SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of The Securities act of 1934 Date of Report (Date of earliest event reported): June 25, 1996 PAYCHEX, INC. (Exact name of Registrant as specified in its charter) Delaware 0-11330 16-1123166 ___________________________________________________________________________ (State or other (Commission (I.R.S. Employer jurisdiction File No.) Identification of incorporation) No.) 911 Panorama Trail South Rochester, New York 14625 ___________________________________________________________________________ (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (716) 385-6666 ______________ N/A ___________________________________________________________________________ (Former name or former address, if changed, since last report) ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. On June 25, 1996 Paychex, Inc. ("Paychex"), Paychex Merger Corp., a wholly owned subsidiary of Paychex, and National Business Solutions, Inc. ("NBS") together with the four shareholders of NBS entered into an Agreement and Plan of Merger whereby Paychex, through a reverse triangular merger of Paychex Merger Corp. into NBS, will acquire all of the issued and outstanding common stock of NBS in exchange for Paychex common stock valued at approximately $140,000,000. The transaction will be accounted for as a pooling of interests. The transaction is subject to receipt of a favorable decision on filings made under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 as well as any and all approvals required by the Florida Board of Professional Leasing Companies and the Texas Board of Staff Leasing Services. ITEM 7. FINANCIAL STATEMENTS OF BUSINESS ACQUIRED. (a) The pooling acquisition does not involve a "significant" amount of assets as defined by Item 2(b)4. However, the following historical financial statements of National Business Solutions, Inc. and Affiliates are provided at the option of the Registrant: a. Audited Consolidated Statements of Income for years ended December 31, 1995, 1994 and 1993 (unaudited). b. Audited Consolidated Balance Sheets as of December 31, 1995 and 1994. c. Audited Consolidated Statements of Cash Flows for years ended December 31, 1995, 1994 and 1993 (unaudited). COMBINED FINANCIAL STATEMENTS AND REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS NATIONAL BUSINESS SOLUTIONS, INC. AND AFFILIATES DECEMBER 31, 1995 AND 1994 CONTENTS ________ Page ____ Report of Independent Certified Public Accountants 1 Combined Statements of Earnings 2 Combined Balance Sheets 3 Combined Statement of Stockholders' Equity 4 Combined Statements of Cash Flows 5 Notes to Combined Financial Statements 6-13 Grant Thornton LLP Suite 3850 101 East Kennedy Blvd. Tampa, FL 33602-5154 Report of Independent Certified Public Accountants __________________________________________________ Board of Directors and Stockholders National Business Solutions, Inc. and Affiliates We have audited the combined balance sheets of National Business Solutions, Inc. and Affiliates as of December 31, 1995 and 1994 and the related combined statements of earnings, stockholders' equity and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the combined financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the combined financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In accordance with your instructions, we did not audit the combined statements of earnings, stockholders' equity, and cash flows for the year ended December 31, 1993 and therefore, we express no opinion on them. In our opinion, the combined financial statements referred to above present fairly, in all material respects, the combined financial position of National Business Solutions, Inc. and Affiliates as of December 31, 1995 and 1994, and the results of their combined operations and their combined cash flows for the years then ended in conformity with generally accepted accounting principles. April 16, 1996 Tampa, Florida Grant Thornton LLP National Business Solutions, Inc. and Affiliates COMBINED STATEMENTS OF EARNINGS Year Ended December 31,
