Note 17: Supplemental guarantor financial information

In March 2011, we issued $200,000 of long-term notes due in March 2019. The notes were issued under a private placement under Rule 144A of the Securities Act of 1933. These notes were subsequently registered with the SEC via a registration statement which became effective on January 10, 2012. These notes are jointly and severally guaranteed on a full and unconditional basis, subject to the release provisions described herein, by certain 100%-owned subsidiaries that guarantee any of our other indebtedness. These subsidiaries also guarantee our obligations under our credit facility and our long-term notes due in 2015. The subsidiary guarantees with respect to the notes due in March 2019 are subject to release upon the sale of all or substantially all of a subsidiary's assets, when the requirements for legal defeasance of the guaranteed securities have been satisfied, when the subsidiary is declared an unrestricted subsidiary, or upon satisfaction and discharge of the indenture.

The following condensed supplemental consolidating financial information reflects the summarized financial information of Deluxe Corporation, the guarantors on a combined basis and the non-guarantor subsidiaries on a combined basis. Separate financial statements of the guarantors are not presented because the guarantors are jointly, severally, fully and unconditionally liable under the guarantees, subject to the release provisions described herein, and we believe that the condensed consolidating financial statements presented are sufficient to provide an understanding of the financial position, results of operations and cash flows of the guarantors.

We are an integrated enterprise, characterized by substantial intersegment cooperation, cost allocations and the sharing of assets. Therefore, we do not represent that the financial information presented is indicative of the financial position, results of operations or cash flows which the entities would have reported if they had operated independently. The condensed consolidating financial statements should be read in conjunction with our consolidated financial statements.

Deluxe Corporation

Condensed Consolidating Balance Sheet

	December 31, 2011
	Deluxe Corporation			Guarantor subsidiaries		Non- guarantor subsidiaries			Eliminations			Total
ASSETS
Current Assets:
Cash and cash equivalents	$	3,047		$	1,522	$	24,118		$	-		$	28,687
Trade accounts receivable, net		-			57,463		11,560			-			69,023
Inventories and supplies		-			19,941		2,102			-			22,043
Deferred income taxes		1,035			5,430		751			-			7,216
Funds held for customers		-			-		44,394			-			44,394
Other current assets		5,851			10,469		4,892			-			21,212
Total current assets		9,933			94,825		87,817			-			192,575
Long-term Investments		36,338			8,809		-			-			45,147
Property, Plant and Equipment, net		-			96,345		17,066			-			113,411
Assets Held for Sale		-			2,741		-			-			2,741
Intangibles, net		-			155,452		1,887			-			157,339
Goodwill		-			775,044		1,954			-			776,998
Investments In Consolidated Subsidiaries		1,307,149			15,478		-			(1,322,627	)		-
Intercompany (Payable) Receivable		(316,876	)		360,789		(43,913	)		-			-
Other Non-Current Assets		11,758			72,944		15,896			-			100,598
Total assets	$	1,048,302		$	1,582,427	$	80,707		$	(1,322,627	)	$	1,388,809

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	13,401		$	44,908	$	6,385		$	-		$	64,694
Accrued liabilities		12,272			86,001		51,825			-			150,098
Long-term debt due within one year		85,575			-		-			-			85,575
Total current liabilities		111,248			130,909		58,210			-			300,367
Long-Term Debt		656,131			-		-			-			656,131
Deferred Income Taxes		(27,471	)		74,133		3,145			-			49,807
Other Non-Current Liabilities		5,705			70,236		3,874			-			79,815
Total Shareholders' Equity		302,689			1,307,149		15,478			(1,322,627	)		302,689
Total liabilities and shareholders' equity	$	1,048,302		$	1,582,427	$	80,707		$	(1,322,627	)	$	1,388,809

