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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 11-K
(MARK ONE)
[ ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
FOR THE FISCAL YEAR ENDED ___________
OR
[X] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE TRANSITION PERIOD FROM OCTOBER 1, 2003 TO DECEMBER 31, 2003
COMMISSION FILE NUMBER 33-63078
A. Full title of the plan and the address of the plan, if different from that of
the issuer named below:
EZCORP, INC. 401(k) PLAN AND TRUST
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
EZCORP, INC.
1901 CAPITAL PARKWAY
AUSTIN, TEXAS 78746
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INFORMATION FURNISHED
1. Audited financial statements and supplemental schedules of the
EZCORP, Inc. 401(k) Plan and Trust (the "Plan").
2. The written consent of the independent registered public accounting
firm for the Plan, filed as an exhibit to this transition report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the 401(k)
Administrative Committee has duly caused this transition report to be signed on
its behalf by the undersigned hereunto duly authorized.
EZCORP, INC. 401(k) PLAN AND TRUST
Signature Date
By: /s/ Dan N. Tonissen May 27, 2005
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Dan N. Tonissen
EZCORP, Inc. 401(k) Plan and Trust
Administrative Committee
EZCORP, INC. 401(k) PLAN AND TRUST
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
December 31, 2003 and September 30, 2003 and three months ended December
31, 2003
CONTENTS
Page
Report of Independent Registered Public Accounting Firm. . . . . . . . . . . . . . . 1
Audited Financial Statements:
Statements of Net Assets Available for Benefits. . . . . . . . . . . . . . . 2
Statement of Changes in Net Assets Available for Benefits. . . . . . . . . . 3
Notes to Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . 4
Supplemental Schedules:
Schedule H, Line 4a - Schedule of Delinquent Participant Contributions . . . 9
Schedule H, Line 4i - Schedule of Assets (Held at End of Year). . . . . . . 10
Exhibit Index. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Consent of Independent Registered Public Accounting Firm. . . . . . . . . . . . . . 12
Note: Other schedules required by Section 2520.103-10 of the Department of Labor
Rules and Regulations for Reporting and Disclosure under the Employee Retirement
Income Security Act ("ERISA") of 1974 have been omitted because they are not
applicable.
Report of Independent Registered Public Accounting Firm
Administrative Committee
EZCORP, Inc. 401(k) Plan and Trust
We have audited the accompanying statements of net assets available for benefits
of the EZCORP, Inc. 401(k) Plan and Trust as of December 31, 2003 and September
30, 2003, and the related statement of changes in net assets available for
benefits for the three months ended December 31, 2003. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. We were not engaged to perform an
audit of the Company's internal control over financial reporting. Our audit
included consideration of internal control over financial reporting as a basis
for designing audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the
Company's internal control over financial reporting. Accordingly, we express no
such opinion. An audit also includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 2003 and September 30, 2003, and the changes in its net assets
available for benefits for the three months ended December 31, 2003, in
conformity with U.S. generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedule of assets
(held at end of year) as of December 31, 2003, and schedule of delinquent
participant contributions for the three months then ended, are presented for
purposes of additional analysis and are not a required part of the financial
statements, but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. These supplemental schedules are the
responsibility of the Plan's management.
The supplemental schedules have been subjected to the auditing procedures
applied in our audits of the financial statements and, in our opinion, are
fairly stated in all material respects in relation to the financial statements
taken as a whole.
/s/ ERNST & YOUNG LLP
Austin, Texas
November 15, 2004
1
EZCORP, INC. 401(k) PLAN AND TRUST
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31 SEPTEMBER 30
2003 2003
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ASSETS:
Cash $ 16,461 $ 12,151
Investments, at fair value 3,458,807 2,940,922
Receivables:
Employer contributions 9,189 60,693
Employee contribution 21,109 14,004
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Total receivables 30,298 74,697
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Total assets 3,505,566 3,027,770
LIABILITIES:
Fees payable 1,550 1,201
Excess contribution refunds and other payables 18,800 60,271
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Total liabilities 20,350 61,472
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Net assets available for benefits $ 3,485,216 $ 2,966,298
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See accompanying notes.
2
EZCORP, INC. 401(k) PLAN AND TRUST
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
THREE MONTHS ENDED DECEMBER 31, 2003
Additions:
Employee contributions $ 111,134
Employer matching contributions 9,189
Investment income 9,656
Net appreciation in fair value of investments 471,590
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Total additions 601,569
Deductions:
Distributions to participants 63,373
Administrative expenses 2,650
Excess contribution refunds 16,628
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Total deductions 82,651
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Net increase 518,918
Net assets available for benefits at beginning of period 2,966,298
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Net assets available for benefits at end of period $ 3,485,216
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See accompanying notes.
