Microsoft Word 10.0.6829;urn:schemas-microsoft-com:office:smarttags013f
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: July 19, 2007
(Date of earliest event reported)
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 a Fourth Amendment to Credit
Agreement, dated as of July 19, 2007 (the "Fourth Amendment"), amending the
Credit Agreement dated as of June 28, 2005, as amended (the "Credit Agreement")
for DST's $600 million unsecured revolving credit facility. The Fourth Amendment
is among DST, the Lenders identified in the Fourth Amendment and Bank of
America, N.A. as Administrative Agent, L/C Issuer and Swing Line Lender. A copy
of the Fourth Amendment is attached as Exhibit 10.1 to this report.
The Fourth Amendment amends the Credit Agreement by, among other
things: (i) excluding from the prohibition on restricted payments (as defined in
the Credit Agreement), for the period prior to December 31, 2008, repurchases or
redemptions by DST of its capital stock using a portion of the proceeds received
by DST from Asurion Corporation on July 3, 2007, in connection with the purchase
by certain private equity firms of a significant stake in Asurion Corporation,
as described in DST's current report on Form 8-K dated July 3, 2007, as filed
with the Securities and Exchange Commission on July 6, 2007; (ii) increasing the
amount of permitted restricted payments for the last half of 2007; (iii)
clarifying that the restriction on using proceeds of loans or letters of credit
to purchase or carry margin stock applies only to circumstances in which such
use would violate Regulation U issued by the Federal Reserve Board; and (iv)
allowing a one time addition of $150,000,000 to the $50,000,000 exclusion on
real property liens if incurred prior to June 30, 2008.
The above description of the Fourth Amendment is qualified in its
entirety by reference to the terms of the Fourth Amendment attached hereto as
Exhibit 10.1.
ITEM 9.01 Financial Statements and Exhibits
(d) Exhibits.
Exhibit
Number Description
10.1 Fourth Amendment to Credit Agreement, dated as of July 19, 2007
SIGNATURE
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 25th day of July, 2007.
DST SYSTEMS, INC.
By: /s/ Kenneth V. Hager
Kenneth V. Hager
Vice President, Chief Financial Officer and Treasurer
EXHIBIT 10.1
FOURTH AMENDMENT TO CREDIT AGREEMENT
THIS FOURTH AMENDMENT TO CREDIT AGREEMENT (this "Amendment") dated as
of July 19, 2007 to the Credit Agreement referenced below is by and among DST
Systems, Inc., a Delaware corporation (the "Borrower"), 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, $600 million in credit facilities have been established in
favor of the Borrower pursuant to the terms of that Credit Agreement dated as of
June 28, 2005 (as modified by that certain Consent dated as of December 22,
2005, as amended by that certain First Amendment to Credit Agreement dated as of
February 17, 2006, that certain Second Amendment to Credit Agreement dated as of
September 1, 2006, that certain Third Amendment to Credit Agreement dated as of
April 16, 2007 and as may be further amended, restated, modified or supplemented
from time to time, the "Credit Agreement") among the Borrower, 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) Section 8.06 is amended by deleting the word "and" at the
end of clause (j) thereof, deleting clause (k) thereof in its entirety
and replacing it with the following clauses (k) and (l):
(k) with respect to the period prior to December 31, 2008
only, the Borrower may repurchase or redeem its Capital Stock utilizing
up to $600,000,000 of the proceeds received by the Borrower from
Asurion Corporation on July 3, 2007, in connection with the purchase by
certain private equity firms of a significant stake in Asurion
Corporation; and
(l) in addition to the foregoing, the Borrower may make
dividends and repurchase or redeem its Capital Stock and/or settle
forward equity transactions in an aggregate amount in any fiscal year
not to exceed 10.0% of Consolidated Net Tangible Assets (measured as of
the last day of the immediately preceding fiscal year for which the
Required Financial Information has been received by the Administrative
Agent); provided that with respect to the fiscal year of the Borrower
ending December 31, 2007, (i) for the period of January 1, 2007 through
June 30, 2007, the Borrower may make dividends and repurchase or redeem
its Capital Stock and/or settle forward equity transactions in an
aggregate amount not to exceed 10.0% of Consolidated Net Tangible
Assets (measured as of the last day of the immediately preceding fiscal
year for which the Required Financial Information has been received by
the Administrative Agent) and (ii) for the period of July 1, 2007
through December 31, 2007, the Borrower may make dividends and
repurchase or redeem its Capital Stock and/or settle forward equity
transactions in an aggregate amount not to exceed 10.0% of Consolidated
Net Tangible Assets (measured as of the last day of the immediately
preceding fiscal year for which the Required Financial Information has
been received by the Administrative Agent).
(b) Section 6.14(a) is hereby amended by deleting the last
sentence of such section and replacing it with the following:
No part of the proceeds of any of the Loans or Letters of
Credit will be used for purchasing or carrying margin stock
(within the meaning of Regulation U issued by the FRB) in
violation of Regulation U issued by the FRB.
