EXHIBIT 4.3
FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, THIS DEBENTURE IS BEING ISSUED WITH TAX ORIGINAL ISSUE
DISCOUNT AND THE ISSUE DATE OF THIS DEBENTURE IS AUGUST 12, 2003. IN ADDITION,
THIS DEBENTURE IS SUBJECT TO THE UNITED STATES FEDERAL INCOME TAX REGULATIONS
GOVERNING CONTINGENT PAYMENT DEBT INSTRUMENTS. FOR PURPOSES OF SECTIONS 1272,
1273 AND 1275 OF THE INTERNAL REVENUE CODE, THE COMPARABLE YIELD OF THIS
DEBENTURE IS 8.4%, COMPOUNDED SEMIANNUALLY (WHICH WILL BE TREATED AS THE YIELD
TO MATURITY FOR UNITED STATES FEDERAL INCOME TAX PURPOSES).
DST SYSTEMS, INC. (THE "COMPANY") AGREES, AND BY ACCEPTING A BENEFICIAL
OWNERSHIP INTEREST IN THIS DEBENTURE EACH HOLDER AND ANY BENEFICIAL OWNER OF
THIS DEBENTURE WILL BE DEEMED TO HAVE AGREED, FOR UNITED STATES FEDERAL INCOME
TAX PURPOSES (1) TO TREAT THIS DEBENTURE AS A DEBT INSTRUMENT THAT IS SUBJECT TO
U.S. TREAS. REG. SEC. 1.1275-4 OR ANY SUCCESSOR PROVISION (THE "CONTINGENT DEBT
REGULATIONS") AND (2) TO BE BOUND (IN THE ABSENCE OF AN ADMINISTRATIVE
DETERMINATION OR JUDICIAL RULING TO THE CONTRARY) BY THE COMPANY'S DETERMINATION
OF THE "COMPARABLE YIELD" AND "PROJECTED PAYMENT SCHEDULE" WITHIN THE MEANING OF
THE CONTINGENT DEBT REGULATIONS, WITH RESPECT TO THIS DEBENTURE. THE COMPANY
AGREES TO PROVIDE PROMPTLY TO THE HOLDER OF THIS DEBENTURE, UPON WRITTEN
REQUEST, THE ISSUE PRICE, AMOUNT OF TAX ORIGINAL ISSUE DISCOUNT, ISSUE DATE,
YIELD TO MATURITY, COMPARABLE YIELD AND PROJECTED PAYMENT SCHEDULE. ANY SUCH
WRITTEN REQUEST SHOULD BE SENT TO THE COMPANY AT THE FOLLOWING ADDRESS: DST
SYSTEMS, INC., 333 West 11th Street, Kansas City, Missouri 64105, ATTENTION: DST
CORPORATE SECRETARY.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL DEBENTURE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY, OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
DEBENTURE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN ARTICLE TWO OF THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
THIS DEBENTURE AND ANY COMMON STOCK ISSUABLE UPON THE CONVERSION OF THIS
DEBENTURE HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS DEBENTURE IS HEREBY NOTIFIED THAT THE SELLER OF THIS DEBENTURE
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THIS DEBENTURE AND ANY COMMON STOCK ISSUABLE UPON THE CONVERSION OF THIS
DEBENTURE MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1)
TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER" WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT ACQUIRING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE), (3) TO DST SYSTEMS, INC. OR ANY SUBSIDIARY THEREOF OR (4) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.
THIS DEBENTURE, ANY SHARES OF COMMON STOCK ISSUABLE UPON ITS CONVERSION AND
ANY RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME TO
MODIFY THE RESTRICTIONS ON RESALES AND OTHER TRANSFERS OF THIS DEBENTURE AND ANY
SUCH SHARES TO REFLECT ANY CHANGE IN APPLICABLE LAW OR REGULATION (OR THE
INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE RESALE OR TRANSFER OF
RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS DEBENTURE AND SUCH SHARES
SHALL BE DEEMED BY THE ACCEPTANCE OF THIS DEBENTURE AND ANY SUCH SHARES TO HAVE
AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.
DST SYSTEMS, INC.