3
EZCORP, INC. 401(k) PLAN AND TRUST
NOTES TO AUDITED FINANCIAL STATEMENTS
DECEMBER 31, 2003
1. DESCRIPTION OF THE PLAN
The EZCORP, Inc. 401(k) Plan and Trust (the "Plan") is a defined contribution
plan covering substantially all eligible employees of EZCORP, Inc. and its
subsidiaries (the "Company"). The Plan became effective October 1, 1991, and is
subject to the provisions of the Employee Retirement Income Security Act of 1974
("ERISA"). All Plan assets are held by Security Trust Company, the trustee of
the Plan. On November 6, 2003, the Company's 401(k) Committee elected to change
the plan year from a fiscal year ending September 30th to a calendar year ending
December 31st. Complete information regarding the Plan is included in the Plan
Agreement. Significant Plan provisions are summarized below.
ELIGIBILITY
Employees are eligible to participate in the Plan upon the attainment of 21
years of age and completion of six months of service. Under the enrollment
provisions of the Plan, eligible employees are allowed to enter the Plan on the
first day of each quarter of any fiscal year following the completion of six
months of service.
CONTRIBUTIONS
Participants are allowed to make voluntary contributions to the Plan up to the
maximum allowed under the Internal Revenue Code (the "Code"). The Company makes
contributions to the Plan of amounts determined and authorized by the Company's
Board of Directors up to the maximum amounts permitted by the Internal Revenue
Service ("IRS"). The Company's matching contributions are based on each
participant's contribution, up to 6% of the participant's compensation and made
in the form of EZCORP Class A Non-Voting Common Stock. The participants can
transfer the vested matching contribution to other investment funds at their
discretion.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contribution, the
Company's contribution and Plan earnings. Employees are given a choice of
fifteen investment options in which to invest their contributions, including the
Company Stock fund. Plan earnings in each of these funds are allocated based on
each employee's fund account balance relative to the aggregate of all employees'
fund account balances.
VESTING PROVISIONS
Participants are immediately vested in their contributions and earnings thereon.
The Company's contributions vest according to the following schedule.
Years of Service Vesting Percentage
---------------- ------------------
1 0%
2 25%
3 50%
4 75%
5 100%
4
PARTICIPANT LOANS
Participants are allowed to borrow a maximum amount of the lesser of 50% of the
participant's vested amount or $50,000. Loans are amortized over a maximum of 60
months, unless the purpose of the loan is for the purchase of the principal
residence of the participant in which case the maximum period may be 20 years.
Repayment is made through payroll deductions with equal installments made each
pay period. The loans are collateralized by the vested balance in the
participant's account, not to exceed 50% of the vested balance, and bear
interest at a rate commensurate with local prevailing rates as determined by the
plan administrator.
PAYMENT OF BENEFITS
Upon termination of service, death, disability, or retirement, a participant is
entitled to receive an amount equal to the value of his or her account, payable
in lump-sum form or in periodic installments.
PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA.
In the event of the termination of the Plan, the individual accounts of all
members shall become fully vested. After deducting all charges and expenses, the
balances of all individual accounts will be adjusted and the remaining assets
distributed to participants.
2. SIGNIFICANT ACCOUNTING POLICIES
METHOD OF ACCOUNTING
The financial statements of the Plan are prepared on the accrual basis of
accounting in accordance with accounting principles generally accepted in the
United States.
VALUATION OF INVESTMENTS
The Plan's investments in mutual funds and common stock are stated at fair value
based primarily on quoted prices in active markets. Participant loans are stated
at cost, which approximates fair value. Purchases and sales of securities are
recorded on a trade-date basis. Interest income is recorded on the accrual
basis. Dividends are recorded on the ex-dividend date.
DISTRIBUTIONS
Distributions to participants are recorded by the Plan when actual payment is
made.
EXPENSES
Substantially all expenses incident to the administration of the Plan are paid
by the Company.
FORFEITED NONVESTED ACCOUNTS
At December 31, 2003 and September 30, 2003, forfeited nonvested accounts
totaled $9,905 and $4,950, respectively. These accounts will be used to reduce
future employer contributions.
EXCESS CONTRIBUTIONS
Contributions in excess of maximum limits allowed by the IRS are accrued as
liabilities to be refunded to participants. At December 31, 2003 and September
30, 2003, excess contributions were $18,800 and $57,112, respectively.
5
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
that affect the amounts reported in the financial statements and accompanying
notes and schedules. Actual results could differ from those estimates.
RISKS AND UNCERTAINTIES
The Plan provides for investments in various investment securities which, in
general, are exposed to various risks, such as interest rate, credit, and
overall market volatility risks. Due to the level of risk associated with
certain investment securities, it is reasonably possible that changes in the
values of investment securities will occur in the near term and that such
changes could materially affect the amounts reported in the statements of net
assets available for benefits and participant account balances.
3. INVESTMENTS
The following presents individual investments that represent 5% or more of the
Plan's net assets at December 31, 2003 or September 30, 2003.
