UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 18, 2005
DST SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
1-14036 43-1581814
(Commission File Number) (I.R.S. Employer Identification No.)
333 West 11th Street, Kansas City, Missouri 64105
(Address of principal executive offices) (Zip Code)
(816) 435-1000
Registrant's telephone number, including area code
Not Applicable
Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions (see General
Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01 Entry into a Material Definitive Agreement
DST Systems, Inc. ("DST") has entered into the Third Amendment to
Credit Agreement, dated as of April 18, 2005 (the "Amendment"), to its credit
agreement dated as of November 24, 2003 (the "Credit Agreement"). The amendment
is among DST, West Side Investments, Inc. ("West Side"), a wholly owned
subsidiary of DST, the lenders identified in the amendment and Bank of America,
N.A. as Administrative Agent, L/C Issuer and Swing Line Lender ("Administrative
Agent"). A copy of the amendment is filed as Exhibit 10.1 to this Form 8-K. No
material relationship exists between DST and any of such lenders or
Administrative Agent.
The Amendment amends the Credit Agreement to: (i) provide for the
replacement of shares of capital stock of Computer Sciences Corporation ("CSC")
held by West Side and constituting collateral under the Credit Agreement with
the shares of capital stock of CSC Healthcare Inc. ("CSC Healthcare"), a
wholly-owned subsidiary of CSC; and (ii) place certain restrictions on CSC
Healthcare, while its shares are pledged as collateral, with respect to
incurring liens or indebtedness, making investments, loans or advances, merging,
dissolving or consolidating with another person, making certain dispositions or
restricted payments, and having less than a specified level of cash on its
balance sheet.
The above description of the Amendment is qualified in its entirety be
reference to the terms of the Amendment attached hereto as Exhibit 10.1.
ITEM 9.01 Financial Statements and Exhibits
(c). Exhibits.
Exhibit
Number Description
10.1 Third Amendment to Credit Agreement, dated as of April 18, 2005
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized on this 21st day of April, 2005.
DST SYSTEMS, INC.
By: /s/ Randall D. Young
Name: Randall D. Young
Title: Vice President and General Counsel
Exhibit 10.1
THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Amendment") dated as of
April 18, 2005 to the Credit Agreement referenced below is by and among DST
Systems, Inc., a Delaware corporation (the "Borrower"), West Side Investments,
Inc., a Nevada corporation (the "Guarantor"), the Lenders identified on the
signature pages hereto and Bank of America, N.A. as Administrative Agent, L/C
Issuer and Swing Line Lender (the "Administrative Agent").
W I T N E S S E T H
WHEREAS, $650 million in credit facilities have been established in
favor of the Borrower pursuant to the terms of that Credit Agreement dated as of
November 24, 2003 (as amended by that certain First Amendment to Credit
Agreement dated as of September 14, 2004, as further amended by that certain
Second Amendment to Credit Agreement dated as of December 10, 2004 and as may be
further amended, restated, modified or supplemented from time to time, the
"Credit Agreement") among the Borrower, the Guarantor, the Lenders identified
therein (the "Lenders") and the Administrative Agent;
WHEREAS, the Borrower has requested that the Lenders amend the Credit
Agreement to modify certain provisions contained therein; and
WHEREAS, the Required Lenders have agreed to amend the Credit Agreement
on the terms and subject to the conditions set forth herein.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Defined Terms. Capitalized terms used herein but not otherwise
defined herein shall have the meanings provided to such terms in the Credit
Agreement.
2. Amendments. Subject to the satisfaction of the conditions precedent
set forth in Section 3 hereof, the Credit Agreement is amended in the following
respects:
(a) New definitions of "Newco" and "Newco Exchange Effective
Date" are added to Section 1.01 in the appropriate alphabetical order
to read as follows:
"Newco" shall mean CSC Healthcare Inc., a California
corporation and a wholly-owned subsidiary of Computer Sciences
Corporation, the Capital Stock of which will be transferred by
Computer Sciences Corporation to the Guarantor in exchange for
7,128,772 shares of the Capital Stock of Computer Sciences
Corporation.
"Newco Exchange Effective Date" means the date on which each
of the following shall have occurred:
(a) the consummation of the exchange by the Guarantor of
7,128,772 shares of the Capital Stock of Computer Sciences
Corporation for the Capital Stock of Newco held by Computer
Sciences Corporation; and
(b) the Administrative Agent's receipt of the following:
(i) a Pro Forma Compliance Certificate in
accordance with Section 8.02(i)(iii) demonstrating
that, upon giving effect to the Acquisition of the
Capital Stock of Newco on a Pro Forma Basis, the Loan
parties are in compliance with the financial
covenants set forth in Section 8.11 as of the most
recent fiscal quarter end with respect to which the
Administrative Agent has received the Required
Financial Information;
(ii) a Collateral Coverage Certificate
demonstrating that after giving effect to (A) the
release by the Administrative Agent of all of the
shares of Capital Stock of Computer Sciences
Corporation which constitute Collateral on the date
of such exchange and (B) the pledge by Guarantor to
the Administrative Agent for the benefit of the
Lenders of all of the Capital Stock of Newco, the
Aggregate Collateral Value exceeds the Obligations
then outstanding by at least 135%;
(iii) all certificates representing the
Capital Stock of Newco, together with duly executed
in blank, undated stock powers attached thereto;
(iv) certified resolutions of the Guarantor
authorizing the pledge of the Capital Stock of Newco
to the Administrative Agent for the benefit of the
Lenders;
(v) a favorable opinion of counsel to the
Guarantor which shall cover, among other things, the
legality, validity, binding effect and enforceability
of the documentation referred to in clause (b)(iii)
above and the perfection of the Administrative
Agent's Liens thereunder; and
(vi) any other documents reasonably
requested by the Administrative Agent in connection
with such transaction.
