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[CONFORMED COPY]
AMENDMENT NO. 3 TO 3-YEAR CREDIT AGREEMENT
AMENDMENT No. 3 dated as of August 9, 1996 among POLICY
MANAGEMENT SYSTEMS CORPORATION (the "Borrower"), the BANKS listed
on the signature pages hereof and XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK, as Agent.
W I T N E S S E T H :
WHEREAS, the parties hereto have heretofore entered into a
3-Year Credit Agreement dated as of August 11, 1995 (as amended,
the "Agreement"); and
WHEREAS, the Borrower has asked the Banks, and the Banks are
willing, on the terms and conditions set forth below, to amend the
Agreement as set forth herein;
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Definitions. Unless otherwise specifically
defined herein, each term used herein that is defined in the
Agreement shall have the meaning assigned to such term in the
Agreement. Each reference to "hereof", "hereunder", "herein" and
"hereby" and each other similar reference and each reference to
"this Agreement" and each other similar reference contained in the
Agreement shall from and after the date hereof refer to the
Agreement as amended hereby.
SECTION 2. Amendment of the Definition of Debt. The
definition of "Debt" set forth in Section 1.1 of the Agreement is
amended to read in its entirety as follows: "Debt" of any Person
means at any date, without duplication, (i) all obligations of
such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar
instruments, (iii) all obligations of such Person to pay the
deferred purchase price of property or services, except (x) trade
accounts payable arising in the ordinary course of business, (y)
any other accrued expenses incurred in the ordinary course of
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business and (z) payment of amounts pursuant to "contingent earn-out" or
similar provisions the payment of which amounts is
contingent upon the achievement of good faith performance targets,
but only to the extent that such payment is not, or would not be
reflected as, a liability on the balance sheet of such Person at
such date, (iv) all obligations of such Person as lessee which are
capitalized in accordance with generally accepted accounting
principles, (v) all non-contingent obligations (and, for purposes
of Section 5.9 (a), (f) and (k) and the definitions of Material
Debt and Material Financial Obligations, all contingent
obligations) of such Person to reimburse any bank or other Person
in respect of amounts paid under a letter of credit, (vi) all
obligations of such Person with respect to Designated Swaps, but
only to the extent that such obligations are, or would be
reflected as, a liability on the balance sheet of such Person at
such date, (vii) all Debt secured by a Lien on any asset of such
Person, whether or not such Debt is otherwise an obligation of
such Person and (viii) all Debt of others Guaranteed by such
Person. It is understood that the payment obligations of the
Borrower to a counterparty under any equity swap (each such swap,
a "Designated Swap") to be entered into between it and the
Borrower with respect to shares of outstanding common stock of the
Borrower in connection with the Borrower's share repurchase
program shall not constitute "Debt" except as set forth in clause
(vi) of the definition of Debt.
SECTION 3. Additional Permitted Temporary Cash Investments.
The definition of "Temporary Cash Investments" set forth in
Section 1.1 of the Agreement is amended to read in its entirety as
follows:
"Temporary Cash Investment" means any Investment in
(i) direct obligations of the United States or any agency thereof
or the Commonwealth of Australia, or obligations guaranteed by the
United States or any agency thereof or the Commonwealth of
Australia, (ii) commercial paper rated at least A-1 by Standard &
Poor's Rating Group and P-1 by Xxxxx'x Investors Service, Inc.,
(iii) time deposits with, including certificates of deposit issued
by, any office located in the United States of (x) any Bank or (y)
any bank or trust company which is organized under the laws of the
United States or any state thereof or the United Kingdom and has
capital, surplus and undivided profits aggregating at least
$750,000,000, (iv) repurchase agreements with respect to
securities described in clause (i) above entered into with an
office of a bank or trust company meeting the criteria specified
in clause (iii) above, (v) municipal bonds issued by
municipalities located in the United States rated at least A or
the equivalent thereof by Standard & Poor's Rating Group or A2 or
the equivalent thereof by Xxxxx'x Investors Service, Inc. and, if
such bonds are rated by both such agencies, then at least A or the
equivalent thereof by Standard & Poor's Rating Group and A2 or the
equivalent thereof by Xxxxx'x Investors Service, Inc. and
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(vi) Debt securities of any Person which are rated at least A or
the equivalent thereof by Standard & Poor's Rating Group or A2 or
the equivalent thereof by Xxxxx'x Investors Service, Inc. and, if
such Debt securities are rated by both such agencies, then at
least A or the equivalent thereof by Standard & Poor's Rating
Group and A2 or the equivalent thereof by Xxxxx'x Investors
Service, Inc.; provided that any Investment described in clauses
(i), (ii), (iii) or (iv) matures within one year from the date of
acquisition thereof by the Borrower or a Subsidiary and any
Investment described in clause (vi) matures within 90 days from
the date of acquisition thereof by the Borrower or a Subsidiary.
