UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

    Annual Report Pursuant to Sections 13 or 15(d) of The Securities Exchange
                                  Act of 1934

    For the Fiscal Year Ended December 31, 1995 Commission File No. 1-11465
                            ----------------- -------

                                IDEON GROUP, INC.
             (Exact name of Registrant as specified in its charter)

             Delaware                                    59-3293212
(State or other jurisdiction of        (I.R.S. Employer Identification Number)
incorporation or organization)

7596 Centurion Parkway, Jacksonville, Florida  32256
(Address of principal executive offices)      (Zip Code)
Registrant's telephone number, including area code:  (904) 218-1800

Securities registered pursuant to Section 12(b) of the Act:

         Title of Class         Name of Exchange on Which Registered
  Common Stock, $.01 Par Value         New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:   NONE

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. [ ]

State the aggregate market value of the voting stock held by  non-affiliates  of
the  Registrant  (based  on  the  closing  market  price  on  March  15,  1996):
$332,284,243.

Indicate the number of shares outstanding of each of the Registrant's classes of
common stock (as of March 15, 1996):  Common Stock,  $.01 Par Value - 27,981,831
shares.

                                         Documents Incorporated By Reference

     Portions of the Proxy Statement for the 1996 Annual Meeting of Stockholders
are incorporated by reference into Part III.

                           Total Number of Pages - 95

<PAGE>
                                     PART I
Item 1.    BUSINESS

Background

         Ideon Group,  Inc. ("Ideon" or the "Company") is a holding company with
current operating  business units as follows:  SafeCard  Services,  Incorporated
("SafeCard"),  Wright Express Corporation  ("Wright Express"),  National Leisure
Group, Inc.  ("National Leisure Group") and Ideon Marketing and Services Company
("IMS").  The  operations  of an additional  business  unit,  Family  Protection
Network, Inc. ("Family Protection Network"),  were both initiated and terminated
during  1995.  On April 27,  1995,  the  stockholders  of  SafeCard,  a Delaware
corporation  organized  in  1969,  approved  a plan  of  reorganization  whereby
SafeCard  became a  wholly-owned  subsidiary  of Ideon,  a Delaware  corporation
formed in December 1994. All shares of SafeCard common stock were converted into
shares of Ideon common stock.  Upon the  completion of the  reorganization,  the
Company's  headquarters  were relocated from Cheyenne,  Wyoming to Jacksonville,
Florida.

    SafeCard,  the Company's principal subsidiary,  is a credit card enhancement
marketing  company  that serves  over 160 credit  card  issuers and more than 13
million  subscribers.  SafeCard's  executive  offices  were  also  relocated  to
Jacksonville,  Florida from Cheyenne,  Wyoming, in April 1995. This move did not
impact  SafeCard's  operational  facility in Cheyenne.  See Item 7. Management's
Discussion  and Analysis of Financial  Condition and Results of  Operations  and
Note 7 of Notes to  Consolidated  Financial  Statements  under Item 8. Financial
Statements and Supplementary Data.

    In 1993  and  1994,  the  Company  began  placing  greater  emphasis  on the
development of new products and services and additional  lines of business.  The
Company's  strategy  was to  diversify  and  broaden  its  scope  to  become  an
innovative  marketing  and servicing  organization  operating  through  multiple
strategic  business units. To accomplish this strategy,  the Company named a new
senior management team, expanded and enhanced its infrastructure and accelerated
the development of new products and services and new areas of business.  In 1994
and 1995,  the Company  incurred  significant  expenses in developing  these new
products  and new areas of  business.  During this time,  the  Company  made two
acquisitions  and launched two  internally  developed  businesses as a result of
these developmental efforts.

    In  September  1994,  the Company  acquired  Wright  Express,  a provider of
information processing, management and financial services to petroleum companies
and  transportation  fleets in the United States.  The Wright Express  Universal
Fleet Card is the nation's most widely accepted  electronic fleet fueling credit
card and is accepted at over 90,000 fueling  locations.  Wright Express is based
in South Portland, Maine.

     In January 1995, the Company acquired National Leisure Group, a provider of
vacation travel packages and cruises  directly to the public in partnership with
established retailers and warehouse clubs throughout New England and with credit
card issuers and membership clubs nationwide. National Leisure Group is based in
Boston, Massachusetts.


<PAGE>


    In 1995, the Company formed IMS principally to fulfill its obligation  under
an exclusive multi-year marketing and servicing agreement with the PGA TOUR that
was entered into in November 1994.  Under the agreement,  IMS began managing the
PGA TOUR  Partners  program which  included a co-branded  credit card issued and
funded by SunTrust BankCard,  N.A. IMS was also responsible for card acquisition
and customer  servicing.  In May 1995, the Company  announced that, due to lower
than expected response rates to the PGA TOUR Partners program, the activities of
IMS would be significantly  curtailed.  In September 1995, the Company announced
that card  servicing for the PGA TOUR Partners  credit card would be transferred
to SunTrust. IMS continues to service existing PGA TOUR Partners non-credit card
accounts (see  Developmental  Operations  below).  IMS is based in Jacksonville,
Florida.

    IMS is also engaged in test marketing a direct response  consumer  business,
Collections of the Vatican Museums, that offers to consumers,  primarily through
catalog distribution,  products that are recreated from and inspired by historic
works from the thirteen Vatican Museums.

     In 1995, the Company formed Family Protection  Network,  a nationwide child
registration and missing child search program.  Consumer response rates from the
initial  product  launch  were  significantly  lower than  anticipated,  and the
Company  discontinued the operation  effective June 30, 1995 (see  Developmental
Operations below).


    In February 1996, SafeCard completed its acquisition of United Bank Services
("UBS"),  a provider of value added enhancement  products and services through a
diverse group of financial  institutions.  Products and services offered by UBS,
based in Norman,  Oklahoma,  include an airline  frequent  flyer miles  program,
rebate travel, insurance enhancements, customer loyalty and credit card merchant
reward programs.

    On February 14, 1995,  the Company  filed a Transition  Period Form 10-Q for
the two months  ended  December 31, 1994 in order to effect a change in its year
end from October 31 to December 31.  References herein to the year 1995 refer to
the  Company's  calendar  year  ended  December  31.  References  herein  to the
Transition  Period refer to the two months ended  December 31, 1994.  References
herein to the years 1994 and 1993 refer to the Company's  previous  fiscal years
ended October 31.

    The following  discussion of the Company's business  activities is segmented
according to its current operating business units, which is the same segregation
used by management in its internal  evaluation of financial results.  Additional
information   regarding  the  Company's  results  of  operations  and  financial
condition,  including segmented financial  information,  can be found in Item 7.
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations and Item 8. Financial Statements and Supplementary Data.



<PAGE>


SafeCard Services, Inc.

    SafeCard has historically  been in the business of selling  subscriptions by
mail and telephone  for  continuity  services  that it provides to  subscribers.
Continuity  services  are  services  provided  pursuant to  subscriptions  which
typically  continue annually or periodically  unless canceled by the subscriber.
Subscriptions are primarily sold to credit cardholders through arrangements with
credit card issuers, including banks and financial services companies, major oil
companies,  retail department stores and others. Subscriber acquisition material
printed for  SafeCard  that  describes  its  services  and how to  subscribe  is
inserted in the credit card  issuer's  monthly  billing  statements or mailed by
SafeCard directly to credit  cardholders.  Credit  cardholders are also asked to
subscribe by means of direct telemarketing  solicitation.  SafeCard has recently
begun marketing  through  alternative  channels,  such as  solicitation  efforts
during  credit  card  activation.  Subscription  fees are  generally  billed  to
subscribers'  credit card  accounts  and remitted to SafeCard by the credit card
issuer. A discussion of SafeCard's  services and subscriber  acquisition methods
follows.

    Hot-Line Credit Card Loss Notification Service
    Hot-Line is a credit card  registration  service.  If a subscriber  notifies
SafeCard of the loss or theft of his/her credit cards,  SafeCard  retrieves (or,
if cards have not  previously  been  registered,  obtains)  the  necessary  card
registration information,  and then promptly notifies the credit card issuers of
the  loss,  simultaneously  requesting  replacement.  In most  states,  Hot-Line
protects members with liability  insurance for fraudulent use of credit,  debit,
ATM and calling cards. Membership includes issuance of fraud-deterrent  stickers
to be  affixed to credit  cards,  a change of  address  service  to notify  card
issuers and  magazines  when a  subscriber  moves,  car rental  discounts  and a
"DateReminder"  service.  SafeCard  will also wire  stranded  subscribers a cash
advance or send an airplane ticket,  subject to available credit on a bank card.
Other  services  available to subscribers  include a 24-hour  message center and
nationwide toll-free message relay service.

    Hot-Line is  SafeCard's  original  service and has been its major  source of
revenue  and  earnings.  During  1995,  the  Transition  Period,  1994 and 1993,
Hot-Line  provided  55%, 61%, 65% and 68% of the  Company's  total  consolidated
revenue,  respectively.  In addition, Hot-Line provided 73%, 75%, 76% and 78% of
the Company's  consolidated  membership and subscription revenue during the same
periods. SafeCard generally charges an annual membership fee of $15 for a single
year subscription.  SafeCard also sells multi-year subscriptions,  generally for
three  year  periods  at a price of $39 to $45,  which  provide  for  payment in
advance of the full subscription price. SafeCard sometimes offers to subscribers
an initial trial period at either no fee or a nominal fee.

    Fee-Based Credit Card Services
    SafeCard,  through  arrangements  with certain credit card issuers,  markets
fee-based  credit cards ("Fee  Card") on behalf of the issuer,  generally to the
issuer's  existing  no fee  cardholders.  For  an  annual  fee  of  $15 to  $25,
cardholders  who elect to subscribe  to the  fee-based  credit  cards  typically
receive a new credit card (to replace the no fee card) and various services such
as credit card registration,  discounts on travel,  insurance and other services
provided  or  obtained  by  SafeCard.  The card  issuer is  responsible  for the
collection  of all  charges  made  to the  credit  card  and  may  also  provide
additional services to the cardholder. During 1995, the Transition Period, 1994,
and 1993,  Fee Card  programs  provided  13%,  14%, 14% and 12% of the Company's
consolidated revenue, respectively. In addition, Fee Card programs provided 17%,
17%,  16% and 14% of the  Company's  consolidated  membership  and  subscription
revenue during the same periods.


<PAGE>


    Reminder Services
    SafeCard  also offers date reminder  services  ("Reminder  Services")  which
provide  subscribers,  by mail, a monthly  computer-generated  reminder  listing
personal  dates and events  registered by the subscriber in addition to standard
holidays.  Subscribers  add dates and  events as  desired,  either by mail or by
calling  SafeCard's  operations  center.  The Reminder Services include either a
large  plastic-laminated wall calendar,  and/or a personal Desk Appointment Book
and/or a Pocket Appointment Book. During 1995, the Transition  Period,  1994 and
1993,  Reminder  Services  provided less than 10% of the Company's  consolidated
revenue.

    CreditLine Services
    CreditLine is a personal credit information  service.  Subscribers receive a
comprehensive  personal credit report biography either annually or upon request.
The subscriber's credit information is obtained from national credit bureaus and
reorganized  into a  user-friendly  format.  The  annual fee is  typically  $29.
SafeCard  also  markets  "CreditLine  Early  Warning"  which  provides  customer
notification  upon entry of adverse  information  to a customers  credit  bureau
file. The annual fee for this service is typically $39.  SafeCard also sometimes
markets  CreditLine in conjunction  with other  services at higher  prices.  The
credit reporting business is subject to existing regulation, as well as possible
future regulation. During 1995, the Transition Period, 1994 and 1993, CreditLine
provided less than 10% of the Company's consolidated revenue.

    SafeCard began marketing  CreditLine in 1989.  SafeCard marketed  CreditLine
pursuant  to  an  agreement  (the   "CreditLine   Agreement")   with  CreditLine
Corporation,  a  corporation  owned by Peter and  Steven J.  Halmos,  SafeCard's
co-founders,  and their families.  Profits or losses, if any, are shared equally
between SafeCard and CreditLine Corporation. In June 1993, SafeCard was notified
by  CreditLine  Corporation  that the license  agreement  under  which  SafeCard
markets  certain  credit  information  products and services known as CreditLine
would not be renewed effective November 1, 1993.  However,  SafeCard believes it
has  certain  continuing  marketing  rights  under the  license  agreement.  The
CreditLine  Agreement  is the subject of  litigation  between  Peter  Halmos and
related entities and SafeCard. See Item 7. Management's  Discussion and Analysis
of Financial Condition and Results of Operations and Notes 14 and 16 of Notes to
Consolidated  Financial  Statements  under  Item  8.  Financial  Statements  and
Supplementary Data.

    Discount Travel Service
    SafeCard  offers  a  discount  travel  service,   either  separately  or  in
conjunction with other continuity programs.  During 1995, the Transition Period,
1994 and 1993, this service provided less than 10% of the Company's consolidated
revenue. SafeCard's travel service is separate from the travel services provided
by the Company's  National  Leisure Group business  unit.  See National  Leisure
Group below.

    Subscriber Acquisition

    SafeCard sells subscriptions for its products and services on a retail basis
primarily  through  arrangements  with credit card issuers to consumers  who use
credit cards.  SafeCard's  subscriber  acquisition strategy includes direct mail
(generally   "Solo  Mailings"  and  "Billing   Inserts")  and  telephone  sales.
SafeCard's   subscriber   acquisition   campaigns   are   typically   based   on
internally-developed  strategies, research, formats, copy and graphics and often
include multiple solicitations within an overall strategy.


<PAGE>


    Solo Mailings are generally those created and mailed directly by SafeCard to
holders of credit  cards from  listings  supplied  to SafeCard by the issuers of
such credit cards.  The printing is typically done by others under contract with
SafeCard. While Solo Mailings vary in type and content, they generally include a
descriptive brochure, a letter and other subscriber  acquisition  materials,  as
well as a postage-paid  return  subscription  form. Each Solo Mailing  typically
must be  approved by the credit card  issuer and  generally  contains  materials
(i.e., letter, envelope, etc.) bearing the credit card issuer's name and logo.

    Billing  Inserts are  generally  created by  SafeCard  and printed by others
under contract and are inserted in the monthly billing statements of credit card
issuers.  Billing  Inserts have the advantage of lower cost (because  postage is
generally  paid by credit card issuers).  Each Billing Insert mailing  typically
must be approved by the credit card issuer. Due to the comparatively low cost of
Billing  Inserts and the limitation on the number of inserts which may be placed
in any single billing statement,  there is intense  competition for insert space
among providers of credit card enhancements.

    The current average cost of Solo Mailings is approximately $300 per thousand
pieces of mail,  as  compared  with about $25 per  thousand  pieces for  Billing
Inserts. While Solo Mailings are more costly, primarily due to the fact that the
Company pays the postage,  Solo Mailings  typically  generate a higher  response
rate.  In  addition,  Solo  Mailings  may be sent to all  cardholders  of a card
issuer, whereas Billing Inserts are mailed only to cardholders who are receiving
a statement in the month of insertion.  A U.S.  postal rate increase took effect
in  January  1995.  The  postal  rate  increase  had the  effect  of  increasing
subscriber  acquisition  costs  by  approximately  $2,000,000  during  1995.  In
addition,  paper costs have increased  approximately  20-50% over the past year.
Postage and paper costs  generally  represent  the  majority of the cost of Solo
Mailings.

    SafeCard  also  sells  subscriptions   (primarily  Hot-Line)  by  telephone.
Although the cost of telemarketing campaigns is typically higher, as compared to
Solo Mailing and Billing  Inserts,  the response rates are generally  higher and
the initial  subscription  period for telephone sales is primarily for more than
one year,  with payment to SafeCard in advance.  Mailings  result in both single
year and multi-year  subscribers,  with a larger  percentage  being single year.
During 1995, the Transition Period,  1994 and 1993,  approximately 47%, 51%, 50%
and 54%,  respectively,  of all subscriptions for Hot-Line were acquired through
telephone solicitation.

    Subscriber  fees  are  SafeCard's  primary  source  of  revenue.  Subscriber
acquisition  costs are the largest  expense.  The relationship of these costs to
subscription revenues is dependent on a variety of factors including prices, net
response  rates (gross  enrollments  less  cancellations),  marketing  costs and
renewal  rates.  These  factors are  affected by economic  conditions,  interest
rates,  the  number  of  credit  cards in use,  demographic  trends,  consumers'
propensity to buy, the degree of market  penetration  and the  effectiveness  of
subscriber  acquisition concepts,  copy and marketing  strategies.  In addition,
cardholders of certain  credit card issuer  clients  respond more favorably than
others to similar promotions.

    Relationships with Credit Card Issuers

    SafeCard acquires its subscribers primarily through contractual arrangements
with credit card issuers  (including  banks and  financial  services  companies,
major oil  companies,  retail  department  stores and  others)  for the mail and
telephone  sales of its  products  and  services  to the  issuers'  credit  card
holders.  SafeCard also provides, to a limited extent, on a wholesale basis, its
services  to large  membership  groups  which are  affiliated  with  credit card
issuers,  such as oil company travel clubs. New marketing with particular credit
card issuers  varies from year to year based on both  SafeCard's  and the credit
card issuer's strategies as well as contractual requirements.
<PAGE>

    SafeCard has written agreements with certain large credit card issuers which
account for a large percentage of its subscription  revenue.  Termination of any
of these contracts would adversely affect the Company.

    Contracts  with  Citibank   (South  Dakota),   N.A.  and  related   entities
contributed 22%, 24%, 26% and 30% of the Company's consolidated revenue in 1995,
the Transition Period, 1994 and 1993,  respectively.  Citibank  contributed 30%,
30%,  32% and 36% of the  Company's  consolidated  membership  and  subscription
revenue during the same periods.  SafeCard has had contracts with Citibank since
1981. The principal  Citibank contract,  as amended,  expires December 31, 2000.
Citibank  has a right to  terminate  the  contract in the event of the sale of a
majority of the shares of the Company to specified credit card issuers, to banks
and their  corporate  affiliates  and to entities  that do not have equity of at
least $25 million.

    Contracts with Sears,  Roebuck and Co. contributed  approximately 10% of the
Company's  consolidated  revenue in 1995, the Transition Period,  1994 and 1993.
Sears contributed 13%, 12%, 13% and 12% of the Company's consolidated membership
and subscription  revenue during the same periods.  SafeCard has signed a letter
of intent for a new five-year  cooperative business relationship with Sears. The
new  contract  will be  effective  January 1, 1996,  and is expected to executed
shortly. See Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations.

    SafeCard's  contracts with credit card issuers generally (though not always)
have a one-year or two-year  initial term,  provide for automatic annual renewal
thereafter  unless canceled by either party,  and are subject to the fulfillment
of certain  contractual  obligations.  These contracts generally provide for the
mail  and/or  telephone  sales of  subscriptions  to the  issuer's  credit  card
customers,  for the  billing  (to the  subscriber's  credit  card  account)  and
collection of subscription  fees by the card issuers and for payment to the card
issuers  of  commissions  or  fees.  In  certain  cases,  SafeCard  enters  into
profit-sharing  arrangements  with credit card issuers,  in which  SafeCard pays
compensation  to credit card issuers,  after  recovery of its  marketing  costs,
based on profitability (as defined in the agreement with the credit card issuer)
in lieu of commissions.

    Authorization  for each mailing and/or  telephone  sales campaign  typically
must be obtained by  SafeCard  from the card  issuer,  although  some  contracts
contain minimum marketing volume requirements. SafeCard's ability to obtain such
authorization  is critical  and is  dependent  on many  factors,  including  the
business strategies of the credit card issuer clients; the volume, profitability
and efficiency of subscriber acquisitions;  quality and efficiency of SafeCard's
client and subscriber  servicing;  and  competition  for the limited  subscriber
acquisition  volume  which  may be  allowed  by any one  issuer.  An  additional
important  factor in the maintenance of these contracts is SafeCard's  knowledge
of the differing operational  requirements of each credit card issuer, including
compatible  data  processing   software,   innovative   subscriber   acquisition
strategies, operational efficiency and financial stability.

    Credit card issuers from time to time may adopt changes in business strategy
which may affect  SafeCard.  In addition,  there has been  significant  industry
consolidation  by both financial  institutions  and retailers in recent periods.
Such changes and market shifts can both  positively  and  negatively  impact the
member  acquisition  strategy  and market  position of SafeCard and the Company.
SafeCard works with its credit card issuer clients,  where possible, to minimize
any adverse affects of such changes.


<PAGE>


    SafeCard generally does not have proprietary or other rights to the issuers'
credit card  customer  lists should a credit card issuer  terminate its contract
with  SafeCard.  In that event,  with the  majority of issuers,  SafeCard  would
continue  to provide  services  to,  and  receive  its  revenue  from,  existing
subscribers  after  termination.  SafeCard's  right to continue to bill existing
subscribers after termination of the client contract generally continues as long
as  there  is an  active  credit  card,  until  such  subscribers  cancel  their
subscriptions or for certain contractually specified periods of time.

    Seasonality

    The operations of SafeCard are not generally seasonal in nature, except that
SafeCard  avoids  subscriber  acquisition  campaigns prior to and during certain
holiday periods (i.e. Thanksgiving and Christmas).  SafeCard's cash receipts and
disbursements are also related to the timing of solicitation campaigns.

    Competition

    Competition  in securing  contracts  with  credit card  issuers for sales of
subscriptions  to the issuers'  cardholders  -- i.e.,  the third party  endorsed
segment of the credit card industry -- is intense.  Among the factors  affecting
the outcome of such  competition  are price,  the quality and reliability of the
services to be offered,  subscriber acquisition strategy and expertise (which is
highly dependent upon creative  talents),  operational  capability,  reputation,
financial  stability of the company  supplying the services,  the  confidence of
credit card issuers in the management  and the sales and marketing  personnel of
the  enhancement  provider and the  compensation  or fee paid to the credit card
issuer.  Additionally,  the  enhancement  provider must  maintain  security over
credit card and credit data of which it has custody.

    SafeCard  believes it has greater than 50% of the market  share  (within the
United  States) for credit  card  registration.  Competitors  in the credit card
registration business include Signature, CUC International, American Express and
others.  Fee-based credit cards are sometimes  directly marketed and/or serviced
by certain credit card issuers.  Certain national credit bureaus, as well as CUC
International,  offer or have offered  personal credit  information  services in
competition  with  CreditLine.  CreditLine  is  dependent  upon the  purchase of
consumer  credit data from such credit bureaus and there is no other  comparable
source for such data. Since SafeCard competes for "advertising space" of various
credit card issuers,  it competes with  companies who market other  products and
services through credit card issuers. Certain of SafeCard's competitors may have
greater resources and/or other competitive advantages.

    SafeCard's  competition  is not  confined  to any  particular  region of the
country.

    United Bank Services, Inc.

    On February 16, 1996,  SafeCard completed its acquisition of UBS, a provider
of value  added  products  and  services  through a diverse  group of  financial
institutions  including  banks,  credit  unions  and  other  financial  services
companies.  Products and services offered by UBS are expected to expand the base
of product offerings available for offer to SafeCard's extensive client list. In
addition,  SafeCard's products will be offered through UBS' more diverse base of
financial  institutions.  See Item 7.  Management's  Discussion  and Analysis of
Financial Condition and Results of Operations.



<PAGE>


Wright Express Corporation

    On September 14, 1994 the Company  acquired 100% of the  outstanding  common
stock of Wright Express, a leading provider of enhanced  information services to
oil companies and commercial transportation fleets. Revenues from Wright Express
accounted for approximately  10% of consolidated  revenue for 1995 and less than
10% of consolidated revenue during the Transition Period and 1994.

    Wright Express Universal Fleet Card

    Wright Express provides  transaction and information  processing services to
commercial  fleet owners  through a national  credit card network  program,  the
Wright  Express  Universal  Fleet  Card  (the  "WexCard").  These  services  are
generally  provided  through  fueling  stations  which are owned and operated by
retail petroleum merchants.  The WexCard is accepted at more than 90,000 fueling
locations in the United States including those operated by Mobil, Texaco, Exxon,
Shell and Getty.  Wright  Express also manages  private label fleet charge cards
and co-branded  WexCard fleet fueling cards for large fleet operators  including
regional telephone utilities and national courier and package delivery services.

    In providing  services  through the WexCard and certain private label cards,
Wright Express  generates  receivables from fleet customers.  These  receivables
relate to payments due from fleet  customers for  purchases at fueling  stations
that accept such cards.  These receivables are funded through a revolving credit
agreement and payables to retail petroleum  merchants.  See Item 7. Management's
Discussion and Analysis of Financial Condition and Results of Operations.

    Vehicle Analysis Report

    In addition to the  convenience of  electronically  charging fuel purchases,
the  WexCard  includes a "Vehicle  Analysis  Report"  designed  to assist  fleet
managers  who monitor and control  expenses.  The report can be  generated  on a
vehicle and/or driver specific basis providing information to managers regarding
both driver and vehicle performance.

    WexIndex

    WexIndex is a new product  being  marketed by Wright  Express.  This product
makes use of the vast amount of fuel and transaction  data accumulated by Wright
Express  on a daily  basis.  Wright  Express  provides  data  through  a license
agreement  with a third  party  database  provider  who  makes it  available  to
economists,  fleet managers, oil companies and government agencies for their use
and analysis.

    Seasonality

    The operations of Wright Express are not generally seasonal in nature.


<PAGE>


    Competition

    Wright  Express'  competition  primarily  exists in the form of oil  company
credit cards and other competing  fleet cards,  including those offered by large
card  associations and financial  institutions.  These oil companies and certain
other competitors are larger and have greater financial and other resources than
Wright Express or the Company.  The key factor in distinguishing  Wright Express
from its competition is the array of ancillary  information  processing services
that are offered in addition to the basic credit card service.  Recent  entrants
into  this  competitive  market,  including  Texaco's  Voyager  card,  are  also
providing such information  processing services.  There can be no assurance that
Wright Express will not face increased competition in the future.


National Leisure Group


     National Leisure Group,  acquired by the Company effective January 1, 1995,
provides  vacation  travel  packages  and  cruises  directly  to the  public  in
partnership  with  established  retailers and  warehouse  clubs  throughout  New
England and with  credit  card  issuers and  membership  clubs  nationwide.  The
majority of bookings have historically been generated in New England area retail
stores and, as a result,  are  dependent  upon the level of customer  traffic in
these  stores.  Sales  through  credit  card  issuers and  membership  clubs are
becoming significant new sources of growth.  Revenue from National Leisure Group
was less than 10% of consolidated revenue for 1995.


    National Leisure Group revenues were negatively  affected by adverse weather
conditions at several popular vacation  destinations  during the summer and fall
of  1995.  A  number  of  hurricanes  hit  several  popular   Caribbean   cruise
destinations and destroyed many of the hotels and attractions. As a result, many
would-be travelers canceled plans or postponed travel to these destinations. The
majority  of  National   Leisure   Group's  cruise  bookings  are  to  Caribbean
destinations. The Company is unable to estimate the lost revenues resulting from
the canceled or postponed bookings.

    During 1995,  many  airlines  imposed  commission  caps on air travel booked
through travel agencies which had a negative impact on margins across the travel
industry.  This  commission  cap did not have a  significant  impact on National
Leisure  Group as the majority of its bookings are cruises  and/or air inclusive
tour packages which were not affected by the commission caps.

    Seasonality

    National Leisure Group's business is highly seasonal in nature. The majority
of the  Company's  revenues are generated in the winter months (first and fourth
quarters). Although marketing efforts through credit card issuers and membership
clubs are spreading sales into  historically  slower periods,  National  Leisure
Group is expected to continue to be highly seasonal.

    Competition

    Competition  within the travel agency industry is intense.  National Leisure
Group's primary  competitors are independent travel agencies and national travel
providers such as The American Automobile  Association,  American Express Travel
Related Services and Carlson  Wagenlit  Travel.  National Leisure Group competes
primarily on the basis of price and service.


<PAGE>


Developmental Operations

    Ideon Marketing and Services

    IMS  activities  were  initiated  in 1994 as a platform to develop,  manage,
market and service  co-branded  credit  cards.  The first product to result from
this development  effort was an initiative  between the Company and the PGA TOUR
under an exclusive multi-year licensing,  marketing and servicing agreement with
the PGA TOUR.  As part of the  agreement,  the Company  committed  to manage and
expand the existing PGA TOUR Partners program. The program, developed by the PGA
TOUR, offers access to program members to PGA TOUR events,  special members only
tournament play, golf clinics instructed by PGA TOUR players and other services.
In  addition,  IMS offered a  co-branded  PGA TOUR  Partners  credit card issued
through SunTrust BankCard,  N.A. Originally,  the Company had responsibility for
card  acquisition  and  customer   servicing  while  SunTrust  funded  the  card
receivables. The expanded PGA TOUR Partners program was launched in March 1995.