1995 1994 1993 ______________ ____________ _____________ (Unaudited) Revenues $191,896,419 $119,540,685 $86,543,859 Direct Costs: Salaries and wages of worksite employees 163,395,079 101,560,780 74,891,776 Benefits and payroll taxes 21,682,288 14,173,837 9,296,638 ____________ ____________ ___________ Total direct costs 185,077,367 115,734,617 84,188,414 Gross profit 6,819,052 3,806,068 2,355,445 Operating expenses: Administrative personnel 2,971,835 1,914,774 1,214,708 General and administrative expenses 1,047,183 740,119 501,319 Sales and marketing 487,816 272,754 189,672 Depreciation and amortization 92,050 46,062 32,730 ____________ ____________ ___________ Total operating expenses 4,598,884 2,973,709 1,938,429 ____________ ____________ ___________ Income from operations 2,220,168 832,359 417,016 ____________ ____________ ___________ Other income (expense): Interest income 219,639 47,328 18,193 Interest expense - - (6,162) Other, net (24,896) - - ____________ ____________ ____________ Total other income 194,743 47,328 12,031 ____________ ____________ ____________ NET EARNINGS $ 2,414,911 $ 879,687 $ 429,047 ============ ============ ============
The accompanying notes are an integral part of these statements. National Business Solutions, Inc. and Affiliates COMBINED BALANCE SHEETS December 31,
ASSETS 1995 1994 ______ ___________ ___________ CURRENT ASSETS Cash and cash equivalents $ 5,517,445 $ 1,698,885 Marketable securities-at market 150,933 35,561 Accounts receivable 5,598,896 3,283,683 Due from stockholders and related party 45,083 108,300 Prepaid expenses 143,043 96,708 ___________ ___________ Total current assets 11,455,400 5,223,137 CERTIFICATES OF DEPOSIT AND OTHER ASSETS 268,401 177,945 FURNITURE AND EQUIPMENT, NET 464,231 227,093 ___________ ___________ $12,188,032 $ 5,628,175 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY ____________________________________ CURRENT LIABILITIES Accounts payable and accrued expenses $ 1,744,244 $ 1,288,163 Accrued salaries, wages and payroll taxes 5,498,550 3,091,345 Accrued workers compensation claims 658,455 - ___________ ___________ Total current liabilities 7,901,249 4,379,508 ACCRUED WORKERS COMPENSATION CLAIMS 864,927 - CUSTOMER DEPOSITS 980,400 535,284 COMMITMENTS AND CONTINGENCIES - - STOCKHOLDERS' EQUITY 2,441,456 713,383 ___________ ___________ $12,188,032 $ 5,628,175 =========== ===========
The accompanying notes are an integral part of these statements. National Business Solutions, Inc. and Affiliates COMBINED STATEMENT OF STOCKHOLDERS' EQUITY Years Ended December 31, 1995, 1994 and 1993
Unrealized Gain (Loss) Additional on Marketable Common Stock Paid-in Securities Retained Amount Capital Available-for-Sale Earnings Total ____________ __________ ______________________ ________ _____ Balance, January 1, 1993 (unaudited) $126,900 $ 3,200 $ - $ 65,406 $ 195,506 Common stock issued (unaudited) 8,000 - - - 8,000 Common stock purchased by the Company and retired (unaudited) (11,900) - - (85,918) (97,818) Additional affiliate (unaudited) 20,000 (1,359) - - 18,641 Net earnings for the year (unaudited) - - - 429,047 429,047 Net change in unrealized gain (losses) in marketable securities available-for-sale (unaudited) - - 30,135 - 30,135 Distributions to stockholders (unaudited) - - - (133,534) (133,534) _______ ________ ________ __________ __________ Balance, December 31, 1993 143,000 1,841 30,135 275,001 449,977 Common stock issued 100 - - - 100 Net earnings for year - - - 879,687 879,687 Net change in unrealized gain (losses) in marketable securities available-for-sale - - (59,764) - (59,764) Distributions to Stockholders - - - (556,617) (556,617) _______ ________ _______ _________ _________ Balance, December 31, 1994 143,100 1,841 (29,629) 598,071 713,383 Common stock issued 2,767 4,816 - - 7,583 Additional affiliate 100 900 - - 1,000 Net earnings for year - - - 2,414,911 2,414,911 Net change in unrealized gain (losses) in marketable securities available-for-sale - - 52,502 - 52,502 Distributions to stockholders - - - (747,923) (747,923) _________ _________ _______ _________ _________ Balance, December 31, 1995 $145,967 $ 7,557 $ 22,873 $2,265,059 $2,441,456 ========= ========= ======= ========== ==========
The accompanying notes are an integral part of these statements. National Business Solutions, Inc. and Affiliates COMBINED STATEMENTS OF CASH FLOWS Year Ended December 31,