(b) The definition of "Collateral Value" in Section 1.01 is
hereby amended by adding a proviso at the end of such definition to
read as follows:
; provided, however, that with respect to the Capital Stock of
Newco, the Collateral Value of such Capital Stock shall be
deemed at all times to be the Collateral Value of the
7,128,772 shares of Capital Stock of Computer Sciences
Corporation that are exchanged by the Guarantor for the
Capital Stock of Newco, as determined immediately prior to
such exchange.
(c) The definition of "Marketable Securities" in Section 1.01
is hereby amended by adding a proviso at the end of such definition to
read as follows:
; provided, however, that for the sixty (60) day period
commencing on the Newco Exchange Effective Date, the term
"Marketable Securities" shall also include the Capital Stock
of Newco acquired by the Guarantor on the Newco Exchange
Effective Date, so long as the Loan Parties are in compliance
with Section 8.16 of this Agreement.
(d) A new Section 8.16 is hereby added to the Credit Agreement
immediately following Section 8.15 thereof and shall read as follows:
8.16 Restrictions on Newco.
Notwithstanding any other provision in this Agreement, at any
time that the Capital Stock of Newco is required to be pledged to the
Administrative Agent for the benefit of the Lenders, neither the
Borrower nor the Guarantor shall permit Newco to (i) create, incur,
assume or suffer to exist any Lien upon any of its property, assets or
revenues other than Liens securing Indebtedness and other obligations
of Newco in an aggregate amount not to exceed $5,000,000, (ii) make any
Investment other than (a) Investments in cash or Cash Equivalents and
(b) loans or advances from Newco to a Loan Party solely to facilitate
an immediate prepayment of the Loans by such Loan Party in the amount
of such loans or advances, (iii) create, incur, assume or suffer to
exist any Indebtedness other than Indebtedness of Newco in an aggregate
amount not to exceed $5,000,000, (iv) merge, dissolve, liquidate,
consolidate with or into any Person, (v) make any Disposition or
Restricted Payment other than to a Loan Party solely to facilitate an
immediate prepayment of the Loans by such Loan Party in the amount of
such Disposition or Restricted Payment or (vi) have less than $175
million in cash or Cash Equivalents on its balance sheet other than as
a result of an Investment, Disposition or Restricted Payment to a Loan
Party that results in the immediate prepayment of the Loans as
permitted pursuant to clauses (ii) or (vi) above.
3. Conditions Precedent. This Amendment shall become effective upon
receipt by the Administrative Agent of counterparts of this Amendment duly
executed by the Borrower, the Guarantor and the Required Lenders.
4. Representations and Warranties. The Borrower and the Guarantor each
hereby represent and warrant that (a) it has the requisite corporate power and
authority to execute, deliver and perform this Amendment, (b) it is duly
authorized to, and has been authorized by all necessary corporate action to,
execute, deliver and perform this Amendment, (c) no consent, approval,
authorization or order of, or filing, registration or qualification with, any
court or governmental authority or third party is required in connection with
the execution, delivery or performance by it of this Amendment, (d) the
execution, delivery and performance by it of this Amendment do not and will not
conflict with, result in a breach of or constitute a default under the articles
of incorporation, bylaws or other organizational documents of either the
Borrower or the Guarantor or any of their Subsidiaries or any indenture or other
material agreement or instrument to which any such Person is a party or by which
any of its properties may be bound or the approval of any Governmental Authority
relating to such Person except as could not reasonably be expected to have a
Material Adverse Effect, (e) the representations and warranties contained in
Article VI of the Credit Agreement are true and correct in all material respects
on and as of the date hereof as though made on and as of such date (except for
those which expressly relate to an earlier date) and (f) after giving effect to
this Amendment, no Default or Event of Default exists under the Credit Agreement
on and as of the date hereof or will occur as a result of the transactions
contemplated hereby.
5. No Other Changes; Ratification. Except as expressly modified hereby,
all of the terms and provisions of the Credit Agreement (including schedules and
exhibits thereto) and the other Loan Documents shall remain in full force and
effect. The term "this Agreement" or "Credit Agreement" and all similar
references as used in each of the Loan Documents shall hereafter mean the Credit
Agreement as amended by this Amendment. Except as herein specifically agreed,
the Credit Agreement is hereby ratified and confirmed and shall remain in full
force and effect according to its terms.