    In  late  May  1995,   preliminary   launch  results  indicated  lower  than
anticipated  consumer  response  rates,  and the Company  announced its plans to
reduce marketing  expenditures  while analyzing product designs and distribution
channels.  In  September  1995,  after a period  of  product  redesign  and test
marketing,  the Company  announced  that it was  significantly  scaling back the
activities of IMS and would  discontinue its credit card servicing role.  Credit
card  servicing  responsibilities  for the PGA TOUR  Partners  credit  card were
transferred  to  SunTrust.  IMS  continues  its  PGA  TOUR  Partners  membership
(non-credit  card)  servicing  role.  The Company  recorded a pre-tax  charge of
$21,605,000 to 1995 earnings for activities  associated  with the abandonment of
IMS' credit card servicing role and the related restructuring of IMS operations.
Revenue  from the PGA TOUR  Partners  program is not  material to the  Company's
consolidated  revenue.  See Item 7.  Management's  Discussion  and  Analysis  of
Results  of  Operations  and  Financial  Condition  and  Note  10  of  Notes  to
Consolidated  Financial  Statements  under  Item  8.  Financial  Statements  and
Supplementary Data.

    IMS is also engaged in test marketing  "Collections of the Vatican Museums,"
a direct response consumer business that offers to consumers,  primarily through
catalog distribution,  products that are recreated from and inspired by historic
works from the thirteen Vatican  Museums.  The revenue and results of operations
of the Collections of the Vatican Museums test marketing effort are not material
to the consolidated revenue and results of operations of the Company.

    Family Protection Network


     Family Protection  Network was launched as a nationwide child  registration
and search product in April 1995. The Company  developed the concept during 1994
and through March 1995. In late May 1995,  preliminary  launch results indicated
lower than anticipated  consumer  response rates, and the Company  announced its
plans to reduce marketing  expenditures  while analyzing product designs as well
as  distribution  channels.  During June 1995,  Family  Protection  Network used
in-market mailings to test different product configurations and price points and
to verify  the  results  from the  initial  launch  that the  products  were not
economically  viable.  As a result of the  unsuccessful  product  launch and the
subsequent   unsuccessful  test  mailings,   the  Company   discontinued  Family
Protection Network.  The Company recorded a pre-tax charge of $8,987,000 to 1995
earnings for activities  associated  with the  termination of Family  Protection
Network  operations.  Revenue from Family Protection  Network is not material to
the Company's  consolidated  revenue.  See Item 7  Management's  Discussion  and
Analysis of Results of Operations  and Financial  Condition and Note 10 of Notes
to  Consolidated  Financial  Statements  under Item  8.Financial  Statements and
Supplementary Data.
<PAGE>

 New Products and Businesses Under Development

    As previously  noted,  in 1993 and 1994,  the Company began placing  greater
emphasis on the  development of new products and services and areas of business.
The Company focused on four areas which management believed would be high growth
sectors of the economy--security and convenience,  travel and leisure,  consumer
direct merchandising, and financial management and planning. While the Company's
business  acquisition  strategy has been  successful to date, as a result of the
product failures  discussed above, the Company has redirected its efforts to the
streamlining of operations and related cost reductions.

    The Company is still committed,  however, to growing the existing profitable
business units through new product  development,  distribution channel expansion
and selective  acquisitions  which will  complement  and enhance the  individual
business  units.  It should be noted that a risk  exists that new  products  and
services being developed and test marketed may not be successful or may never be
brought to market.  Two new products being developed by SafeCard are "TraveLine"
and  "ShopLine."  TraveLine is a discount  travel  membership  program  offering
airline,  hotel,  rental car,  vacation and cruise package savings.  It includes
services  designed to increase  travel  convenience  and enjoyment  such as trip
routing,  destination  information and a single 800 number to access all program
services.  ShopLine is a discount shopping membership program offering up to 50%
off  manufacturer's  suggested retail price on over 250,000 name brand products.
ShopLine is designed to be differentiated from competitive  services by a series
of  customer  features  including a "double the  manufacturer's"  warranty,  "no
questions"  return policy and lower prices.  The ShopLine program is the product
of a joint venture between SafeCard and a third party provider.


Employees

     As of December 31, 1995, the Company  employed 1,038 persons  (including 48
part-time  employees),  as compared to 779  employees  (including  31  part-time
employees) as of December 31, 1994.


Other Information

    Printing of  subscriber  acquisition  materials is generally  contracted  to
commercial printers.  The Company copyrights most of this material and registers
its  trademarks.  Telephone  sales are made using the  services  of  independent
contractors with SafeCard developing and dictating sales strategies, methods and
quality controls. These strategies, methods and controls are subject to approval
by the credit card  issuers.  Currently,  SafeCard has  contracted  with several
independent telemarketing  contractors,  with one such contractor accounting for
the majority of the volume,  to execute its  telephone  sales using  scripts and
procedures  provided by SafeCard.  There are other  independent  telephone sales
contractors who could provide similar services for SafeCard.

    National Leisure Group is dependent on a limited number of wholesale charter
vacation  providers  in the New England  market.  National  Leisure  Group could
create its own charter vacation  packages or utilize  scheduled  airline package
providers as alternative sources.

    All raw  materials  utilized by the Company  (primarily  paper,  plastic and
printer's ink) are readily available.


<PAGE>


    Certain  copyrights  and  trademarks  of the  Company,  such  as  the  names
"Hot-Line" and "Wright Express Universal Fleet" may be material to its business.
Various  trademarks of the Company are registered under applicable  federal law.
These trademarks,  which expire  periodically,  are subject to renewal,  and the
Company presently intends to renew all such trademarks.  The agreement  pursuant
to  which  SafeCard  marketed  CreditLine   provided  that  logos,   trademarks,
tradenames,  service  marks and  copyrights  do not belong to SafeCard.  In June
1993,  SafeCard  was  notified  by  CreditLine  Corporation,  that  the  license
agreement under which SafeCard markets certain credit  information  products and
services would not be renewed on November 1, 1993.  This agreement is subject to
litigation. See Note 14 of Notes to Consolidated Financial Statements under Item
8.   Financial   Statements  and   Supplementary   Data  and  Item  13.  Certain
Relationships and Related Transactions.

    Due to the  nature of the  Company's  business,  specifically  its  SafeCard
business unit, many aspects of the Company's  operations  involve some degree of
security risk. The Company views security as a significant function, a breach of
which could have a material adverse impact on the Company.  As such, the Company
places  a great  deal of  emphasis  on the  security  of  confidential  customer
information. However, it should be noted that no security systems/procedures are
foolproof.

    Subscribers  to the Company's  services are entitled to receive the benefits
of their subscriptions immediately; consequently, the Company has no backlog. In
addition,  there is no backlog  associated with the Company's travel reservation
business or its fleet fueling operations.

    Compliance  with federal,  state and local laws and  regulations  which have
been  enacted or adopted  with  respect to  protecting  the  environment  is not
expected to have a material impact on capital  expenditures or operations of the
Company.

    The Company's  operations  for mail and  telephone  sales are conducted on a
nationwide basis and the Company does not derive its revenue from any particular
geographic  area of the United States,  except for National  Leisure Group whose
revenue was less than 10% of  consolidated  revenue for 1995.  During the period
1993 through 1995, the Company did not conduct any significant  operations,  nor
derive  any  material  portion  of its sales or  revenue,  from  subscribers  or
customers in foreign countries.

    On January 22, 1996,  the Company  announced that its Board of Directors has
decided to explore  strategic  alternatives  available  to the  Company  for the
purpose of enhancing  shareholder  value. In connection with this decision,  the
Company has retained  financial  and legal  advisors to assist the Board in this
process.  The Board has  established  a Strategic  Direction  Committee  to have
oversight of the  process.  The eventual  outcome of this  evaluation  cannot be
predicted and there can be no assurance  that any  restructuring  or transaction
will  result  from this  process.  Because of the  uncertainty  surrounding  the
evaluation  process,  the Company's  business units are experiencing  market and
operational issues including increased competitive pressure, customer and client
concerns resulting in contract delays and various employee related matters.

     On February 6, 1996, the Company  announced that Eugene Miller,  one of its
outside  directors,  has been  appointed  as  Chairman  of the  Board  and Chief
Executive  Officer  replacing Paul G. Kahn. Mr. Miller serves as the head of the
Company's Strategic Direction Committee as described above.



<PAGE>



Item 2.    PROPERTIES


    During 1995, the Company relocated its headquarters  from Cheyenne,  Wyoming
to Jacksonville,  Florida. During 1995, the Company leased approximately 110,000
square feet of office space and operational facilities in Jacksonville,  Florida
for certain executive and administrative offices of the Company and SafeCard and
personnel  associated with the development of new businesses.  Due to closure of
Family  Protection  Network,  scaling  back  of  IMS  operations  and  corporate
restructurings,  the amount of leased space in Jacksonville  has been reduced to
approximately 73,000 square feet.

    SafeCard owns and occupies an approximately  143,000 square foot building on
approximately  17 acres in Cheyenne,  Wyoming,  which serves as its  operational
facility.   SafeCard   expanded  its  Cheyenne   facility  during  1995,  adding
approximately  28,000 square feet. In connection  with the  acquisition  of UBS,
SafeCard  also assumed a lease  covering  approximately  18,000 square feet of a
32,000  square  foot  facility  in Norman,  Oklahoma.  See Item 7.  Management's
Discussion and Analysis of Financial Condition and Results of Operations.

    Wright Express  currently  leases a 33,000 square foot building in Portland,
Maine which serves as its headquarters and operational facility.

    National  Leisure Group currently  leases 20,000 square feet of office space
in  Boston,  Massachusetts  which  serves as its  headquarters  and  operational
facility.

    The Company  also leases a 9,300 square foot  facility in  Portland,  Oregon
which houses its information technology staff.


Item 3.    LEGAL PROCEEDINGS

    The Company is defending or prosecuting thirteen complex lawsuits, twelve of
which  involve  Peter  Halmos,  former  Chairman  of  the  Board  and  Executive
Management Consultant to the Company, and parties related to him as adversaries.
See  Note  16 of  Notes  to  Consolidated  Financial  Statements  under  Item 8.
Financial Statements and Supplementary Data.

    The Company is involved in certain  other claims and  litigation,  including
various  employment  related claims,  arising in the ordinary course of business
and which are not considered material to the operations of the Company.


Item 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    NONE



<PAGE>


EXECUTIVE OFFICERS OF THE REGISTRANT

Executive  Officer  information is as follows.  Prior to the  reorganization  of
SafeCard Services into a wholly subsidiary of Ideon in April 1995,  officers who
are,  unless  otherwise  noted,  officers  of Ideon were  officers  of  SafeCard
Services.
 

NAME/POSITION/AGE

Kevin L. Bouchillon           33

     Vice  President - Treasury,  Ideon Group,  Inc.,  from May 1995 to present;
Vice President - Assistant  Controller,  Ideon Group, Inc., from October 1994 to
May 1995;  Senior  Litigation  Manager  from July 1993 to  October  1994 - Price
Waterhouse, independent public accountants; Litigation Manager from June 1992 to
July 1993, Audit  staff/supervisor/manager from August 1985 to June 1992 - Price
Waterhouse.

Joel E. Cutler                38                    

     President and Chief Executive  Officer,  National Leisure Group, Inc., from
1986 to present.

G. Thomas Frankland 49                                                       
    
     Vice Chairman and Chief Financial Officer, Ideon Group, Inc., from May 1994
to present;  Partner of Price Waterhouse,  independent public accountants,  from
1980 to 1994.

Robert M. Frechette           56

     President and Chief Executive  Officer,  SafeCard  Services,  Inc., from 
February 1995 to present;  Executive Vice President - Sales,  SafeCard Services,
Inc., from April 1994 to February 1995; Senior Vice President - U. S. Acceptance
Group of MasterCard  International,  from 1991 to 1994; Vice President - General
Merchandise Manager of Montgomery Ward from 1987 to 1991.

Bryan L. Hanson               42                  

     Executive  Vice President and Chief  Operating  Officer,  National  Leisure
Group, Inc., from February 1996 to present;  Vice President - Finance,  National
Leisure Group,  Inc.,  from August 1993 to February 1996;  Director of Strategic
Planning-  Retail Travel of Carlson  Wagenlit  Travel,  from July 1990 to August
1993. 

Richard M.  Interdonato       47

     Executive Vice President - Operations,  SafeCard Services, Inc., from April
1994 to  present;  President  of  Intec  International,  Inc.,  manufacturer  of
specialty  lubricants from January 1993 to March 1994;  Senior Vice President of
American Express managing the Optima Card Operations Center, from 1987 to 1992.


<PAGE>



NAME/POSITION/AGE

David D. Lunghino             42

     Executive  Vice  President  -  Marketing,  SafeCard  Services,  Inc.,  from
September 1995 to present; Executive Vice President of Citibank Diners Club from
September 1993 to September  1995;  Vice President - Marketing of Conagra Frozen
Foods from  September  1990 to  September  1993;  General  Manager of the Vlasic
Pickle Division of Campbell Soup from June 1988 to July 1990.

Francis J. Marino             53               

     Vice  Chairman and General  Counsel,  Ideon Group,  Inc. from April 1995 to
present;  Vice Chairman,  Ideon Group,  Inc.,  from February 1994 to April 1995;
Senior  member of the law firm of Mahoney  Adams & Criser,  P. A., from  January
1990 to January 1994.

Donelyn N. Merritt, Jr.       40          

     Executive Vice President - Corporate  Development & Strategy,  Ideon Group,
Inc., from June 1995 to present;  Senior Vice President - Corporate  Development
and  Strategy,  Ideon Group,  Inc.;  from May 1994 to June 1995;  Principal of a
private  consulting  firm primarily  concentrating  on strategy  development and
implementation,  from 1986 to May 1994; Consultant with Boston Consulting Group,
a strategic consulting firm, from 1983 to 1986.

Harry Strauss                 55                    

     Executive Vice President - Information Technology, SafeCard Services, Inc.,
from January 1996 to present; Executive Vice President - Information Technology,
Ideon  Group,  Inc.  from July  1994 to  January  1996;  Principle  of  Microtec
Planning, a technical and management consulting firm, from 1980 to June 1994.

David C. Thompson             40               

     Senior Vice President & Chief Financial Officer,  SafeCard Services,  Inc.,
Senior Vice  President  and  Controller,  Ideon Group,  Inc.,  from July 1995 to
present; Senior Vice President and Controller,  Ideon Group, Inc. from June 1994
to July  1995;  Vice  President  and Chief  Financial  Officer  of the bank card
division  of  Fidelity  Investments,  from  February  1992  to June  1994;  Vice
President and Controller for a regional  operating  center of American  Express,
from October 1988 to February 1992.


<PAGE>

NAME/POSITION/AGE

Paul F. Walsh                 46                      

     President and Chief Executive  Officer,  Wright Express  Corporation,  from
February  1995 to  present;  Chairman  and Chief  Executive  Officer  of BancOne
Investor  Services  Corporation  and BancOne  Diversified  Services  Corp.  from
January 1990 to January 1995.


                                     PART II

Item 5.MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

    The Company's  common stock trades on the New York Stock  Exchange under the
symbol "IQ".  The following  table sets forth the  quarterly  high and low sales
prices of Ideon's  common  stock as reported  on the New York Stock  Exchange as
well as cash dividends paid during the Transition Period and 1994.

<TABLE>
<CAPTION>
<S>                              <C>              <C>                 <C>
                                                                     Dividend
                                   High               Low              Paid
Quarter Ended
March 31, 1995                   $ 21.38          $  17.50            $ .05
June 30, 1995                      19.75              8.38              .05
September 30, 1995                 11.63              9.00              .05
December 31, 1995                  10.88              7.38              .05

Two Months Ended
December 31, 1994                  18.88             14.25              .05

Quarter Ended
January 31, 1994                   20.75             11.50              .05
April 30, 1994                     20.00             16.00              .05
July 31, 1994                      19.00             14.13              .05
October 31, 1994                   17.00             13.75              .05
</TABLE>

The closing price of the Company's stock on March 15, 1996, was $11.875.

The Company had 899 stockholders of record on February 29, 1996.



<PAGE>


Item 6.    SELECTED FINANCIAL DATA

Selected Statement of Earnings Data(8)  (In thousands, except per share data)

<TABLE>
<CAPTION>

<S>             <C>         <C>         <C>       <C>       <C>         <C>


                            Two Months
                Year Ended      Ended              
                December 31, December 31, Year Ended October 31,
                  1995         1994       1994      1993       1992       1991
                  ----         ----       ----      ----       ----       ----

Subscription,
  card service
  and consumer
  marketing
  revenue, net   $226,620   $ 33,290   $175,541   $156,600   $146,265   $140,557
Interest and 
  other income(1)   7,348      1,408     13,545     10,526     11,916     11,327
Income (loss) 
  before cumulative
  effect of
  accounting
  change(2)(3)
  (5)(6)          (49,441)   (49,944)    18,021     31,477     22,498     29,713
Net income
  (loss)(2)(3)
  (4)(5)(6)       (49,441)   (49,944)    20,021     31,477     22,498     29,713
Income (loss)
  per share(2)
  (3)(4)(5)(6)   $ (1.73)  $   (1.70)   $   .70    $  1.10   $    .75   $   1.02
Weighted average
  number of
  common and 
  common
  equivalent
  shares(7)       28,500      29,297     28,411     28,572     30,158     29,325
Cash dividends
  per share     $    .20   $     .05    $   .20    $    .20   $   .15   $    .15

</TABLE>

Selected Balance Sheet Data(8)                 (In thousands)
<TABLE>
<CAPTION>

<S>                <C>        <C>        <C>       <C>        <C>       <C>

                    December 31,         October 31,
                    1995      1994       1994       1993      1992      1991
Total cash
 and cash
 equivalents and 
 investments(7)    $72,140    $168,981   $184,533   $170,039  $187,301  $178,670

Total assets       385,910     428,714    480,373    378,287   377,418   351,566

Stockholders'
 equity(7)         102,860     166,806    217,592    157,695   165,498   144,903
</TABLE>

(1)  During  1994,  the  Company  recognized   $4,257,000  of  income  from  the
     settlement of two lawsuits. During 1992, the Company recognized $550,000 of
     income from the settlement of a lawsuit.
(2)  During 1995, the Company  recorded  pre-tax charges of $43,817,000  (net of
     recoveries of $1,200,000) related to the abandonment of certain new product
     development  efforts and the  restructuring  of SafeCard and the  corporate
     infrastructure.
(3)  During the two months  ended  December  31,  1994,  the Company  recorded a
     pre-tax charge of $65,500,000 for a change in the amortization  periods for
     deferred  subscriber  acquisition costs. The Company also recorded a charge
     to earnings of  $1,943,000  for  permanent  impairment  of the value of its
     securities portfolio.
(4) During  1994,  the Company  recorded a $2,000,000  benefit  ($.07 per share)
     resulting from a change in its method of accounting for income taxes.
(5)  During 1992, the Company  recorded a pre-tax charge of $17,500,000  against
     earnings in connection with its relocation from Ft. Lauderdale, Florida to
     Cheyenne, Wyoming.
(6)  In April  1994,  the Company  recorded a pre-tax  charge of  $7,900,000  in
     connection with a  reorganization  of its  operations,  the naming of a new
     senior  management  team  and a  payment  made to  Steven  J.  Halmos,  the
     Company's co-founder, in connection with the termination of his contract to
     provide services to the Company.
(7)  During 1995 and 1993, the Company repurchased  approximately  1,005,000 and
     3,470,000 shares of its common stock at a cost of approximately  $9,801,000
     and $41,699,000,  respectively  (see Liquidity and Capital  Resources under
     Item 7.  Management's  Discussion  and Analysis of Financial  Condition and
     Results of Operations).
(8)  In September  1994, the Company  acquired the  outstanding  common stock of
     Wright  Express.  In January 1995,  the Company  acquired the net assets of
     National  Leisure  Group.  The results of operations of Wright  Express and
     National  Leisure Group have been included in the  consolidated  results of
     operations since their respective dates of acquisition.

<PAGE>





Item 7.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
             RESULTS OF OPERATIONS

     References  herein to the year 1995 refer to the  Company's  calendar  year
ended December 31.  References  herein to the Transition Period refer to the two
months ended  December 31,  1994.  References  herein to the years 1994 and 1993
refer to the Company's previous fiscal years ended October 31.

     Ideon resulted from the reorganization of SafeCard approved by shareholders
on April 27, 1995. As a result of the reorganization, Ideon is a holding company
with current  operating  business  units  including  SafeCard,  Wright  Express,
National Leisure Group, and IMS. The operations of an additional  business unit,
Family Protection Network, have been discontinued as described below.


RESULTS OF OPERATIONS

CONSOLIDATED
Overview

     The Company reported a pre-tax loss of $77,242,000, resulting in a net loss
of  $49,441,000,  or $1.73 per share,  for 1995.  The  pre-tax  loss  includes a
special  charge of  $43,817,000  (net of  recoveries  of  $1,200,000)  for costs
associated with the abandonment of certain new product  development  efforts and
the related  impairment of certain assets and the  restructuring of SafeCard and
the corporate infrastructure. During the first two quarters of 1995, the Company
attempted to launch two new businesses.  Consumer response rates to the products
offered by these businesses were significantly  below management's  expectations
and the products  proved not to be economically  viable.  The Company closed its
Family Protection  Network business unit and  significantly  reduced the size of
its IMS  business  unit,  returning  it to a  developmental  mode in the  second
quarter.  In the  third  quarter,  the  Company  took an  additional  charge  to
discontinue  the credit card servicing  operation of IMS and to reduce  SafeCard
and corporate staff and overhead expenses.  See Note 10 of Notes to Consolidated
Financial Statements.

     The Company  reported a net loss of  $49,944,000  ($1.70 per share) and net
income of $20,021,000 ($.70 per share) and $31,477,000 ($1.10 per share) for the
Transition  Period,  1994 and 1993,  respectively.  The net loss of  $49,944,000
during the  Transition  Period was largely the result of a  $65,500,000  pre-tax
charge  recorded as a result of a change in the Company's  amortization  periods
for subscriber  acquisition costs (see Note 1 of Notes to Consolidated Financial
Statements). The decrease in net income from 1993 to 1994 was principally due to
the expansion of the Company's  infrastructure  in anticipation of future growth
and a  $7,900,000  restructuring  charge  taken in  connection  with a change in
senior  management in 1994.  Net income for 1994  included a $2,000,000  benefit
from the cumulative effect of a change in the Company's method of accounting for
income taxes.

Revenues
     Revenues for 1995 were  $233,968,000,  compared to revenues of $34,698,000,
$189,086,000  and  $167,126,000  for  the  Transition  Period,  1994  and  1993,
respectively.  The increases in revenues are primarily due the  acquisitions  of
Wright Express in September 1994 and National  Leisure Group in January 1995 and
revenue growth at SafeCard.


<PAGE>


Operating Income

     The  Company  incurred a pre-tax  operating  loss of  $77,242,000  in 1995,
compared to a pre-tax operating loss of $76,019,000 in the Transition Period and
pre-tax  operating  income of  $24,199,000  and  $42,445,000  for 1994 and 1993,
respectively.  The  decline  in  operating  income  was the  result of  expenses
incurred in connection  with the launch and  subsequent  abandonment  of two new
product  development  initiatives and related  restructuring as discussed above.
The 1995  operating  loss  includes  a  special  charge of  $43,817,000  (net of
recoveries of $1,200,000)  for costs  associated  with the  abandonment of these
product  development  efforts and the reduction of SafeCard and corporate  staff
and overhead  expenses.  The charges  include  severance  payments to terminated
employees,  costs to terminate equipment and facilities leases, the recording of
certain  commitments and write-downs  taken for asset impairments as a result of
these actions.

     The following  tables  summarize  operating  results by business  unit. The
"Developmental  Operations"  column  includes the  operating  results of IMS and
Family Protection Network, the Company's developmental stage business units.


For the year ended December 31, 1995 (in thousands):
<TABLE>
<CAPTION>

                                     National    Develop-   Corporate
                           Wright    Leisure      mental      and
               SafeCard    Express   Group       Operations  Other      Total
<S>               <C>       <C>       <C>         <C>       <C>         <C>

Membership and
  subscription
  revenue, net    $176,951                                              $176,951
Card acquisition
  and services
  revenue                    $23,332                                      23,332
Consumer marketing
  revenue           10,343             $15,994                            26,337
Interest and other
   income              581                  24              $6,743         7,348
                 ---------   -------    ------    --------  --------    -------
Total revenue      187,875    23,332    16,018               6,743       233,968
                 ---------   -------    ------    --------  --------    --------
Total costs and
 expenses          155,429    19,898    14,045   $ 83,803   38,035       311,210
                  --------   -------    ------   --------   --------   ---------
Income (loss) 
  before provision 
  for income
  taxes          $  32,446  $  3,434  $  1,973   $(83,803) $(31,292)  $ (77,242)
                ==========  ========  ========   ========= =========  ==========

</TABLE>


<PAGE>

<TABLE>
<CAPTION>

For the two months ended December 31, 1994 (in thousands):
<S>                 <C>       <C>         <C>     <C>        <C>       <C>

                                          National Develop-  Corporate
                               Wright     Leisure   mental    and
                    SafeCard   Express     Group  Operations  Other      Total
Membership and
  subscription 
  revenue, net     $  28,579                                            $28,579
Card acquisition
  and services
  revenue                      $ 2,915                                    2,915
Consumer marketing
  revenue              1,796                                              1,796
Interest and other
   income                                                    $ 1,408      1,408
                    --------    --------                     -------    -------

Total revenue         30,375     2,915                         1,408     34,698
                   ---------    --------                      ------    -------
Total costs and
 expenses             89,825     2,691           $  6,565     11,636     10,717
                    --------    -------          --------     ------    -------
Income (loss)
 before provision
 for income taxes $  (59,450)  $   224          $ (6,565)    $(10,228) $(76,019)
                      =======    ======         =========    ========  ========
</TABLE>

For the year ended October 31, 1994 (in thousands):
<TABLE>
<CAPTION>

                                         National    Develop-  Corporate
                                Wright   Leisure     mental       and
                     SafeCard   Express  Group      Operations   Other    Total
<S>                 <C>       <C>         <C>       <C>       <C>      <C>

Membership and
  subscription
  revenue, net    $ 162,591                                            $ 162,591
Card acquisition
 and services
 revenue                       $ 2,107                                     2,107
Consumer marketing
  revenue            10,843                                               10,843
Interest and
 other income           229                                    $ 13,316   13,545
                   --------     ------                        ---------  -------

Total revenue       173,663      2,107                           13,316  189,086
                   ---------   -------                         --------  ------
Total costs and
 expenses           131,702      1,857             $  5,006      26,322  164,887
                    -------    -------             -------     --------  -------
Income (loss)
 before provision
 for income taxes $  41,961   $   250              $ (5,006)   $(13,006) $24,199
                     ======   =======                 ======    =======   ======
</TABLE>


<PAGE>

<TABLE>
<CAPTION>

For the year ended October 31, 1993 (in thousands):
                                       National    Develop-   Corporate
                               Wright   Leisure    -mental       and
                   SafeCard   Express    Group    Operations    Other     Total
<S>                <C>       <C>       <C>       <C>        <C>       <C>

Membership and
 subscription
 revenue, net     $ 146,173                                           $  146,173
Card acquisition
 and services
 revenue
Consumer marketing
  revenue            10,427                                               10,427
Interest and
 other income           512                                 $  10,014     10,526
                 ----------                                   --------   -------

Total revenue       157,112                                    10,014    167,126
                  --------                                    -------    -------
Total costs and
 expenses          112,430                                     12,251    124,681
                  ---------                                  --------    -------
Income (loss)
 before provision
 for income taxes $ 44,682                                 $   (2,237)  $ 42,445
                  =========                                  =========  ========
</TABLE>

SAFECARD SERVICES

Business Overview
     SafeCard is a provider of credit card enhancement and continuity  products.
Subscriptions for continuity services are primarily marketed through credit card
issuers  by using mail and  telemarketing  solicitations.  SafeCard's  principal
service is credit card registration and loss notification ("Hot-Line"),  whereby
SafeCard  gives prompt notice to credit card issuers upon being  informed that a
subscriber's credit cards have been lost or stolen. Subscriptions for continuity
services  typically  continue  annually or  periodically  unless canceled by the
subscriber.  SafeCard also markets other continuity services including fee-based
credit cards ("Fee Card"), a personal credit information service ("CreditLine"),
date reminder services and discount travel services.