SECTION 4. Increase in Amount of Certain Permitted
Subsidiary Debt. The proviso in clause (c) of Section 5.10 of the
Agreement is amended to read in its entirety as follows: "provided
that the aggregate principal amount of Debt of each such wholly-owned
Subsidiary outstanding at any time and permitted by this
clause (c) (net of the aggregate amount of Debt owed to such
wholly-owned Subsidiary by the Borrower or any other wholly-owned
Subsidiary) does not exceed $15,000,000. For purposes of this
clause (c), (1) the "Debt" owed by any wholly-owned Subsidiary
shall include, subject to clause (3) below, any intercompany loans
of or advances made to such Subsidiary and regardless of whether
such loans or advances constitute "Debt" as defined in Section
1.1, intercompany accounts payable of such Subsidiary or
otherwise, (2) the "Debt" owed to any wholly-owned Subsidiary
shall include any amounts payable to such Subsidiary with respect
to intercompany loans or advances made by such Subsidiary and
regardless of whether such payments constitute intercompany
accounts receivables of such Subsidiary or otherwise and (3) the
"Debt" of a Subsidiary of the Borrower shall not include an amount
up to 8,000,000 Australian Dollars owed by such Subsidiary to the
Borrower and incurred by such Subsidiary solely for the purpose of
consummating the acquisition of certain assets of Co-Cam Pty Ltd.,
Co-Cam Wholesale Pty Ltd., Co-Cam Asia Pty Ltd., Co-Cam Financial
Systems Pty Ltd., Co-Cam Custom Software Pty Ltd., and Auz-Com
Technologies Pty Ltd., each an Australian corporation, Co-Cam New
Zealand Ltd., a New Zealand corporation, and Co-Cam Computer
Services (UK) Ltd., a United Kingdom corporation.
SECTION 5. Increase in Minimum Cash Flow Ratio. Section
5.11 of the Agreement is amended by substituting the ratio ".4:1"
for the ratio ".25:1" set forth therein.
SECTION 6. Increase in Minimum Consolidated Tangible Net
Worth. Section 5.13 of the Agreement is amended by substituting
the amount "$175,000,000" for the amount "$162,500,000" set forth
in the first sentence thereof.
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SECTION 7. Increase in Amount of Certain Permitted Investments.
Clauses (c) and (d) of Section 5.15 of the Agreement are amended
to read in their entirety as follows:
"(c) Investments in any customer of the Borrower or any of
its Subsidiaries (or in any other Person the accounts of which
would be consolidated with those of such customer in such
customer's consolidated financial statements if such statements
were prepared as of the date such Investments are made) which are
characterized as "inducements" and are made in connection with
long term processing contracts entered into by the Borrower or
such Subsidiary with such customer; and
(d) any Investment not otherwise permitted by the foregoing
clauses of this Section if, immediately after such Investment is
made or acquired, the aggregate net book value of all Investments
permitted by this clause (d) and outstanding at such time does not
exceed $40,000,000.".
SECTION 8. Substitution of Banks. A new Section 8.6 to the
Agreement is added immediately after Section 8.5 thereof, to read
in its entirety as follows:
SECTION 8.6. Substitution of Bank. If (i) the obligation of
any Bank to make Euro-Dollar Loans has been suspended pursuant to
Section 8.2 or (ii) any Bank has demanded compensation under
Section 8.3 or 8.4, the Borrower shall have the right, with the
assistance of the Agent, to seek a mutually satisfactory
substitute bank or banks (which may be one or more of the Banks)
to purchase the Note and assume the Commitment of such Bank.