4.125% Series A Convertible Senior Debentures due 2023
No. 2 Original Principal Amount: $40,000,000
Issue Date: August 12, 2003 CUSIP: 233326 AA 5
DST SYSTEMS, INC., a Delaware corporation (the "Company"), for value
received, hereby promises to pay to Cede & Co., or registered assigns, the
Accreted Principal Amount (as defined in the Indenture referred to on the
reverse side of this Security) on August 15, 2023.
This Security shall bear regular cash interest and the Original Principal
Amount (as defined in the Indenture) of this Security shall accrete as specified
on the reverse side of this Security and in the Indenture. Contingent Interest,
if any, on this Security, will be payable as specified on the reverse side of
this Security and in the Indenture. This Security is convertible, is subject to
redemption at the option of the Company or purchase at the option of the Holder
hereof, all as specified on the reverse side of this Security and in the
Indenture.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
DST SYSTEMS, INC.
By: /s/ Gregg Wm. Givens
------------------------------------
Name: Gregg Wm. Givens
Title: VP & CAO
By: /s/ Thomas A. McCullough
------------------------------------
Name:
Title: C.O.O.
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
JPMORGAN CHASE BANK, as Trustee,
certifies that this is one of the Securities referred
to in the within-mentioned Indenture.
By: /s/ Carol Ng
------------------------------------------------
Authorized Officer
Dated: August 12, 2003
----------------
4.125% Series A Convertible Senior Debentures due 2023
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities") limited in aggregate Original Principal
Amount to $40,000,000 Original Principal Amount, issued under an Indenture,
dated as of August 12, 2003 (the "Indenture"), between the Company and JPMorgan
Chase Bank, as Trustee (the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. Capitalized terms used and not otherwise
defined in this Security are used as defined in the Indenture.
1. Interest.
This Security will bear interest from August 12, 2003 or from the most
recent date to which interest has been paid or duly provided for, semi-annually
in arrears on February 15 and August 15 of each year (each, an "Interest Payment
Date"), subject to Section 1.08 of the Indenture, commencing February 15, 2004,
at the rate per annum equal to 4.125%, to but excluding August 15, 2010.
Interest on this Security shall be calculated on the basis of a 360-day year
composed of twelve 30-day months. Interest payable on this Security on any
Interest Payment Date will include interest for the immediately preceding
Interest Period. The interest so payable and punctually paid or duly provided
for on any Interest Payment Date will, as provided in such Indenture, be paid to
the Person in whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such
interest, which shall be the February 1 or August 1, as the case may be,
immediately preceding the relevant Interest Payment Date. Any interest which is
payable, but is not punctually paid or duly provided for, on any Interest
Payment Date shall forthwith cease to be payable to the registered Holder hereof
on the relevant Regular Record Date by virtue of having been such Holder, and
may be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Company, notice whereof shall be given to the Holders of Securities not less
than 10 days prior to such Special Record Date, or may be paid at any time in
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.
From and after August 15, 2010, the Company will no longer be required to
pay cash interest. The Original Principal Amount of this Security shall accrete
daily at the Applicable Yield on a semiannual bond equivalent basis using a
360-day year composed of twelve 30-day months. The Applicable Yield shall be 0%
prior to August 15, 2010 and 4.125% per annum on and after April 15, 2010, until
Stated Maturity. At Stated Maturity, the Holder of this Security will receive
$1,700.28 for each $1,000 Original Principal Amount of Securities, which is the
fully Accreted Principal Amount of this Security on such date, unless the
Security has been earlier redeemed, purchased or converted.
2. Contingent Interest.
From and after August 20, 2010, the Company will pay Contingent Interest on
this Security under the circumstances and in the amounts described in Article 14
of the Indenture. Such Contingent Interest, if any, shall be payable
semiannually in arrears on each Interest Payment Date to the Holder of this
Security as of the close of business on the Regular Record Date relating to such
Interest Payment Date.