1995 1994 1993 _________ ________ _________ (Unaudited) Cash flows from operating activities: Net earnings $2,414,911 $ 879,687 $ 429,047 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 92,050 45,718 32,729 Gain on sale of assets (3,113) - - Loss on sale of marketable securities 28,009 - - Stock received from demutualization (90,909) - - (Increase) decrease in: Accounts receivable (2,315,213) (1,288,227) (222,488) Due from stockholders and related party 63,217 (29,509) (78,791) Prepaid expenses (46,335) (74,754) 68,760 Other assets (1,837) 233,075 (249,815) Increase (decrease) in: Accounts payable and accrued expenses 456,079 815,238 29,791 Accrued salaries, wages and payroll taxes 2,407,205 1,549,816 (14,017) Accrued workers compensation claims 1,523,382 - - Customer deposits 445,116 125,559 164,360 Due to related party - (105,000) 105,000 __________ ___________ __________ Net cash provided by operating activities 4,972,562 2,151,603 264,576 __________ ___________ __________ Cash flow from investing activities: Sale of furniture and equipment 38,500 - - Sale of marketable securities 37,181 - - Purchase of furniture and equipment (364,574) (122,419) (81,998) Purchase of marketable securities and certificates of deposit (125,769) (147,763) (37,615) ___________ ___________ __________ Net cash used by investing activities (414,662) (270,182) (119,613) ___________ ___________ __________ Cash flow from financing activities: Purchase of common stock subsequently retired - - (97,818) Proceeds from issuance of common stock 1,000 100 7,900 Proceeds from promissory note - - 55,362 Payments on promissory note - - (55,362) Stock options exercised 7,583 - - Distributions to stockholders (747,923) (556,617) (133,534) ___________ ___________ __________ Net cash used by financing activities (739,340) (556,517) (223,452) Net increase (decrease) in cash and cash ___________ ___________ __________ equivalents 3,818,560 1,324,904 (78,489) Cash and cash equivalents, beginning of year 1,698,885 373,981 452,470 ___________ ___________ __________ Cash and cash equivalents, end of year $5,517,445 $1,698,885 $ 373,981 =========== =========== ==========
The accompanying notes are an integral part of these statements. National Business Solutions, Inc. and Affiliates NOTES TO COMBINED FINANCIAL STATEMENTS December 31, 1995, 1994 and 1993 NOTE 1 - NATURE OF THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING _____________________________________________________________________ POLICIES ________ National Business Solutions, Inc. and Affiliates (the Company) are professional employer organizations ("PEO") engaged primarily in providing human resource management, benefits and personnel administration services. In addition, the Company provides employee assistance programs, drug-free workplace programs, risk management and loss containment services. The Company provides PEO services to small and medium sized companies in a variety of industries, including manufacturing, retail, and hospitality. PEO service contracts with client companies are generally for one year terms with automatic renewal options and subject to termination on a 60 days' notice by either party during the first year and annually thereafter. A summary of the significant accounting policies followed in the preparation of the accompanying combined financial statements is presented below: Principles of Combination _________________________ The accompanying combined financial statements include the accounts of National Business Solutions, Inc. (NBS) and its affiliates, NBS of America, Inc., NBS of Central Florida, Inc., NBS of North Florida, Inc., NBS of South Florida, Inc., and Express Benefits Corporation (See Note 7). All material intercompany balances and transactions have been eliminated. Revenue Recognition ___________________ Revenues and related costs of wages, salaries, and employment taxes from professional employer services related to worksite employees are recognized in the period in which the employee performs the service. Because the Company is at risk for all of its direct costs, independently of whether payment is received from its clients, all amounts billed to clients for these costs are recognized as revenue by the Company. Accounts receivable consists primarily of billed receivables of approximately $1,847,000 and $998,000 and unbilled receivables of approximately $3,752,000 and $2,286,000 at December 31, 1995 and 1994 respectively. Unbilled receivables represent fees for leased employees which relate to the period from the last pay period ending date through the financial statement date, which have not yet been billed and the client matching contribution to the employee benefit plans (See Note 5). Generally, contractual arrangements