SECTION 9. New Pricing Schedule. The Pricing Schedule to
the Agreement is amended to read in its entirety as set forth on
the Pricing Schedule attached hereto.
SECTION 10. Release of Guarantor. Effective as of the date
hereof, Policy Management Systems Canada, Ltd. shall cease to be a
"Guarantor" under the Agreement and shall be released from all of
its obligations thereunder.
SECTION 11. Counterparts; Effectiveness. This Amendment
may be signed in any number of counterparts, each of which shall
be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument. This Amendment shall
become effective as of August 9, 1996 upon receipt by the Agent of
duly executed counterparts hereof signed by the Borrower and the
Banks.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed as of the date first above written.
POLICY MANAGEMENT SYSTEMS CORPORATION,
POLICY MANAGEMENT SYSTEMS
CANADA, LTD.
CYBERTEK CORPORATION
POLICY MANAGEMENT SYSTEMS
INTERNATIONAL, LTD.
PMSI, L.P.
By POLICY MANAGEMENT
SYSTEMS CORPORATION;
its General Partner
CYBERTEK SOLUTIONS, L.P.
By POLICY MANAGEMENT
SYSTEMS CORPORATION;
its General Partner
By /s/ Xxxxxxx X. Xxxxxxxx
Title: Executive Vice President &
General Counsel
POLICY MANAGEMENT SYSTEMS
INVESTMENTS, INC.
By /s/ Xxxxxx X. Xxxxxxx
Title: Secretary
XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK
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By /s/ Xxxxxxx Xxxxx
Title: Vice President
FIRST UNION NATIONAL
BANK OF SOUTH CAROLINA
By /s/ Xxxxxxx X. Xxxxx
Title: Vice President
WACHOVIA BANK OF SOUTH
CAROLINA, N.A.
By /s/ Xxxx X.Xxxxxxx
Title: Vice President
BANK OF AMERICA ILLINOIS
By /s/ Xxxxxxx X. XxXxxxxx
Title: Vice President
COMMERZBANK
AKTIENGESELLSCHAFT,
ATLANTA AGENCY
By /s/ X. Xxxxxx
Title: Senior Vice President
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By /s/ X. Xxxxxx
Title: Vice President
THE DAI-ICHI KANGYO BANK
LTD., ATLANTA AGENCY
By /s/ Xxxxxxxx Xxxxxxxx
Title: Joint General Manager
NBD BANK
By /s/ Xxxxx Xxxxxxxx
Title: Authorized Agent
DEUTSCHE BANK AG NEW YORK
AND/OR CAYMAN ISLANDS
BRANCHES
By /s/ Xxxx Xxxxxxxx
Title: Vice President
By /s/ Xxxx X. Xxxxxxxx
Title: Vice President
THE FUJI BANK, LIMITED,
ATLANTA AGENCY
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By /s/ Xxxxxxxxx Xxxxxx
Title: Vice President & Manager
PRICING SCHEDULE
Each of "Euro-Dollar Margin", "CD Margin" and
"Facility Fee Rate" means, for any date, the rates set forth below
in the row opposite such term and the Usage on such date and in
the column corresponding to "Level I":
Level I
CD Margin
Usage < _
Usage > _
0.525%
0.625%
Euro-Dollar
Margin
Usage
< _
Usage > _
0.4%
0.5%
Facility Fee
Rate
0.2%
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For purposes of this Schedule, the following terms have the
following meanings:
"Level I Pricing" applies at any date.
"Usage" means at any date a fraction (i) the numerator
of which is the aggregate outstanding principal amount of the
Loans at such date, after giving effect to any borrowing or
payment on such date, and (ii) the denominator of which is the
aggregate amount of the Commitments at such date, after giving
effect to any reduction of the Commitments on such date. For
purposes of this Schedule, if for any reason any Loans remain
outstanding after termination of the Commitments, the Usage for
each date on or after the date of such termination shall be deemed
to be greater than _.
