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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: May 21, 2009
(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))
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ITEM 1.01 Entry into a Material Definitive Agreement.
On May 21, 2009, DST Systems, Inc. ("DST") entered into a $175 million
accounts receivable securitization program with Enterprise Funding Company, LLC
("Enterprise"), a third party multi-seller asset-backed commercial paper conduit
administered by Bank of America, National Association ("Bank of America"). This
accounts receivable securitization program replaces DST's $200 million accounts
receivable securitization program with CIESCO, LLC, a third party multi-seller
asset-backed commercial paper conduit administered by Citibank, N.A., which
expired by its terms on May 21, 2009.
Under the terms of this new securitization program, (a) DST will acquire,
on a revolving true sale basis, accounts receivable originated by certain of its
subsidiaries, including, but not limited to, DST Output, DST Health Solutions,
DST Technologies, and Argus Health Systems (the "Subsidiary Originators"), (b)
DST will sell receivables originated by DST and receivables acquired from the
Subsidiary Originators, on a revolving true sale basis, to a wholly-owned
bankruptcy remote special purpose subsidiary of DST (the "SPE"), and (c) the SPE
will sell undivided interests in receivables to Enterprise and other investors
in the program. DST will retain servicing responsibility over the receivables.
The assets of the SPE are not available to satisfy the creditors of any other
person, including DST or any of its subsidiaries or affiliates.
As part of the program, the SPE, Enterprise and other parties will enter
into a Receivables Purchase Agreement (the "Purchase Agreement"), pursuant to
which (a) the SPE will sell undivided interests in receivables to Enterprise and
other investors in the program from time to time, (b) DST will act as servicing
agent for the receivables, and (c) Bank of America and other banks in the
program from time to time will provide a liquidity facility to Enterprise and
commit to purchase undivided interests in receivables from the SPE if Enterprise
fails or refuses to do so. The maximum amount advanced to the SPE at any one
time under the program shall not exceed $175 million.
The receivables will be subject to customary criteria, limits and reserves.
Although the SPE will bear the risk of non-payment of the receivables, DST has
agreed to indemnify the SPE, and the Subsidiary Originators have in turn agreed
to indemnify DST, against certain events, including certain defaults under the
program agreements. Neither DST nor the SPE guarantees collectability of the
receivables or the creditworthiness of obligors. Enterprise's purchase
commitment will expire on May 20, 2010 (unless otherwise extended in accordance
with the program agreements), subject to Enterprise's right to terminate the
program upon certain events described in the Purchase Agreement.
This summary does not purport to be complete, and is qualified in its
entirety by reference to the Purchase Agreement, which is attached as an exhibit
hereto.
This report contains forward-looking statements with respect to the
accounts receivable securitization program, its accounting treatment under
generally accepted accounting principles in the Unites States of America, and
other matters discussed herein. Such information is based upon currently
available information and DST's views as of today, and actual actions, results
or accounting treatments could differ. There could be a number of factors
affecting the securitization program or its financial statement impact, as well
as factors affecting our future performance or results, including those
described in DST's latest annual report on Form 10-K or quarterly report on Form
10-Q filed with the Securities and Exchange Commission. All such factors should
be considered in evaluating any forward-looking statement. We will not update
any forward-looking statements in this report to reflect future events.
ITEM 9.01 Financial Statements and Exhibits
(c). Exhibits.
Exhibit
Number Description
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10.1 The Receivables Purchase Agreement dated May 21, 2009 among
Fountain City Finance, LLC, Enterprise Funding Company LLC,
Bank of America, National Association, DST Systems, Inc.,
and certain subsidiaries of DST
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 28th day of May, 2009.
DST SYSTEMS, INC.
By: /s/ Kenneth V. Hager
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Kenneth V. Hager
Vice President, Chief Financial
Officer and Treasurer