3. Interest on Overdue Amounts.
If the Accreted Principal Amount hereof or any portion of such Accreted
Principal Amount is not paid when due (whether upon acceleration pursuant to
Section 4.02 of the Indenture, upon the dates set for payment of the Redemption
Price, Purchase Price or Fundamental Change Purchase Price, or upon the Stated
Maturity of this Security) or if interest due hereon (including Contingent
Interest and Liquidated Damages, if any) (or any portion of such interest), is
not paid when due, then in each such case the overdue amount shall, to the
extent permitted by law, bear interest at the rate then borne by this Security
or, if any overdue amount exists on or after August 15, 2010, at the Applicable
Yield of this Security, which interest shall accrue from the date such overdue
amount was originally due to the date payment of such amount, including interest
thereon, has been made or duly provided for. All such interest shall be payable
as set forth in the Indenture.
4. Method of Payment.
Subject to the terms and conditions of the Indenture, the Company will make
payments in respect of Redemption Price, Purchase Price, Fundamental Change
Purchase Price and at Stated Maturity to Holders who surrender Securities to a
Paying Agent to collect such payments in respect of the Securities. The Company
will pay cash amounts in money of the United States that at the time of payment
is legal tender for payment of public and private debts. However, the Company
may make such cash payments by check payable in such money; provided that
payment by wire transfer of immediately available funds will be required with
respect to principal of and interest (including Contingent Interest and
Liquidated Damages, if any) on all Global Securities and all Securities of
Holders of more than $25,000,000 aggregate Original Principal Amount of
Securities that have requested such method of payment and provided wire transfer
instructions to the Company or the Paying Agent. If any Interest Payment Date
(other than an Interest Payment Date coinciding with the Stated Maturity or
earlier Redemption Date, Purchase Date, or Fundamental Change Purchase Date)
falls on a day that is not a Business Day, such Interest Payment Date will be
postponed to the next succeeding Business Day and no interest on such payment
will accrue for the period from and after the Interest Payment Date to such next
succeeding Business Day, provided that, if such Business Day falls in the next
succeeding calendar month, the Interest Payment Date will be the Business Day
immediately preceding such Interest Payment Date. If the Stated Maturity,
Redemption Date, Purchase Date or Fundamental Change Purchase Date of this
Security would fall on a day that is not a Business Day, the required payment of
interest, if any, and principal will be made on the next succeeding Business Day
and no interest on such payment will accrue and no principal will accrete for
the period from and after the Stated Maturity, Redemption Date, Purchase Date or
Fundamental Change Purchase Date to such next succeeding Business Day.
5. Paying Agent, Conversion Agent and Registrar.
Initially, the Trustee will act as Paying Agent, Conversion Agent and
Registrar. The Company may appoint and change any Paying Agent, Conversion
Agent, Registrar or co-registrar without notice, other than notice to the
Trustee. The Company or any of its Subsidiaries or any of their Affiliates may
act as Paying Agent, Conversion Agent, Registrar or co-registrar.
6. Indenture.
The terms of the Securities include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
in effect from time to time (the "TIA"). The Securities are subject to all such
terms, and Holders are referred to the Indenture and the TIA for a statement of
those terms.
The Securities are general unsecured obligations. The Indenture does not
limit other indebtedness of the Company.
7. Redemption at the Option of the Company.
No sinking fund is provided for the Securities. Prior to August 20, 2010,
the Securities shall not be redeemable at the option of the Company. Beginning
on August 20, 2010 and until the Stated Maturity, the Securities are redeemable
for Cash as a whole, or from time to time in part, at the option of the Company
at the applicable Redemption Price.
If the Company redeems less than all of the outstanding Securities, the
Trustee will select the Securities to be redeemed (i) by lot; (ii) pro rata; or
(iii) by another method the Trustee considers fair and appropriate. If the
Trustee selects a portion of a Holder's Securities for partial redemption and
the Holder converts a portion of the same Securities, the converted portion
shall be deemed to be from the portion selected for redemption.
8. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not more than 60
days before the Redemption Date to each Holder of Securities to be redeemed at
the Holder's registered address. If money sufficient to pay the Redemption Price
of all Securities (or portions thereof) to be redeemed on the Redemption Date is
deposited with the Paying Agent prior to or on the Redemption Date, immediately
after such Redemption Date interest shall cease to accrue and principal will
cease to accrete on such Securities or portions thereof. Securities in
denominations larger than $1,000 Original Principal Amount may be redeemed in
part but only in integral multiples of $1,000.