     SafeCard markets its products and services through approximately 160 credit
card issuers including banks, oil companies and retailers. Contracts were signed
with four new clients in 1995 including  Mellon Bank (DE) National  Association.
New contracts were signed with five existing  clients during 1995,  including an
extension  of the  Company's  contract  with  Citibank  through  the year  2000.
SafeCard also signed a letter of intent for a new five-year agreement with Sears
Roebuck & Co. The new  agreement  will become on January 1, 1996 and is expected
to be executed shortly. In connection with the new agreement,  Sears will assume
additional  marketing costs and SafeCard's overall margins will be reduced. As a
result,  SafeCard  expects pre-tax income from existing  products to be lower by
approximately  $2,000,000  in 1996.  In May 1995,  the  Company  announced  that
SafeCard's contract to provide Fee Card services to Texaco Refining & Marketing,
Inc.  would be terminated  effective  August 1, 1995.  SafeCard will continue to
service some Texaco  customers  and will  continue to provide  other credit card
enhancement  services to Texaco.  This change in  SafeCard's  relationship  with
Texaco did not have a material impact on the Company's  results of operations in
1995.  In February  1996,  the Company  announced  that  SafeCard's  contract to
provide  credit card  registration  to J.C.  Penney  credit card holders will be
terminated.  Renewals of existing subscribers will continue to be billed through
J.C.  Penney for five  years.  Termination  of the J.C.  Penney  contract is not
expected to have a material  impact on the  Company's  results of  operations in
1996.


<PAGE>

     The Company  believes  that  successful  development  of new  products  and
services and new channels of distribution will become increasingly  important to
the future growth of SafeCard revenues and operating income.  New products being
test marketed in 1996 include "TraveLine," a discount travel membership program,
and  "ShopLine,"  a  discount  shopping  membership  program.  New  channels  of
distribution  include using voice response  technology to conduct  solicitations
during  credit card  activation.  The viability of new products and services and
new channels of distribution  under development is not assured and the timing of
bringing such new products and services to market or penetrating new channels of
distribution cannot be estimated.


Revenue
     Membership and Subscription Revenue, Net
     Membership and  subscription  revenue,  net represents the  amortization of
advance payments received from subscribers to SafeCard's credit card enhancement
continuity  services such as Hot-Line,  Fee Card and CreditLine.  Membership and
subscription revenue is reported net of an allowance for cancellations. Billings
for  subscriptions  are  deferred  and  amortized  to revenue  over the  related
subscription periods, generally one or three years.

     Membership and subscription  revenue, net increased 9% from $162,591,000 in
1994 to  $176,951,000  in 1995. The increase is due to a combination of factors,
including an increase in the number of subscribers to SafeCard's  Hot-Line,  Fee
Card and CreditLine  services,  a shift in sales mix to higher priced  products,
such as  CreditLine,  and a price  increase for certain  Hot-Line  subscriptions
which began in 1993.  Subscription  revenue  increased 5% in 1995 over 1994 as a
result of the  increase  in the  average  number of  subscribers  to  SafeCard's
principal  enhancement services. A shift in sales mix to higher priced products,
the  price  increase  which  began  to take  effect  in 1993 and  other  factors
accounted for a 4% increase in subscription revenue in 1995 over 1994.

     Membership and subscription revenue, net increased 11% from $146,173,000 in
1993 to $162,591,000  in 1994.  Subscription  revenue  increased 7% in 1994 over
1993 as a result in the increase in the average number of SafeCard  subscribers.
The price change noted above accounted for a 4% increase in subscription revenue
in 1994 over 1993.

     Membership  and  subscription  revenue is dependent on a variety of factors
including   subscription  fees,  net  response  rates  (gross  enrollments  less
cancellations),  the extent of new marketing activities and renewal rates. These
factors  are  further  affected by  economic  conditions,  credit card  issuer's
strategies,  interest  rates,  the  number of credit  cards in use,  demographic
trends, consumers' propensity to buy, the number of competing offers received by
potential subscribers, the degree of market penetration and the effectiveness of
subscriber   acquisition   concepts,   solicitation   materials   and  marketing
strategies.  Many  direct-to-consumer  marketers  have  experienced  an  overall
decline in the  percentage  of consumers  responding  to offers  during the past
year.  Such  declines  in  response  rates may  result  from a number of factors
including the foregoing.  There can be no assurance that response rates will not
decline further in the future.


     The following table details renewal rates at December 31, 1995 and 1994:
<TABLE>
<CAPTION>
         Subscription Product                             1995             1994
         --------------------                             ----             ----
         <S>                                                <C>              <C>

         Single year Hot-Line                               76%              76%
         Multi-year Hot-Line                                48%              47%
         Fee Card (primarily single year)                   78%              82%
</TABLE>


<PAGE>



     Renewal rates are computed by comparing the number of paid  subscribers  at
the end of the period for each  subscriber  campaign  pool to the number of paid
subscribers at the beginning of the period.  SafeCard  monitors renewal rates by
product  and by client on a monthly  basis.  Renewal  rates of  subscribers  are
affected by a variety of factors,  including  the number and mix of  subscribers
renewing,  economic  factors,  changes in the  credit  card  industry  and other
factors,  some  of  which  may be  beyond  SafeCard's  control,  as  well as the
effectiveness of retention programs.  The decrease in renewal rates for Fee Card
is  primarily  due to the  loss  of  certain  Texaco  customers  during  1995 as
previously  discussed.  Fee  Card  renewal  rates  in 1996  are  expected  to be
negatively impacted by the loss of the Texaco contract.


     In 1995, SafeCard initiated a new retention  initiative designed to enhance
renewal rates. During the year,  additional marketing  expenditures were made in
connection with this effort.  The Company  estimates that in 1995  approximately
155,000  subscribers  were retained who would  otherwise  have  cancelled  their
subscriptions.

     The following  table details  subscriber  activity for 1995, the Transition
Period,  1994 and 1993 for  SafeCard's  credit card  enhancement  and continuity
services.
<TABLE>
<CAPTION>
                          Beginning         New                        Ending
                        Subscribers      Subscribers  Cancellations  Subscribers
          <S>            <C>            <C>             <C>            <C>

          1995           13,046,000     3,856,000       (3,730,000)   13,172,000
          Transition     13,105,000       592,000         (651,000)   13,046,000
          1994           12,043,000     4,877,000       (3,815,000)   13,105,000
          1993           11,472,000     4,374,000       (3,803,000)   12,043,000
</TABLE>

     New subscribers  represent fee-paying  subscribers obtained through various
marketing   channels.   Free  initial  trial  subscriptions  which  are  offered
periodically as a marketing  technique are excluded from the subscriber activity
above.  Cancellations  consist  of both  voluntary  and  involuntary  membership
losses.  Voluntary  cancellations  result from members  electing to  discontinue
their subscriptions. Involuntary cancellations result from the inability to bill
credit card accounts, the closure of credit card accounts or other events beyond
SafeCard's control.

     The  decline  in new  subscribers  in 1995  reflects  the impact of reduced
marketing  efforts  at the end of 1994 and  during  the first half of 1995 while
SafeCard renegotiated contracts with certain large credit card issuers.  Changes
in marketing  emphasis and the extent of new marketing  with credit card issuers
affects the number of potential  subscribers.  Certain card  issuers,  including
Citibank,  have  begun  to  limit  telemarketing  and  other  customer  contacts
performed by SafeCard and other  enhancement  providers to their customer lists.
As a result,  SafeCard has developed  alternative  marketing  channels,  such as
solicitation  efforts during credit card activation.  SafeCard is also expanding
its use of  customer  modeling  in  order  to more  effectively  solicit  likely
purchasers.  SafeCard  expects  that these  efforts  will  partially  offset the
negative effects of reduced customer contacts.


<PAGE>


     At any given point in time,  SafeCard is in  contractual  discussions  with
various  current and potential  card issuer  clients  regarding the state of its
relationship,  the extent of new  marketing,  new  product  offerings  and other
matters.  As previously  discussed,  in 1995 SafeCard signed contracts with four
new clients and signed new contracts  with five existing  clients  (including an
extension  of its  contract  with  Citibank).  SafeCard  also signed a letter of
intent for a new  five-year  agreement  with Sears.  The new  agreement  will be
effective  January 1, 1996 and is expected to executed  shortly.  In  connection
with the new  agreement,  Sears  will  assume  additional  marketing  costs  and
SafeCard's  overall  margins  will be  reduced.  As a result,  SafeCard  expects
pre-tax income from existing products to be lower by approximately $2,000,000 in
1996.  Certain  contracts  with Texaco and J.C.  Penney have been  terminated as
previously noted.  Future changes in business strategy by credit card issuers or
relationships with such issuers could have an adverse impact on the revenues and
earnings of SafeCard.

     In June 1993,  SafeCard was notified by CreditLine  Corporation,  a company
owned by Peter and Steven J. Halmos, SafeCard's co-founders, and their families,
that the license  agreement under which SafeCard markets the CreditLine  product
would  not  be  renewed  effective   November  1,  1993.   Notwithstanding   its
termination,  SafeCard believes it has certain continuing marketing rights under
the CreditLine  Agreement.  The CreditLine  Agreement,  including the continuing
marketing rights, is the subject of litigation between SafeCard, the Company and
Peter  Halmos  (see  Notes  14  and  16  of  Notes  to  Consolidated   Financial
Statements).

     Consumer Marketing Revenue
     SafeCard also generated consumer marketing revenue from its discount travel
service  and  date  reminder  service,  including  the  sale  of  calendars  and
appointment  books.  Consumer  marketing  revenue decreased 5% to $10,343,000 in
1995 as compared to $10,843,000 in 1994. Consumer marketing revenue increased 4%
from $10,427,000 in 1993 to $10,843,000 in 1994.

Operating Income
     Operating   income  decreased  23%  to  $32,446,000  in  1995  compared  to
$41,961,000 in 1994.  The decrease in operating  income was the result of higher
subscriber  acquisition costs,  increased  marketing and new product development
costs,  increased  equipment and facilities costs and a restructuring  charge of
$3,010,000  taken in the third quarter of 1995.  SafeCard  incurred an operating
loss of $59,450,000  during the  Transition  Period as a result of a $65,500,000
pre-tax charge  resulting from the change in  amortization  periods for deferred
subscriber acquisition costs.

     After a review of the Company's  accounting practices during the Transition
Period,  SafeCard  changed  the  amortization  periods for  deferred  subscriber
acquisition  costs (see Note 1 of Notes to Consolidated  Financial  Statements).
The change  was made in  response  to the  Company's  plans to incur  additional
marketing  expenditures to enhance renewal rates as noted above. Under generally
accepted  accounting  principles,  if  additional  expenditures  are incurred to
maintain  or enhance  the renewal  stream,  the Company  would not be allowed to
amortize such subscriber acquisition costs over periods greater than the initial
subscription period. Accordingly, based on efforts to enhance renewal rates, the
Company  changed  its  amortization  periods.  Prior to the  change,  subscriber
acquisition  costs were  generally  amortized  up to ten years for  single  year
subscriptions  and  up to  twelve  years  for  multi-year  subscriptions.  These
amortization  periods  represented  the  estimated  life of the  subscriber.  At
December 31, 1994, the amortization periods were shortened to one year and three
years  for   single  and   multi-year   subscriptions,   respectively   (initial
subscription  period without  regard for  anticipated  renewals).  The effect of
reducing the  amortization  periods  resulted in a one-time,  non-cash,  pre-tax
charge of  $65,500,000  in the  Transition  Period.  As a result of the  change,
deferred  subscriber  acquisition  costs  in  1995  are  recognized  on  a  more
accelerated basis as compared to prior periods.
<PAGE>

     Beginning in late 1994 and continuing through 1995,  SafeCard increased its
marketing  and new  product  development  efforts in order to expand its product
lines and better  target new  customers.  These efforts  translated  into higher
marketing and product  development  expenses of $2,218,000 for 1995,  which were
partially offset by higher revenues.

     As  previously  discussed,  in 1995  the  Company  reviewed  and  evaluated
SafeCard's  operating  structure.  A  restructuring  charge  of  $3,010,000  was
recorded  during the year to provide for the  associated  costs of  streamlining
SafeCard's operating  structure.  Approximately 70 positions were eliminated and
several  functions  will be, or have been,  restructured  to streamline  certain
operations  and  take  advantage  of  operational   efficiencies  obtained  from
automation programs implemented during the year.

     SafeCard also experienced  higher facilities and equipment  expenses during
1995  compared to 1994 due to  increased  depreciation  associated  with capital
expenditures in 1994 and 1995. In 1995, capital expenditures totaled $9,881,000,
including  approximately  $5,000,000  for the  expansion  and  renovation of the
Cheyenne operating center. The remainder  represents upgraded computer equipment
and systems.

     Operating  income  decreased 6% from  $44,682,000 in 1993 to $41,961,000 in
1994. The decrease resulted from increased marketing  expenditures,  new product
development expenses and facilities costs in 1994, partially offset by increased
membership and subscription revenues.

Acquisition
    On February 16, 1996,  SafeCard completed its acquisition of UBS, a provider
of value  added  products  and  services  through a diverse  group of  financial
institutions.  Products and services  offered by UBS,  headquartered  in Norman,
Oklahoma,  include an airline  frequent  flyer miles program  called  CardMiles,
rebate travel,  insurance  enhancements,  customer loyalty programs (designed to
aid in card  acquisition or increase card usage) and credit card merchant reward
programs  (designed  as  packages of  enhancements  to be offered by credit card
merchant  processors).  SafeCard expects to be able to increase revenues through
the sale of its products through UBS'  distribution  channels and to expose UBS'
current and planned enhancement products to SafeCard's client base.

     SafeCard's  acquisition of UBS closed in 1996, and,  accordingly,  the 1995
results of  operations  of SafeCard and the Company do not include UBS financial
results.  Terms of the  acquisition  included  an  $18,328,000  cash  payment at
closing and up to an additional  $4,000,000 in each of the years 1996,  1997 and
1998 based on the  attainment of certain  earnings  hurdles and  fulfillment  of
certain conditions.  In addition,  the sellers are also entitled to 50% of UBS's
share of the profits from a foreign joint venture over the next three years,  up
to a  maximum  of  $10,000,000.  The  acquisition  of  UBS is  not  expected  to
materially impact the Company's earnings in 1996.


WRIGHT EXPRESS

Business Overview
     Wright  Express,  acquired in  September  1994,  provides  transaction  and
information  processing services to oil companies and commercial  transportation
fleets  primarily  through a national  credit card network  program,  the Wright
Express  Universal  Fleet  card (the  "WEX  card")  and  through  private  label
processing  arrangements  for retail fuel marketers.  See Note 3 of Consolidated
Notes to Financial Statements.


<PAGE>


     The WEX card is  accepted at over 90,000  fueling  locations  in the United
States and is used by fleets  covering over one-half  million  vehicles.  Wright
Express  programs  include  co-branded  fleet  fueling  programs for many of the
nation's vehicle leasing companies.

     Wright  Express is continuing  the  development of products which will take
advantage of the vast amount of fuel and transaction  data it gathers on a daily
basis.  Wright  Express  provides this data through a license  agreement  with a
third party  database  provider  who makes it  available  to  economists,  fleet
managers, oil companies and government agencies for their use and analysis.

     Wright  Express'  competition  primarily  exists in the form of oil company
credit cards and other competing  fleet cards,  including those offered by large
card associations and financial  institutions.  The key factor in distinguishing
Wright  Express  from its  competition  is the  array of  ancillary  information
processing  services  that are  offered in  addition  to the basic  credit  card
service.  Recent  entrants  into this  competitive  market,  including  Texaco's
Voyager card, are also providing such information processing services. These oil
companies and certain other  competitors  are larger and have greater  financial
and  other  resources  than  Wright  Express  or the  Company.  There  can be no
assurance that Wright Express will not face increased competition in the future.

Revenues

     Card Acquisition and Services Revenue
     Card acquisition and services revenue  principally results from transaction
fees deducted  from amounts  remitted to retail  fueling  merchants and periodic
fees charged to fleet  customers.  Card  acquisition  and  services  revenue was
$23,332,000  for 1995  compared to  $2,107,000  in 1994.  Card  acquisition  and
services  revenue for 1994 includes the results of operations of Wright  Express
from  September  14,  1994 (date of  acquisition)  to  October  31,  1994.  Card
acquisition and services revenue was $2,915,000 for the Transition Period.

     Card acquisition and services revenue varies as a result of changes in fuel
prices and the volume of fuel purchased. Changes in fuel prices primarily impact
revenue  through the dollar volume of fuel  purchases  subject to discount rates
charged to retail fueling merchants.  Fuel gallons purchased  increased from 108
million  gallons  in the first  quarter  of 1995 to 153  million  gallons in the
fourth  quarter.  This volume  represents  less than 2% of the annual 35 billion
gallon  automobile  and light truck  fleet  fueling  market,  which is part of a
larger 50-55 billion gallon commercial fleet fueling market.

Operating Income
     Operating  income was  $3,434,000  for 1995,  $224,000  for the  Transition
Period and $250,000 for the period from  September 14, 1994 to October 31, 1994.
Operating income has been positively impacted by an increase in card acquisition
and  services  revenue,  as  described  above,  offset by a slight  increase  in
operating expenses and product development costs.



<PAGE>

NATIONAL LEISURE GROUP

Business Overview

     National Leisure Group was acquired  effective  January 1, 1995 (see Note 3
of Notes to Consolidated Financial Statements).  National Leisure Group provides
vacation travel packages and cruises  directly to the public in partnership with
established retailers and warehouse clubs throughout New England and with credit
card issuers and travel club members  nationwide.  The majority of bookings have
historically  been generated in New England area retail stores and, as a result,
are dependent upon the level of customer  traffic in these stores.  In addition,
sales are highly  seasonal  in nature  with the  majority of sales in the winter
months  (first and fourth  quarters).  Sales  through  credit  card  issuers and
membership clubs are becoming significant new sources of growth.

Revenues

     Consumer Marketing Revenue
     Consumer   marketing  revenue  for  National  Leisure  Group  is  primarily
generated  from   commissions   paid  by  cruise  lines  and  vacation   package
wholesalers.   Consumer   marketing  revenue  for  National  Leisure  Group  was
$15,994,000  for 1995.  As National  Leisure  Group was  acquired  in 1995,  the
Company's  results of operations for previous periods do not include the results
of  operations  of National  Leisure  Group.  As noted above,  National  Leisure
Group's revenue has  historically  come primarily from retail outlets in the New
England area.  Revenue  during 1995 was adversely  impacted by reduced levels of
customer  traffic in Filene's  Basement  stores in the New  England  area and by
adverse publicity received by Filene's.  Revenue was also negatively impacted by
adverse  weather  conditions  at several  popular  vacation  destinations  which
reduced new bookings and increased cancellations.

Operating Income
     National  Leisure  Group  had  operating  income  of  $1,973,000  for 1995.
Virtually  all of National  Leisure  Group's  operating  income for the year was
generated in the first and fourth  quarters due to the highly seasonal nature of
the New England travel market.  Operating  income was adversely  impacted by the
negative  impact of weather  conditions at certain travel  destinations as noted
above. Operating income was positively impacted by sales growth through endorsed
channels such as credit card issuers and membership clubs.


DEVELOPMENTAL OPERATIONS

     The "Developmental  Operations" column of the business units table includes
the  operating  results  of  Family   Protection   Network  and  IMS  (including
Collections of the Vatican Museums).  Revenue generated from these developmental
efforts is not  material  and has been netted  against  operating  expenses  for
financial statement presentation.  The losses presented in the table include the
actual losses from  operations  and the  associated  product  abandonment  costs
recorded in 1995.


<PAGE>


Business Overview

Family Protection Network

     Family  Protection  Network,  launched in April 1995,  was  initiated  as a
nationwide  child   registration  and  search  product.   The  Company  expended
approximately  $7,000,000 to develop the concept during 1994 through March 1995.
These costs were expensed as incurred.

     In  late  May  1995,   preliminary  launch  results  indicated  lower  than
anticipated  consumer  response  rates and the  Company  announced  its plans to
reduce  marketing  expenditures  while  analyzing  product  designs  as  well as
distribution  channels.   During  June  1995,  Family  Protection  Network  used
in-market mailings to test different product configurations and price points and
to verify  the  results  from the  initial  launch  that the  products  were not
economically  viable.  As a result of the  unsuccessful  product  launch and the
subsequent  unsuccessful  test mailings,  the Company  closed Family  Protection
Network.

Ideon Marketing and Services Company

     IMS  activities  were  initiated in 1994 as a platform to develop,  manage,
market and service  co-branded  credit  cards.  The first product to result from
this developmental  effort was an initiative  between the Company,  the PGA TOUR
and SunTrust  BankCard  N.A. to develop and market an expanded PGA TOUR Partners
program,  including a co-branded credit card. IMS proceeded on two developmental
tracks--development  and launch of the expanded  Partners  program and continued
research and development of additional co-branding opportunities. From inception
through March 31, 1995,  $9,000,000 of costs were incurred in both developmental
efforts (multiple  co-branding  opportunities and the Partners  program).  These
costs were expensed as incurred.

     An expanded PGA TOUR Partners program,  designed around a co-branded credit
card,  was  launched  in late  March and  early  April  1995.  In late May 1995,
preliminary  launch results  indicated lower than anticipated  consumer response
rates and the Company announced its plans to reduce marketing expenditures while
analyzing  product  designs and  distribution  channels.  During June 1995,  the
Company began  in-market test mailings to determine  product  viability and test
alternative product configurations.  The results of these test mailings were not
satisfactory.  As a result,  the Company ceased  marketing the PGA TOUR Partners
credit card program and  eliminated  approximately  two-thirds of IMS' marketing
and customer service positions. The remaining employee base was kept to continue
the development and testing of new PGA TOUR offerings.

     In September,  after a period of product  redesign and test marketing,  the
Company  announced that it would  discontinue  its credit card servicing role in
connection with the PGA TOUR Partners credit card program.  This resulted in the
elimination of approximately 60 additional positions.  IMS will continue its PGA
TOUR Partners  membership  (non-credit  card)  servicing  role while credit card
servicing responsibilities have been transferred to SunTrust.


<PAGE>


     IMS is also engaged in test marketing "Collections of the Vatican Museums,"
a direct response consumer  business that offers to consumers  products that are
recreated from and inspired by historic works from the thirteen Vatican Museums.
A fall  catalog  was  tested in 1995 with  mailings  during the third and fourth
quarters.  A spring  catalog  is being  tested  in the first  half of 1996.  The
Company  expended  approximately  $2,500,000  in 1995 to develop and test market
this program.  The future development of this program will be evaluated based on
the  results of the catalog  test  marketing.  The  Company  does not expect the
completion of testing of this program to have a material  impact on 1996 results
of operations.

Operating Loss
     Family  Protection  Network and IMS incurred a combined  operating  loss of
$83,803,000  in 1995,  including  pre-tax  charges of $30,592,000 to cover costs
associated with the product  abandonments.  Operating  losses for  developmental
operations in the Transition  Period and 1994 were  $6,565,000  and  $5,006,000,
respectively.

     For 1995, IMS had an operating loss of $54,115,000,  including  $32,510,000
related to marketing and operational  costs incurred  (including  product launch
costs) and $21,605,000 for product abandonment costs including costs of employee
severance,   costs  to  terminate   equipment  and  facilities  leases  and  the
recognition of certain  commitments.  Marketing and  operational  costs incurred
include $2,511,000 for the Collections of the Vatican Museums test marketing.

     The operations of Family  Protection  Network were  discontinued  effective
June  30,  1995.  Family  Protection  Network  incurred  an  operating  loss  of
$29,688,000 for 1995,  including  $20,701,000 of marketing and operational costs
(including  product  launch  costs)  and  $8,987,000  for  product   abandonment
including  costs  of  employee  severance,  costs  to  terminate  equipment  and
facilities  leases and the  write-down  resulting from the impairment of certain
assets.

CORPORATE AND OTHER

Overview

     Corporate  expenditures increased during 1994 and the first half of 1995 as
the  Company  developed  the  infrastructure  necessary  to  support  previously
anticipated growth,  including  corporate  marketing and information  technology
support.  The corporate and other  operating  results in the business unit table
includes the following:
<TABLE>
<CAPTION>

                             Year           Year               Two Months
                            Ended          Ended                 Ended
                         December 31,    December 31,         October 31,
                             1995           1994         1994          1993
                             ----           ----         ----          ----
<S>                      <C>            <C>          <C>           <C>   

General corporate
 overhead expenses       $18,971,000   $ 6,531,000   $9,316,000    $ 5,257,000
Litigation and
 other legal expenses      5,570,000       762,000    8,162,000      6,924,000
Corporate research
 and development           3,279,000     2,400,000      944,000         70,000
Asset impairment and
 restructuring charges    10,215,000                  7,900,000
Unrealized loss on
 securities available
 for sale                  1,943,000
Interest income           (5,497,000)   (1,394,000)  (8,421,000)    (8,736,000)
Other income              (1,246,000)      (14,000)  (4,895,000)    (1,278,000)
                         ------------  ------------   ----------  -------------
                        $ 31,292,000   $10,228,000  $13,006,000    $ 2,237,000
                        ============   ===========  ===========    ============
</TABLE>


<PAGE>


General Corporate Overhead Expenses
     General corporate overhead expenses increased  $9,655,000 (104%) in 1995 as
compared to 1994.  This increase was the result of indirect  costs  incurred for
new product launches,  acquisition efforts and a larger corporate infrastructure
designed  to  support  previously  anticipated  growth.   Increases  in  general
corporate  overhead  expenses for 1995 as compared to 1994 include  increases in
payroll and  employee  related  expenses  of  $6,025,000,  increases  in outside
services  of  $1,762,000  and  increases  in  corporate  operating  expenses  of
$1,868,000.

     General corporate overhead expenses increased $4,059,000 (77%) from 1993 to
1994 as the Company built a larger corporate  infrastructure designed to support
multiple,   diversified,   high-growth  business  units.   Additional  corporate
functions  were added (i.e.  marketing,  information  technology  and  corporate
development) to support the anticipated  rapid growth of the Company.  Increases
in general  corporate  overhead  expenses  for 1994 as compared to 1993  include
increases in payroll and employee related  expenses of $2,221,000,  increases in
outside services of $1,308,000 and increases in corporate  operating expenses of
$530,000.

     As previously  discussed,  subsequent to the product launch  failures,  the
Company reviewed and evaluated its  organization and structure.  The Company has
instituted  expense  reduction  efforts  including  restrictions on travel and a
decrease  in the  use of  outside  consultants.  The  Company  has  reduced  its
corporate  staff by more than 80% since the end of the first  quarter 1995. As a
result of these  cost  cutting  measures  and the third  quarter  restructuring,
general corporate overhead expenses  decreased  $4,598,000 (54%) from the second
quarter to the third quarter 1995 and $1,254,000 (32%) from the third quarter to
the  fourth  quarter  1995.  As  discussed  below,  a  restructuring  charge  of
$10,215,000,  net of  recoveries,  was recorded in 1995 to cover the  associated
costs of downsizing the Company's corporate infrastructure.

Litigation and Other Legal Expenses
     Litigation  and other legal  expenses  decreased  $2,592,000  (32%) in 1995
compared to 1994. Litigation and other legal expenses increased $1,238,000 (18%)
in 1994  compared  to 1993.  The  Company  is  involved  in a number of  complex
lawsuits  involving  Peter  Halmos,  former  Chairman of the Board and Executive
Management  Consultant  to  SafeCard  (see  Note  16 of  Notes  to  Consolidated
Financial Statements).  Litigation expenses anticipated in future periods cannot
be quantified  as such expenses are dependent on a number of factors  beyond the
Company's control.

