solely as trustee under
Trust Agreement dated March 20, 1980 and known as Trust No. 48268) and
Chicago Mercantile Exchange Inc. relating to 30 South Wacker Drive,
including First Amendment thereto, dated as of February 1, 1982,
Second Amendment thereto, dated as of April 26, 1982, Third Amendment
thereto, dated as of June 29, 1982, Fourth Amendment thereto, dated as
of July 28, 1982, Fifth Amendment thereto, dated as of October 7,
1982, Sixth Amendment thereto, dated as of July 5, 1983, Seventh
Amendment thereto, dated as of September 19, 1983, Eighth Amendment
thereto, dated as of October 17, 1983, Ninth Amendment thereto, dated
as of December 3, 1984, Tenth Amendment thereto, dated as of March 16,
1987, Eleventh Amendment thereto, dated as of January 1, 1999, Twelfth
Amendment thereto, dated as of June 30, 1999 (incorporated by
reference to Exhibit 10.16 to Chicago Mercantile Exchange Inc.'s Form
S-4, filed with the SEC on February 24, 2000, File No. 33-95561).
10.14 First Amended and Restated Credit Agreement, dated as of October 19,
2001, among Chicago Mercantile Exchange Inc. and the consortium of
banks party thereto (incorporated by reference to Exhibit 10.14 to
Chicago Mercantile Exchange Holdings Inc.'s Annual Report on Form 10-K
for the year ended December 31, 2001, filed with SEC on March 28,
2002).
13.1 Specified portions of Chicago Mercantile Exchange Holdings Inc.'s
annual report to shareholders for the year ended December 31, 2001.
(incorporated by reference to Exhibit 23.1 to Chicago Mercantile
Exchange Holdings Inc.'s Annual Report on Form 10-K for the year ended
December 31, 2001, filed with SEC on March 28, 2002).
21.1 List of Subsidiaries of Chicago Mercantile Exchange Holdings Inc.
(incorporated by reference to Exhibit 21.1 to Chicago Mercantile
Exchange Holdings Inc.'s Annual Report on Form 10-K for the year ended
December 31, 2001, filed with SEC on March 28, 2002).
23.1 Consent of Arthur Andersen LLP (incorporated by reference to Exhibit
23.1 to Chicago Mercantile Exchange Holdings Inc.'s Annual Report on
Form 10-K for the year ended December 31, 2001, filed with SEC on
March 28, 2002).
----------
* Confidential treatment pursuant to Rule 406 of the Securities Act has been
previously granted by the SEC.
6
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, in the City of Chicago
and State of Illinois on the 10th day of June, 2002.
CHICAGO MERCANTILE EXCHANGE HOLDINGS INC.
By: /s/ David G. Gomach
----------------------------------------------
David G. Gomach
MANAGING DIRECTOR AND CHIEF FINANCIAL OFFICER
7