9. Purchase By the Company at the Option of the Holder.
Each Holder has the right to require the Company to purchase the Securities
held by such Holder on August 15, 2010, 2015 and 2020 (each, a "Purchase Date").
If required by any Holder, the Company shall purchase Securities for Cash,
Common Stock or any combination of Cash and Common Stock at a Purchase Price
equal to the Accreted Principal Amount thereof, plus accrued and unpaid cash
interest (including Contingent Interest and Liquidated Damages, if any) to, but
excluding, the Purchase Date, upon delivery of a Purchase Notice containing the
information set forth in the Indenture, at any time from the opening of business
on the date that is 20 Business Days prior to such Purchase Date until the close
of business on the Business Day immediately preceding such Purchase Date and
upon delivery of the Securities to the Paying Agent by the Holder as set forth
in the Indenture.
At the option of the Holder and subject to the terms and conditions of the
Indenture, the Company shall purchase for Cash, Common Stock or any combination
of Cash and Common Stock all or a portion of the Securities held by such Holder
as of the date that is not less than 20 nor more than 35 Business Days after the
date of the Company's notice to Holders of the occurrence of a Fundamental
Change occurring prior to Stated Maturity for a Fundamental Change Purchase
Price equal to the Accreted Principal Amount thereof, plus accrued and unpaid
cash interest (including Contingent Interest and Liquidated Damages, if any) to,
but excluding, the Fundamental Change Purchase Date, unless such Fundamental
Change Purchase Date falls after a Regular Record Date and on or prior to the
corresponding Interest Payment Date, in which case the Company shall pay the
full amount of accrued and unpaid cash interest (including Contingent Interest
and Liquidated Damages, if any) payable on such Interest Payment Date to the
Holder at the close of business on such Regular Record Date.
Holders have the right to withdraw any Purchase Notice or Fundamental
Change Purchase Notice, as the case may be, by delivering to the Paying Agent a
written notice of withdrawal in accordance with the provisions of the Indenture.
As provided in the Indenture, if Cash or Common Stock (or any combination
of Cash and Common Stock) sufficient to pay the Purchase Price or Fundamental
Change Purchase Price, as the case may be, of all Securities or portions thereof
to be purchased as of the Purchase Date or the Fundamental Change Purchase Date,
as the case may be, is deposited with the Paying Agent on the Purchase Date or
the Fundamental Change Purchase Date, as the case may be, all interest
(including Contingent Interest and Liquidated Damages, if any) ceases to accrue
and principal ceases to accrete on such Securities (or portions thereof)
immediately after such Purchase Date or Fundamental Change Purchase Date, as the
case may be, and the Holder thereof shall have no other rights as such (other
than the right to receive the Purchase Price or Fundamental Change Purchase
Price, as the case may be, upon surrender of such Security).
10. Conversion.
Subject to the terms of the Indenture, the Holder of a Security may convert
the Security into shares of Common Stock at the Conversion Rate under the
circumstances set forth in Section 11.01 of the Indenture; provided, however,
the Company may satisfy its obligation with respect to any demand for conversion
by delivering Common Stock, Cash or a combination of Cash and Common Stock. The
Conversion Rate for the Securities on any Conversion Date shall be determined as
set forth in the Indenture. Upon conversion of a Security, the Company shall
deliver the Conversion Settlement Distribution within the time periods set forth
in Section 11.02 of the Indenture.
A Security in respect of which a Holder has delivered a Purchase Notice or
a Fundamental Change Purchase Notice exercising the option of such Holder to
require the Company to purchase such Security may be converted only if such
notice of exercise is withdrawn in accordance with the terms of the Indenture.
The Company shall deliver Cash or a check in lieu of any fractional share
of Common Stock.
A Holder's right to convert the Securities into Common Stock of the Company
is also subject to the Company's right to elect pursuant to Section 11.03 of the
Indenture to pay such Holder Cash in lieu of delivering all or part of such
Common Stock.