require the Company to be paid one day prior to the pay date of the leased employees. National Business Solutions, Inc. and Affiliates NOTES TO COMBINED FINANCIAL STATEMENTS (Continued) December 31, 1995, 1994 and 1993 NOTE 1 - NATURE OF THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-(continued) _____________________________________________________________________ The Company considers accounts receivable to be fully collectible; accordingly, no allowance for doubtful accounts is required. If amounts become uncollectible, they will be charged to operations when that determination is made. Cash and Cash Equivalents _________________________ The Company has defined cash and cash equivalents as those highly liquid investments with an original maturity of three months or less. Accounting Estimates ____________________ The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant estimates relate to the Company's reserve for workers compensation claims. Actual results could differ from those estimates. Reserve for Workers Compensation Claims _______________________________________ Prior to 1995, the Company's workers compensation plan was fully insured. In 1995, the Company's workers compensation benefits are provided under a large deductible insured plan. Since the Company has limited claims loss experience the Company has elected to record reserves for the deductible portion of workers compensation claims costs based on the maximum contractual loss exposure under their workers compensation program. Management believes that this is a conservative approach and the reserve is adequate to meet its obligations for the open claims. As historical loss experience becomes available, the Company will modify its reserve requirements. Workers compensation claims reserves are established at the time an employee files a claim. Furthermore, the Company, in determining its reserves, includes reserves for estimated claims incurred but not reported. At December 31, 1995, the Company has classified as current the estimated amounts of reserves established for claims expected to be paid within one year. National Business Solutions, Inc. and Affiliates NOTES TO COMBINED FINANCIAL STATEMENTS (Continued) December 31, 1995, 1994 and 1993 NOTE 1 - NATURE OF THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES- (continued) _____________________________________________________________________ Certificates of Deposit _______________________ Certificates of deposit with an aggregate balance of $154,829 at December 31, 1994 had been pledged in conjunction with the workers compensation insurance policy used by the Company. The Company obtained a letter of credit in the amount of $308,000 in conjunction with the workers compensation policy for 1995. Certificates of deposit with an aggregate balance of $243,448 at December 31, 1995 have been pledged as collateral for the letter of credit (See Note 6). Furniture and Equipment _______________________ Furniture and equipment are stated at cost. Depreciation is being provided using the straight-line method over the estimated economic useful lives (5 - 8 years) for financial statement purposes. Accelerated methods are used for income tax purposes. Income Taxes ____________ NBS and four affiliates have elected not to be taxable as corporations pursuant to Subchapter S of the Internal Revenue Code. Income taxes on net earnings are payable personally by the individual stockholders of the respective companies. Accordingly, no provision has been recorded for Federal or State income taxes. One other affiliate is a taxable corporation under the Internal Revenue Code. No provision has been recorded for Federal and State income taxes as the results of operations of this Affiliate is immaterial to the combined financial statements. In 1993, this affiliate adopted Statement of Financial Accounting Standard (SFAS) No. 109, "Accounting for Income Taxes", issued February 1992. Under the liability method specified in SFAS No. 109, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities as measured by the enacted tax rates which will be in effect when these differences reverse. Deferred tax expense (benefit) is the result of changes in deferred tax assets and liabilities. The change from the Accounting Principles Board (APB) No. 11 to SFAS No. 109 had an immaterial effect on the financial statements. Stock Based Compensation ________________________ In October 1995, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 123, Accounting for Stock Based Compensation (SFAS 123). SFAS 123, the disclosure provisions of which must be implemented for fiscal years beginning subsequent to December 15, 1995, establishes a fair value based method of accounting for stock based compensation plans, the effect of which can either be disclosed or recorded. The Company will adopt the provisions of SFAS 123 in 1996. Upon adoption, the Company intends to retain the intrinsic value method of accounting for stock based compensation, which it currently uses. National Business Solutions, Inc. and Affiliates NOTES TO COMBINED FINANCIAL STATEMENTS (Continued) December 31, 1995, 1994 and 1993 NOTE 1 - NATURE OF THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES- (continued) _____________________________________________________________________ Fair Value of Financial Instruments ___________________________________ The Company's financial instruments consist primarily of instruments without extended maturities whose fair value equals their carrying value. Supplemental Disclosure of Cash Flow Information ________________________________________________ During 1993 cash paid for interest aggregated $6,162 (unaudited). No cash was paid for interest during 1995 and 1994. Reclassifications _________________ Certain reclassifications have been made to the 1994 and 1993 balances to conform to the 1995 presentation. NOTE 2 - MARKETABLE SECURITIES ______________________________ Marketable Securities _____________________ The Company adopted, effective December 31, 1993, Statement of Financial Accounting Standards (SFAS) No. 115, "Accounting for Certain Investments in Debt and Equity Securities", issued in May 1993. The Statement requires companies to classify investments in marketable equity and in all debt securities as trading securities, available-for-sale securities, or held-to-maturity securities. Marketable securities consist of the following: 1995 1994 ____ ____ Available for sale securities: Investments in common stocks 150,933 35,561 ________ _______ $150,933 $35,561 ======== =======
Unrealized (loss)/gain of $22,873 and $(29,629) at December 31, 1995 and 1994 respectively, relate to available-for-sale securities and have been recorded in the stockholders' equity section of the accompanying combined balance sheet. National Business Solutions, Inc. and Affiliates NOTES TO COMBINED FINANCIAL STATEMENTS (Continued) December 31, 1995, 1994 and 1993 NOTE 3 - FURNITURE AND EQUIPMENT ________________________________
Furniture and equipment consist of the following: 1995 1994 ____ ____ Computer hardware and software $353,099 $173,827 Furniture, fixtures and leasehold improvements 285,595 151,708 ________ ________ 638,694 325,535 Less: accumulated depreciation (174,463) (98,442) ________ ________ $464,231 $227,093 ======== ========
NOTE 4 - COMMITMENTS AND CONTINGENCIES ______________________________________ Operating Leases ________________ The Company leases their office facilities and certain equipment under operating leases, which expire at various times from 1996 through 2001.
Future minimum lease payments under these operating leases are as follows: Less Net Gross Sublease Lease _____ ________ _____ 1996 $ 434,739 $ (91,666) $ 343,073 1997 455,393 (96,766) 358,627 1998 459,100 (96,766) 362,334 1999 369,954 (8,064) 361,890 2000 309,388 - 309,388 Thereafter 13,361 - 13,361 __________ _________ __________ $2,041,935 $(293,262) $1,748,673
The leases provide for payment of taxes and other expenses by the Company. Rent expense was $197,000, $127,000 and $89,000 (unaudited) for the three years ended December 31, 1995, 1994 and 1993 respectively. National Business Solutions, Inc. and Affiliates NOTES TO COMBINED FINANCIAL STATEMENTS (Continued) December 31, 1995, 1994 and 1993 NOTE 4 - COMMITMENTS AND CONTINGENCIES (Continued) __________________________________________________ Workers Compensation Reserves _____________________________ During 1995, the Company entered into a workers compensation insurance policy whereby the maximum individual claims exposure is $350,000 and the aggregate claims exposure is limited to a percentage of workers compensation payroll. The Company estimates this will result in a maximum liability of $1,523,382 when they are ultimately resolved. The Company believes this reserve is sufficient