CONSENT, WAIVER AND AMENDMENT
This Consent, Waiver and Amendment, dated as of June 19, 2000 (this
"Consent"), relating to the Credit Agreement referenced below is entered into by
and among Policy Management Systems Corporation, a South Carolina corporation
(the "Borrower"), the Subsidiaries of the Borrower parties hereto (the
"Guarantors"), the financial institutions parties hereto (collectively, the
"Banks"; individually, a "Bank") and Bank of America, N.A. (formerly known as
Bank of America National Trust and Savings Association), as Agent (the "Agent").
RECITALS
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The Borrower, the Guarantors, the Agent and the Banks are parties to a Term
Loan Agreement dated as of November 5, 1999, as amended by a First Amendment to
Term Loan Agreement dated as of February 10, 2000, a Second Amendment to Term
Loan Agreement dated as of March 30, 2000 and a Third Amendment to Term Loan
Agreement dated as of April 24, 2000 (the "Credit Agreement") pursuant to which
the Banks extended a term loan. Capitalized terms used and not otherwise
defined or amended in this Consent shall have the meanings respectively assigned
to them in the Credit Agreement.
The Borrower has requested that the Banks (i) provide a consent and wavier
under the Credit Agreement and (ii) modify certain provisions of the Credit
Agreement and the Banks have agreed to do so, all upon the terms and provisions
and subject to the conditions hereinafter set forth.
AGREEMENT
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In consideration of the foregoing and the mutual covenants and agreement
hereinafter set forth, the parties hereto mutually agree as follows:
1. AMENDMENT. The Credit Agreement is hereby amended in the following
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respects:
(a) Amendment of Section 1.1. Section 1.1(a) is hereby amended by
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adding the following definition of "Base Rate Margin" to the definitions therein
in the appropriate alphabetical order:
"Base Rate Margin" means a rate per annum determined in accordance with the
Pricing Schedule.
(b) Amendment of Section 2.6(a). Section 2.6(a) of the Credit
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Agreement is hereby amended by deleting the first sentence thereof in its
entirety and substituting the following therefor:
(a) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made until it
becomes due, at a rate per annum equal to the sum of the Base Rate plus the Base
Rate Margin.
(c) Amendment to Pricing Schedule. The Pricing Schedule shall be
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amended and restated as per the attachment hereto.
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2. CONSENT AND WAIVER
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We understand that the Borrower intends to incur indebtedness, which will
be subordinate to all indebtedness owing under the Credit Agreement and the Term
Loan, in an aggregate principal amount of up to $24,000,000 (the "Subordinated
Loan") and to use the proceeds of such Subordinated Loan to pay the fee
(together with related expenses of both Politic Acquistion Corp. and Welsh
Carson Anderson & Stowe VIII) to Welsh Carson Anderson & Stowe, L.P. or Politic
Acquisition Corp. (or its designated beneficiary) as required under the Amended
and Restated Agreement and Plan of Merger between Politic Acquisition Corp. and
the Borrower (such fee hereinafter referred to as, the "Break-up Fee"). Section
2.9(c) of the Credit Agreement requires that the Borrower apply 100% of the net
cash proceeds of any issuance of debt securities for cash to prepay the Term
Loan. As the payment of the Break-up Fee with the proceeds of the Subordinated
Loan by the Borrower would otherwise violate the provisions of Section 2.9(c),
the Banks, effective as of the date hereof, hereby (a) consent to payment by the
Borrower of the Break-up Fee with the proceeds of the Subordinated Loan, and (b)
grant a limited one-time waiver of any Default or Event of Default that would
otherwise arise pursuant to Section 2.9(c), provided that the Subordinated Loan
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shall be subordinated to the indebtedness owing under the Credit Agreement and
the Senior Bank Facility on terms and conditions and pursuant to documentation
satisfactory in all respects to the Agent.
3. The Borrower and the Guarantors hereby represent and warrant to the
Agent and Banks that (i) after giving effect to this Consent, no Default or
Event of Default has occurred and is continuing; (ii) after giving effect to
this Consent, the representations and warranties of the Borrower and the
Guarantors pursuant to the Credit Agreement are true on and as of the date
hereof as if made on and as of said date; and (iii) the making and performance
by the Borrower and the Guarantors of this Consent have been duly authorized by
all necessary corporate action.
4. This Consent may be signed in any number of counterparts, each of
which shall be an original, with same effect as if the signatures thereto and
hereto were upon the same instrument.
5. Except as herein specifically amended, all terms, covenants and
provisions of the Credit Agreement shall remain in full force and effect and
shall be performed by the parties hereto according to its terms and provisions
and all references therein or in the Exhibits shall henceforth refer to the
Credit Agreement as modified by this Consent.
6. This Consent shall be governed by and construed in accordance with
the laws of the State of New York.
7. The parties hereto agree that Policy Management Systems Investments,
Inc. shall execute this Consent by or on June 28, 2000 and the failure by them
to so execute this Consent by such date shall be an Event of Default under the
Credit Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Consent as of the date first written.
BORROWER: POLICY MANAGEMENT SYSTEMS
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CORPORATION
By:/S/ Stephen G. Morrison
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Title: Exec. VP, General Counsel & Secretary
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GUARANTORS: MYND CORPORATION F/K/A CYBERTEK
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CORPORATION
MYND INTERNATIONAL, LTD.
MYND PARTNERS, L.P. F/K/A CYBERTEK
SOLUTIONS, L.P.
By: POLICY MANAGEMENT
SYSTEMS CORPORATION, its General
Partner
MYND CORPORATION F/K/A DORN
TECHNOLOGY GROUP, INC.
MYND CORPORATION F/K/A THE
LEVERAGE GROUP, INC.
SOFTWARE SERVICES HOLDING, INC.
By:/S/ Stephen G. Morrison
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Title: Secretary
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POLICY MANAGEMENT SYSTEMS
INVESTMENTS, INC.
By:/S/ Elizabeth D. Powers
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Title: President
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BANKS: BANK OF AMERICA, N.A.
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By:/S/ Michael J. McKenney
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Title: Managing Director
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WACHOVIA BANK, N.A.
By:/S/ Donald E. Sellers, Jr.
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Title: Vice President
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FIRST UNION NATIONAL BANK
By:/S/ Franklin M. Wesssinger
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Title: Senior Vice President
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PRICING SCHEDULE
Each of "Base Rate Margin", "Euro-Dollar Margin" and "Facility Fee Rate"
means, for any date, the rates set forth below:
Base Rate Margin:
January 1, 2000 through July 15, 2000 0%
July 16, 2000 through October 15, 2000 1.00%
October 16, 2000 through January 31, 2001 2.00%
Euro-Dollar Margin:
January 1, 2000 through July 15, 2000 2.75%
July 16, 2000 through October 15, 2000 3.75%
October 16, 2000 through January 31, 2001 4.75%
Facility Fee Rate (retroactive to January 1, 2000) 0.50%
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