Deluxe Corporation

Condensed Consolidating Balance Sheet

	December 31, 2010
	Deluxe Corporation			Guarantor subsidiaries		Non-guarantor subsidiaries			Eliminations			Total
ASSETS
Current Assets:
Cash and cash equivalents	$	3,197		$	683	$	13,503		$	-		$	17,383
Trade accounts receivable, net		-			53,679		12,792			-			66,471
Inventories and supplies		-			19,350		2,310			-			21,660
Deferred income taxes		2,854			6,303		233			-			9,390
Funds held for customers		-			-		35,720			-			35,720
Other current assets		9,463			8,047		3,103			-			20,613
Total current assets		15,514			88,062		67,661			-			171,237
Long-term Investments		34,905			2,427		78						37,410
Property, Plant and Equipment, net		-			102,427		17,794			-			120,221
Assets Held for Sale		-			4,527		-			-			4,527
Intangibles, net		-			151,512		3,600			-			155,112
Goodwill		-			723,938		1,999			-			725,937
Investments In Consolidated Subsidiaries		986,484			615		-			(987,099	)		-
Intercompany (Payable) Receivable		(68,348	)		114,299		(45,951	)		-			-
Other Non-Current Assets		12,337			71,032		10,878			-			94,247
Total assets	$	980,892		$	1,258,839	$	56,059		$	(987,099	)	$	1,308,691

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	11,697		$	42,798	$	5,983		$	-		$	60,478
Accrued liabilities		9,440			92,038		42,556			-			144,034
Short-term debt		7,000			-		-			-			7,000
Total current liabilities		28,137			134,836		48,539			-			211,512
Long-Term Debt		748,122			-		-			-			748,122
Deferred Income Taxes		(25,898	)		68,794		3,856			-			46,752
Other Non-Current Liabilities		4,333			68,725		3,049			-			76,107
Total Shareholders' Equity		226,198			986,484		615			(987,099	)		226,198
Total liabilities and shareholders' equity	$	980,892		$	1,258,839	$	56,059		$	(987,099	)	$	1,308,691

Deluxe Corporation

Condensed Consolidating Statement of Income

	Year Ended December 31, 2011
	Deluxe Corporation			Guarantor subsidiaries			Non-guarantor subsidiaries			Eliminations			Total
Revenue	$	9,409		$	1,276,898		$	272,994		$	(141,705	)	$	1,417,596
Total cost of goods sold		-			459,119			159,589			(125,306	)		493,402
Gross Profit		9,409			817,779			113,405			(16,399	)		924,194

Selling, general and administrative expense, including net restructuring charges		9,323			569,957			89,169			(16,399	)		652,050
Asset impairment charges		-			1,196			-			-			1,196
Net gain on assets held for sale		-			(110	)		-			-			(110	)
Operating Income		86			246,736			24,236			-			271,058

Loss on early debt extinguishment		(6,995	)		-			-			-			(6,995	)
Interest expense		(47,629	)		(8,561	)		(1,190	)		9,583			(47,797	)
Other income (expense)		8,534			907			(40	)		(9,583	)		(182	)
(Loss) Income Before Income Taxes		(46,004	)		239,082			23,006			-			216,084

Income tax (benefit) provision		(22,143	)		86,489			7,143			-			71,489
(Loss) Income From Continuing Operations Before Equity In Earnings Of Consolidated Subsidiaries		(23,861	)		152,593			15,863			-			144,595

Equity In Earnings Of Consolidated Subsidiaries		168,456			15,863			-			(184,319	)		-
Income From Continuing Operations		144,595			168,456			15,863			(184,319	)		144,595

Net Loss From Discontinued Operations		-			-			-			-			-
Net Income	$	144,595		$	168,456		$	15,863		$	(184,319	)	$	144,595

Deluxe Corporation

Condensed Consolidating Statement of Income

	Year Ended December 31, 2010
	Deluxe Corporation			Guarantor subsidiaries			Non-guarantor subsidiaries			Eliminations			Total
Revenue	$	9,145		$	1,270,480		$	270,279		$	(147,667	)	$	1,402,237
Total cost of goods sold		-			454,374			162,473			(128,428	)		488,419
Gross Profit		9,145			816,106			107,806			(19,239	)		913,818

Selling, general and administrative expense, including net restructuring charges		5,663			551,519			94,331			(19,239	)		632,274
Operating Income		3,482			264,587			13,475			-			281,544

Interest expense		(44,061	)		(6,365	)		(930	)		7,191			(44,165	)
Other income (expense)		4,992			(58	)		827			(7,191	)		(1,430	)
(Loss) Income Before Income Taxes		(35,587	)		258,164			13,372			-			235,949

Income tax (benefit) provision		(16,952	)		92,691			6,815			-			82,554
(Loss) Income From Continuing Operations Before Equity In Earnings Of Consolidated Subsidiaries		(18,635	)		165,473			6,557			-			153,395