DECEMBER 31, 2003 SEPTEMBER 30, 2003
----------------- ------------------
Goldman Sachs Prime Obligations Fund $ 178,600 $ 175,522
Pimco Total Return Admin Fund 195,104 188,190
Davis New York Venture A Fund 536,860 462,203
T. Rowe Price Mid Cap Growth Fund 408,146 361,014
American Funds Europacific A Fund 394,750 351,790
EZCORP Class A Non-Voting Common Stock 1,176,512 866,503
During the three months ended December 31, 2003, the Plan's investments
(includes investments purchased, sold, as well as held during the period)
appreciated in fair value as follows:
Mutual funds $ 182,076
Common stock 289,514
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$ 471,590
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4. INCOME TAX STATUS
The underlying non-standardization prototype plan has received an opinion letter
from the Internal Revenue Service ("IRS") dated November 19, 2001 stating that
the form of the plan is qualified under Section 401(a) of the Internal Revenue
Code (the "Code"), and therefore, the related trust is tax-exempt. In accordance
with Revenue Procedure 2002-6 and Announcement 2001-77, the Plan Sponsor has
determined that it is eligible to and has chosen to rely on the current IRS
prototype plan opinion letter. Once qualified, the Plan is required to operate
in conformity with the Code to maintain its qualification. The plan
administrator believes the Plan is being operated in compliance with the
applicable requirements of the Code and, therefore, believes that the Plan is
qualified and the related trust is tax exempt.
6
5. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for benefits per the
financial statements to the Form 5500:
DECEMBER 31, 2003 SEPTEMBER 30, 2003
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Net assets available for benefits per the financial
statements $ 3,485,216 $ 2,966,298
Amounts allocated to withdrawing participants - (7,071)
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Net assets available for benefits per the Form 5500 $ 3,485,216 $ 2,959,227
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The following is a reconciliation of the net increase per the financial
statements to the Form 5500 for the three months ended December 31, 2003:
Net increase in net assets available for benefits per
the financial statements $ 518,918
Plus: Prior year amounts allocated to withdrawing
participants 7,071
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Net increase in net assets available for benefits per
the Form 5500 $ 525,989
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6. SUBSEQUENT EVENT
Effective January 1, 2004, the trustee changed from Security Trust Company to
Reliance Trust Company.
7
EZCORP, INC. 401(k) PLAN AND TRUST
THREE MONTHS ENDED DECEMBER 31, 2003
SUPPLEMENTAL SCHEDULES
8
EZCORP, INC. 401(k) PLAN AND TRUST
SCHEDULE H, LINE 4a - SCHEDULE OF DELINQUENT PARTICIPANT CONTRIBUTIONS
EIN: 74-2540145 PN: 001
THREE MONTHS ENDED DECEMBER 31, 2003
PARTICIPANT CONTRIBUTIONS TOTAL THAT CONSTITUTE NONEXEMPT
YEAR ENDED TRANSFERRED LATE TO PLAN PROHIBITED TRANSACTIONS
---------- ------------------------ -----------------------
1999 $ 115,994 $ 115,994
2002 $ 5,014 $ 5,014
2003 $ 123,893 $ 123,893
Delinquent participant contributions in 1999, 2002 and 2003 were corrected
outside of the Voluntary Fiduciary Compliance Program in 2004. The total amount
of accrued interest on late remittances for contributions made in 1999, 2002 and
2003 was determined to be $1,798 and this amount was paid to the Plan on
November 12, 2004.
9
EZCORP, INC. 401(k) PLAN AND TRUST
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS
(HELD AT END OF YEAR)
EIN: 74-2540145 PN: 001
DECEMBER 31, 2003
CURRENT
IDENTITY OF ISSUE DESCRIPTION OF INVESTMENT VALUE
----------------- ------------------------- -----
Goldman Sachs Prime Obligations Fund Money Market $ 178,600
Vanguard Short Term Federal Fund Mutual fund 8,822
Pimco Total Return Admin Fund Mutual fund 195,104
Columbia High Yield Fund Mutual fund 145,572
Dodge & Cox Stock Fund Mutual fund 28,279
Davis New York Venture A Fund Mutual fund 536,860
Vanguard Index 500 Fund Mutual fund 22,151
Growth Fund of America A Fund Mutual fund 28,803
Pimco Renaissance Admin Fund Mutual fund 14,407
T. Rowe Price Mid Cap Growth Fund Mutual fund 408,146
Turner Small Cap Value Fund Mutual fund 15,761
Columbia Acorn Z Fund Mutual fund 33,969
American Funds Europacific A Fund Mutual fund 394,750
American Funds Am Balanced A Fund Mutual fund 111,550
*EZCORP Class A Non-Voting
Common Stock Common stock 1,176,512
*Participant loans With varying maturity dates and interest
rates ranging from 5% to 10.5% 159,521
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$ 3,458,807
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* Indicates a party-in-interest to the Plan.
10
EXHIBIT INDEX
EXHIBIT 23.1 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
11