Corporate Research and Development

     Corporate research and development expenses include the costs of developing
new  products  and  services  and new areas of  business  that are not  directly
related  to the  Company's  existing  business  units.  Corporate  research  and
development  expenses also include the costs incurred by the Company's corporate
development and acquisition function. Corporate research and development efforts
increased  in 1994  and  1995  primarily  due to  acquisition  activity  and the
development and launch of new products in the first half of 1995.

Asset Impairment and Restructuring Charges

     The 1995 asset  impairment and  restructuring  charges include a $7,176,000
write-down of certain assets related to the product abandonments recorded in the
second  quarter  and a  $4,239,000  restructuring  charge  recorded in the third
quarter for the downsizing of the corporate  headquarters  staff.  In the fourth
quarter,  the Company  recorded a $1,200,000  recovery of a $3,900,000  building
deposit  included in the write-down  taken in the second quarter (see Note 10 of
Notes to Consolidated Financial Statements).


<PAGE>


     The 1994 restructuring  charge was for a reorganization of operations,  the
appointment  of a new senior  management  team and a related  settlement  with a
former chief executive  officer.  These charges  included the costs to close the
Ft. Lauderdale,  Florida sales  office,  employee  severance  and lease  
termination costs.

Unrealized Loss on Securities Available for Sale

     During the Transition Period, the Company experienced market value declines
in  its  investment  portfolio  as a  result  of  an  increasing  interest  rate
environment.  Given the Company's strategy to redeploy its investment  resources
into operating assets and in view of the then current interest rate environment,
management  elected to reposition its investment  portfolio.  This repositioning
helped to minimize  additional  market risk and complete the Company's effort to
shorten the overall  maturity of the  portfolio.  Due to the  decision to sell a
significant portion of the Company's investment portfolio, management determined
that  there was an other  than  temporary  decline  in the  market  value of its
available  for  sale  portfolio,  and  consequently  net  unrealized  losses  of
$1,943,000 were charged  against  earnings for the two months ended December 31,
1994.

Interest and Other Income
     Interest income decreased $2,924,000 (35%) during 1995 as compared to 1994.
Interest  income is primarily  derived from earnings on the Company's  municipal
bonds and U.S.  Treasury  securities  portfolio,  as well as  earnings on excess
operating  cash  invested  in  money  market  funds  and  overnight   repurchase
agreements.  The decrease in interest  income is due to lower interest rates and
lower levels of investment  holdings during the period as the Company redeployed
its  investment  resources  to  fund  the  launch  of  new  businesses  and  the
acquisitions  of Wright  Express and National  Leisure Group.  In addition,  the
Company  repurchased  approximately  1,005,000 shares of its own common stock in
1995 for  $9,801,000.  The impact of the  decrease in  investment  holdings  was
partially offset by the repositioning of a significant  portion of the municipal
bond portfolio into higher yielding  short-term  taxable  securities  during the
first  quarter  of  1995  (see  Note  4  of  Notes  to  Consolidated   Financial
Statements).

     Interest income  decreased  $315,000 (4%) in 1994 as compared to 1993. This
decrease in interest  income was due to lower levels of cash and  investments in
1994 compared to 1993,  partially offset by increasing  interest rates. Cash and
investments were used to fund increased marketing and operating expenses in 1994
and to fund the acquisition of Wright Express.

     Other  income  decreased to  $3,649,000  (75%) in 1995 as compared to 1994.
Other income in 1994 includes  $4,257,000 of gains from litigation  settlements.
This decrease was offset by realized gains on sales of securities  available for
sale of $1,094,000  during 1995 compared to securities  gains of $593,000 during
1994. The 1995 sales were part of the Company's  plans,  as discussed  above, to
shorten the portfolio's overall maturity and increase its investments in taxable
securities.

     Other  income  increased  $3,617,000  (283%) in 1994 as  compared  to 1993,
primarily due to the gains from litigation settlements in 1994 noted above. This
litigation  settlement  income was offset by a $684,000  decrease in  securities
gains.


<PAGE>


Provision for Income Taxes
     For  information  regarding  the  Company's  effective  income tax rate and
deferred income tax assets and liabilities, see Note 12 of Notes to Consolidated
Financial Statements.

     Effective November 1, 1993, the Company  prospectively adopted FAS 109. The
adoption of FAS 109 required a change from the deferred  method to the liability
method of  accounting  for income  taxes.  The impact of the adoption of FAS 109
resulted  in a  cumulative  benefit  of  $2,000,000  on the  Company's  reported
earnings  during 1994.  This benefit was primarily the result of deferred income
taxes being  provided in prior periods at tax rates higher than those  currently
in effect.


LIQUIDITY AND CAPITAL RESOURCES

Operating Activities

1995 Compared to 1994

     Cash used in operating  activities was $55,519,000 in 1995 compared to cash
provided by operating  activities of  $47,046,000  in 1994. The decrease in cash
flow from  operations is principally  the result of a  $143,140,000  increase in
cash paid to suppliers  and  employees,  which  includes cash  expenditures  for
research and product  development and payments  relating to product  abandonment
and restructuring  charges. The increase in cash paid to suppliers and employees
was offset by a  $44,251,000  increase in cash  received  from  subscribers  and
customers.  Operating  cash flow was also  impacted by a $4,257,000  decrease in
gain from litigation  settlements,  a $7,352,000  decrease in interest received,
net of interest  paid and a $7,933,000  increase in income tax  refunds,  net of
payments.

     Of the $143,140,000 increase in cash paid to suppliers and employees during
1995,  approximately  $33,763,000 was expended for the development and launching
of the PGA TOUR Partners program,  $22,721,000 for Family Protection Network and
$3,197,000  for  Collections of the Vatican  Museums.  The Company made payments
totalling  $14,252,000 for product abandonment and restructuring related charges
in 1995.  In  addition,  approximately  $43,501,000  more was  expended  for the
operations  of Wright  Express and National  Leisure Group in 1995 than in 1994.
NLG was not included in the  consolidated  results of operations for 1994, while
Wright  Express was only included  from  September 14, 1994 to October 31, 1994.
The  remaining  increase in cash paid to suppliers  and employees in 1995 is the
result of a larger corporate  infrastructure  and increased spending on SafeCard
marketing, operations and product development activities.

     Expenditures  for  subscriber  acquisition  costs at SafeCard  increased by
$919,000  in 1995 as  compared  to  1994.  The  volume  and  type of  subscriber
acquisition expenditures,  as well as enrollments,  fluctuate periodically,  and
such fluctuations are not unusual.  Due to timing  differences  between periods,
there may not  always be a direct  correlation  between  subscriber  acquisition
expenditures and new enrollments and related billings in a particular period. In
addition,  historical response rates may not be an indication of future response
rates.  Offsetting the increase in expenditures for subscriber acquisition costs
was a decrease in  commissions  paid to credit card  issuers of $846,000 in 1995
compared to 1994.  Changes in commissions  paid are related to the change in net
billings for credit card enhancement continuity services as discussed below.


<PAGE>


     A postal rate  increase  became  effective in January  1995.  Since postage
represents the largest component of direct mail costs, this rate of increase has
a direct  impact on the  Company by  increasing  subscriber  acquisition  costs.
During 1995,  deferred  subscriber  acquisition costs increased by approximately
$2,000,000  for  additional  expenditures  for  postage  as a result of the rate
increase.  The Company is working with its card issuer  clients to better target
its direct  mailings,  is making  changes in its mix of direct  mailings  and is
taking other steps to reduce the impact of the postal rate increase.  Provisions
in some card  issuer  client  contracts  allow for the  recovery  of postal rate
increases  from the  card  issuer.  In  addition,  paper  costs  have  increased
approximately 20-50% over the past year.

     Of the $44,251,000 increase in cash received from subscribers and customers
in 1995, the operations of Wright Express and National Leisure Group contributed
$43,125,000  more in 1995  than in  1994.  The  remaining  increase  is due to a
decrease in receivables  from  continuity  services  offset by a decrease in net
billings to subscribers discussed below.

     Net  billings for credit card  enhancement  continuity  services  decreased
$4,628,000 in 1995 compared to 1994. The decline in billings in 1995 as compared
to 1994 reflects the impact of the renegotiation of contracts with certain large
credit card issuers and a reduction in the number of customer contacts permitted
by  credit  card  issuers.  In  light of the  reduction  in  permitted  customer
contacts,  SafeCard  has  engaged in more  targeted  marketing  in an attempt to
improve  response rates. New marketing began increasing at the end of the second
quarter.

     As a result of a tax net operating  loss for the tax year ended October 31,
1994,  the Company filed a carryback  claim in 1995 for a refund of tax payments
made in 1991 and 1992. The Company  received refunds of previously paid taxes of
approximately  $9,300,000 in connection  with the carryback claim and $1,500,000
for  estimated  tax  payments  made prior to the filing of the  return.  The net
operating  loss for 1994 was  principally  the result of increased  compensation
expense from the exercise of  non-qualified  stock options in 1994. In addition,
as a result of the completion of an audit of the Company's 1992 and 1993 federal
income tax returns,  the Company received a refund of approximately  $600,000 in
1995.  During 1994,  the Company  received a  $4,000,000  federal tax refund for
estimated  tax payments made in the prior year and made an estimated tax payment
of $1,500,000 in connection with its 1994 federal income tax return.

1994 Compared to 1993

     Cash provided by operating  activities was  $47,046,000 in 1994 compared to
$28,845,000 in 1993. The increase in cash flow from operations from 1993 to 1994
was the result of (i) a reduction in taxes paid, net of refunds of  $24,527,000,
principally as a result of recognition of increased compensation expense for tax
purposes from the exercise of stock options,  (b) a $12,131,000  increase in net
cash received from SafeCard  subscribers,  (c) a net cash  contribution from the
operations of Wright Express since the date of acquisition of $4,341,000 and (d)
litigation  settlements  received  during 1994 of $4,257,000.  Offsetting  these
changes was a $27,025,000 increase in cash paid to suppliers and employees.

     Expenditures  for subscriber  acquisition  costs increased by $4,312,000 in
1994  compared to 1993.  The increase  from 1993 to 1994 was primarily due to an
increase in the level of direct-mail and telemarketing programs initiated during
1994.  Commissions  paid to credit card  issuers  increased  $2,901,000  in 1994
compared to 1993. The increase in commissions  paid in 1994 was due primarily to
increased  subscriber  billings  over  this  period.   Billings  to  subscribers
increased $16,156,000 in 1994 compared to 1993 due to a combination of increases
in subscription fees and the number of subscribers. 
<PAGE>

Investing Activities

1995 Compared to 1994

     Cash provided by investing  activities was  $82,915,000 in 1995 compared to
$48,523,000  used in  investing  activities  in 1994.  Proceeds  from  sales and
maturities  of investment  securities,  net of  securities  purchased  increased
$117,538,000 in 1995 as compared to 1994. As previously  discussed,  the Company
repositioned  its investment  portfolio in order to shorten the overall maturity
of the portfolio  and to take  advantage of higher  yielding  short term taxable
securities.  In  addition,  the Company  continued  to redeploy  its  investment
resources to fund the launch of new  businesses  and to fund  acquisitions.  The
Company  paid  $12,977,000  (net of cash  acquired) to acquire the net assets of
National Leisure Group in the first quarter of 1995 and $35,276,000, net of cash
acquired,  to acquire the outstanding  stock of Wright Express in September 1994
(see Note 3 of Notes to Consolidated Financial Statements).

         The  Company  also  expended  $16,443,000  for  capital  assets in 1995
compared to $8,044,000 in 1994. Capital additions at Wright Express and National
Leisure  Group  contributed  $3,632,000 of the  increase,  primarily  related to
technology platform enhancements.  The remaining increase was principally due to
the completion of the expansion and renovation of SafeCard's  operations  center
in Cheyenne,  Wyoming,  company-wide  information  technology  enhancements  and
capital additions related to the Company's internally developed businesses.

1994 Compared to 1993

     Cash used in investing  activities was $48,523,000 in 1994 compared to cash
provided by investing activities of $7,714,000. Investment securities purchased,
net of proceeds from sales and maturities of securities increased $13,636,000 in
1994 as compared to 1993  primarily due to the increase in operating  cash flow.
As noted above,  the Company paid  $35,276,000 (net of cash acquired) to acquire
Wright  Express in September  1994. Net  acquisitions  of property and equipment
increased  $7,325,000 in 1994 compared to 1993  principally for  enhancements to
the  Company's  information  technology  platform  designed to improve  customer
service capabilities.


Financing Activities

1995 Compared to 1994

    Cash used in financing  activities was  $11,640,000 in 1995 compared to cash
provided by  financing  activities  of  $16,063,000  in 1994.  Cash flow used in
financing  activities included a $9,318,000 increase in treasury share purchases
in 1995 over 1994 as the Company reinstated its stock repurchase program. On May
30, 1995, the Company's board of directors reinstated a stock repurchase program
authorizing the Company to purchase up to 2,500,000 shares of outstanding common
stock on the open  market.  The  program,  which had  ended  October  31,  1994,
authorized  the  Company  to  purchase  a total of  6,000,000  shares,  of which
approximately 3,500,000 shares had been previously purchased. As of December 31,
1995,  the Company  had  purchased  1,005,100  shares for  $9,801,000  under the
reinstated plan.

     Dividends paid increased by $306,000 in 1995 compared to 1994. The increase
in dividends  paid was solely due to an increase in the number of common  shares
outstanding during each period presented. The Company's annual dividend rate was
$.20 per share ($.05 per quarter) for each period presented. Cash generated from
the exercise of stock options decreased $24,202,000 in 1995 compared to 1994.
<PAGE>

     Cash  provided  by net  borrowings  on  Wright  Express'  revolving  credit
facility increased $6,123,000 due to growth and related funding requirements for
this business unit. Wright Express' borrowings are a part of its working capital
management  structure  and  are  required  periodically  to  fund  its  accounts
receivable.

1994 Compared to 1993

     Cash provided by financing  activities was  $16,063,000 in 1994 compared to
cash used in financing  activities of  $41,432,000 in 1993. The increase in cash
provided  by  operating  activities  in 1994 as  compared  to 1993 was due to an
increase in proceeds from exercise of stock options of $19,278,000  coupled with
a decrease in payments for treasury  shares of  $41,216,000.  These increases in
financing cash flows were offset by a increase in dividends paid of $207,000 and
net repayments on Wright Express' revolving credit facility of $2,792,000.

Liquidity

     Historically,  the  Company  has  generated  the cash needed to finance its
operations  and growth  from its  operating  cash flow.  The  Company's  primary
liquidity  requirements  are  to  fund  membership  and  subscriber  acquisition
marketing  programs,  support the  development and operation of new products and
services and fund acquisitions.  In addition,  Wright Express requires resources
to fund  receivable  balances on its fleet  credit  cards.  Management  does not
foresee any material  changes in funding needs or uses over the long term except
as set forth in the following paragraphs.

     As a result of the  abandonment  of  certain  product  development  efforts
previously  discussed and the restructuring of SafeCard and the Company in 1995,
the Company committed approximately $30-35 million for employee severance, lease
terminations and other costs associated with these decisions. This commitment is
based  upon  management's  best  estimates  and  is  subject  to  change  as the
restructuring  plan is  implemented.  Management  believes that this estimate is
adequate to cover the estimated costs  associated with the product  abandonments
and related restructuring liabilities. During 1995, the Company paid $14,252,000
(net of  recoveries  of  $1,200,000)  related  to its  product  abandonment  and
restructuring   efforts.   As  of  December  31,  1995,  the  remaining  product
abandonment and restructuring  liability was $20,796,000,  the majority of which
is expected to be utilized during 1996.

     As  previously  discussed,  the Company has  reinstated a stock  repurchase
program.  While the Company is not  obligated  to  purchase  any stock under the
program,  if the full amount of remaining  authorized  shares are repurchased at
the current market price, the Company would spend  approximately  $18,000,000 to
acquire its stock.

     In February 1996,  SafeCard  completed its acquisition of UBS. Terms of the
acquisition  included  an  $18,328,000  cash  payment  at  closing  and up to an
additional  $4,000,000  in each of the years  1996,  1997 and 1998  based on the
attainment of certain earnings hurdles and fulfillment of certain conditions. In
addition, the sellers are also entitled to 50% of UBS' share of the profits from
a  foreign  joint  venture  over  the  next  three  years,  up to a  maximum  of
$10,000,000.  The initial  payment of $18,328,000  was funded from the Company's
cash and securities available for sale portfolio. Cash needed to make any of the
contingent  payments  is  expected  to be  provided  from UBS  operations,  cash
currently on hand and/or the Company's investment securities available for sale.


<PAGE>


     As a result of the Company's tax net operating  loss for the tax year ended
October 31, 1995,  the Company  expects to file a carryback  claim in 1996 for a
refund of federal tax payments made in previous years.  The Company expects such
a carryback claim to result in a refund of approximately $17,000,000 in 1996.

    The amount of the expected  costs or  commitments  to develop or acquire new
businesses,  products and services in future periods other than those  discussed
above are not  quantifiable.  In addition,  legal and litigation  expenses to be
incurred in future periods, including amounts paid in resolution thereof, cannot
be  quantified.  Such  amounts  could be  material  to  liquidity  or results of
operations.  The Company believes that its operating cash flow and the Company's
cash and investment balances  ($72,140,000 as of December 31, 1995) are adequate
to meet the Company's  current and long term liquidity  needs. In addition,  the
Company  believes that Wright Express'  revolving credit facility is adequate to
meet its current working capital needs.


IMPACT OF NEW ACCOUNTING STANDARDS

    In March 1995, the Financial  Accounting Standards Board issued Statement of
Financial  Accounting  Standards  No. 121,  "Accounting  for the  Impairment  of
Long-Lived  Assets  and for  Long-Lived  Assets to be  Disposed  Of,"  which the
Company will adopt in the first quarter of 1996. In  management's  opinion,  the
adoption of this standard  will not have a  significant  impact on the financial
condition or results of operations of the Company.

    In October 1995, the Financial  Accounting  Standards Board issued Statement
of  Financial  Accounting  Standards  No.  123  ("FAS  123"),   "Accounting  for
Stock-Based  Compensation."  FAS 123 does not require  companies to change their
existing accounting for employee stock options, however, the new rules encourage
companies to recognize  expense for stock-based  awards based on their estimated
fair  value on the date of  grant.  Companies  electing  to  continue  following
present  accounting  rules will be required to provide pro forma  disclosures of
what net income and  earnings  per share  would have been had the new fair value
method been used. FAS 123 is effective for fiscal years beginning after December
15, 1995.  Management has elected to continue following present accounting rules
for the  recording  of stock  option  expenses and will prepare the required pro
forma disclosures as required.


OTHER MATTERS

    On January 22, 1996,  the Company  announced that its Board of Directors has
decided to explore  strategic  alternatives  available  to the  Company  for the
purpose of enhancing  shareholder  value. In connection with this decision,  the
Company has retained  financial  and legal  advisors to assist the Board in this
process.  The Board has  established  a Strategic  Direction  Committee  to have
oversight of the  process.  The eventual  outcome of this  evaluation  cannot be
predicted and there can be no assurance  that any  restructuring  or transaction
will  result  from this  process.  Because of the  uncertainty  surrounding  the
evaluation  process,  the Company's  business units are experiencing  market and
operational issues including increased competitive pressure, customer and client
concerns resulting in contract delays and various employee related matters.

     On February 6, 1996, the Company  announced that Eugene Miller,  one of its
outside  directors,  has been  appointed  as  Chairman  of the  Board  and Chief
Executive  Officer  replacing Paul G. Kahn. Mr. Miller serves as the head of the
Company's Strategic Direction Committee as described above.


<PAGE>

Item 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Financial Statements                                             Page

Financial Statements(1):

Report of Independent Certified Public Accountants                         37
Consolidated Balance Sheet as of December 31, 1995 and 1994                38
Consolidated Statement of Operations for the year ended
  December 31, 1995, the two months ended December 31, 1994
  and the two years ended October 31, 1994                                  39
Consolidated Statement of Changes in Stockholders' Equity for
  the year ended December 31, 1995, the two months ended 
December 31, 1994 and the two years ended October 31, 1994                 40
Consolidated Statement of Cash Flows for the year ended
December 31, 1995, the two months ended December 31, 199
  and the two years ended October 31, 1994                                  41
Notes to Consolidated Financial Statements                              42 - 68

Financial Statement Schedules:

For the year ended December 31, 1995, the two months ended
 December 31, 1994 and the two years ended October 31, 1994:
          VIII - Valuation and Qualifying Accounts                         77


    All other  schedules  are omitted  because  they are not  applicable  or the
required information is shown in the consolidated  financial statements or notes
thereto.


(1)  In  December  1994,  the  Company  effected  a change  in its year end from
     October  31  to  December  31.  As a  result,  the  consolidated  financial
     statements contain  information as of and for the two months ended December
     31, 1994.



<PAGE>




              REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS




To the Board of Directors and
Stockholders of Ideon Group, Inc.



In our opinion, the consolidated financial statements listed in the accompanying
index present fairly, in all material respects,  the financial position of Ideon
Group,  Inc.  (formerly  known  as  SafeCard  Services,  Incorporated),  and its
subsidiaries at December 31, 1995 and 1994, and the results of their  operations
and their cash flows for the year ended  December 31, 1995, the two months ended
December  31, 1994,  and each of the two years in the period  ended  October 31,
1994,  in  conformity  with  generally  accepted  accounting  principles.  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 of these  statements  in  accordance  with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable  assurance about whether the financial statements are
free of material  misstatement.  An audit 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 the opinion  expressed
above.

As  discussed  in Note 1, the  Company  changed  the  amortization  periods  for
deferred subscriber acquisition costs effective December 31, 1994.



PRICE WATERHOUSE LLP
Tampa, Florida
February 2, 1996





<PAGE>
<TABLE>
<CAPTION>                                                  

Ideon Group, Inc.
Consolidated Balance Sheet
(in thousands, except share data)
                                                                December 31,
                                                               1995       1994
                                                            ---------   --------
<S>                                                       <C>           <C>
Assets
Current assets:
   Cash and cash equivalents                             $    25,071    $ 9,315
   Securities available for sale maturing within one year     33,741     43,532
   Receivables, net                                           71,953     58,337
   Income taxes receivable                                    16,153     11,441
   Deferred subscriber acquisition costs and
     related commissions amortizing within one year           91,150     85,435
   Deferred income tax asset                                   3,370        995
   Other current assets                                        3,228      3,262
                                                             -------    -------
     Total current assets                                    244,666    212,317

Securities available for sale maturing after one year         13,328    116,134
Deferred subscriber acquisition costs and
  related commissions amortizing after one year               40,403     46,482
Property and equipment, net                                   32,389     23,381
Excess of cost over fair value of net assets acquired         45,002     28,451
Deferred income tax asset, noncurrent                          5,223
Other assets                                                   4,899      1,949
                                                             --------  ---------

     Total assets                                         $  385,910   $428,714
                                                           =========    ========

Liabilities
Current liabilities:
   Notes payable to bank                                  $   15,414   $ 12,083
   Accounts payable                                           32,523     33,037
   Accrued expenses                                           35,165     30,535
   Product abandonment and related liabilities                20,796
   Subscribers' advance payments amortizing
     within one year                                         119,805    117,203
   Allowance for cancellations                                 9,548      9,197
                                                            ---------  ---------
     Total current liabilities                               233,251    202,055

Subscriber advance payments amortizing after one year         49,799     54,862
Deferred income tax liability                                             4,991
                                                            ---------    -------

     Total liabilities                                       283,050    261,908
                                                            ---------   --------

Commitments and Contingencies (Note 16)

Stockholders' Equity
Preferred stock--authorized 10,000,000 shares ($.01 par
  value); no shares issued or outstanding
Common stock--authorized  90,000,000 shares ($.01 par
  value);  34,946,000 shares issued  (34,946,000  at
  December  31,  1994);  27,981,831  shares  outstanding
  (28,933,599 at December 31, 1994)                             349         349
Additional paid-in capital                                   41,230      41,058
Retained earnings                                           118,999     174,066
Unrealized gain on securities available for sale                345
                                                          ----------    -------- 
                                                            160,923      215,473
Less cost of 6,964,169 common shares in treasury
 (6,012,401 shares at December 31, 1994)                    (58,063)    (48,667)
                                                          ----------   ---------

     Total stockholders' equity                             102,860     166,806
                                                          ----------  ----------

     Total liabilities and stockholders' equity          $  385,910  $  428,714
                                                         ==========  ==========

              The accompanying notes are an integral part of these
                       consolidated financial statements.
</TABLE>

<PAGE>
<TABLE>
<CAPTION>
Ideon Group, Inc.
Consolidated Statement of Operations
(in thousands, except per share data)

                                                         Two Months
                                        Year Ended         Ended      Year Ended
                                        December 31,    December 31, October 31,
                                     1995        1994       1994        1993
                                     ----        ----       ----        ----
<S>                               <C>         <C>         <C>         <C>
Revenues
   Membership and subscription
      revenue, net                 $176,951   $  28,579   $  162,591  $  146,173
   Card acquisition and services
      revenue                        23,332       2,915        2,107
   Consumer marketing revenue        26,337       1,796       10,843      10,427
   Interest income                    5,690       1,394        8,421       8,736
   Other income                       1,658          14        5,124       1,790
                                 ----------     --------     --------     ------

                                    233,968      34,698      189,086     167,126
                                -----------     ---------    --------   --------

Costs and expenses
   Subscriber acquisition costs
     and related commissions        112,632      14,967       98,150      87,852
   Other costs of revenue            22,837       4,475        8,353       7,396
   Research and produc
      development costs               7,043       8,163        7,682
   Service costs and other
      operating expenses             38,351      10,063       26,351      16,891
   General and administrative
      expenses                       33,318       5,606       16,451      12,542
   Costs related to products
      abandoned and restructuring    97,029                    7,900
   Unrealized loss on securities
      available for sale                          1,943
   Effect of change in
      amortization periods for 
      deferred subscriber acquisition
      costs                                      65,500
                                  ---------     -------      -------    --------
                                    311,210     110,717      164,887     124,681
                                  ---------     -------      -------    --------

Income (loss) before income taxes   (77,242)    (76,019)      24,199      42,445

Provision for (benefit from)
     income taxes                   (27,801)    (26,075)       6,178      10,968
                                   ---------    --------     --------   --------

Income (loss) before cumulative
   effect of change in accounting
   for income taxes                 (49,441)    (49,944)      18,021      31,477

Cumulative effect of change in
   accounting for income taxes                                 2,000

Net income (loss)               $   (49,441)  $ (49,944)  $   20,021    $ 31,477
                                 ===========   =========  ==========    ========

Earnings per share:

Income (loss) before cumulative
   effect of accounting change  $     (1.73)  $   (1.70)  $      .63    $   1.10
Cumulative effect of accounting
     change                                                      .07
                                ------------  ----------  -----------  ---------
Net income (loss)               $     (1.73)  $   (1.70)  $      .70    $   1.10
                                ============  ==========   =========    =======

Weighted average number of common
  and common equivalent shares       28,500      29,297       28,411      28,572

              The accompanying notes are an integral part of these
                       consolidated financial statements.