Equity In Earnings Of Consolidated Subsidiaries		171,259			6,557			-			(177,816	)		-
Income From Continuing Operations		152,624			172,030			6,557			(177,816	)		153,395

Net Loss From Discontinued Operations		-			(771	)		-			-			(771	)
Net Income	$	152,624		$	171,259		$	6,557		$	(177,816	)	$	152,624

Deluxe Corporation

Condensed Consolidating Statement of Income

	Year Ended December 31, 2009
	Deluxe Corporation			Guarantor subsidiaries			Non-guarantor subsidiaries			Eliminations			Total
Revenue	$	24,184		$	1,209,475		$	271,367		$	(160,831	)	$	1,344,195
Total cost of goods sold		-			470,835			167,635			(133,688	)		504,782
Gross Profit		24,184			738,640			103,732			(27,143	)		839,413

Selling, general and administrative expense, including net restructuring charges		8,816			541,135			101,116			(27,143	)		623,924
Asset impairment charges		-			24,900			-			-			24,900
Operating Income		15,368			172,605			2,616			-			190,589

Gain on early debt extinguishment		9,834			-			-			-			9,834
Interest expense		(46,166	)		(4,091	)		(768	)		4,745			(46,280	)
Other income		3,398			885			1,340			(4,745	)		878
(Loss) Income Before Income Taxes		(17,566	)		169,399			3,188			-			155,021

Income tax (benefit) provision		(13,685	)		68,203			1,138			-			55,656
(Loss) Income From Continuing Operations Before Equity In Earnings Of Consolidated Subsidiaries		(3,881	)		101,196			2,050			-			99,365

Equity In Earnings Of Consolidated Subsidiaries		103,246			2,050			-			(105,296	)		-
Income From Continuing Operations		99,365			103,246			2,050			(105,296	)		99,365

Net Loss From Discontinued Operations		-			-			-			-			-
Net Income	$	99,365		$	103,246		$	2,050		$	(105,296	)	$	99,365

Deluxe Corporation

Condensed Consolidating Statement of Cash Flows

	Year Ended December 31, 2011
	Deluxe Corporation			Guarantor subsidiaries			Non-guarantor subsidiaries			Total
Net Cash Provided By Operating Activities of Continuing Operations	$	2,567		$	213,999		$	18,801		$	235,367

Cash Flows From Investing Activities:
Purchases of capital assets		-			(33,731	)		(1,775	)		(35,506	)
Payments for acquisitions, net of cash acquired		-			(80,486	)		(5,155	)		(85,641	)
Payments on company-owned life insurance policies		-			(6,383	)		-			(6,383	)
Loans to distributors		-			(4,879	)		(296	)		(5,175	)
Purchases of marketable securities		-			-			(18	)		(18	)
Other		(342	)		850			430			938
Net cash used by investing activities of continuing operations		(342	)		(124,629	)		(6,814	)		(131,785	)

Cash Flows From Financing Activities:
Net payments on short-term debt		(7,000	)		-			-			(7,000	)
Payments on long-term debt, including costs of debt reacquisition		(215,030	)		-			-			(215,030	)
Proceeds from issuing long-term debt		200,000			-			-			200,000
Payments for debt issue costs		(3,513	)		-			-			(3,513	)
Change in book overdrafts		742			(878	)		-			(136	)
Proceeds from issuing shares under employee plans		7,671			-			-			7,671
Excess tax benefit from share-based employee awards		1,052			-			-			1,052
Payments for common shares repurchased		(23,620	)		-			-			(23,620	)
Cash dividends paid to shareholders		(51,126	)		-			-			(51,126	)
Advances from (to) consolidated subsidiaries		88,449			(87,653	)		(796	)		-
Net cash used by financing activities of continuing operations		(2,375	)		(88,531	)		(796	)		(91,702	)

Effect Of Exchange Rate Change on Cash		-			-			(576	)		(576	)

Net Change In Cash And Cash Equivalents		(150	)		839			10,615			11,304
Cash And Cash Equivalents: Beginning Of Year		3,197			683			13,503			17,383
Cash And Cash Equivalents: End Of Year	$	3,047		$	1,522		$	24,118		$	28,687