(c) Section 8.01(p) is hereby deleted in its entirety and
replaced with the following:
Liens not otherwise permitted by this Section 8.01 on real
property of the Borrower and its Subsidiaries securing
Indebtedness in an aggregate principal amount at any time
outstanding not to exceed (i) $50,000,000 or (ii) in addition
to clause (i), an additional $150,000,000 to the extent such
Indebtedness is incurred on a one time basis on or before June
30, 2008; and
(d) Section 8.10 is hereby deleted in its entirety and
replaced with the following:
Use the proceeds of any Credit Extension, whether directly or
indirectly, and whether immediately, incidentally or
ultimately, to purchase or carry margin stock (within the
meaning of Regulation U issued by the FRB) or to extend credit
to others for the purpose of purchasing or carrying margin
stock or to refund indebtedness originally incurred for such
purpose in violation of Regulation U issued by the FRB.
3. Waiver of Events of Default. Notwithstanding the provisions of the
Credit Agreement to the contrary, the Required Lenders hereby waive any
Defaults or Events of Default that may exist on or prior to the date
hereof under Sections 6.14(a) and 8.10 of Credit Agreement as a result
of the Borrower's use of the proceeds of the Loans to repurchase the
Borrower's stock which is margin stock (within the meaning of
Regulation U issued by the FRB).
4. Conditions Precedent. This Amendment shall become effective upon the
satisfaction of the following conditions:
(a) Execution of Counterparts of Amendment. Receipt by the
Administrative Agent of counterparts of this Amendment duly executed by
the Borrower, the Administrative Agent and the Required Lenders; and
(b) Form U-1's. Receipt by the Administrative Agent for each Lender of
a Federal Reserve Form U-1 duly executed and completed by the Borrower
in form and substance satisfactory to the Administrative Agent.
(c) Fees and Expenses. The payment by the Borrower to the
Administrative Agent (or its Affiliates) of all fees and reasonable
expenses relating to this Amendment which are due and payable on the
date hereof including all reasonable out of pocket 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,
special counsel to the Administrative Agent.
5. Representations and Warranties. The Borrower hereby represents and
warrants 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 the Borrower or any of its
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) no Default or Event of Default exists under the
Credit Agreement on and as of the date hereof and after giving effect
to this Amendment, or will occur as a result of the transactions
contemplated hereby.
6. No Other Changes; Ratification. Except as expressly modified or
waived 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. This Amendment shall be
effective only to the extent specifically set forth herein and shall
not (i) be construed as a waiver of any breach or default other than as
specifically waived herein nor as a waiver of any breach or default of
which the Lenders have not been informed by the Borrower, (ii) affect
the right of the Lenders to demand compliance by the Borrower with all
terms and conditions of the Credit Agreement in all other instances,
(iii) be deemed a waiver of any transaction or future action on the
part of the Borrower requiring the Lenders' or the Required Lenders'
consent or approval under the Credit Agreement, or (iv) except as
waived hereby with respect to the Defaults or Events of Default under
Sections 6.14(a) and 8.10 of the Credit Agreement, be deemed or
construed to be a wavier or release of, or a limitation upon, the
Administrative Agent's or the Lenders' exercise of any rights or
remedies under the Credit Agreement or any other document executed or
delivered in connection therewith, whether arising as a consequence of
any Event of Default which may now exist or otherwise, all such rights
and remedies hereby being expressly reserved.
7. Counterparts; Facsimile/Email. 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 or electronic mail 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.
[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: Vice President, CFO & Treasurer
[signature pages continue]
ADMINISTRATIVE AGENT
AND LENDERS: BANK OF AMERICA, N.A.,
as Administrative Agent
By: /s/ Mollie S. Canup
Name: Mollie S. Canup
Title: Vice President
BANK OF AMERICA, N.A.,
as a Lender, L/C Issuer
and Swing Line Lender
By: /s/ Aileen Supena
Name: Aileen Supena
Title: Vice President
CITIBANK, N.A.
By: /s/ Matthew Nichols
Name: Matthew Nichols
Title: Managing Director
U.S. BANK NATIONAL
ASSOCIATION
By: /s/ Michael J. Reymann
Name: Michael J. Reymann
Title: Senior Vice
President
WELLS FARGO BANK, N.A.
By: /s/ Tammy R. Henke
Name: Tammy R. Henke
Title: Vice President
WACHOVIA BANK, NATIONAL
ASSOCIATION
By: /s/ Karin E. Samuel
Name: Karin E. Samuel
Title: Vice President
SUMITOMO MITSUI BANKING
CORP., NEW YORK
By: /s/ David A. Buck
Name: David A. Buck
Title: Senior Vice
President
LLOYDS TSB BANK plc
By: /s/ Windsor R. Davies
Name: Windsor R. Davies
Title: Managing Director
Corporate Banking USA
By: /s/ Carlos Lopez
Name: Carlos Lopez
Title: Associate Director
Corporate Banking USA
MIZUHO CORPORATE BANK (USA)
By: /s/ Bertram H. Tang
Name: Bertram H. Tang
Title: Senior Vice
President & Team Leader
COMMERZEBANK
AKTIENGESELLSCHAFT,
NEW YORK BRANCH AND
GRAND CAYMAN BRANCHES
By: /s/ Al Morrow
Name: Al Morrow
Title: Assistant Vice
President
By: /s/ John Marlatt
Name: John Marlatt
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/ David C. Enslen
Name: David C. Enslen
Title: Senior Vice
President
THE BANK OF
TOKYO-MITSUBISHI UFJ, LTD.,
CHICAGO BRANCH
By: /s/ Hirotsugu Hayashi
Name: Hirotsugu Hayashi
Title: General Manager