</TABLE>

<PAGE>

<TABLE>
<CAPTION>

Ideon Group, Inc.
Consolidated Statement of Changes In Stockholders' Equity
(in thousands, except share data)
                                                                Unrealized
                                                             Gain(Loss)on
                                           Additional          Securities      Common Stock         Total
                            Common Stock    Paid-in  Retained   Available      in Treasury       Stockholders'
                          Shares    Amount  Capital  Earnings   for Sale    Shares      Amount      Equity
<S>                      <C>         <C>    <C>      <C>        <C>    <C>          <C>         <C>

Balance at
  October 31, 1992 ...  33,426,048   $334   $ 9,625   $194,534          (6,780,015)   $(38,995)   $165,498

Net earnings .............                              31,477                                      31,477
Cash dividends paid,
  $.20 per share ........                               (5,113)                                     (5,113)
Exercise of employee
  stock options .........  769,952      8     4,213                         172,059      1,159       5,380
Tax benefit from 
  exercise of employee
  stock options                               2,152                                                  2,152
Purchase of treasury
  stock                                                                  (3,469,860)   (41,699)    (41,699)
                         --------   -----    ------    -------           -----------  ---------    --------

Balance at
 October 31, 1993 ....  34,196,000    342    15,990    220,898          (10,077,816)   (79,535)    157,695

Net earnings ..............                             20,021                                      20,021
Cash dividends paid,
 $.20 per share ..........                              (5,320)                                     (5,320)
Exercise of employee
 stock options ........... 750,000      7     3,440    (10,140)           4,090,165     31,351      24,658
Tax benefit from 
 exercise of employee
 stock options                               21,628                                                 21,628
Issuance of restricted
 common stock ............                                                   11,950
Change in unrealized
 gain (loss) on 
 securities available
 for sale ......                                                 $(607)                               (607)
Purchase of treasury
 stock                                                                      (36,700)     (483)        (483)
                          --------  ----    -------   --------   ------    ----------     -----     --------

Balance at
  October 31, 1994 .....34,946,000   349     41,058    225,459   (607)   (6,012,401)  (48,667)      217,592

Net loss ..................                            (49,944)                                     (49,944)
Cash dividends paid,
  $.05 per share ..........                             (1,449)                                      (1,449)
Change in unrealize
 gain(loss)on securities
 available for sale ......                                         607                                  607
                         ---------  -----   -------   -------    ------     --------       ---      ---------

Balance at
 December 31, 1994 .... 34,946,000   349     41,058    174,066           (6,012,401)   (48,667)     166,806

Net loss ..................                            (49,441)                                     (49,441)
Cash dividends paid,
  $.20 per share ..........                             (5,626)                                      (5,626)
Exercise of employee
  stock options ...........                      51                          49,832        405          456
Tax benefit from
 exercise of employee
 stock options                                  121                                                     121
Issuance of restricted
 common stock ............                                                    3,500
Change in unrealized
 gain(loss) on securities
 available for sale ......                                         345                                  345
Purchase of treasury
 stock                                                                   (1,005,100)    (9,801)      (9,801)
                         ---------  -----  ---------  --------   -----    ---------     -----      ---------

Balance at
  December 31, 1995 ....34,946,000   $349   $41,230   $118,999    $345    (6,964,169)  $(58,063)    $102,860
                        ==========   ====   =======   ========    ====   ==========  ==========    =========
</TABLE>

              The accompanying notes are an integral part of these
                       consolidated financial statements.


<PAGE>


<TABLE>
<CAPTION>

Ideon Group, Inc.
Consolidated Statement of Cash Flows
(in thousands)
                                             Two Months
                                 Year Ended    Ended            Year Ended
                                December 31, December 31,       October 31,
                                    1995       1994         1994          1993
                                    ----       ----         ----          ----
<S>                             <C>         <C>          <C>          <C>
Cash Flows From Operating Activities

   Net cash received from
      subscribers/customers     $ 238,835   $  31,070    $ 194,584    $ 175,596
   Cash paid to supplier
      and employees              (311,971)    (38,763)    (168,831)    (139,290)
   Interest received                7,857       3,094       13,922       13,952
   Interest paid                   (1,287)       (146)
   Income tax refunds 
     (payments), net               11,047          (7)       3,114      (21,413)
   Gain from litigation
      settlements                                            4,257
                                ----------    ---------    ---------     -------
   Net cash (used in) provided
      by operating activities     (55,519)     (4,752)      47,046       28,845
                                 ---------    ---------   ----------    --------

Cash Flows From Investing
      Activities

   Purchases of investment
      securities                  (52,961)    (12,752)     (96,986)     (63,174)
   Proceeds from sales of
      investment securities       135,111      17,463       73,748       64,539
   Proceeds from maturing
      investment securities        30,185                   18,035        7,068
   Cost of acquisitions, net
      of cash acquired            (12,977)                 (35,276)
   Acquisition of property
      and equipment, net          (16,443)     (7,406)      (8,044)        (719)
                                 ----------   --------    ---------    ---------
   Net cash provided by(used in)
     investing activities          82,915      (2,695)     (48,523)       7,714
                                  --------    --------     --------    ---------

Cash Flows From Financing
      Activities

   Net borrowings (repayments)
      on notes
     payable to bank                3,331         290       (2,792)
   Proceeds from exercise
      of stock options                456                   24,658        5,380
   Dividends paid                  (5,626)     (1,449)      (5,320)      (5,113)
   Payments for purchas
      of treasury shares           (9,801)                    (483)     (41,699)
                                 ---------    --------     --------     --------
   Net cash (used in) provided
      by financing activities     (11,640)     (1,159)      16,063      (41,432)
                                ----------    --------     --------    ---------

Net increase (decrease) in
  cash and cash equivalents        15,756      (8,606)      14,586       (4,873)
Cash and cash equivalents at
   beginning of period              9,315      17,921        3,335        8,208
                                ---------     --------      -------    ---------

Cash and cash equivalents at
   end of period               $   25,071     $ 9,315      $17,921     $  3,335
                               ==========     =========    ========    =========

              The accompanying notes are an integral part of these
                       consolidated financial statements.
</TABLE>


<PAGE>



Ideon Group, Inc.

Notes to Consolidated Financial Statements

1.  Summary of Significant Accounting Policies

On  April  27,  1995,  the  stockholders  of  SafeCard  Services,   Incorporated
("SafeCard")  approved  a plan  of  reorganization  whereby  SafeCard  became  a
wholly-owned subsidiary of Ideon Group, Inc. ("Ideon" or the "Company"), a newly
formed Delaware corporation.  All shares of SafeCard common stock were converted
into shares of Ideon  common  stock.  Ideon is a holding  company  with  current
business  units as  follows:  SafeCard,  Wright  Express  Corporation,  National
Leisure Group, Inc. and Ideon Marketing and Services Company.  The operations of
an  additional  business  unit,  Family  Protection  Network,  Inc.,  have  been
discontinued  as described in Note 10 - Costs Related to Products  Abandoned and
Restructuring.

SafeCard,  the  Company's  principal  operating  subsidiary,  is a  credit  card
enhancement  marketing  company.   Subscriptions  for  continuity  services  are
primarily marketed through credit card issuers by mail or telephone.  SafeCard's
principal   service  is  credit   card   registration   and  loss   notification
("Hot-Line"),  whereby  SafeCard gives prompt notice to credit card issuers upon
being  informed  that a  subscriber's  credit  cards  have been lost or  stolen.
Subscriptions   for  continuity   services   typically   continue   annually  or
periodically  unless  canceled by the  subscriber.  SafeCard  also markets other
continuity  services  including  those  related to fee-based  credit cards ("Fee
Card"),   date  reminder  services,   a  personal  credit  information   service
("CreditLine").  SafeCard is also  developing  new lines of  business  including
travel and shopping related products.

Wright  Express  Corporation  ("Wright  Express"),  acquired in September  1994,
provides  transaction and information  processing  services to oil companies and
commercial  transportation  fleets  primarily  through a  national  credit  card
network  program,  the Wright Express  Universal Fleet card (the "WEX card") and
through private label processing arrangements for retail fuel marketers.

National Leisure Group,  Inc.  ("National  Leisure Group"),  acquired in January
1995,  provides  vacation travel packages and cruises  directly to the public in
partnership  with  established  retailers and  warehouse  clubs  throughout  New
England and with credit card issuers and membership clubs nationwide.

Ideon Marketing and Services  Company ("IMS") manages an initiative  between the
Company,  the PGA TOUR and  SunTrust  BankCard,  N.A.  to develop  and market an
expanded PGA TOUR  Partners  program,  including a co-branded  credit card.  The
activities of IMS have been  significantly  curtailed due to lower than expected
response rates to the expanded PGA TOUR Partners program and related credit card
offering  during  1995 (see Note 10 - Costs  Related to Products  Abandoned  and
Restructuring).

On February 14, 1995,  the Company  filed a Transition  Period Form 10-Q for the
two months  ended  December 31, 1994 in order to effect a change in its year end
from October 31 to December 31.  References herein to the year 1995 refer to the
Company's  calendar  year ended  December  31,  1995.  References  herein to the
Transition  Period refer to the two months ended  December 31, 1994.  References
herein to the years 1994 and 1993 refer to the Company's  previous  fiscal years
ended October 31.


<PAGE>


Principles of Consolidation

The  consolidated  financial  statements  include the  accounts of Ideon and its
subsidiaries,  after elimination of intercompany  accounts and transactions.  On
September 14, 1994, the Company acquired 100% of the outstanding common stock of
Wright Express.  Effective  January 1, 1995, the Company acquired  substantially
all of the assets and assumed  substantially  all of the liabilities of National
Leisure Group.  These  transactions were accounted for under the purchase method
and accordingly the  consolidated  financial  statements  include the results of
operations  of Wright  Express and National  Leisure  Group from the  respective
dates of purchase (see Note 3 - Acquisitions).

Cash and Cash Equivalents

Cash and cash equivalents include  cash-on-hand,  demand deposits and short-term
investments with original maturities of three months or less.

Securities Available for Sale

In May 1993,  the  Financial  Accounting  Standards  Board  issued  Statement of
Financial  Accounting  Standards No. 115,  ("FAS 115")  "Accounting  for Certain
Investments  in  Debt  and  Equity   Securities."  FAS  115  requires  that  all
investments  in debt  and  equity  securities  that  fall  within  its  scope be
classified as either held to maturity, trading or available for sale. Management
elected  early  adoption of FAS 115 as of October 31,  1994 and  classified  its
entire  securities  portfolio as "available  for sale" at that time.  Securities
classified as available for sale are stated at market value with any  unrealized
gains or losses included as a separate component of stockholders' equity.

Approximately  $11,600,000 of securities available for sale at December 31, 1995
were held in escrow as required  contractually  by certain  credit card  issuers
(see "Revenue Recognition/Cost Amortization").

Property and Equipment

Property  and  equipment  are  stated  at cost  less  accumulated  depreciation.
Maintenance   and  repairs  are  charged  to  expense  while   betterments   are
capitalized.  Depreciation is computed using the  straight-line  method over the
assets'  estimated useful lives.  Estimated useful lives range from 3 to 7 years
for  equipment,  furniture and fixtures to 30 years for  buildings.  Capitalized
leasehold  improvements  are amortized  over the lesser of the estimated  useful
life of the asset or the lease term.

Excess of Cost Over Fair Value of Net Assets Acquired

Excess of cost over fair value of net assets  acquired  ("goodwill")  represents
the difference between the purchase price of Wright Express and National Leisure
Group and the value of the net assets acquired in each of the acquisitions  (see
Note 3 -  Acquisitions).  Such  goodwill is being  amortized on a  straight-line
basis over 25 years.  Accumulated amortization was $2,216,000 and $440,000 as of
December 31, 1995 and 1994, respectively.  Periodically, the Company reviews its
intangible assets for events or changes in circumstances  that may indicate that
the carrying amounts of the assets are not recoverable.  Based upon this review,
the Company  believes that the  unamortized  balance of goodwill at December 31,
1995 is fully recoverable.


<PAGE>


Revenue Recognition/Cost Amortization

Subscription Revenue and Commission Expense

The  Company  generally  receives  advance  payments  from  subscribers  for its
products  and  services.  The  subscription  period  and  advance  payments  are
generally  for  periods  of 12 or 36 months.  These  advance  payments,  less an
appropriate  allowance for cancellations,  are deferred and amortized to revenue
ratably over the subscription period. Credit card issuers earn commissions based
on percentages of  subscription  billings or other profit sharing  arrangements.
Such  commissions,  less an appropriate  allowance for  cancellations,  are also
deferred and amortized to expense ratably over the subscription period.

The allowance for cancellations,  net of related commissions, relates to amounts
which may be  refunded  at a future  time to  subscribers  who may cancel  their
subscriptions  prior to the completion of the  subscription  period.  Previously
paid commissions related to canceled subscriptions are reimbursed to the Company
by the credit card issuer.

The Company places funds in escrow as required  contractually  by certain credit
card issuer  clients.  The  contractual  requirement as of December 31, 1995 was
approximately  $11,600,000.  Restricted  funds  are  released  ratably  over the
subscription period (which coincides with the period of revenue recognition) and
are invested  primarily in  tax-exempt  municipal  securities  and United States
Treasury securities.

Card Acquisition and Services Revenue

Card  acquisition and services revenue is principally in the form of transaction
fees deducted from amounts remitted to retail fueling merchants and monthly fees
charged to fleet customers of Wright Express.

Consumer Marketing Revenue

Revenue from the sale of vacation  packages by National Leisure Group,  which is
included  in the  "Consumer  marketing  revenue"  caption  in  the  consolidated
statement  of  operations,  is  recognized  at the date when  substantially  all
obligations  to the customer have been  performed and at least 90 percent of the
total  booking  price  has been  received  (see Note 3  Acquisitions).  Consumer
marketing  revenue also includes  revenues from SafeCard's date reminder service
which is amortized over each calendar year.

Subscriber Acquisition Costs

Subscriber  acquisition  expenditures  directly relate to the acquisition of new
subscribers  through  "direct-response"  type marketing  campaigns and primarily
include payments for telemarketing, printing, postage, mailing services, certain
direct  salaries  and other direct  costs  incurred to acquire new  subscribers.
Prior to December 31, 1994,  these  expenditures  were deferred and amortized to
expense in  proportion  to  expected  revenues  over the  expected  subscription
periods,  including  renewal  periods (life of subscriber).  These  amortization
periods ranged from 10 to 12 years for single year and multi-year subscriptions,
respectively.


<PAGE>


After a general review of the Company's  business  plans and related  accounting
practices  during  the  Transition  Period,  the  Company's  Board of  Directors
approved  a  change  in  the  amortization   periods  for  deferred   subscriber
acquisition  costs.  The change was made in response to the  Company's  plans to
incur  additional  marketing   expenditures  to  enhance  renewal  rates.  Under
generally  accepted  accounting  principles,   if  additional  expenditures  are
incurred to maintain or enhance the renewal  stream,  the Company is required to
amortize such subscriber acquisition costs over periods greater than the initial
subscription period. Accordingly, based on efforts to enhance renewal rates, the
Company  changed its  amortization  periods.  Effective  December 31, 1994,  the
amortization  periods were shortened to one year and three years for single year
and multi-year subscriptions,  respectively (initial subscription period without
regard for  anticipated  renewals).  The  effect of  reducing  the  amortization
periods  resulted  in a  one-time,  non-cash,  pre-tax  charge  to  earnings  of
$65,500,000 during the two months ended December 31, 1994.

The change in the amortization periods for deferred subscriber acquisition costs
does not affect the  amortization of commissions  which continue to be amortized
over the one to three year subscription period, as appropriate.

Income Taxes

Effective  November 1, 1993,  the Company  prospectively  adopted  Statement  of
Financial  Accounting  Standards  No. 109 ("FAS  109"),  "Accounting  for Income
Taxes."  Adoption of FAS 109 required a change from the  deferred  method to the
liability   method  of  accounting  for  income  taxes.  One  of  the  principal
differences  of the liability  method from the deferred  method used in previous
financial  statements  is that  changes in tax laws and rates are  reflected  in
income from  continuing  operations in the period such changes are enacted.  The
impact  of the  adoption  of FAS 109 had a  cumulative  positive  effect  on the
Company's reported earnings in 1994 of $2,000,000.

Income (Loss) Per Share

Income per share is  calculated  by dividing net income by the weighted  average
number of shares of common  stock and common  stock  equivalents  (common  stock
issuable  upon  exercise  of  stock  options)  outstanding.  Loss  per  share is
calculated  by dividing  net loss by the  weighted  average  number of shares of
common stock outstanding.

Use of 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 financial  statements and the
reported  amounts of revenues and expenses during the reporting  period.  Actual
results could differ from those estimates.

Reclassifications

Certain reclassifications have been made in prior period financial statements to
conform to the 1995 presentation.



<PAGE>


2.  Change in Fiscal Year End

On February 14, 1995,  SafeCard filed a Transition  Period Form 10-Q for the two
months ended  December 31, 1994 in order to effect a change in its year end from
October 31 to  December  31. As a result,  the  consolidated  audited  financial
statements  contain  information as of and for the two months ended December 31,
1994. The following  supplemental unaudited consolidated statement of operations
and  unaudited  consolidated  statement  of cash flows for the two months  ended
December 31, 1993 is presented for  comparative  purposes only and was presented
in the Transition Period Form 10-Q filed in February 1995.
<TABLE>
<CAPTION>

     Consolidated Statement of Operations
                                                                Two Months Ended
                                                               December 31, 1993
                                                                   (unaudited)
     <S>                                                        <C>

     Revenues
        Membership and subscription revenue, net                $     25,775,000
        Card acquisition and services revenue
        Consumer marketing revenue                                     1,743,000
        Interest income                                                1,334,000
        Other income                                                     280,000
                                                                ----------------
                                                                      29,132,000

     Costs and expenses
        Subscriber acquisition costs and related commissions          15,652,000
        Other costs of revenue                                         1,239,000
        Service costs and other operating expenses                     3,282,000
        General and administrative expenses                            2,480,000
                                                                ----------------
                                                                      22,653,000

     Income before income taxes                                        6,479,000

     Provision for income taxes                                        1,652,000

     Income before cumulative effect of change in accounting
       for income taxes                                                4,827,000

     Cumulative effect of change in accounting for income taxes        2,000,000
                                                                ----------------

     Net Income                                                 $      6,827,000
                                                                ================

     Earnings per share

     Income before cumulative effect of accounting change                  $ .18

     Cumulative effect of accounting change                                  .07

     Net income                                                            $ .25
                                                                           =====

     Weighted average number of common
       and common equivalent shares                                   27,325,000


</TABLE>

<PAGE>

<TABLE>
<CAPTION>

     Consolidated Statement of Cash Flows
                                                               Two Months Ended
                                                               December 31, 1993
                                                                  (unaudited)
<S>                                                             <C>

     Cash Flows From Operating Activities
        Net cash received from subscribers/customers            $    33,523,000
        Net cash paid to suppliers and employees                    (31,601,000)
        Interest received                                             3,627,000
        Income tax refunds (payments), net                              515,000
                                                                ----------------

           Net cash provided by operating activities                  6,064,000
                                                                ----------------

     Cash Flows From Investing Activities
        Purchases of investment securities                          (18,350,000)
        Proceeds from sale of investment securities                  15,438,000
        Proceeds from maturing investment securities                    710,000
        Acquisition of property and equipment, net                     (410,000)
                                                               -----------------

           Net cash used in investing activities                     (2,612,000)
                                                               -----------------

     Cash Flows From Financing Activities
        Proceeds from exercise of stock options                          36,000
        Dividends paid                                               (1,207,000)
        Payments for purchase of treasury shares                       (483,000)
                                                               -----------------

           Net cash used in financing activities                     (1,654,000)
                                                               -----------------

     Net increase in cash and cash equivalents                         1,798,000

     Cash and cash equivalents at beginning of period                  3,335,000
                                                                ----------------

     Cash and cash equivalents at end of period                 $      5,133,000
                                                                ================
</TABLE>


3.  Acquisitions

National Leisure Group
On February 10, 1995, the Company completed its acquisition of substantially all
of the assets and liabilities of National  Leisure Group, a provider of vacation
travel packages to credit card  companies,  retailers and wholesale clubs in the
United  States.  The  Company  paid  cash of  $15,048,000  and  agreed  to issue
$1,400,000 of common stock on the third anniversary of the acquisition. Also, up
to $2,800,000 of additional  common stock is issuable based on the attainment of
certain  earnings  hurdles.  The acquisition was effective as of January 1, 1995
and was accounted for under the purchase method.  Accordingly,  the consolidated
results of  operations  of the  Company  include the  results of  operations  of
National Leisure Group for the year ended December 31, 1995.

As part of the  transaction,  the Company acquired  $5,631,000 of assets,  which
included $2,395,000 of cash, and assumed liabilities of $7,153,000.  The Company
recorded  $18,327,000  of goodwill which is being  amortized on a  straight-line
basis over 25 years.  Amortization  expense through December 31, 1995 related to
this acquisition was approximately $725,000.


<PAGE>


The  following  presents the  unaudited  pro forma  results of operations of the
Company and  National  Leisure  Group as if combined  throughout  the two months
ended December 31, 1994 and the year ended October 31, 1994:
<TABLE>
<CAPTION>

                                                                                           Two Months Ended              Year Ended
                                                                                             December 31,                October 31,
                                                                                               1994                         1994
                                                                                             (unaudited)                 (unaudited)
<S>                                                                                         <C>                         <C>

Revenues, net ................................................................              $  36,933,000               $201,940,000
Costs and expenses ...........................................................                112,708,000                176,570,000
                                                                                            -------------               ------------
Income (loss) before provision for income taxes
   and cumulative effect of accounting change ................................              $ (75,775,000)              $ 25,370,000
                                                                                            =============               ============

Net (loss) income ............................................................              $ (49,769,000)              $ 20,980,000
                                                                                            =============               ============

   (Loss) earnings per share                                                                   $   (1.70)                     $ .74
                                                                                               =========                      =====
</TABLE>


The pro forma results are not necessarily indicative of what actually would have
occurred if the acquisition had been in effect for the entire periods presented,
nor are they intended to be a projection of future results.

Wright Express Corporation
On September 14, 1994, the Company acquired 100% of the outstanding common stock
of Wright Express, a provider of transaction and information processing services
to oil companies and commercial  transportation fleets in the United States, for
$35,500,000 in cash. The acquisition was accounted for under the purchase method
and,  accordingly,  the results of operations of Wright  Express are included in
the Company's consolidated financial statements from the date of acquisition. In
connection with the acquisition,  the Company  recorded  $28,891,000 of goodwill
which is being amortized on a straight-line basis over 25 years.

The  following  presents the  unaudited  pro forma  results of operations of the
Company and Wright Express as if combined  throughout the year ended October 31,
1994:
<TABLE>
<CAPTION>

                                                                                                     Year Ended
                                                                                                     October 31,
                                                                                                         1994
                                                                                                    (unaudited)
<S>                                                                                              <C>
Revenues, net                                                                                    $      200,955,000
Costs and expenses                                                                                      176,060,000
                                                                                                 ------------------
Income before provision for income taxes
   and cumulative effect of accounting change                                                    $       24,895,000
                                                                                                 ==================

Net income                                                                                       $       20,149,000
                                                                                                 ==================

   Earnings per share                                                                                    $ .71
                                                                                                         =====
</TABLE>


The pro forma results are not necessarily indicative of what actually would have
occurred if the acquisition had been in effect for the entire periods presented,
nor are they intended to be a projection of future results.


<PAGE>


4.  Investments

The Company's investment portfolio is invested primarily in tax-exempt municipal
bonds.  Because there is not a regularly  published  source of accurate  current
market values for tax-exempt  municipal bonds, the Company's  investment adviser
estimates market values for the Company's  securities available for sale using a
pricing  matrix  commonly used in the  municipal  bond  industry,  or in certain
cases, by soliciting quotations from municipal bond dealers.

The  financial   statement  carrying  amount,   gross  unrealized  gains,  gross
unrealized  losses  and  estimated  market  value  of the  Company's  securities
available for sale were as follows:
<TABLE>
<CAPTION>

                                                                            December 31, 1995
                                                                     Gross              Gross            Estimated
                                              Carrying            Unrealized         Unrealized           Market
                                               Amount                Gains              Losses             Value
<S>                                      <C>                     <C>                 <C>            <C>

Tax-exempt municipal bonds               $      39,054,000       $    366,000        $    (21,000)  $      39,399,000

U.S. Treasury bills                              7,415,000                                                  7,415,000

Other                                              255,000                                                    255,000
                                         -----------------       ------------        ------------   -----------------

                                         $      46,724,000       $    366,000        $    (21,000)  $      47,069,000
                                         =================       ============        ============   =================
</TABLE>
<TABLE>
<CAPTION>


                                                                              December 31, 1994
                                                                      Gross               Gross         Estimated
                                              Carrying             Unrealized          Unrealized        Market
                                               Amount                 Gains              Losses           Value
<S>                                      <C>                     <C>                 <C>            <C>

Tax-exempt municipal bonds               $     159,473,000                                          $     159,473,000

Other                                              193,000                                                    193,000
                                         -----------------       ------------        ------------   -----------------

                                         $     159,666,000                                          $     159,666,000
                                         =================       ============        ============   =================
</TABLE>


Maturities  of the Company's  investment  portfolio at December 31, 1995 were as
follows:
<TABLE>
<CAPTION>
                                                                                     Carrying             Market
                                                                                       Value               Value
                           <S>                                                   <C>                <C>

                           Within one year                                       $     33,499,000   $      33,741,000
                           One to five years                                            9,187,000           9,282,000
                           More than five years                                         4,038,000           4,046,000
                                                                                 ----------------   -----------------

                                                                                 $     46,724,000   $      47,069,000
                                                                                 ================   =================
</TABLE>

Gross  realized  gains  on  sales  of  securities  available  for  sale  totaled
$1,237,000,  $620,000 and  $1,290,000  for the years ended December 31, 1995 and
October  31,  1994 and 1993,  respectively.  Gross  realized  losses on sales of
securities available for sale totaled $143,000, $97,000, $27,000 and $12,000 for
the years ended  December 31, 1995,  the two months ended  December 31, 1994 and
the years ended  October 31,  1994 and 1993,  respectively.  Gains and losses on
sales of securities  are computed on the specific  identification  basis and are
included as a component of other income.


<PAGE>


On October  31, 1994 the  Company  adopted  Statement  of  Financial  Accounting
Standards No. 115 ("FAS 115"),  "Accounting  for Investments in Certain Debt and
Equity  Securities."  Upon  adoption  of FAS 115,  the  Company  classified  its
securities  portfolio,  principally  consisting of municipal bonds, as available
for sale and disclosed the unrealized  loss of $607,000 as a separate  component
of  stockholders'  equity.  During the two months ended  December 31, 1994,  the
Company experienced further market value declines in its investment portfolio as
a result of the  increasing  interest  rate  environment.  Given  the  Company's
strategy to redeploy its investment  resources into operating assets and in view
of the then current interest rate environment,  management elected to reposition
the portfolio.  This repositioning helped to minimize additional market risk and
complete the Company's  effort to shorten the overall maturity of the portfolio.
Due to the decision to sell a significant  portion of the  Company's  investment
portfolio,  management determined that there was an other than temporary decline
in the market value of its available for sale portfolio,  and  consequently  the
net unrealized  losses of $1,943,000 were charged  against  earnings for the two
months ended December 31, 1994.


5. Receivables, net

Receivables and the related  allowance for doubtful  accounts were as follows at
December 31:
<TABLE>
<CAPTION>

                                                                               1995                      1994
                                                                               ----                      ----
<S>                                                                      <C>                       <C>

Receivables for transportation fleet services                            $    47,041,000           $     31,402,000
Receivables  for continuity services                                          24,086,000                 25,391,000
Other receivables                                                              1,700,000
Accrued interest receivable                                                    1,121,000                  3,288,000
                                                                         ---------------           ----------------

                                                                              73,948,000                 60,081,000

Allowance for doubtful accounts                                               (1,995,000)                (1,744,000)
                                                                         ---------------             --------------

                                                                         $    71,953,000           $     58,337,000
                                                                         ===============           ================
</TABLE>

The receivables for  transportation  fleet services  primarily relate to amounts
due from customers of Wright Express for fleet fueling and other  transportation
services.


6.  Property and Equipment

Property and equipment consisted of the following at December 31:
<TABLE>
<CAPTION>

                                                                                             1995                        1994
                                                                                             ----                        ----
<S>                                                                                    <C>                              <C>

Equipment ............................................................                  $ 19,747,000                   $ 13,457,000
Building .............................................................                    16,204,000                      5,582,000
Furniture and fixtures ...............................................                     7,053,000                      1,481,000
Construction in progress .............................................                     6,877,000
Land .................................................................                       447,000                        447,000
                                                                                        ------------                   ------------

                                                                                          43,451,000                     27,844,000

Less: accumulated depreciation .......................................                   (11,062,000)                    (4,463,000)
                                                                                        ------------                   ------------

                                                                                        $ 32,389,000                   $ 23,381,000
                                                                                        ============                   ============

</TABLE>

<PAGE>


Construction  in  progress   related  to  improvements  and  additions  made  to
SafeCard's  operations  center in Cheyenne,  Wyoming.  All costs associated with
this  project  were  capitalized  as  construction  in progress  and began to be
depreciated  when the  improvements  and additions were placed in service during
1995.


7.  Accrued Expenses

Included  within  "Accrued  expenses"  as of  December  31,  1995  and 1994 is a
disputed liability recorded in 1992 of approximately $10,500,000 relating to the
Company's  estimated net obligation under a contested lease (the "Ft. Lauderdale
Lease")  of its  former  Ft.  Lauderdale  headquarters.  The  Company  no longer
occupies these premises and is no longer making  payments on the Ft.  Lauderdale
Lease,  which is now the subject of litigation  (see Note 16 -  Commitments  and
Contingencies).