Deluxe Corporation

Condensed Consolidating Statement of Cash Flows

	Year Ended December 31, 2010
	Deluxe Corporation			Guarantor subsidiaries			Non-guarantor subsidiaries			Total
Net Cash (Used) Provided By Operating Activities of Continuing Operations	$	(16,786	)	$	224,279		$	5,122		$	212,615

Cash Flows From Investing Activities:
Purchases of capital assets		-			(43,005	)		(927	)		(43,932	)
Payments for acquisitions, net of cash acquired		-			(98,621	)		-			(98,621	)
Purchases of customer lists		-			(70	)		(195	)		(265	)
Purchases of marketable securities		-			-			(14	)		(14	)
Proceeds from sales of marketable securities		-			-			1,970			1,970
Proceeds from company-owned life insurance policies		5,782			361			-			6,143
Other		(1,410	)		(41	)		-			(1,451	)
Net cash provided (used) by investing activities of continuing operations		4,372			(141,376	)		834			(136,170	)

Cash Flows From Financing Activities:
Net payments on short-term debt		(19,000	)		-			-			(19,000	)
Payments for debt issue costs		(2,361	)		-			-			(2,361	)
Change in book overdrafts		(1,090	)		397			-			(693	)
Proceeds from issuing shares under employee plans		3,267			-			-			3,267
Excess tax benefit from share-based employee awards		680			-			-			680
Payments for common shares repurchased		(2,999	)		-			-			(2,999	)
Cash dividends paid to shareholders		(51,435	)		-			-			(51,435	)
Advances from (to) consolidated subsidiaries		85,824			(83,114	)		(2,710	)		-
Net cash provided (used) by financing activities of continuing operations		12,886			(82,717	)		(2,710	)		(72,541	)

Effect Of Exchange Rate Change on Cash		-			-			690			690

Net Change In Cash And Cash Equivalents		472			186			3,936			4,594
Cash And Cash Equivalents: Beginning Of Year		2,725			497			9,567			12,789
Cash And Cash Equivalents: End Of Year	$	3,197		$	683		$	13,503		$	17,383

Deluxe Corporation

Condensed Consolidating Statement of Cash Flows

	Year Ended December 31, 2009
	Deluxe Corporation			Guarantor subsidiaries			Non-guarantor subsidiaries			Total
Net Cash (Used) Provided By Operating Activities of Continuing Operations	$	(9,287	)	$	217,167		$	(1,442	)	$	206,438

Cash Flows From Investing Activities:
Purchases of capital assets		-			(41,777	)		(2,489	)		(44,266	)
Payments for acquisitions, net of cash acquired		-			(30,825	)		-			(30,825	)
Purchases of customer lists		-			(1,639	)		-			(1,639	)
Purchases of marketable securities		-			-			(4,581	)		(4,581	)
Proceeds from sales of marketable securities		-			-			914			914
Other		(1,234	)		(157	)		-			(1,391	)
Net cash used by investing activities of continuing operations		(1,234	)		(74,398	)		(6,156	)		(81,788	)

Cash Flows From Financing Activities:
Net payments on short-term debt		(52,000	)		-			-			(52,000	)
Payments on long-term debt, including costs of debt reacquisition		(21,187	)		(1,440	)		-			(22,627	)
Change in book overdrafts		(3,457	)		97			-			(3,360	)
Proceeds from issuing shares under employee plans		1,972			-			-			1,972
Excess tax benefit from share-based employee awards		68			-			-			68
Payments for common shares repurchased		(1,319	)		-			-			(1,319	)
Cash dividends paid to shareholders		(51,279	)		-			-			(51,279	)
Advances from (to) consolidated subsidiaries		136,956			(140,965	)		4,009			-
Net cash provided (used) by financing activities of continuing operations		9,754			(142,308	)		4,009			(128,545	)

Effect Of Exchange Rate Change on Cash		-			-			1,594			1,594
Cash Used By Operating Activities Of Discontinued Operations		-			(470	)		-			(470	)
Cash Used By Investing Activities Of Discontinued Operations		-			(30	)		-			(30	)

Net Change In Cash And Cash Equivalents		(767	)		(39	)		(1,995	)		(2,801	)
Cash And Cash Equivalents: Beginning Of Year		3,492			536			11,562			15,590
Cash And Cash Equivalents: End Of Year	$	2,725		$	497		$	9,567		$	12,789