A Holder may convert a portion of a Security if the Original Principal
Amount of such portion is $1,000 or an integral multiple of $1,000. No payment
or adjustment shall be made for dividends on the Common Stock except as provided
in the Indenture. On conversion of a Security, except for conversion during the
period from the close of business on any Regular Record Date immediately
preceding any Interest Payment Date to the opening of business on such Interest
Payment Date, in which case the Holder on such Regular Record Date shall receive
the interest payable on such Interest Payment Date, that portion of accrued and
unpaid interest (including Contingent Interest, if any) and any accretion of
principal on the converted Security attributable to the period from the most
recent Interest Payment Date (or, if no Interest Payment Date has occurred, from
the Issue Date) through the Conversion Date shall not be cancelled, extinguished
or forfeited, but rather shall be deemed to be paid in full to the Holder
thereof through delivery of the Common Stock (together with the Cash payment, if
any, in lieu of fractional shares), or Cash or a combination of Cash and Common
Stock in lieu thereof, in exchange for the Security being converted pursuant to
the provisions hereof.
Securities or portions thereof surrendered for conversion during the period
from the close of business on any Regular Record Date immediately preceding any
Interest Payment Date to the opening of business on such Interest Payment Date
shall be accompanied by payment to the Company or its order, in New York
Clearing House funds or other funds acceptable to the Company, of an amount
equal to the interest payable on such Interest Payment Date with respect to the
Original Principal Amount of Securities or portions thereof being surrendered
for conversion; provided that no such payment need be made (1) if the Company
has specified a Redemption Date that occurs during the period from the close of
business on a Regular Record Date to the opening of business on the Interest
Payment Date to which such Regular Record Date relates, (2) if the Company has
specified a Fundamental Change Purchase Date during such period, (3) with
respect to any Liquidated Damages payable on such Interest Payment Date or (4)
if any overdue interest or overdue Contingent Interest exists on the Conversion
Date with respect to the Securities converted, to the extent of such overdue
interest.
No fractional shares will be issued upon conversion; in lieu thereof, an
amount will be paid in Cash pursuant to Section 11.04 of the Indenture.
The Company agrees, and by acceptance of a beneficial interest in a
Security each Holder and any beneficial owner of a Security shall be deemed to
agree to be bound (in the absence of an administrative determination or judicial
ruling to the contrary) by the Company's determination of the comparable yield
and projected payment schedule within the meaning of the contingent debt
regulations, and accordingly shall treat, for United States federal income tax
purposes, the fair market value of the Common Stock received upon the conversion
of a Security (together with any Cash payment in lieu of fractional shares) or
Cash in lieu thereof, or a combination of Cash and Common Stock as a contingent
payment on the Security for purposes of Treasury Regulation Section 1.1275-4 or
any successor provision.
To convert a Security, a Holder must fulfill the conditions set forth in
Section 11.02 of the Indenture.
The Conversion Rate will be adjusted as set forth in Article 11 of the
Indenture.
11. Denominations; Transfer; Exchange.
The Securities are in fully registered form, without coupons, in
denominations of $1,000 of Original Principal Amount and integral multiples of
$1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not transfer
or exchange any Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security not to be redeemed)
or any Securities in respect of which a Purchase Notice or Fundamental Change
Purchase Notice has been given and not withdrawn (except, in the case of a
Security to be purchased in part, the portion of the Security not to be
purchased) or any Securities for a period of 15 days before the mailing of a
notice of redemption of Securities to be redeemed.
12. Persons Deemed Owners.
The registered Holder of this Security may be treated as the owner of this
Security for all purposes.
13. Unclaimed Money or Securities.
The Trustee and the Paying Agent shall return to the Company upon written
request any money or securities held by them for the payment of any amount with
respect to the Securities that remains unclaimed for two years subject to
applicable unclaimed property law. After return to the Company, Holders entitled
to the money or securities must look to the Company for payment as general
creditors unless an applicable abandoned property law designates another person.
14. Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the Indenture
or the Securities may be amended with the written consent of the Holders of at
least a majority in aggregate Original Principal Amount of the Securities at the
time outstanding and (ii) certain Defaults may be waived with the written
consent of the Holders of a majority in aggregate Original Principal Amount of
the Securities at the time outstanding. The Company and the Trustee may amend
the Indenture under certain circumstances without the consent of the Holders, as
described in the Indenture.
15. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee, or the
Holders of at least 25% in aggregate Original Principal Amount of the Securities
then outstanding, may declare all the Securities to be due and payable
immediately. Certain events of bankruptcy or insolvency are Events of Default
which will result in the Securities becoming due and payable immediately upon
the occurrence of such Events of Default.
Holders may not enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee may refuse to enforce the Indenture or the
Securities unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in aggregate Original Principal
Amount of the Securities at the time outstanding may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders notice of
any continuing Default (except a Default in payment on any Security) if it
determines that withholding notice is in their interests.
16. Trustee Dealings with the Company.
Subject to certain limitations imposed by the TIA, the Trustee under the
Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
17. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the Company shall
not have any liability for any obligations of the Company under the Securities
or the Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Security, each Holder waives and
releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities.
18. Authentication.
This Security shall not be valid until an authorized signatory of the
Trustee manually signs the Trustee's Certificate of Authentication on the other
side of this Security.
19. Abbreviations.
Customary abbreviations may be used in the name of a Holder or an assignee,
such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT
TEN (=joint tenants with right of survivorship and not as tenants in common),
CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act).
20. GOVERNING LAW.
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE AND THIS
SECURITY, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
----------------------------
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture.
DST Systems, Inc.
333 West 11th Street
Kansas City, MO 64105
Attention: DST Corporate Secretary
Schedule I
DST SYSTEMS, INC.
4.125% Series A Convertible Senior Debenture Due 2023
No. 2
=========== ======================================== ===================================== =========================
Notation Explaining Original Authorized Signature of
Date Original Principal Amount Principal Amount Recorded Trustee or Trustee
<s> <c> <c> <c>
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
- ----------- ---------------------------------------- ------------------------------------- -------------------------
ASSIGNMENT FORM
To assign this Security, fill in the form below:
For value received ______________________________hereby sell(s), assign(s)
and transfer(s) unto ___________________________________ (Please insert social
security or other Taxpayer Identification Number of assignee) the within
Security, and hereby irrevocably constitutes and appoints
______________________________________ attorney to transfer said Security on the
books of the Company, with full power of substitution in the premises.
In connection with any transfer of the Security prior to the expiration of
the holding period applicable to sales thereof under Rule 144(k) under the
Securities Act (or any successor provision), the undersigned confirms that such
Security is being transferred:
[ ] To DST Systems, Inc. (the "Company") or a subsidiary
thereof; or
[ ] To a "qualified institutional buyer" in compliance with Rule
144A under the Securities Act of 1933, as amended; or
[ ] Pursuant to a Registration Statement which has been declared
effective under the Securities Act of 1933, as amended, and
which continues to be effective at the time of transfer; or
[ ] Pursuant to and in compliance with another available
exemption from the registration requirements of the
Securities Act of 1933, as amended.
Unless one of the boxes is checked, the Trustee or Registrar will refuse to
register any of the Securities evidenced by this certificate in the name of any
person other than the registered holder thereof.
Dated: ______________________
------------------------------
------------------------------
Signature(s)
Signature(s) must be guaranteed by an "eligible guarantor
institution" meeting the requirements of the Security
registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion
Program ("STAMP") or such other "signature guarantee
program" as may be determined by the Security registrar in
addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as
amended.
------------------------------
Signature Guarantee
CONVERSION NOTICE
To convert this Security pursuant to Article 11 of the Indenture, check the box:
To convert only part of this Security, state the Original Principal Amount to be
converted (which must be $1,000 or an integral multiple of $1,000): $
___________________________
If you want the stock certificate made out in another person's name, fill in the
form below:
- -------------------------------------------------------------------------------
(Insert other person's soc. sec. or tax ID no.)
- --------------------------------------------------------------------------------
(Print or type other person's name, address and zip code)
Your
Signature: _____________________________________________
(Sign exactly as your name appears on the other side of this Security)
PURCHASE NOTICE
4.125% Series A Convertible Senior Debentures due 2023
TO: DST SYSTEMS, INC.