8.  Notes Payable to Bank

Notes  payable  to  bank  represents  a  revolving  loan  agreement  assumed  in
connection  with the  acquisition of Wright  Express in 1994. The agreement,  as
originally  structured,  provided for maximum  borrowings equal to the lesser of
$17,500,000 or an amount based on a percentage of eligible  accounts  receivable
as defined therein. In November 1994, the revolving credit agreement was amended
increasing  the  available  line to  $27,500,000  and the Company was added as a
guarantor under the amended agreement.

Interest on the outstanding  borrowings was, at Wright Express'  option,  either
the bank's prime rate minus 0.5% or the London Interbank Offering Rate ("LIBOR")
plus 0.625%.  Wright  Express paid a fee of 0.25% per annum on the average daily
unused portion of the line of credit.  Borrowings  are secured by  substantially
all assets of Wright Express.

At  December  31,  1995,  the  Company  had  $15,414,000  outstanding  under the
revolving line of credit with interest rates ranging from 6.31% to 7.25%.

In February 1996,  Wright Express  entered into a new revolving  credit facility
agreement  replacing  the  previous  revolving  line of  credit.  The new credit
facility has an available line of $75,000,000 of which  $50,000,000  may be used
to finance working capital  requirements and for general corporate  purposes and
$25,000,000  may be used for  acquisition  financing.  The new  credit  facility
expires December 1, 1998. Interest on the outstanding borrowings is computed, at
the option of Wright Express,  under various methods  including the bank's prime
rate or LIBOR plus 0.75%.  Wright  Express pays a quarterly  fee of 0.25% on the
average daily unused  portion of the line of credit and an annual agent's fee of
$25,000.  Borrowings are secured by substantially  all assets of Wright Express.
In  February  1996,  Wright  Express  also  entered  into a  $5,000,000  capital
expenditure line of credit arrangement with a bank.


<PAGE>


9.  Subscriber Acquisition Costs and Commissions

Deferred subscriber acquisition costs and related commissions were as follows at
December 31:
<TABLE>
<CAPTION>

                                                                               1995                      1994
                                                                               ----                      ----
<S>                                                                     <C>                       <C>

Hot-Line                                                                $     65,232,000          $      61,006,000
Fee Card                                                                       5,597,000                  4,540,000
Other services                                                                15,905,000                 19,500,000
                                                                        ----------------          -----------------

Total deferred subscriber acquisition costs                                   86,734,000                 85,046,000

Commissions                                                                   44,819,000                 46,871,000
                                                                        ----------------          -----------------

Total deferred subscriber acquisition
   costs and commissions                                                $    131,553,000          $     131,917,000
                                                                        ================          =================

</TABLE>

10.  Costs Related to Products Abandoned and Restructuring

Included  in costs  related  to  products  abandoned  and  restructuring  in the
Consolidated  Statement of Operations  for the year ended  December 31, 1995 are
special  charges  totaling  $43,817,000,  net  of  recoveries,  related  to  the
abandonment  of  certain  new  product  developmental  efforts  and the  related
impairment of certain assets and the restructuring of SafeCard and the corporate
infrastructure  as discussed  below.  The  original  charge of  $45,017,000  was
composed  of  accrued  liabilities  of  $36,248,000  and  asset  impairments  of
$8,769,000.   As  discussed  below,  in  December  1995  the  Company  recovered
$1,200,000 of a $3,900,000 deposit included in the above charges.

The components of the product abandonment and related liabilities as of December
31, 1995 are as follows:
<TABLE>
<CAPTION>

                                                                     1995                                Balance at
                                                                  Provisions          Activity            12/31/95
<S>                                                           <C>                 <C>                <C>

Severance and other employee costs                            $    14,960,000     $     8,950,000    $      6,010,000
Costs to terminate equipment and facilities leases                  9,593,000           2,656,000           6,937,000
Liability for contract impairments                                  8,400,000           1,000,000           7,400,000
Other costs                                                         3,295,000           2,846,000             449,000
                                                              ---------------     ---------------    ----------------

                                                              $    36,248,000     $    15,452,000    $     20,796,000
                                                              ===============     ===============    ================
</TABLE>

The $20,796,000  balance of the product  abandonment and related  liabilities at
December 31, 1995 represents the Company's best estimate of the amounts expected
to be  incurred  with  respect  to its  product  abandonment  and  restructuring
efforts.  The amounts that will ultimately be paid could differ from the amounts
included  in the  product  abandonment  and related  liabilities  estimate.  The
Company  anticipates  completion  of the majority of the actions  related to the
product abandonment and restructuring during 1996.


<PAGE>


PGA TOUR Partners

In late March and early April 1995,  the Company  launched an expanded  PGA TOUR
Partners  program  through  its IMS  subsidiary.  The program  provided  various
benefits to members  including access to PGA TOUR events and a co-branded credit
card.  Consumer  response  rates after the launch were  significantly  less than
management's  expectations  and it was determined that the product as configured
was not economically viable. The Company discontinued  marketing the product and
recorded a special charge of  $17,993,000 at June 30, 1995 for costs  associated
with the  abandonment  of the product  marketing  including  employee  severance
payments  (approximately  130  employees),  costs  to  terminate  equipment  and
facilities  leases,  costs for contract  impairments and  write-downs  taken for
asset impairments.

On September 14, 1995,  after a period of product  redesign and test  marketing,
the Company  announced that it would  discontinue its credit card servicing role
in connection with the PGA TOUR Partners credit card program. In connection with
this  decision,  the Company  recorded a special  charge of $3,612,000 for costs
associated  with the  abandonment  of this role,  including  employee  severance
payments  (approximately  60  employees),   costs  to  terminate  equipment  and
facilities  leases and the  recognition  of  certain  commitments.  The  Company
continues to provide  membership  (non-credit  card)  servicing for the PGA TOUR
Partners program.

Family Protection Network

In  April  1995,   Family   Protection   Network  launched  a  nationwide  child
registration and missing child search program.  Consumer response rates from the
initial product launch were significantly lower than anticipated and the Company
closed this  business  unit.  As a result,  the Company  recorded an  $8,987,000
charge in the second quarter 1995 to cover severance payments (approximately 100
employees),  costs to terminate  equipment and facilities leases and write-downs
taken for asset  impairments.  As of December 31, 1995,  all employees of Family
Protection Network have been terminated.

Corporate and SafeCard Restructurings
As a result of the  discontinuance  of these products,  the Company undertook an
overall  restructuring of its operations,  including a significant  reduction of
its workforce at its  corporate  headquarters  and at SafeCard.  The decision to
abandon these products and restructure the Company  resulted in the recording of
a charge of  $7,176,000  in the second  quarter 1995 to cover costs to terminate
certain  operating  leases and write-down  certain assets to their estimated net
realizable value. The Company recorded  additional  charges of $3,010,000 in the
third quarter 1995 for costs  associated with the  restructuring of SafeCard and
$4,239,000 for a restructuring  of the corporate  infrastructure.  Restructuring
costs include severance payments and costs to terminate equipment and facilities
leases.

In May 1995,  the Company  signed a definitive  purchase  agreement to acquire a
350,000 square foot building and related property for approximately $39,000,000.
As part of the agreement,  the Company paid $3,900,000 into an escrow account as
a  nonrefundable  deposit  pending the completion of the purchase in early 1996.
Included in the $7,176,000 corporate charge recorded in the second quarter was a
provision for the full  impairment of this deposit.  Management  worked with the
building  owner to  facilitate  a sale of the  building to a third  party.  As a
result,  the building owner and a third party entered into a purchase  agreement
and the Company  recovered  $1,200,000  of its deposit in the fourth  quarter of
1995.


<PAGE>


In April 1994,  the Company  announced a  reorganization  of its  operations and
named a new senior management team. As a part of the reorganization, nine senior
executives left the Company and the Ft. Lauderdale sales office was closed. As a
result of this  reorganization,  the Company recorded a restructuring  charge of
$3,500,000 to cover severance  agreements and a lease termination.  In addition,
the  Company  recorded  an  additional  charge of  $4,400,000  paid to Steven J.
Halmos,  the  Company's  co-founder  (see Note 14 -  Transactions  with  Related
Parties).  At  December  31,  1995 the  remaining  balance of these  reserves of
$285,000 was included in "Accrued expenses."


11.  Segment Information

The  operations  of the  Company  are  managed  along  business  unit lines and,
accordingly, the Company considers each operating subsidiary a separate business
segment  for  financial  reporting  purposes.  Due to their  nature and stage of
development,  the  operations  of IMS and Family  Protection  Network  have been
combined and presented as  Developmental  Operations in the segment  information
table below.
<TABLE>
<CAPTION>

                                                                            Two Months
                                                        Year Ended             Ended                     Year Ended
                                                       December 31,        December 31,                  October 31,
                                                           1995                1994               1994                1993
<S>                                                 <C>                 <C>                 <C>                <C>
                                                           ----                ----               ----                ----
SafeCard
     Operating revenue                              $     187,875,000   $     30,375,000    $    173,663,000   $     157,112,000
     Operating income (loss)                               32,446,000        (59,450,000)         41,961,000          44,682,000
     Identifiable assets                                  195,769,000        217,679,000         270,636,000         206,331,000
     Depreciation and amortization                          2,549,000            236,000           1,094,000             864,000
     Capital expenditures, net                              9,881,000          7,241,000           7,913,000             719,000

Wright Express
     Operating revenue                                     23,332,000          2,915,000           2,107,000
     Operating income                                       3,434,000            512,000             250,000
     Identifiable assets                                   77,309,000         32,737,000          32,471,000
     Depreciation and amortization                          1,721,000            421,000             255,000
     Capital expenditures, net                              1,663,000            165,000             131,000

National Leisure Group
     Operating revenue                                     16,018,000
     Operating income                                       1,973,000
     Identifiable assets                                   27,237,000
     Depreciation and amortization                          1,066,000
     Capital expenditures, net                              1,969,000

Developmental Operations
     Operating revenue
     Operating loss                                       (83,803,000)        (6,565,000)         (5,006,000)
     Identifiable assets                                      521,000          4,218,000
     Depreciation and amortization                            384,000
     Capital expenditures, net                                664,000


<PAGE>


Corporate and Other
     Operating revenue                                      6,743,000          1,408,000          13,316,000          10,014,000
     Operating income (loss)                              (31,292,000)       (10,516,000)        (13,006,000)         (2,237,000)
     Identifiable assets                                   85,074,000        174,080,000         177,266,000         171,956,000
     Depreciation and amortization                            437,000             66,000
     Capital expenditures, net                              2,266,000

Consolidated Totals
     Operating revenue                                    233,968,000         34,698,000         189,086,000         167,126,000
     Operating income (loss)                              (77,242,000)       (76,019,000)         24,199,000          42,445,000
     Identifiable assets                                  385,910,000        428,714,000         480,373,000         378,287,000
     Depreciation and amortization                          6,157,000            723,000           1,349,000             864,000
     Capital expenditures, net                             16,443,000          7,406,000           8,044,000             719,000
</TABLE>

Identifiable assets are those assets of the Company that are identified with the
operations  of each of the  individual  business  units.  Corporate  assets  are
principally  cash,  securities  available  for sale and property and  equipment.
National Leisure Group's  identifiable assets include $17,607,000 of unamortized
goodwill as of December 31, 1995. Wright Express'  identifiable  assets included
unamortized goodwill of $27,395,000,  $28,451,000 and $28,739,000 as of December
31, 1995 and 1994 and  October  31,  1994,  respectively.  Operating  income for
SafeCard for the two months ended December 31, 1994 includes a pre-tax charge of
$65,500,000  for a  change  in  amortization  periods  for  deferred  subscriber
acquisition  costs.  Operating  revenue for the year ended  October 31, 1994 for
Corporate and Other includes a gain on litigation settlements of $4,257,000.

The Company does not earn material  amounts of revenue from sources  outside the
United States.


12.  Income Taxes

As discussed in Note 1, the Company  changed its method of accounting for income
taxes as of November 1, 1993. The components of the provision for (benefit from)
income taxes for the year ended December 31, 1995, the two months ended December
31, 1994 and the years ended October 31, 1994 and 1993 were as follows:
<TABLE>
<CAPTION>

                                                                             Two Months
                                                         Year Ended             Ended                     Year Ended
                                                        December 31,        December 31,                  October 31,
                                                            1995                1994               1994                1993
<S>                                                 <C>                 <C>                 <C>                <C>
                                                            ----                ----               ----                ----
Current
     Federal                                        $     (15,636,000)  $     (1,887,000)   $     13,032,000   $      15,608,000
     State                                                    (93,000)           (54,000)            272,000             101,000
                                                    -----------------   ----------------    ----------------   -----------------

         Total current                                    (15,729,000)        (1,941,000)         13,304,000          15,709,000
                                                    -----------------   ----------------    ----------------   -----------------

Deferred
     Federal                                              (11,530,000)       (23,815,000)         (7,640,000)         (3,588,000)
     State                                                   (542,000)          (319,000)            514,000          (1,153,000)
                                                    -----------------   ----------------    ----------------   -----------------

         Total deferred                                   (12,072,000)       (24,134,000)         (7,126,000)         (4,741,000)
                                                    -----------------   ----------------    ----------------   -----------------
</TABLE>

Total $  (27,801,000) $ (26,075,000) $ 6,178,000 $ 10,968,000 The following is a
reconciliation  of the statutory U.S.  federal income tax rate and the Company's
effective  income tax rate for the year ended  December 31, 1995, the two months
ended December 31, 1994 and the years ended October 31, 1994 and 1993:
<TABLE>
<CAPTION>

                                                                               Two Months
                                                             Year Ended           Ended                  Year Ended
                                                            December 31,       December 31,              October 31,
                                                                1995              1994             1994              1993
                                                                ----              ----             ----              ----
<S>                                                             <C>              <C>               <C>               <C>

Statutory federal income tax rate                               35.0%             35.0%            35.0%             34.8%
Increase (reduction) in tax rates
 resulting from:
   State income tax, net of federal benefit                                                         2.1               1.2
   Tax-exempt interest income                                   (1.7)              (.6)           (10.8)             (6.8)
   Amortization of non-deductible goodwill                        .5                .1
   Reversal of prior years' deferred taxes
    at the rates in effect at that time                                                                              (2.9)
   Other                                                         2.2             (.2)             (.8)              (.5)
                                                               -----           ------           -----             -----

Effective tax rate                                              36.0%             34.3%            25.5%             25.8%
                                                                ====              ====             ====              ====
</TABLE>


The components of the Company's deferred income tax assets and liabilities under
FAS 109 were as follows:
<TABLE>
<CAPTION>

                                                       December 31,        December 31,        October 31,         November 1,
<S>                                                 <C>                 <C>                 <C>                <C> 
                                                           1995                1994               1994                1993
Deferred tax liabilities:
   Subscriber acquisition costs                     $      47,255,000   $     45,915,000    $     71,585,000   $      68,391,000
   Depreciation                                             1,312,000            432,000             549,000             382,000
                                                    -----------------   ----------------    ----------------   -----------------

                                                           48,567,000         46,347,000          72,134,000          68,773,000
                                                    -----------------   ----------------    ----------------   -----------------
Deferred tax assets:
   Multi-year subscription revenues                        41,928,000         36,968,000          36,226,000          29,051,000
   Relocation expenses                                      3,439,000          3,606,000           3,749,000           3,736,000
   Product abandonment and
     related liabilities                                    8,005,000
   Net operating loss carryforwards                         1,347,000          1,474,000           8,217,000
   Reminder/reference subscription revenue                 (2,709,000)        (3,643,000)          1,195,000          (1,945,000)
   Other                                                    5,150,000          3,946,000           1,996,000           1,829,000
                                                    -----------------   ----------------    ----------------   -----------------

                                                           57,160,000         42,351,000          51,383,000          32,671,000
                                                    -----------------   ----------------    ----------------   -----------------

Net deferred tax (asset) liability                  $      (8,593,000)  $      3,996,000    $     20,751,000   $      36,102,000
                                                    =================   ================    ================   =================
</TABLE>



<PAGE>


The deferred income tax benefit for the year ended October 31, 1993 (under prior
accounting method) resulted from the following items:
<TABLE>
<CAPTION>

<S>                                                                     <C>

Subscriber costs, net                                                   $        450,000
Multi-year subscription revenues                                              (7,310,000)
Reminder/reference subscription revenue                                        1,952,000
Relocation expenses                                                              698,000
Other                                                                           (531,000)
                                                                        ----------------

                                                                        $     (4,741,000)
</TABLE>


At  December  31,  1995,  the  Company  had  $4,298,000  of net  operating  loss
carryforwards for tax purposes which, if unused, will expire in 2001.


13.  Common Stock And Stock Options

The following  table presents  information for the year ended December 31, 1995,
the two months ended  December 31, 1994 and the years ended October 31, 1994 and
1993 with respect to options granted and outstanding as follows:
<TABLE>
<CAPTION>

                                                                               Shares Under Option
                                                           Outstanding                                                   Outstanding
                                              Option      at beginning                                                    at end of
                                            Price Range     of period        Granted       Canceled       Exercised        period

<S>                                      <C>                <C>              <C>         <C>               <C>           <C>
----------------------------------------------------------------------------------------------------------------------------
Year ended October 31, 1993
1979 Plan                                      $ 5.875        141,040                                      (141,040)
Outside Directors' Options               $ 6.375-13.00        200,000        200,000                       (100,000)       300,000
1987 Plan                                      $ 5.875        348,100                                      (348,100)
1989 Executive Options                         $ 5.125        980,000                                      (230,000)       750,000
1989 Employee Stock Option Plan                 $ 6.00        361,004                        (5,333)       (102,671)       253,000
Peter & Steven J. Halmos                  $ 5.125-5.50      5,850,000                    (1,950,000)                     3,900,000
1991 Employee Stock Option Plan                 $ 9.00        138,000                       (24,333)        (38,334)        75,333
1992 Employee Stock Option Plan                $ 8.875                        75,000        (12,500)                        62,500
                                                      -----------------   ----------   ------------ -----------------  -----------
                                                            8,018,144        275,000     (1,992,166)       (960,145)     5,340,833
                                                            =========      =========     ==========      ==========      =========
----------------------------------------------------------------------------------------------------------------------------
Year ended October 31, 1994
Outside Directors' Options              $ 9.00 - 13.00        300,000                                                      300,000
1989 Executive Options                         $ 5.125        750,000                                      (750,000)
1989 Employee Stock Option Plan                 $ 6.00        253,000                                      (234,000)        19,000
Steven J. Halmos                          $ 5.125-5.50      3,900,000                                    (3,900,000)
1991 Employee Stock Option Plan                 $ 9.00         75,333                       (11,667)        (36,333)        27,333
1992 Employee Stock Option Plan                $ 8.875         62,500                       (13,335)        (14,164)        35,001
1994  Long-Term Stock-Based
  Incentive Plan                       $ 12.625-18.375                     2,315,000         (3,000)                     2,312,000
Employee Stock Option Plan                     $ 16.50                        42,700         (2,700)                        40,000
                                                      -----------------  -----------    ----------- ------------------ -----------
                                                            5,340,833      2,357,700        (30,702)     (4,934,497)     2,733,334
                                                            =========      =========     ==========      ==========      =========
----------------------------------------------------------------------------------------------------------------------------


<PAGE>


Two months ended December 31, 1994
Outside Directors' Options              $ 9.00 - 13.00        300,000                                                      300,000
1989 Employee Stock Option Plan                 $ 6.00         19,000                                                       19,000
1991 Employee Stock Option Plan                 $ 9.00         27,333                                                       27,333
1992 Employee Stock Option Plan                $ 8.875         35,001                                                       35,001
1994  Long-Term Stock-Based
  Incentive Plan                       $ 12.625-18.938      2,312,000        193,500                                     2,505,500
Employee Stock Option Plan                $16.50-17.50         40,000         21,500                                        61,500
                                                          -----------    -----------                                   -----------
                                                            2,733,334        215,000                                     2,948,334
                                                            =========     ==========                                     =========
----------------------------------------------------------------------------------------------------------------------------
Year ended December 31, 1995
Outside Directors' Options              $ 9.00 - 13.00        300,000                                                      300,000
1989 Employee Stock Option Plan                 $ 6.00         19,000                                       (19,000)
1991 Employee Stock Option Plan                 $ 9.00         27,333                        (1,667)        (17,333)         8,333
1992 Employee Stock Option Plan                $ 8.875         35,001                       (12,501)        (12,500)        10,000
1994  Long-Term Stock-Based
  Incentive Plan                       $ 7.625 - 20.75      2,505,500      1,049,200       (936,000)         (1,000)     2,617,700
Employee Stock Option Plan            $ 9.875 - 19.125         61,500         74,300        (27,500)                       108,300
Directors Stock Plan                           $15.875                        30,000                                        30,000
                                                      ----------------   --------------------------------------------- -----------
                                                            2,948,334      1,153,500       (977,668)        (49,833)     3,074,333
                                                            =========      =========    ===========     ===========      =========
</TABLE>

All options to purchase common shares are  exercisable and no additional  shares
are available for granting options under each plan except as noted below.

Of the options to purchase 2,617,700 shares outstanding under the 1994 Long-Term
Stock-Based  Incentive Plan (as amended,  the "1994 Plan"),  options to purchase
655,583  shares were  exercisable  at December  31, 1995. A portion of the stock
options outstanding under the 1994 Plan vest over time (becoming fully vested in
two or four years) beginning one year from the date of grant and a portion vests
based on certain stock price hurdles.  Of the options to purchase 108,300 shares
outstanding  under the Employee  Stock Option Plan,  options to purchase  48,600
shares were  exercisable  at December 31, 1995.  The options  under the Employee
Stock Option Plan vest one year from the date of grant.

Of the options to purchase 30,000 shares  outstanding  under the Directors Stock
Plan, none of the options were  exercisable at December 31, 1995.  Sixty percent
of the options,  which are granted  automatically upon a director's  election to
the Board,  vest over four years  beginning one year after the date of grant and
forty  percent  of the  options  vest  in  three  equal  installments  based  on
achievement of certain stock price hurdles.

In addition  to the  options  granted  under the 1994 Plan as  discussed  above,
15,450 shares of restricted  stock have been awarded under the 1994 Plan through
December 31,  1995.  Of the 15,450  shares of  restricted  stock issued  through
December 31, 1995, 12,450 shares are vested and 1,000 shares of restricted stock
were forfeited upon the grantee's termination of employment.

In connection  with the exercise of options to purchase  common  stock,  certain
employees  exchanged 94,332 and 18,134 shares of common stock in lieu of cash in
1994 and 1993,  respectively.  The exchanged shares are deducted from the number
of shares  issued upon the  exercise of employee  stock  options for purposes of
presentation in the consolidated statement of changes in stockholders' equity.


<PAGE>


The 1994 Plan was  approved by the  stockholders  at the 1994 Annual  Meeting of
Stockholders  held on March 7, 1994 and  amended at the 1995  Annual  Meeting of
Stockholders held on April 27, 1995. The 1994 Plan, as amended, provides for the
award of stock options,  stock appreciation rights and restricted stock covering
a maximum of  3,740,000  shares.  The  Directors  Stock Plan was approved by the
stockholders  at the 1995 Annual  Meeting of  Stockholders  and provides for the
automatic grant of an option to purchase  15,000 shares of the Company's  common
stock upon a director's  initial  election or  appointment  to the Board.  Up to
105,000 shares may be issued pursuant to the Directors Stock Plan.

All stock  options  granted  in 1995 and in prior  years,  except for the grants
under  the  Employee  Stock  Option  Plan,  were  administered  by the  Board of
Directors or a committee  thereof and had an exercise  price based on the market
price of the  Company's  common stock on the date of grant.  The Employee  Stock
Option Plan is  administered  by a  committee  of Company  officers  who are not
eligible to participate in this plan. As of December 31, 1995,  3,074,333 of the
shares held in treasury were reserved for the issuance of shares under the above
described stock options.


14.  Transactions with Related Parties

Until his resignation as Chief Executive  Officer and a director on December 19,
1992, Steven J. Halmos, SafeCard's co-founder, provided his services to SafeCard
through High Plains Capital Corporation ("HPCC"), a company owned by himself and
his brother, Peter Halmos, SafeCard's other co-founder.  After that date, Steven
J. Halmos,  acting in the capacity of an Advisor on  Marketing  and  Operational
Strategy, provided services directly to SafeCard pursuant to a written agreement
(as amended and restated as of April 1, 1993, the "Steven J. Halmos Agreement").
On May 26,  1994,  SafeCard  reached  a  settlement  with  Steven  J.  Halmos to
terminate the Steven J. Halmos  Agreement and various other  agreements  between
SafeCard and Mr. Halmos that provided for payments to Mr. Halmos of $2,000,000 a
year through March 31, 1998. The settlement,  which arose in connection with the
Company's  management  restructuring  in April 1994 and a resulting  decision to
cease using Mr. Halmos'  services,  resulted in a $4,400,000 cash payment to Mr.
Halmos and charge to 1994  earnings.  Subsequent to his  termination  Mr. Halmos
exercised  options to purchase  3,900,000  shares of the Company's common stock.
Stockholders' equity increased  $37,800,000  resulting from the exercise of such
options  and the  related  tax  benefit  (see  Note 13 - Common  Stock and Stock
Options). In 1993, SafeCard paid Steven J. Halmos (or HPCC for Steven J. Halmos'
services) a total of approximately $2,100,000.

In 1993,  SafeCard  also  entered  into an  agreement  that called for Steven J.
Halmos to sell the 1,645,760 shares of Company stock he owned at that time (this
representing approximately 6.2% of total outstanding shares at April 1, 1993) to
the Company as part of the Company's stock repurchase  program.  The shares were
acquired  by the  Company on April 21,  1993 for a price of $11.50 per share,  a
price equal to the average  trading price of the  Company's  common stock over a
specific period of days following public disclosure of the repurchase.


<PAGE>


SafeCard  markets its CreditLine  product  pursuant to an agreement (as amended,
the "CreditLine  Agreement") with CreditLine  Corporation ("CLC"), a corporation
owned by Steven J. Halmos and Peter Halmos,  SafeCard's  co-founders,  and their
families.  The  CreditLine  Agreement  grants  SafeCard an exclusive  license to
market  CreditLine  through  certain credit card issuers  (including all issuers
with which SafeCard has contractual relationships) and provides that profits and
losses,  if any, are shared  equally  between CLC and SafeCard.  Net  CreditLine
billings  to  subscribers   totaled   approximately   $30,710,000,   $7,000,000,
$22,900,000  and  $15,800,000  while  marketing and other  expenditures  totaled
$23,488,000, $3,060,000, $17,400,000 and $13,400,000 for the year ended December
31, 1995, the two months ended December 31, 1994 and the years ended October 31,
1994 and 1993, respectively. In June 1993, SafeCard was notified by CLC that the
CreditLine Agreement would not be renewed effective November 1, 1993.

Notwithstanding  its  termination,  the CreditLine  Agreement gives SafeCard the
perpetual right to continue to service  existing  CreditLine  subscribers and to
participate in the resulting income. In addition, an amendment to the CreditLine
Agreement  provides that SafeCard has the perpetual right to market  CreditLine,
and participate in the resulting income, through all of its existing card issuer
clients with which it either had a CreditLine marketing agreement on November 1,
1993 or entered  into such a  marketing  agreement  within the  following  three
years.  The  CreditLine  Agreement is the subject of  litigation as described in
Note 16 - Commitments and Contingencies.

In 1995, CreditLine and certain services marketed in conjunction with CreditLine
accounted for  approximately  $14,506,000 or 7.7% of the Company's  subscription
revenue and generated  approximately  $4,728,000 of pre-tax  income.  During the
Transition  Period,  CreditLine and related services accounted for approximately
$1,913,000  or  6.3%  of  the  Company's   subscription  revenue  and  generated
approximately  $702,000 of pre-tax income. In 1994, such services  accounted for
approximately  $9,100,000  or 5.3% of the  Company's  subscription  revenue  and
approximately $2,800,000 or 11.6% of the Company's pre-tax income. In 1993, such
services  accounted for approximately  $6,500,000 or 4.2% and $1,900,000 or 4.5%
of the Company's subscription revenue and pre-tax income, respectively.