6. Costs and Expenses. The Borrower agrees to pay all reasonable costs
and expenses of the Administrative Agent in connection with the preparation,
execution and delivery of this Amendment, including without limitation the
reasonable fees and expenses of Moore & Van Allen, PLLC.
7. Counterparts; Facsimile. This Amendment may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed an original and it shall not be necessary in making proof of this
Amendment to produce or account for more than one such counterpart. Delivery of
an executed counterpart of this Amendment by telecopy by any party hereto shall
be effective as such party's original executed counterpart.
8. Governing Law. This Amendment shall be deemed to be a contract made
under, and for all purposes shall be construed in accordance with, the laws of
the State of New York.
9. Entirety. This Amendment and the other Loan Documents embody the
entire agreement between the parties and supersede all prior agreements and
understandings, if any, relating to the subject matter hereof. These Loan
Documents represent the final agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous or subsequent oral agreements
of the parties. There are no oral agreements between the parties.
10. Acknowledgment of Guarantor. The Guarantor acknowledges and
consents to all of the terms and conditions of this Amendment and agree that
this Amendment and any documents executed in connection herewith do not operate
to reduce or discharge the Guarantor's obligations under the Credit Agreement or
the other Loan Documents.
11. Affirmation of Liens. Each Loan Party affirms the liens and
security interests created and granted by it in the Loan Documents (including,
but not limited to, the Security Agreement) and agrees that this Amendment shall
in no manner adversely affect or impair such liens and security interests.
12. Excluded Disposition. For the avoidance of doubt, the Lenders
hereby acknowledge and agree that, so long as the Acquisition of the Capital
Stock of Newco constitutes a Permitted Acquisition, the Disposition of the
Capital Stock of Computer Sciences Corporation constitutes a Permitted
Investment and, therefore, an Excluded Disposition under clause (v) of such
definition.
[SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Amendment to be duly executed and delivered as of the date first above
written.
BORROWER: DST SYSTEMS, INC.,
a Delaware corporation
By: /s/ Kenneth V. Hager
Name: Kenneth V. Hager
Title: VP, CFO and Treasurer
GUARANTOR: WEST SIDE INVESTMENTS, INC.,
a Nevada corporation
By: /s/ Kenneth V. Hager
Name: Kenneth V. Hager
Title: Secretary and Treasurer
ADMINISTRATIVE AGENT
AND LENDERS: BANK OF AMERICA, N.A.,
as Administrative Agent
By: /s/ Mollie S. Camp
Name: Mollie S. Camp
Title: Vice President
BANK OF AMERICA, N.A.,
as a Lender, L/C Issuer and Swing Line Lender
By: /s/ W. Thomas Barnett
Name: W. Thomas Barnett
Title: Senior Vice President
CITIBANK, N.A.,
By: /s/ Matthew Nicholls
Name: Matthew Nicholls
Title: Director
FLEET NATIONAL BANK
By: /s/ W. Thomas Barnett
Name: W. Thomas Barnett
Title: Senior Vice President
WELLS FARGO BANK, N.A.
By: /s/ Tammy R. Sturgis
Name: Tammy R. Sturgis
Title: Vice President
WACHOVIA BANK, NATIONAL
ASSOCIATION
By: /s/ Karin E. Samuel
Name: Karin E. Samuel
Title: Vice President
THE BANK OF TOKYO-MITSUBISHI, LTD., CHICAGO BRANCH
By: /s/ Shinichiro Munechika
Name: Shinichiro Munechika
Title: Deputy General Manager
COMMERZEBANK AKTIENGESELLSCHAFT,
NEW YORK BRANCH AND GRAND
CAYMAN BRANCHES
By: /s/ Albert Morrow
/s/ Hajo Neugartner
Name: Albert Morrow
Name: Hajo Neugartner
Title: Assistant Vice President
Title: Vice President
KEYBANK NATIONAL ASSOCIATION
By: /s/ Vijaya Kulkarni
Name: Vijaya Kulkarni
Title: AVP
LLOYDS TSB BANK PLC
By: /s/ Deborah Carlson
Name: Deborah Carlson
Title: VP & Manager, Business Development
Corporate Banking
By: /s/ Matthew S.R. Tuck
Name: Matthew S.R. Tuck
Title: Vice President, Financial Institutions, USA
THE ROYAL BANK OF SCOTLAND PLC
By: /s/ Philippe Sandmeier
Name: Philippe Sandmeier
Title: Senior Vice President
UMB BANK, N.A.
By: /s/ Douglas F. Page
Name: Douglas F. Page
Title: Executive Vice President
COMMERCE BANK, N.A.
By: /s/ Pamela H. Hosty
Name: Pamela H. Hosty
Title: Vice President
PB CAPITAL CORPORATION
By: /s/ Tyler J. McCarthy
Name: Tyler J. McCarthy
Title: Vice President
By: /s/ Jeff Frost
Name: Jeff Frost
Title: Managing Director
U.S. BANK, NATIONAL
ASSOCIATION
By: /s/ Martin Nay
Name: Martin Nay
Title: Vice President