to meet its obligations for the open claims. The Company estimates that approximately $658,455 of the reserves will be paid out in 1996 and the remaining $864,927 is recorded as a long-term liability at December 31, 1995. NOTE 5 - EMPLOYEE BENEFIT PLANS _______________________________ The Company sponsors and administrates two 401(k) plans and one money purchase plan on behalf of its employees. Such plans cover substantially all full-time employees over age 21 with at least one year of service. Employees are entitled to make contributions to the 401(k) plans on a before-tax basis under the salary reduction provisions of the plans. The Company, (in effect, the Company's clients) at their discretion, may contribute a matching contribution on behalf of each participant for whom an elective contribution was made during the plan year. Contributions by the Company totaled approximately $867,000, $690,000 and $240,000 (unaudited) in the years ended December 31, 1995, 1994 and 1993. NOTE 6 - SUBSEQUENT EVENT _________________________ The Company issued a letter of credit in January 1996 in the amount of $650,000 in conjunction with the workers compensation insurance policy for 1996. A certificate of deposit totaling $650,000 has been pledged as collateral for this letter of credit (See Note 1). National Business Solutions, Inc. and Affiliates NOTES TO COMBINED FINANCIAL STATEMENTS (Continued) December 31, 1995, 1994 and 1993 NOTE 7 - STOCKHOLDERS' EQUITY _____________________________
Common Stock Shares NBS of NBS of Express NBS of NBS of Central America Benefits North South NBS Florida Inc. Corporation Florida Florida $1 par value $1 par value $1 par value $1 par value $1 par value $1 par value 200,000 shares 200,000 shares 20,000 shares 1,000 shares 1,000 shares 1,000 shares authorized authorized authorized authorized authorized authorized ______________ ______________ _______________ ______________ ______________ ______________ Balance, January 1, 1993 63,900 63,000 - - - - (unaudited) Common stock issued 7,900 - - 100 - - (unaudited) Common stock purchased by the Company and retired (unaudited) (11,900) - - - - - Acquisition of entity in 1993 (unaudited) - - 20,000 - - - ______ ______ ______ ______ ______ ______ Balance, December 31, 1993 59,900 63,000 20,000 - - - Common stock issued - - - - 100 - ______ ______ ______ ______ ______ ______ Balance, December 31, 1994 59,900 63,000 20,000 100 100 - Common stock issued 2,767 - - - - 100 ______ ______ ______ ______ ______ ______ Balance, December 31, 1995 62,667 63,000 20,000 100 100 100 ====== ====== ====== ====== ====== ======
National Business Solutions, Inc. and Affiliates NOTES TO COMBINED FINANCIAL STATEMENTS (Continued) December 31, 1995, 1994 and 1993 NOTE 7 - STOCKHOLDERS' EQUITY - (Continued) ___________________________________________ Incentive Stock Option Plan ___________________________ In 1992, NBS adopted an Incentive Stock Option plan pursuant to Section 422 of the Internal Revenue Code. Under the plan, the maximum aggregate number of shares which may be awarded is 15,000. The option price per share shall never be less than the fair market value of NBS' common stock at the grant date. In the case of an individual who owns 10% or more of NBS' common stock, the option price shall be a minimum of 110% of the fair market value on the date of the grant. Options granted vest equally over a three-year period. The current options outstanding expire in February 1997. A summary of options is as follows:
Exercise # of Shares Price Per Share ___________ _______________ Options outstanding at, January 1, 1993 10,000 $1.00 (unaudited) Granted (unaudited) 1,000 8.22 Exercised (unaudited) (7,900) (1.00) ______ Options outstanding at, December 31, 1993 3,100 1.00-8.22 Granted - - Exercised - - ______ _________ Options outstanding at, December 31, 1994 3,100 1.00-8.22 Exercised (2,767) 1.00-8.22 _____ Options outstanding at, December 31, 1995 333 8.22 ====== =========
(b) Pro Forma Financial Information Since the transaction does not involve the acquisition of a significant amount of assets, no Pro Forma financial information are provided with the filing. (c) Exhibits 2. Agreement and Plan of Merger with Exhibit C-1 attached. 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. Dated: July 9, 1996 PAYCHEX, INC. By: /s/ G. Thomas Clark ________________________ G. Thomas Clark, Senior Vice President of Finance