The CreditLine  Agreement  provides for the creation of an escrow in the case of
certain disputes between the parties.  Effective  September 1993, SafeCard began
depositing CLC's share of CreditLine  profits into escrow.  Through December 31,
1995, SafeCard has also deposited  approximately  $4,265,000 of its share of the
CreditLine profits in an escrow account. The Company's cash and cash equivalents
include only SafeCard's share of the escrowed amounts.

SafeCard  made  payments  under  the  Ft.  Lauderdale  Lease  to  a  partnership
consisting  of Peter  Halmos and Steven J.  Halmos (the  "Halmos  Partnership").
Payments made to the Halmos  Partnership for the year ended October 31, 1993 for
the land and building, were approximately $700,000. No payments were made to the
Halmos  Partnership in 1994 or 1995.  SafeCard no longer occupies the operations
center and is no longer making payments on the Ft. Lauderdale Lease which is now
the subject of litigation (see Note 16 - Commitments and Contingencies).

In  October  1993,  the  Company   renewed  a  consulting   agreement  with  the
Dilenschneider  Group,  Inc.  ("DGI") to provide  public  relations  counsel and
advice to the Company in 1994 for an annual retainer of $180,000.  A director of
the Company is the majority owner and chief executive officer of DGI. In October
1994,  the Company  entered  into an agreement  with DGI for public  affairs and
public  relations  assistance  during 1995 for an annual  retainer of  $100,000.
These consulting arrangements have not been renewed for 1996.


<PAGE>


During 1994, DGI consulted on and assisted with investor relations for a monthly
fee of $12,500.  In addition,  another director of the Company provided investor
relations  consulting services to the Company during 1994 for a monthly retainer
of $4,167.  These consulting  arrangements were terminated effective October 31,
1994.

In September 1994, the Company  acquired Wright  Express.  The Company's  former
Chairman and Chief  Executive  Officer,  Paul G. Kahn,  was a director of Wright
Express prior to the acquisition.  During  negotiations  between the Company and
Wright  Express,  Mr.  Kahn did not attend any  meetings or  participate  in any
discussions  of the Board of  Directors  of Wright  Express and  abstained  from
voting on the acquisition by the Company's Board of Directors.


15.  Employee Benefit Plans

In June 1993, the Company  implemented a 401(k) and Profit-Sharing  Plan for its
employees  who are at least 20 years of age, have worked at least 1,000 hours in
the past year and have completed one year of service. The Company matches 50% of
each employee's  contribution,  up to a maximum of 6% of each employee's salary.
Company  contributions  vest at a rate of 20% per year after one year of service
while  participating  in the plan.  Continuation of, and  contributions  to, the
401(k) and Profit-Sharing  Plan are voluntary,  at the discretion of the Company
and are paid to each eligible  employee's  account.  The total expense  recorded
under the plan in 1995, the Transition  Period,  1994 and 1993 was approximately
$686,000, $16,000, $385,000 and $240,000, respectively.

Wright Express maintains a separate 401(k) and Profit-Sharing Plan that has been
modified to mirror the benefits and conditions of the Company's  plan. The total
expense  recorded  under  the  plan  in  1995  and  the  Transition  Period  was
approximately $5,000 and $1,000, respectively.

National Leisure Group maintains a separate 401(k) and  Profit-Sharing  Plan for
its employees  who are  considered  full-time  and have  completed six months of
service. National Leisure Group matches 25% of the each employee's contribution,
up  to a  maximum  of  4%  of  each  employee's  salary.  Continuation  of,  and
contributions  to, the plan are  voluntary,  at the discretion of management and
are paid to each eligible employee's  account.  The total expense recorded under
the plan in 1995 was approximately $30,000.


16. Commitments and Contingencies

Contracts
The Company has written  agreements with certain large credit card issuers which
account for a large percentage of its subscription  revenue.  Termination of any
of these contracts would adversely  affect the Company.  Contracts with Citibank
(South Dakota),  N.A. and related entities  contributed 22%, 24%, 26% and 30% of
the Company's  consolidated  revenue in 1995,  the Transition  Period,  1994 and
1993, respectively.  Citibank contributed 30%, 30%, 32% and 36% of the Company's
consolidated  membership and subscription  revenue during the same periods.  The
principal Citibank contract, as amended, expires December 31, 2000. Citibank has
a right to terminate  the contract in the event of the sale of a majority of the
shares of the  Company to  specified  credit  card  issuers,  to banks and their
corporate  affiliates  and to  entities  that do not  have  equity  of at  least
$25,000,000.


<PAGE>


Contracts  with Sears,  Roebuck  and Co.  contributed  approximately  10% to the
Company's  consolidated  revenue in 1995, the Transition Period,  1994 and 1993.
Sears contributed 13%, 12%, 13% and 12% of the Company's consolidated membership
and subscription  revenue during the same periods.  SafeCard has signed a letter
of intent for a new five-year  cooperative business relationship with Sears. The
new contract will be effective on January 1, 1996 and is expected to be executed
shortly.

Leases
The Company has entered into several  operating  leases for certain computer and
telephone  equipment  and  facilities  in the normal  course of  business.  Rent
expense for 1995, the Transition  Period and 1994 was  $5,535,000,  $452,000 and
$283,000,  respectively.  There was no material  rental  expense  for 1993.  The
following  is a  schedule  of future  minimum  rental  payments  required  under
operating  leases  having  initial or  remaining  non-cancelable  lease terms in
excess of one year at December 31, 1995:
<TABLE>
<S>                                         <C>                           <C>

                                            1996                          $    4,523,000
                                            1997                               4,329,000
                                            1998                               2,848,000
                                            1999                               1,448,000
                                            2000                                 784,000
                                            Thereafter                         2,241,000
                                                                          --------------

                                                                          $   16,173,000
</TABLE>

Legal Matters

The Company is defending or  prosecuting  claims in thirteen  complex  lawsuits,
twelve of which involve Peter Halmos, former Chairman of the Board and Executive
Management  Consultant  to  SafeCard,  and  various  parties  related  to him as
adversaries.  Peter  Halmos is also a  plaintiff  in three other  lawsuits,  one
against a former officer,  one against a director of the Company and one against
SafeCard's outside counsel,  in which neither SafeCard nor the Company have been
named as defendant.  The thirteen cases in which the Company or its subsidiaries
is a party are as follows:

     A suit  initiated by Peter Halmos,  related  entities,  and Myron Cherry (a
     former lawyer for  SafeCard) in April 1993 in Cook County  Circuit Court in
     Illinois against SafeCard and one of the Company's directors, purporting to
     state claims aggregating in excess of $100 million, principally relating to
     alleged  rights  to  "incentive   compensation,"  stock  options  or  their
     equivalent, indemnification,  wrongful termination and defamation. SafeCard
     and the director moved to dismiss this lawsuit. In November 1993, the court
     granted  the motions to dismiss  all parts of the  complaint,  but gave the
     plaintiffs leave to replead, which they did. Again in March 1994, the court
     granted the  motions to dismiss all of the  complaints  but  permitted  the
     plaintiffs to replead which they did in June 1994. On February 7, 1995, the
     court  dismissed with  prejudice  Peter Halmos'  claims  regarding  alleged
     rights to  "incentive  compensation,"  stock  options or their  equivalent,
     wrongful  termination and defamation.  Mr. Halmos has appealed this ruling;
     the initial brief, the answer brief and the reply brief have been filed. No
     date for oral  argument  has been set.  SafeCard has filed an answer to the
     remaining  indemnification  claims. Its obligation to file an answer to the
     claims of Myron Cherry have been stayed pending settlement discussions.


<PAGE>


     A suit by  Peter  Halmos,  purportedly  in the  name of  Halmos  Trading  &
     Investment  Company,  seeking  monetary  damages and  specific  performance
     against  SafeCard,  one of its  former  officers  and one of the  Company's
     directors in Circuit Court in Broward County,  Florida, making a variety of
     claims related to the contested lease of SafeCard's  former Ft.  Lauderdale
     headquarters.  SafeCard has vacated the building,  ceased  making  payments
     related to the Ft.  Lauderdale  lease and has filed  counterclaims.  In May
     1994, the court dismissed Peter Halmos' amended  counterclaim for breach of
     contract for indemnity and intentional infliction of emotional distress but
     gave leave to amend.  In June 1994,  Peter  Halmos  filed a second  amended
     counterclaim  purporting  to state  claims for  intentional  infliction  of
     emotional distress,  fraud and negligent  misrepresentation and declaratory
     judgment  based on alleged  breach of  contract  for  indemnity  or, in the
     alternative,  promissory  estoppel,  related  to  indemnification  of legal
     expenses in this  lawsuit.  In January  1995,  Peter  Halmos  filed a third
     amended  counterclaim  which was identical in all material  respects to the
     second amended counterclaim. On January 17, 1995, SafeCard filed its answer
     to the third amended counterclaim. On October 30, 1995, the court dismissed
     Peter Halmos' claims  against the Company for fraudulent  misrepresentation
     and specific  performance  and dismissed  all claims  against the Company's
     director.  Halmos also dismissed without  prejudice his emotional  distress
     claim, severed his indemnification claims and dismissed with predjudice his
     claim against the former  officer.  Trial of the lawsuit began February 26,
     1996.

     A suit which seeks monetary  damages and certain  equitable relief filed by
     SafeCard in August 1993 in Laramie County Circuit Court in Wyoming  against
     Peter Halmos and related entities  alleging that Peter Halmos dominated and
     controlled  SafeCard,  breached  his  fiduciary  duties  to  SafeCard,  and
     misappropriated  material  non-public  information  to make $48  million in
     profits on sales of SafeCard  stock.  In March 1994, Mr. Halmos and related
     entities  filed a  counterclaim  in which claims were made of conspiracy in
     restraint of trade,  monopolization  and attempted  monopolization,  unfair
     competition  and  restraint of trade,  breach of contract for indemnity and
     intentional  infliction of emotional  distress.  SafeCard's motion to sever
     the conspiracy, monopolization and restraint of trade claims was granted in
     May 1994. The claims for the conspiracy, monopolization, restraint of trade
     and unfair  competition were dismissed  without  prejudice in June 1994. On
     April 12,  1995,  the trial  court  granted  the  motion of Mr.  Halmos and
     certain  related  entities  to  amend  their  counterclaims.   The  amended
     counterclaims   include  claims  for  indemnification  for  legal  expenses
     incurred in the action and a claim that SafeCard's contract with CreditLine
     should be rescinded. On April 19, 1995, the trial court granted Mr. Halmos'
     motion for summary  judgment that certain of SafeCard's  claims against him
     were barred by the statute of  limitations.  On March 14, 1996, the Wyoming
     Supreme Court  reversed the trial court's ruling that certain of SafeCard's
     claims were barred by the statute of limitations.

     A suit seeking  monetary  damages by Peter Halmos,  purportedly in his name
     and  in  the  name  of  CreditLine  Corporation  and  Continuity  Marketing
     Corporation  against  SafeCard,  one  of  its  officers  and  three  of the
     Company's  directors  in  United  States  District  Court  in the  Southern
     District of Florida,  in September  1994  purporting  to state various tort
     claims,  state  and  federal  antitrust  claims  and  claims  of  copyright
     infringement.  The claims  principally  relate to the  allegation  by Peter
     Halmos and his companies that SafeCard has taken action to prevent him from
     being a successful  competitor.  On December 9, 1994, SafeCard, its officer
     and the Company's directors moved to dismiss the lawsuit. On March 8, 1995,
     the court granted Mr. Halmos' motion to file a second amended complaint. On
     March 28, 1995,  SafeCard,  its officer and the Company's  directors  again
     moved to dismiss the  lawsuit.  All  discovery  in the case has been stayed
     pending a ruling on the motion to dismiss.  On August 16, 1995,  the United
     States Magistrate Judge filed a Report and Recommendation  that the case be
     dismissed.  The parties have filed various briefs and memoranda in response
     to this Report. On January 4, 1996, the Magistrate  recommended ruling that
     the  statute of  limitations  was  tolled  during  pendency  of the case in
     federal  court  and  the  plaintiffs'   state  law  claims  were  thus  not
     time-barred. Defendants have filed an objection to this recommendation.
<PAGE>

     A suit seeking monetary  damages by Peter Halmos,  as trustee for the Peter
     A. Halmos revocable trust dated January 24, 1990 and the Halmos Foundation,
     Inc.,  individually and James L. Binder as custodian for Elizabeth  Binder;
     Edward Dubois; Sheila Ann Dubois, as personal  representative of the Estate
     of Winifred Dubois; G. Neal Goolsby,  John E. Masters,  individually and as
     custodian  for Gregory  Halmos and Nicholas  Halmos;  and J.B.  McKinney on
     behalf of themselves and all others similarly  situated  against  SafeCard,
     one of its officers,  one of its former officers and three of the Company's
     directors in the United States District Court for the Southern  District of
     Florida in December 1994.  This  litigation  involves  claims by a putative
     class of sellers of SafeCard  stock for the period January 11, 1993 through
     December  8,  1994  for  alleged  violations  of  the  federal  and  states
     securities  laws in  connection  with alleged  improprieties  in SafeCard's
     investor relations program.  The complaint also includes  individual claims
     made by Peter Halmos in connection with the sale of stock by the two trusts
     controlled  by him. The Complaint was amended on September 13, 1995 to join
     James L. Binder  individually  and as  custodian  for the James L.  Binder,
     D.D.S.,   P.C.  Profit  Sharing  Trust  II.  SafeCard  and  the  individual
     defendants have filed a motion to dismiss. There has been limited discovery
     on class  certification and  identification of "John Doe" defendant issues.
     The  Company  filed  its   opposition  to  the  pending  motion  for  class
     certification  on December  11,  1995.  Plaintiffs'  reply is due March 19,
     1996.

     A suit seeking monetary damages and injunctive relief by LifeFax,  Inc. and
     Continuity Marketing  Corporation,  companies affiliated with Peter Halmos,
     in the State  Circuit  Court in Palm  Beach  County,  Florida in April 1995
     against the Company,  Family Protection Network, Inc., SafeCard, one of the
     Company's directors and the Company's Chief Executive Officer purporting to
     state various statutory and tort claims.  The claims  principally relate to
     the allegation by these companies that SafeCard's Early Warning Service and
     Family  Protection  Network were  conceived  and  commercialized  by, among
     others,  Peter Halmos and have been improperly copied. An amended complaint
     filed on June 14, 1995  seeking  monetary  damages adds to the prior claims
     certain claims by Nicholas Rubino that principally relate to the allegation
     that  SafeCard's Pet  Registration  Product was conceived by Mr. Rubino and
     has been improperly copied. The Company and the individual defendants filed
     a motion to dismiss the amended complaint. A hearing was held on the motion
     to dismiss on October 13, 1995. On November 27, 1995,  the Court entered an
     Order  denying the  Company's  motion to dismiss.  On December 12, 1995 the
     defendants  filed  their  Answer and  Affirmative  Defenses  to the Amended
     Complaint. Preliminary discovery is proceeding.

     A suit seeking  monetary  damages and  declaratory  relief by Peter Halmos,
     individually  and as trustee for the Peter A. Halmos  Revocable Trust dated
     January 24, 1990 and by James B.  Chambers,  individually  and on behalf of
     himself and all others similarly  situated  against the Company,  SafeCard,
     each of the members of the Company's  Board of Directors,  three  non-board
     member  officers of the Company,  the Company's  outside auditor and one of
     the Company's  outside  counsel in the United States District Court for the
     Southern  District of Florida in June 1995. The litigation  involves claims
     by a putative class of purchasers of the Company stock between December 14,
     1994 and May 25,  1995 and on  behalf  of a  separate  class of all  record
     holders of SafeCard  stock as of April 27, 1995.  The putative class claims
     are for alleged  violations  of the federal  securities  laws,  for alleged
     breach of fiduciary duty and alleged  negligence in connection with certain
     matters  voted on at the Annual  Meeting of SafeCard  stockholders  held on
     April 27,  1995.  The Company and the  individual  defendants  have filed a
     motion to dismiss these claims.  There has been limited  discovery on class
     certification  issues.  The  Company  filed its  opposition  to the pending
     motion for class  certification on December 11, 1995.  Plaintiffs' reply is
     due March 19, 1996.


<PAGE>


     A purported  shareholder  derivative action initiated by Michael P. Pisano,
     on behalf of himself and other  stockholders  of SafeCard  and Ideon Group,
     Inc.  against  SafeCard,  Ideon Group Inc., two of their officers,  and the
     Company's  directors in United States District Court,  Southern District of
     Florida. This litigation involves claims that the officers and directors of
     SafeCard have  improperly  refused to accede Peter Halmos'  litigation  and
     indemnification demands against the Company. The Company and the individual
     defendants  have filed motions to dismiss the first amended  complaint.  On
     September  29, 1995,  Pisano filed a second  amended  complaint  which made
     additional  allegations  of waste and  mismanagement  against the Company's
     officers and directors in connection with the Family Protection Network and
     PGA Tour Partners products. On December 26, 1995, the Company filed motions
     to  dismiss  the  Second  Amended  Complaint  for:  (i)  failure to join an
     indispensable  party  (Halmos) and failure to allege demand on the Board of
     Directors with particularity; and (ii) the failure of Pisano to comply with
     the fairness and adequacy  requirements  of Federal Rule of Civil Procedure
     23.1. On January 25, 1996,  the plaintiff  filed a memorandum in opposition
     to motion to dismiss.  The  Company  filed its reply to the  memorandum  in
     opposition on February 23, 1996.

     A suit seeking monetary damages filed by Peter Halmos against SafeCard, one
     of its directors,  its former general counsel, and its legal counsel in the
     Circuit Court,  Fifteenth  Judicial Circuit,  in and for Palm Beach County,
     Florida on August 10, 1995. This litigation involves claims by Peter Halmos
     for breach of fiduciary duty and constructive  fraud,  fraud, and negligent
     misrepresentation and is based on allegations arising out of the resolution
     of a shareholder  class action  lawsuit in 1991 and  SafeCard's  subsequent
     filing of an action against Halmos and his related  companies in Wyoming in
     1993.  Safe-Card  has  filed a motion  to  dismiss  which  has been set for
     hearing on March 29, 1996.

     A suit by Lois  Hekker  on  behalf  of  herself  and all  others  similarly
     situated  seeking monetary damages against the Company and its former Chief
     Executive  Officer  in the  United  States  District  Court for the  Middle
     District of Florida on July 28, 1995. The litigation  involves  claims by a
     putative  class of purchasers  of the Company's  stock for the period April
     25,  1995  through  May 25,  1995  for  alleged  violation  of the  federal
     securities  laws in  connection  with  statements  made about the Company's
     business and financial performance. Defendants filed a motion to dismiss on
     October 2, 1995. On January 3, 1996, the court stayed all merits  discovery
     pending rulings on the motion to dismiss and on the plaintiff's  motion for
     class certification.

     A  declaratory  judgment  action by the Company and its  directors  against
     Peter Halmos in Delaware  Chancery  Court,  New Castle County.  This action
     seeks  a  declaration  regarding  the  Company's  advance   indemnification
     obligations,  if any,  to  Peter  Halmos  who  has  made  numerous  advance
     indemnification  demands  on  the  Company  in  connection  with  his  many
     lawsuits.  Halmos  filed a motion to dismiss on  jurisdictional  grounds on
     November 17, 1995.  The Company filed a brief in opposition  and an amended
     complaint on February 14, 1996. Defendant's response is due March 21, 1996.

     A suit by High Plains Capital  Corporation  against the Company,  SafeCard,
     two of its directors and The Dilenschneider Group, Inc. in Circuit Court in
     Palm Beach County,  Florida. This litigation involves claims by High Plains
     Capital  Corporation,  a corporation with which Peter Halmos is affiliated,
     for certain incentive  compensation arising out of Halmos' affiliation with
     SafeCard.  The Complaint  includes claims for breach of written  agreements
     regarding  additional  services  and  expenses,  an  alternative  claim for
     quantum  meruit  based  on  written  agreement  and a  count  for  tortious
     interference with advantageous business relationship. The Complaint appears
     to attempt  to revive the  incentive  compensation  claims  which have been
     dismissed  with  prejudice in Illinois.  On November 30, 1995,  the Company
     filed a motion  to  strike,  motion to  dismiss  and  motion  to  transfer.
     Hearings  have been set on the motion to dismiss on March 29, 1996,  and on
     the motion to strike on April 4, 1996.


<PAGE>


     A suit filed by High  Plains  Capital  Corporation  against the Company and
     SafeCard  in Circuit  Court in Broward  County,  Florida.  This  litigation
     involves  claims by High Plains  Capital  Corporation,  a corporation  with
     which Peter  Halmos is  affiliated,  for alleged  breach of oral  contract,
     alleged   violation  of  Florida's   Uniform  Trade  Secrets  Act,  alleged
     misappropriation  of trade secrets and for declaration that certain alleged
     trade  secrets are the  property of High Plains  Capital  Corporation.  The
     Company filed motions to dismiss and to transfer on December 15, 1995.

The  Company is  involved  in certain  other  claims and  litigation,  including
various employment related claims,  arising from the ordinary course of business
and which are not considered material to the operations of the Company.

The Company  believes that it has proper and meritorious  claims and defenses in
these lawsuits which it intends to vigorously  pursue.  Resolution of any or all
of these  litigation  matters could have a material impact (either  favorable or
unfavorable depending on the outcome) upon the Company's  operations,  liquidity
and financial condition.



<PAGE>


17.  Statement Of Cash Flows

The following is a  reconciliation  of net income (loss) to net cash provided by
(used in) operating activities:
<TABLE>
<CAPTION>
                                                                        Two Months
                                                      Year Ended           Ended            
                                                     December 31,      December 31,              Year Ended October 31,
                                                         1995              1994                1994                1993
                                                         ----              ----                ----                ----
<S>                                              <C>               <C>                 <C>                 <C>

Net (loss) income                                $    (49,441,000) $     (49,944,000)  $      20,021,000   $     31,477,000
Adjustments to reconcile net
 (loss) income to net cash (used in)
 provided by operating activities:
   Depreciation and amortization                        6,157,000            723,000           1,349,000            864,000
   Cumulative effect of change
     in accounting for income taxes                                                           (2,000,000)
   Amortization of investment
     premiums/discounts, net                            1,701,000            802,000           5,281,000          5,233,000
   Realized (gain) loss on sales of
      securities available for sale                    (1,094,000)            97,000            (593,000)        (1,277,000)
   Unrealized loss on marketable
     securities                                                            1,943,000
   Loss on impairment of assets                         7,569,000
   Income tax (benefit) provision                     (27,801,000)       (26,075,000)          6,178,000         10,968,000
   Income tax (refunds) payments, net                  11,047,000             (7,000)          3,237,000        (16,161,000)
   Billings to subscribers, net                       185,297,000         43,886,000         189,925,000        173,769,000
   Amortization of subscribers' advance
     payments to revenue                             (187,758,000)       (30,375,000)       (173,434,000)      (156,600,000)
   Effect of change in amortization
     periods for deferred subscriber
     acquisition costs                                                    65,500,000
   Expenditures for subscriber
     acquisition costs                                (68,948,000)        (8,792,000)        (68,029,000)       (63,717,000)
   Payment of commissions, net                        (51,566,000)       (11,794,000)        (52,412,000)       (49,511,000)
   Amortization of subscriber
     acquisition costs                                 67,799,000         10,001,000          56,236,000         51,075,000
   Amortization of commissions                         53,079,000          8,565,000          49,745,000         44,173,000
   Increase (decrease) in allowance
     for cancellations                                    351,000          1,541,000          (1,237,000)         1,306,000
   Changes in assets and liabilities, net
     of effects of business acquisitions:
       Receivables, net                               (12,321,000)       (15,888,000)          4,070,000           (877,000)
       Other current assets                               117,000
       Other assets                                    (6,076,000)        (3,020,000)         (1,137,000)           582,000
       Accounts payable and
         accrued expenses                              (4,427,000)         8,085,000           9,846,000         (2,459,000)
       Product abandonment and related
       liabilities                                     20,796,000
                                                 ----------------     --------------      ---------------   ---------------

Net cash (used in) provided by
   operating activities                          $    (55,519,000) $      (4,752,000)  $      47,046,000   $     28,845,000
                                                 ================  =================   =================   ================
</TABLE>


<PAGE>


18.  Unaudited Quarterly Financial Data
<TABLE>
<CAPTION>

                                                                               Quarters Ended
1995                                                March 31            June 30          September 30         December 31
----                                                --------            -------          ------------         -----------
<S>                                              <C>               <C>                 <C>                 <C>

Operating revenue                                $    59,728,000   $     57,732,000    $     57,543,000    $    58,965,000
Operating income (loss)                                  429,000        (72,881,000)        (12,152,000)         7,362,000
Net income (loss) (A)                                    301,000        (46,670,000)         (7,778,000)         4,706,000
Net income (loss) per share (A)                  $           .01   $          (1.62)   $          (.28)    $           .17
Weighted average number of common
   and common equivalent shares                       29,870,000         28,860,000          28,222,000         27,986,000
Subscribers at period end                             13,024,000         13,139,000          13,174,000         13,172,000

                                                                                                              Two Months
                                                                                                                 Ended
Transition Period - 1994                                                                                      December 31
------------------------                                                                                      -----------

Operating revenue                                                                                          $    34,698,000
Operating income (loss)                                                                                        (76,019,000)
Net income (loss) (B)                                                                                          (49,944,000)
Net income (loss) per share (B)                                                                            $         (1.70)
Weighted average number of common
   and common equivalent shares                                                                                 29,297,000
Subscribers at period end                                                                                       13,046,000

                                                                               Quarters Ended
1994                                               January 31          April 30             July 31           October 31
----                                               ----------          --------             -------           ----------

Operating revenue                                $    43,694,000   $     49,313,000    $     46,415,000    $    49,664,000
Operating income (loss)                                9,153,000          5,260,000           8,278,000          1,508,000
Net income (loss) (C)                                  8,444,000          3,804,000           6,635,000          1,138,000
Income (loss) per share before
   cumulative effect of change
   in accounting for income taxes                $           .24   $            .14    $           .23     $           .04
Net income (loss) per share (C)                  $           .31   $            .14    $           .23     $           .04
Weighted average number of common
   and common equivalent shares                       27,608,000         27,761,000          28,768,000         29,229,000
Subscribers at period end                             12,229,000         12,635,000          12,876,000         13,105,000
</TABLE>

(A)  During the second and third quarters of 1995, the Company  recorded pre-tax
     product   abandonment   and   restructuring   charges  of  $34,156,000  and
     $10,861,000,  respectively,  related  to the  abandonment  of  certain  new
     product  developmental efforts and the related impairment of certain assets
     and the restructuring of SafeCard and the corporate infrastructure.  During
     the fourth quarter of 1995, the Company recovered  $1,200,000 relating to a
     deposit  previously  written  off in  connection  with the  second  quarter
     product abandonment.

(B)  During the  Transition  Period,  the Company  recorded a pre-tax  charge of
     $65,500,000  related  to  the  change  in  the  amortization   periods  for
     subscriber acquisition costs.

(C)  The first quarter of 1994 includes a $2,000,000  ($.07 per share)  positive
     effect on net earnings from a change in the Company's  method of accounting
     for income taxes.


<PAGE>


---------------------------------------------------------------
Item 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
           ON ACCOUNTING AND FINANCIAL DISCLOSURE
---------------------------------------------------------------

    NONE

                                    PART III

Item 10.      DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         The  information  called for by this item with regard to Directors  and
Executive  Officers who are also Directors is  incorporated  by reference to the
Company's definitive proxy statement which is to be filed pursuant to Regulation
14A under the Securities  Exchange Act of 1934 in connection  with the Company's
Annual Meeting of Stockholders.  See Part I Executive Officers of the Registrant
for information on executive officers of the Company. The information called for
in this  item  regarding  disclosure  of  delinquent  Form 3, 4 or 5  filers  is
incorporated by reference to the Company's  definitive  proxy statement which is
to be filed pursuant to Regulation 14A under the Securities Exchange Act of 1934
in connection with the Company's Annual Meeting of Stockholders.

Item 11.      EXECUTIVE COMPENSATION

    The information  called for by this item is incorporated by reference to the
Company's definitive proxy statement which is to be filed pursuant to Regulation
14A under the Securities  Exchange Act of 1934 in connection  with the Company's
Annual Meeting of Stockholders.


