UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 8, 2005
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DST SYSTEMS, INC.
(Exact Name of registrant as specified in its charter)
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Delaware
(State or other jurisdiction of incorporation)
1-14036 43-1581814
(Commission File Number) (IRS 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).
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2.):
[ ] 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))
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ITEM 1.01 Entry into a Material Definitive Agreement
DST Systems, Inc. ("DST") has entered into a Loan Agreement, dated as of
June 8, 2005 (the "Loan Agreement"), with Citibank, N.A. ("Citibank"), as
lender. A copy of the Loan Agreement is filed as Exhibit 10.1 to this Form 8-K.
DST has entered into forward transactions with Citibank for the purchase of DST
common stock, in an aggregate amount of $107,472,386. Citibank is also a lender
under DST's credit agreement which established credit facilities of $650
million.
Under the terms of the Loan Agreement, the Lender (as defined in the Loan
Agreement) has agreed, on the terms and conditions set forth in the Loan
Agreement, to make an advance (the "Advance") to DST in the aggregate principal
amount of $107,472,386, and DST has agreed to pay to the Lender the outstanding
principal amount of the Advance and accrued interest on the maturity date. The
maturity date is June 30, 2005 (unless such date is accelerated pursuant to the
terms of the Loan Agreement). The Advance is evidenced by a promissory note (the
"Note") executed by DST, dated June 8, 2005, in favor of Citibank in the
principal amount of $107,472,386. The Note is entitled to the benefits of the
Loan Agreement. The form of Note is attached as Exhibit A to the Loan Agreement.
DST has the right to prepay the Advance in whole or in part, without
premium or penalty, subject to the requirements of the Loan Agreement. The Loan
Agreement contains provisions for acceleration of the maturity date of the Note
upon the happening of certain stated events and also for prepayments on account
of principal of the Note prior to the maturity date upon the terms and
conditions specified in the Loan Agreement. If an Event of Default (as defined
in the Loan Agreement) has occurred and is continuing, the Lender may declare
the Advance, the Note, all interest thereon and all other obligations of DST
under the Loan Agreement and the Note forthwith due and payable. DST is required
to prepay the Advance, in whole or in part, as applicable, under certain
circumstances. If (i) on any business day, the closing price of DST common stock
is equal to or less than a specified price, or (ii) on any calendar day the net
asset value of a specified subsidiary of DST is less than the amount specified
in the Loan Agreement, the Lender may require prepayment of 100% of the
outstanding principal amount of the Advance and any other amounts payable under
the Loan Agreement on the prepayment date specified by the Lender. If, on any
business day, the closing price of DST common stock is within a range specified
in the Loan Agreement, the Lender may require prepayment of 50% of the
outstanding principal amount of the Advance and any accrued interest on the
prepayment date specified by the Lender.
Subject to certain provisions of the Loan Agreement, DST has agreed to pay
interest on the Advance at a per annum rate equal to 1.00% over the LIBOR (as
defined in the Loan Agreement) rate. In an Event of Default, DST has agreed to
pay a default rate of 10% per annum, as set forth in the Loan Agreement.
DST has agreed to indemnify the Lender, its affiliates and their respective
officers, directors, employees, agents and advisors against certain damages,
losses, liabilities and expenses, as set forth in the Loan Agreement.
The above description of the Loan Agreement and the Note is qualified in
its entirety by reference to the terms of the Loan Agreement attached hereto as
Exhibit 10.1 and the form of Note attached as Exhibit A thereto.
ITEM 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
As discussed under Item 1.01, DST has entered into the Loan Agreement with
Citibank and has executed the Note in favor of Citibank in the principal amount
of $107,472,386. Please see the discussion in Item 1.01, which is incorporated
into this Item 2.03 by reference.
ITEM 9.01 Financial Statements and Exhibits
(c). Exhibits.
Exhibit
Number Description
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10.1 Loan Agreement, dated as of June 8, 2005, between DST
Systems, Inc. and Citibank, N.A.
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 13th day of June, 2005.
DST SYSTEMS, INC.
By: /s/ Randall D. Young
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Name: Randall D. Young
Title: Vice President and General Counsel