JPMORGAN CHASE BANK
The undersigned registered owner of this Series A Debenture hereby
irrevocably acknowledges receipt of a notice from DST Systems, Inc. (the
"Company") regarding the right of holders to elect to require the Company to
purchase the Securities and requests and instructs the Company to purchase the
entire Original Principal Amount of this Security, or portion thereof (which is
$1,000 Original Principal Amount or an integral multiple thereof) designated
below, in accordance with the terms of the Indenture at the price of the
Accreted Principal Amount or proportional portion thereof, together with accrued
cash interest (including Contingent Interest and Liquidated Damages, if any) to,
but excluding, the Purchase Date, to the registered holder hereof. Capitalized
terms used herein but not defined shall have the meanings ascribed to such terms
in the Indenture. The Securities shall be purchased by the Company as of the
applicable Purchase Date pursuant to the terms and conditions specified in the
Indenture. This election is made pursuant to: Article 12, Purchase at Option of
Holders.
Dated:
Signature(s):
NOTICE: The above signatures of the holder(s) hereof must correspond with
the name as written upon the face of the Security in every particular without
alteration or enlargement or any change whatever.
Security Certificate Number (if applicable):
Original Principal Amount to be purchased (if less than all):
$_____________________.
In the event the Company elects, pursuant to Section 12.03 of the
Indenture, to pay the Purchase Price, in whole or in part, in shares of Common
Stock but such portion of the Purchase Price shall ultimately be paid to such
Holder entirely in Cash because any of the conditions to payment of the Purchase
Price in shares of Common Stock is not satisfied prior to 5:00 p.m., New York
City time, on the Business Day immediately preceding the Purchase Date, as set
forth in Section 12.03 of the Indenture, I hereby elect to:
[ ] withdraw this Purchase Notice as to $____________ in Original Principal
Amount of Securities with the following certificate numbers:
________________________________ to which this Purchase Notice relates;
[ ] receive Cash in respect of the entire Purchase Price for all Securities
(or portions thereof) to which this Purchase Notice relates.
OPTION OF HOLDER TO ELECT PURCHASE ON FUNDAMENTAL CHANGE
4.125% Series A Convertible Senior Debentures due 2023
TO: DST SYSTEMS, INC.
JPMORGAN CHASE BANK
The undersigned registered owner of this Series A Debenture hereby
irrevocably acknowledges receipt of a notice from DST Systems, Inc. (the
"Company") regarding the right of holders to elect to require the Company to
purchase the Securities upon a Fundamental Change and requests and instructs the
Company pursuant to Section 13.01 to purchase the entire Original Principal
Amount of this Security, or portion thereof (which is $1,000 Original Principal
Amount or an integral multiple thereof) designated below, in accordance with the
terms of the Indenture at the price of the Accreted Principal Amount or
proportional portion thereof, together with accrued cash interest (including
Contingent Interest and Liquidated Damages, if any) to, but excluding, the
Fundamental Change Purchase Date, to the registered holder hereof. Capitalized
terms used herein but not defined shall have the meanings ascribed to such terms
in the Indenture. The Securities shall be purchased by the Company as of the
Fundamental Change Purchase Date pursuant to the terms and conditions specified
in the Indenture.
Dated:
Signature(s):
NOTICE: The above signatures of the holder(s) hereof must correspond with
the name as written upon the face of the Security in every particular without
alteration or enlargement or any change whatever.
Security Certificate Number (if applicable):
Original Principal Amount to be purchased (if less than all):
$_____________________.
In the event the Company elects, pursuant to Section 13.02 of the
Indenture, to pay the Fundamental Change Purchase Price, in whole or in part, in
shares of Common Stock but such portion of the Fundamental Change Purchase Price
shall ultimately be paid to such Holder entirely in Cash because any of the
conditions to payment of the Fundamental Change Purchase Price in shares of
Common Stock is not satisfied prior to 5:00 p.m., New York City time, on the
Business Day immediately preceding the Purchase Date, as set forth in Section
13.02 of the Indenture, I hereby elect to:
[ ] withdraw this Fundamental Change Purchase Notice as to $____________ in
Original Principal Amount of Securities with the following certificate
numbers:________________________________ to which this Fundamental Change
Purchase Notice relates;
[ ] receive Cash in respect of the entire Fundamental Change Purchase Price
for all Securities (or portions thereof) to which this Fundamental Change
Purchase Notice relates.