UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: December 20, 2004
(Date of earliest event reported)
DCAP GROUP, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 0-1665 36-2476480
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(State or Other Jurisdiction (Commission File No.) (IRS Employer Identification
of Incorporation) Number)
1158 Broadway, Hewlett, NY 11557
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (516) 374-7600
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
_____ Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
_____ Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
_____ Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
_____ Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement.
Effective December 27, 2004, Payments Inc. ("Payments"), a wholly-owned
subsidiary of DCAP Group, Inc. ("DCAP"), entered into a Financing and Security
Agreement (the "Financing Agreement") with Manufacturers and Traders Trust
Company ("M&T") with respect to a new line of credit to finance its premium
finance receivables. The new facility replaces M&T's existing line of credit
which was scheduled to mature in July 2005. Pursuant to the Financing Agreement,
the size of the credit facility has been increased from $18 million to $25
million. Subject to certain conditions, M&T has agreed to arrange an additional
$10 million credit facility with other lenders on a "best efforts" basis. The
new line matures on June 30, 2007. The Financing Agreement also provides that
Payments will have the choice of a LIBOR-based rate or a rate based on M&T's
prime rate. This will result in an initial reduction in the interest rate
payable by Payments, relative to its existing line of credit, of at least 1.5%
per annum. In addition, the Financing Agreement permits the early redemption of
up to $2 million of DCAP's 12.625% subordinated debt under certain
circumstances.
On December 20, 2004, DCAP amended its 1998 Stock Option Plan with regard
to the satisfaction of tax withholding obligations that arise upon the exercise
of a nonstatutory stock option. The amendment gives its Board of Directors and
Compensation Committee discretion to permit the withholding by DCAP of a portion
of the stock issuable upon the exercise of an option in connection with the
satisfaction of such obligations. On December 20, 2004, pursuant to such
amendment and in connection with the exercise by Barry Goldstein, President and
Chief Executive Officer of DCAP, of nonstatutory stock options for the purchase
of 34,000 shares of Common Stock of DCAP and the satisfaction of the tax
withholding obligations, the Board of Directors permitted the withholding by
DCAP of 6,789 of the 34,000 shares.
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.
DCAP GROUP, INC.
Dated: December 27, 2004 By: /s/ Barry B. Goldstein
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Barry B. Goldstein
President