Item 12.      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

    The information  called for by this item is incorporated by reference to the
Company's definitive proxy statement which is to be filed pursuant to Regulation
14A under the Securities  Exchange Act of 1934 in connection  with the Company's
Annual Meeting of Stockholders.


Item 13.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

    The information  called for by this item is incorporated by reference to the
Company's definitive proxy statement which is to be filed pursuant to Regulation
14A under the Securities  Exchange Act of 1934 in connection  with the Company's
Annual Meeting of Stockholders.





<PAGE>


                                                       PART IV

Item 14.      EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

    Certain of the  agreements  listed below are the subject of litigation  with
Peter Halmos and parties related to him.

(a)1.      Financial Statements

           The Consolidated  Financial  Statements and Notes thereto required by
           Item 8 are  listed  in the  Index  set  forth  in Item  8.  Financial
           Statements and Supplementary Data.

(a)2.      Financial Statement Schedules

           The Financial  Statement  Schedules  required by Item 8 are listed in
           the Index set forth in Item 8. Financial Statements and Supplementary
           Data.

(a)3.      Exhibits

           2         Plan of Reorganization  and Agreement of Merger dated as of
                     January 23, 1995 between  SafeCard,  Ideon and Ideon Merger
                     Company,   incorporated  by  reference  to  Appendix  A  of
                     SafeCard's  1995  definitive   proxy  statement  which  was
                     included in Ideon Registration  Statement for Form S-4 (No.
                     33-58273) filed as of March 28, 1995 ("Ideon's S-4").

           3(a)       Ideon's Amended and Restated Certificate of Incorporation,
                      incorporated by reference to Appendix B of SafeCard's 1995
                      definitive  proxy  statement which was included in Ideon's
                      S-4.

           3(b)       Certificate  of Amendment of Ideon's  Amended and Restated
                      Certificate of Incorporation, incorporated by reference to
                      Exhibit 3(b) of Ideon's Registration Statement on Form 8-B
                      filed in May 5, 1995.

           3(c)       Ideon's  By-Laws,  incorporated by reference to Appendix B
                      of SafeCard's  1995  definitive  proxy statement which was
                      included in Ideon's S-4.


                      Management Contracts and Compensatory Plans

           10(a)      Form of Non-Qualified  Stock Option Agreement dated August
                      30,  1989  with  an  outside  director,   incorporated  by
                      reference to Exhibit 10(a) of SafeCard's  Quarterly Report
                      on Form 10-Q for its fiscal quarter ended July 31, 1989.

           10(b)      Form of Non-Qualified Stock Option Agreement dated October
                      16,  1991  with  an  outside  director,   incorporated  by
                      reference to Exhibit 10(n) of SafeCard's  Annual Report on
                      Form 10-K for its fiscal year ended October 31, 1991.

           10(c)      Form of  Non-Qualified  1991  Employee  Stock  Option Plan
                      dated   October  16,  1991  with  twenty  key   employees,
                      incorporated   by  reference  to  Exhibit   10(o)  of  the
                      SafeCard's  Annual Report on Form 10-K for its fiscal year
                      ended October 31, 1991.
<PAGE>

           10(d)      Board of  Directors'  Resolution  dated  December  6, 1991
                      establishing  a  non-employee  director  retirement  plan,
                      incorporated  by reference to Exhibit  10(s) of SafeCard's
                      Annual  Report  on Form  10-K for its  fiscal  year  ended
                      October 31, 1991.

           10(e)      Indemnification   Agreements  for  certain  of  SafeCard's
                      Directors dated October 2, 1992, incorporated by reference
                      to Exhibit 10(x) to SafeCard's  Annual Report on Form 10-K
                      for its fiscal year ended October 31, 1992.

           10(f)      Indemnification Agreements for two of SafeCard's Directors
                      dated   February   11,   1993  and   September   1,  1993,
                      incorporated  by reference to Exhibit 10(ai) of SafeCard's
                      Annual  Report  on Form  10-K for its  fiscal  year  ended
                      October 31, 1993.

           10(g)      Forms  of  Non-Qualified  Stock  Option  Agreements  dated
                      February  11, 1993 and  September 1, 1993 with two outside
                      directors,  incorporated by reference to Exhibit 10(aj) of
                      SafeCard's  Annual Report on Form 10-K for its fiscal year
                      ended October 31, 1993.

          10(h)       1994 Long Term  Stock-Based  Incentive Plan,  incorporated
                     by reference to SafeCard's 1993 definitive proxy statement.

           10(i)      Second   Amendment  to  the  1994  Long  Term  Stock-Based
                      Incentive Plan, incorporated by reference to Exhibit 10(i)
                      of  SafeCard's  Annual  Report on Form 10-K for its fiscal
                      year ended October 31, 1994.

           10(j)      Employment  Agreement,  effective  as of December 1, 1993,
                      with Paul G. Kahn,  incorporated by reference to Exhibit 1
                      of SafeCard's Current Report on Form 8-K filed on December
                      6, 1993.

           10(k)      Employment  Agreement,  effective  as of February 1, 1994,
                      with  Francis J.  Marino,  incorporated  by  reference  to
                      SafeCard's  Quarterly  Report on Form 10-Q for the  fiscal
                      quarter ended January 31, 1994.

           10(l)      Amendment  to  Exhibit  3  of  the  Employment  Agreement,
                      effective as of February 1, 1994,  with Francis J. Marino,
                      incorporated  by reference to Exhibit  10(l) to SafeCard's
                      Annual  Report  on Form  10-K for the  fiscal  year  ended
                      October 31, 1994.

           10(m)      Employment  Agreement  as of May 2, 1994,  with G.  Thomas
                      Frankland,  incorporated  by reference to Exhibit 10(a) of
                      SafeCard's  Quarterly  Report for its fiscal quarter ended
                      April 30, 1994.

           10(n)      Amendment  to  Exhibit  3  of  the  Employment  Agreement,
                      effective  as of May 2, 1994,  with G.  Thomas  Frankland,
                      incorporated  by reference to Exhibit  10(n) of SafeCard's
                      Annual Report for the fiscal year ended October 31, 1994.

           10(o)      Indemnification  Agreement  as of April 7, 1994,  with one
                      outside  director,  incorporated  by  reference to Exhibit
                      10(b)  of  SafeCard's  Quarterly  Report  for  its  fiscal
                      quarter ended April 30, 1994.
<PAGE>

           10(p)      Non-Qualified  Stock Option Agreement as of April 7, 1994,
                      with  outside  director,   incorporated  by  reference  to
                      Exhibit  10(c)  of  SafeCard's  Quarterly  Report  for its
                      fiscal quarter ended April 30, 1994.

           10(q)      Employment Agreement,  effective as of September 14, 1994,
                      with John R. Birk,  incorporated  by  reference to Exhibit
                      10(q) of  SafeCard's  Annual  Report  on Form 10-K for the
                      fiscal year ended October 31, 1994.

           10(r)      Amendment,  effective as of January 1, 1995, to Employment
                      Agreement, with John R. Birk, incorporated by reference to
                      Exhibit 10(r) of SafeCard's Annual Report on Form 10-K for
                      the fiscal year ended October 31, 1994.

           10(s)      Form of Assignment and Amendment of Employment  Agreement,
                      incorporated by reference to Exhibit 10(s)of Ideon's 
                      Registration Statement on  Form 8-B filed on May 5, 1995.

           10(t)      Executive  Deferred  Compensation  Plan,  incorporated  by
                      reference to Exhibit 10(s) of SafeCard's  Annual Report on
                      Form 10-K for the year ended October 31, 1994.

           10(u)      Amendment of Executive  Deferred  Compensation  Plan,  
                      incorporated  by reference to Exhibit  10(u) of Ideon's
                      Registration Statement on  Form 8-B filed on May 5, 1995.

           10(v)      Form of Executive  Agreement with certain senior officers,
                      incorporated  by reference to Exhibit  10(t) of SafeCard's
                      Annual  Report  on Form  10-K for the  fiscal  year  ended
                      October 31, 1994.

           10(w)      Form of Amendment and Assignment of Executive  Agreement,
                      incorporated  by reference to Exhibit 10(w)of Ideon's 
                      Registration Statement on Form 8-B filed May 5, 1995.

           10(x)      Form of  Non-Qualified  Stock Option  Agreement  under the
                      1994 Long Term  Stock-Based  Incentive  Plan with  certain
                      officers,  incorporated  by reference to Exhibit  10(u) of
                      SafeCard's  Annual Report on Form 10-K for the fiscal year
                      ended October 31, 1994.

           10(y)      Board of  Directors'  resolution  dated  January 24, 1995,
                      reducing   benefit   under   the   non-employee   director
                      retirement  plan,  incorporated  by  reference  to Exhibit
                      10(v) of Ideon's Form S-4.

           10(z)      Form of  Indemnification  Agreement  with certain  outside
                      directors,  incorporated  by reference to Exhibit 10(w) of
                      Ideon's Form S-4.

           10(aa)     Form  of  Amendment  and  Assignment  of   Indemnification
                      Agreement with certain outside directors,  incorporated by
                      reference  to Ideon's  Registration  Statement on Form 8-B
                      filed on May 5, 1995.

           10(ab)     Directors'  Deferral  Plan,  incorporated  by reference to
                      Ideon's  Quarterly  Report  on Form  10-Q  for the  fiscal
                      quarter ended March 31, 1995.
<PAGE>

           10(ac)     Directors'  Stock Plan,  incorporated by reference to 
                      Appendix D of SafeCard's  1995 definitive  proxy
                      statement which was included in Ideon's Form S-4.

           10(ad)     Termination  Agreement  dated as of May 26,  1994  between
                      SafeCard and Steven J. Halmos and Recission Agreement made
                      and entered into as of June 9, 1994  between  SafeCard and
                      Steven J.  Halmos,  incorporated  by  reference to Exhibit
                      10(e) from  SafeCard's  Quarterly  Report on Form 10-Q for
                      the fiscal quarter ended July 31, 1994.

           10(ae)     Agreement with Citicorp  (South Dakota),  N.A.,  effective
                      January  1, 1995,  incorporated  by  reference  to Exhibit
                      10(g) of  Ideon's  Quarterly  Report  on Form 10-Q for the
                      fiscal quarter ended June 30, 1995.

           10(af)     Agreement  with  Peter  Halmos,  dated  November  1, 1988,
                      regarding  a  marketing  license  for  credit  information
                      services,  incorporated  by reference to Exhibit  10(e) of
                      SafeCard's Annual Report on Form 10-K, for its fiscal year
                      ended October 31, 1988.

           10(ag)     First  Amendment  to  Agreement,  dated  January 25, 1991,
                      regarding   marketing   license  for  credit   information
                      services,  incorporated  by reference to Exhibit  10(m) of
                      SafeCard's  Annual Report on Form 10-K for its fiscal year
                      ended October 31, 1990.

           10(ah)     Letter   Agreement   dated   January  27,  1992,   between
                      CreditLine  Corporation  and the Company,  incorporated by
                      reference to Exhibit 10(q) of SafeCard's  Annual Report on
                      Form 10-K for its fiscal year ended October 31, 1991.

           10(ai)     Confirmation  Agreement between Peter Halmos,  High Plains
                      Capital Corporation,  CreditLine  Corporation and SafeCard
                      dated  January 27,  1992,  incorporated  by  reference  to
                      Exhibit 10(r) of SafeCard's Annual Report on Form 10-K for
                      its fiscal year ended October 31, 1991.

           10(aj)     Public  Relations  Consulting  Agreement dated October 25,
                      1994  between  the  Dilenschneider  Group,  Inc.  and  the
                      Company,  incorporated  by reference to Exhibit  10(ad) of
                      SafeCard's  Annual Report on Form 10-K for its fiscal year
                      ended October 31, 1994.

           10(ak)     Special  Projects Public  Relations  Consulting  Agreement
                      dated  December  14,  1994  between  the  Company  and the
                      Dilenschneider  Group, Inc.,  incorporated by reference to
                      Exhibit  10(ae) of  SafeCard's  Annual Report on Form 10-K
                      for its fiscal year ended December 31, 1994.
 .
           11(a)      Computation of Primary Earnings Per Share.

           11(b)      Computation of Fully Diluted Earnings Per Share.

           21         Subsidiaries of the Registrant.

           23         Consent of  Independent  Accountants to  incorporation  by
                      reference  of their  report in  Prospectuses  constituting
                      part of Registration Statements on Forms S-3 and S-8.

           24         Powers of Attorney.
<PAGE>

           27         Financial Data Schedule


(b) Reports on Form 8-K

           None


<PAGE>


--------------------------------------------------------------------------
                                      SAFECARD SERVICES, INC. AND SUBSIDIARIES
--------------- ----------------------------------------------------------
<TABLE>
<CAPTION>
                                                    SCHEDULE VIII
                                          VALUATION AND QUALIFYING ACCOUNTS


                                                                    Additions
                                              Balance       Charged to      Charged to                          Balance  
                                            at beginning    costs and         other                            at end of
Description                                  of period      expenses         accounts       Deductions           period
 Reserves deducted from assets to
   which they apply:
<S>                                         <C>            <C>              <C>              <C>            <C>

Year ended December 31, 1995:
 Accounts receivable                       $ 1,744,000    $ 1,151,000       $ 90,000 a       $ (990,000)f   $ 1,995,000
 Deferred commissions                          297,000                                                          297,000
 Allowance for cancellations                 9,197,000                    40,821,000 g      (40,470,000)h     9,548,000
 Product abandonment and                                   36,248,000 b                     (15,452,000)     20,796,000
   restructuring liabilities
 Product abandonment and
   restructuring asset impairments                          8,769,000 b                      (8,769,000)

 Two months ended December 31, 1994:
 Accounts receivable                       $ 1,595,000    $   232,000                       $    83,000 f   $ 1,744,000
 Deferred commissions                          297,000                                                          297,000
 Allowance for cancellations                 7,656,000                      9,327,000 g      (7,786,000) h    9,197,000
 Unrealized loss on securities
   available for sale                          607,000                                         (607,000) c

 Year ended October 31, 1994:
------------------------------
 Accounts receivable                       $   150,000    $   307,000      $1,138,000 d                      $ 1,595,000
 Deferred commissions                          297,000                                                           297,000
 Allowance for cancellations                 8,893,000                     37,810,000 g   $ (39,047,000) h     7,656,000
                                                                                  

 Unrealized loss on securities
   available for sale                                                         607,000 e                  c       607,000

Year ended October 31, 1993:
----------------------------

                                                                                     
 Accounts receivable                        $  350,000                                      $  (200,000) f    $  150,000
 Deferred commissions                          347,000                                          (50,000) f       297,000
 Allowance for cancellations                 7,587,000                   $ 35,529,000 g     (34,223,000) h     8,893,000
</TABLE>


 (a) Balance recorded in the acquisition of National Leisure Group, Inc.
 (b)  Charges  recorded  as part of the  Company's  failed  product  development
     efforts and the restructuring of certain SafeCard and corporate functions.
 (c) Amount included as part of the $1,943,000 permanent impairment of
      securities available for sale.
 (d) Balance recorded in the acquisition of Wright Express.
 (e) Adjustment to record securities available for sale portfolio at market
      value in accordance with FAS 115.
 (f) Reversal of uncollectible accounts receivable or commissions reserves.
 (g) Charged to balance sheet accounts "Deferred subscriber acquisition  
     commission" and "Subscriber advance payments."
 (h) Charges for refunds upon subscriber cancellations.
 (i) Uncollectible accounts receivable or commissions written-off.




<PAGE>


----------------------------------------------------------------------------
                                                     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.
                                            IDEON GROUP, INC.

                                            By: /s/ Eugene Miller
                                            Eugene Miller
                                            Chairman and Chief Executive Officer
March 20, 1996

         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
Registrant and in the capacities and on the dates indicated.

Date                Signature                                        Title

March 20, 1996      /s/ Eugene Miller              Director, Chairman and Chief
                   -----------------------------
                   Eugene Miller                   Executive Officer

March 20, 1996          *                          Director
                   ------------------------------
                   William T. Bacon, Jr.

March 20, 1996          *                          Director
                   -------------------------------
                   Marshall L. Burman

March 20, 1996          *                          Director
                   --------------------------------
                   John Ellis Bush

March 20, 1996          *                          Director
                   --------------------------------
                   Robert L. Dilenschneider

March 20, 1996          *                          Director
                   --------------------------------
                   Adam W. Herbert, Jr., Ph.D.

March 20, 1996                                     Director
                   -------------------------------
                   Paul G. Kahn

March 20, 1996          *                          Director
                   -------------------------------
                   Thomas F. Petway, III

March 20, 1996      /s/ G. Thomas Frankland        Vice Chairman and Chief
                                                     Financial Officer
                    G. Thomas Frankland           (Principal  Financial and
                                                     Accounting Officer)


March 20, 1996      /s/ G. Thomas Frankland
                    -----------------------
                    G. Thomas Frankland
                       * Attorney in Fact

      By signing his name hereto, G. Thomas  Frankland,  does sign this document
on behalf of each of the persons  indicated  by an asterisk  above,  pursuant to
Powers of Attorney duly  executed by such persons and filed with the  Securities
and Exchange Commission herewith.

<PAGE>


---------------------------------------------------------------------------
                                  Exhibit Index
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S>    <C>                                                           <C>

Exhibit                                                              Page Numbers                                                  

2         Plan of  Reorganization  and Agreement of Merger           Incorporated by reference to Appendix A of SafeCard's 1995 
          dated as of January 23, 1995, between SafeCard,            definitive proxy statement which was included in Ideon 
          Ideon and Ideon Merger Company.                            Registration Statement on Form S-4 (No. 33-58273) filed as
                                                                     of March 28, 1995 (Ideon's S4).

3(a)      Ideon's Amended and Restated Certificate                   Incorporated by reference to Appendix B of SafeCard's
          of Incorporation.                                          1995 definitive proxy statement which was included
                                                                     in Ideon's S-4.
                                                                              .
3(b)      Certificate of Amendment of Ideon's                        Incorporated by reference to Exhibit 3(b) of Ideon's
          Amended and Restated Incorporation.                        Registration Statement on Form 8-B filed on May 5, 1995.

3(c)      Ideon's By-Laws                                            Incorporated  by  reference  to Appendix B of SafeCard's
                                                                     1995 definitive proxy statement which was included in
                                                                     Ideon's S-4.
Management Contracts and Compensatory Plans

10(a)     Form of Non-Qualified Stock Option Agreement               Incorporated by reference to Exhibit 10(a) with SafeCard's 
          dated August 30, 1989, with an outside director.           Quarterly Report on Form 10-Q for its fiscal quarter ended
                                                                     July 31, 1989. 
                        
10(b)     Form  of  Non-Qualified   Stock  Option  Agreement  dated  Incorporated  by reference to Exhibit 10(n) of SafeCard's
          October 16, 1991 with  an outside director.                Annual  Report on Form  10-K for its  fiscal  year  ended
                                                                     October 31, 1991.

10(c)     Form of Non-Qualified  1991 Employee Stock Option Plan     Incorporated by reference to Exhibit 10(o) of SafeCard's  
          dated October 16, 1991 between SafeCard with twenty        Annual Report on Form 10-K for its fiscal year ended 
          key employees.                                             October 31, 1991. 

10(d)     Board of  Directors'  Resolution  dated  December 6, 1991  Incorporated  by reference to Exhibit 10(s) of SafeCard's
          establishing a non-employee director retirement plan.      Annual  Report on Form  10-K for its  fiscal  year  ended
                                                                     October 31, 1991.

10(e)     Indemnification  Agreements for certain  Directors  dated  Incorporated  by reference to Exhibit 10(x) to SafeCard's
          October 2, 1992.                                           Annual  Report on Form  10-K for its  fiscal  year  ended
                                                                     October 31, 1992.

10(f)     Indemnification   Agreements   for   two  of   SafeCard's  Incorporated   by   reference   to   Exhibit   10(ai)  of
          Directors dated February 11, 1993 and September 1, 1993.   SafeCard's  Annual  Report  on Form  10-K for its  fiscal
                                                                     year ended October 31, 1993.



<PAGE>


----------------------------------------------------------------------------------------------------------------------------
                                                       Exhibit Index
----------------------------------------------------------------------------------------------------------------------------


    
Exhibit                                                              Page Numbers

10(g)     Forms of Non-Qualified  Stock Option                       Incorporated by reference to Exhibit 10(aj) of
          Agreements dated February 11, 1993 and                     SafeCard's Annual Report on Form 10-K for its 
          September 1, 1993 with two outside                         fiscal year ended October 31, 1993.
          directors.                                                              
                               

10(h)     1994 Long Term Stock-Based Incentive Plan.                 Incorporated  by reference to SafeCard's  1993 definitive
                                                                     proxy statement.

10(i)     Second  Amendment  to  the  1994  Long  Term  Stock-Based  Incorporated  by reference to Exhibit 10(I) of SafeCard's
          Incentive Plan.                                            Annual  Report on Form  10-K for its  fiscal  year  ended
                                                                     October 31, 1994.

10(j)     Employment  Agreement,  effective as of December 1, 1993,  Incorporated   by  reference  to  Exhibit  1  of  Current
          with Paul G. Kahn.                                         Report on Form 8-K filed on December 6, 1993.

10(k)     Employment  Agreement,  effective as of February 1, 1994,  Incorporated by reference to SafeCard's  Quarterly Report
          with Francis J. Marino.                                    on Form 10-Q for the fiscal  quarter  ended  January  31,
                                                                     1994.

10(l)     Amendment  to  Exhibit  3 of  the  Employment  Agreement,  Incorporated  by reference to Exhibit 10(l) to SafeCard's
          effective as of February 1, 1994, with Francis J. Marino.  Annual  Report on Form  10-K for the  fiscal  year  ended
                                                                     October 31, 1994.

10(m)     Employment  Agreement  as of May 2, 1994,  with G. Thomas  Incorporated  by reference to Exhibit 10(a) of SafeCard's
          Frankland.                                                 Quarterly  Report for its fiscal  quarter ended April 30,
                                                                     1994.

10(n)     Amendment  to  Exhibit  3 of  the  Employment  Agreement,  Included  by  reference  to Exhibit  10(n) of  SafeCard's
          effective as of May 2, 1994, with G. Thomas Frankland.     Annual Report for the fiscal year ended October 31, 1994.

10(o)     Indemnification  Agreement as of April 7, 1994,  with one  Incorporated  by reference to Exhibit 10(b) of SafeCard's
          outside director.                                          Quarterly  Report for its fiscal  quarter ended April 30,
                                                                     1994.

10(p)     Non-Qualified  Stock  Option  Agreement  as of  April  7,  Incorporated  by reference to Exhibit 10(c) of SafeCard's
          1994, with one outside director.                           Quarterly  Report for its fiscal  quarter ended April 30,
                                                                     1994.

10(q)     Employment  Agreement,  effective  as  of  September  14,  Incorporated  by reference to Exhibit 10(q) of SafeCard's
          1995, with John R. Birk.                                   Annual Report for the fiscal year ended October 31, 1994.



<PAGE>


----------------------------------------------------------------------------------------------------------------------------
                                                       Exhibit Index
----------------------------------------------------------------------------------------------------------------------------

Exhibit                                                              Page Numbers

10(r)     Amendment,   effective   as  of  January   1,  1995,   to  Incorporated  by reference to Exhibit 10(r) of SafeCard's
          Employment Agreement with John R. Birk.                    Annual Report for the fiscal year ended October 31, 1994.

10(t)     Executive Deferred Compensation Plan.                      Incorporated by reference to Exhibit 10(s) of SafeCard's
                                                                     Annual Report for the fiscal year ended October 31, 1994.

10(u)     Amendment of Executive Deferred Compensation Plan.         Incorporated  by  reference  to Exhibit  10(u) of Ideon's
                                                                     Registration Statement on Form 8-B filed on May 5, 1995.

10(v)     Form of Executive Agreement with certain senior officers.  Incorporated   by   reference   to   Exhibit   10(t)   of
                                                                     SafeCard's  Annual  Report  on Form  10-K  for  the  year
                                                                     ended October 31, 1994.

10(w)     Form of Amendment and Assignment of Executive Agreement.   Incorporated by reference to Exhibit 10(w) of Ideon's
                                                                     Registration Statement on Form 8-B filed on May 5, 1995.

10(x)     Form of Non-qualified Stock Option Agreement under         Incorporated by reference to Exhibit 10(u) of SafeCard's 
          the 1994 Long Term Stock-Based Incentive Plan with         Annual Report for fiscal year ended October 31, 1994. 
          certain officers.                                      

10(y)     Board of  Directors'  resolution  dated January 24, 1995,  Incorporated by reference to Exhibit 10(v) of Ideon's
          reducing   benefit   under   the   nonemployee   director  S-4.
          retirement plan.

10(z)     Form of  Indemnification  Agreement with certain  outside  Incorporated by reference to Exhibit 10(w) of Ideon's
          directors.                                                 S-4.

10(aa)    Form of Amendment and Assignment of Indemnification        Incorporated by reference to Exhibit 10(aa) of Ideon's
          Agreement with certain outside directors.                  Registration Statement on Form 8-B filed on May 5, 1995. 

10(ab)    Directors Deferral Plan.                                   Incorporated by reference to Exhibit 10(a) of Ideon's
                                                                     Quarterly Report on Form 10-Q for the fiscal quarter
                                                                     ended March 31, 1995.

10(ac)    Directors Stock Plan.                                      Incorporated by reference to Appendix D of SafeCard's
                                                                     1995 definitive proxy statement which was included in
                                                                     Ideon's S-4.



<PAGE>



           Other Material Contracts

10(ad)     Termination  Agreement dated as of May 26, 1994 with     Incorporated by reference to Exhibit 10(e) from              
           Steven J. Halmos and Recission Agreement made and        SafeCard's Quarterly Report on Form 10-Q for the       
           entered into as of June 9, 1994 between SafeCard and     fiscal quarter ended July 31, 1994.
           Steven J. Halmos.


10(ae)     Agreement with Citicorp (South Dakota),  N.A.,           Incorporated  by reference  to Exhibit  10(g) to Ideon's
           effective January 1, 1995.                               Quarterly  Report  on Form 10-Q for its  fiscal  quarter
                                                                    ended June 30, 1995.

10(af)     Agreement with Peter Halmos, dated November 1, 1988,     Incorporated by reference to Exhibit 10(e) of SafeCard's
           regarding a marketing license for credit information     Annual Report on Form 10-K for its fiscal year ended
           services.                                                October 31, 1988.
                                                                     
10(ag)     First Amendment to Agreement, dated January 25, 1991,    Incorporated by reference to Exhibit 10(m) of SafeCard's 
           regarding marketing license for credit information       Annual Report on Form 10-K for its fiscal year ended
           services.                                                October 31, 1990.

10(ah)     Letter   Agreement   dated  January  27,  1992,          Incorporated by reference to Exhibit 10(q) of
           between CreditLine Corporation and SafeCard.             SafeCard's  Annual  Report on Form  10-K for its  fiscal
                                                                    year ended October 31, 1991.

10(ai)     Confirmation Agreement between Peter Halmos, High        Incorporated by reference to Exhibit 10(r) of SafeCard's 
           Plains Capital Corporation, CreditLine Corporation       Annual Report on Form 10-K for its fiscal year ended
           and SafeCard dated January 27, 1992.                     October 31, 1991.


10(aj)     Public Relations  Consulting  Agreement dated            Incorporated by reference to Exhibit 10(ad) of
           October 25, 1994 with the Dilenschneider Group, Inc.     SafeCard's Annual Report on Form 10-K for its fiscal
                                                                    year ended October 31, 1994.

10(ak)     Special Projects Public Relations Consulting  Agreement  Incorporated by reference to Exhibit 10(ae) of
           dated December 14, 1994 with the Dilenschneider Group,   SafeCard's Annual Report on Form 10-K for its
           Inc.                                                     fiscal year ended October 31, 1994.

11(a)      Computation of Primary Earnings Per Share.               85

11(b)      Computation of Fully Diluted Earnings Per Share.         86

21         Subsidiaries of the Registrant                           87



<PAGE>



23         Consent of Independent  Accountants to  incorporation    88
           by reference  of their report in  Prospectuses 
           constituting part of Registration Statements on Form
           S-3 and S-8.

24         Powers of Attorney                                       89-94

27         Financial Data Schedule                                  95
</TABLE>




<PAGE>


--------------------------------------------------------------------------

--------------------------------------------------------------------------

                                            




                                    EXHIBITS

















                                 PAGE LEFT BLANK