EX-10.64 9 0009.txt CONSENT AND WAIVER This Consent and Waiver, dated as of July 14, 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 -------- 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 in this Consent shall have the meanings respectively assigned to them in the Credit Agreement. The Borrower has requested that the Banks provide a consent and waiver under 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 --------- In consideration of the foregoing and the mutual covenants and agreement hereinafter set forth, the parties hereto mutually agree as follows: 1. Pursuant to (i) a Consent, Waiver and Amendment dated as of June 19, 2000, the Banks consented to and waived any Default or Event of Default under Section 2.9(c) of the Credit Agreement arising from the Borrower's incurrence of subordinate indebtedness to CSC (as defined herein) in an aggregate principal amount of up to $24,000,000 (the "Subordinated Fee Loan") and the Borrower's use of the proceeds of such Subordinated Fee Loan to pay the fee (together with related expenses of both Politic Acquisition Corp. and Welsh Carson Anderson & Stowe VIII) to Welsh Carson Anderson & Stowe, L.P. or Politic Acquisition Corp. (or its designated beneficiary) (collectively, "WCAS") as required under the Amended and Restated Agreement and Plan of Merger between Politic Acquisition Corp. and the Borrower and (ii) a Consent and Waiver dated as of June 20, 2000, the Banks also consented to and waived any Default or Event of Default under Section 2.9(c) of the Credit Agreement arising from (a) the Borrower's possible incurrence of additional subordinated indebtedness to CSC (as defined herein) in the form of a working capital revolving line of credit established by Computer Sciences Corporation ("CSC") in connection with the merger agreement between CSC and the Borrower for an aggregate amount of up to $30,000,000, which is subordinate to the indebtedness owing under the Credit Agreement (the "Term Loan") and the Senior Bank Facility on terms similar to those of the Subordinated Fee Loan and in all respects acceptable to the Agent (the "Subordinated Working Capital Loan") and (b) the possible future issuance of additional subordinated indebtedness by the Borrower to a prospective buyer (the "Replacement Subordinated Loans"), which Replacement Subordinated Loans would refinance and replace the Subordinated Fee Loan and the Subordinated Working Capital Loan in full. The Borrower has requested that the Banks consent to (i) the incurrence by the Borrower of additional indebtedness in an aggregate principal amount of up to $29,000,000 ("New Subordinated Debt") the proceeds of which will be used to pay (A) the fee to CSC (or its designated beneficiary) in connection with the termination by the Borrower of the merger agreement with CSC, (B) the related expenses of CSC in connection with the termination by the Borrower of the merger agreement with CSC and (C) the related expenses of WCAS in connection with the termination by the Borrower of the merger agreement with WCAS (such amounts hereinafter collectively referred to as the "Break up Fee") and (ii) the incurrence by the Borrower of additional subordinated indebtedness in an aggregate principal amount of up to $30,000,000 ("New Subordinated Working Capital Loan") the proceeds of which will be used (A) to the extent outstanding, to refinance the Subordinated Working Capital Loan in full and/or (B) for general working capital purposes. As the use of the proceeds of the New Subordinated Debt to pay the Break-up Fee and the New Subordinated Working Capital Loan to refinance the Subordinated Working Capital Loan and/or for general working capital purposes would otherwise violate the provisions of Section 2.9(c) of the Credit Agreement, which requires that the Borrower apply 100% of the net cash proceeds of any issuance of debt securities for cash to prepay the Term Loan, the Banks, effective as of the date hereof, hereby (i) consent to the use of proceeds of the New Subordinated Debt to pay the Break up Fee and consent to the use of proceeds of the New Subordinated Working Capital Loan (A) to the extent outstanding, to refinance the Subordinated Working Capital Loan and/or (B) for general working capital purposes and (ii) grant a limited one-time waiver of any Default or Event of Default that, at such time, otherwise arise pursuant to Section 2.9(c) as a result of the non-prepayment of the Term Loan, provided that such New -------- Subordinated Debt and such New Subordinated Working Capital Loan 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. 2. 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. 3. 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. 4. 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. 5. This Consent shall be governed by and construed in accordance with the laws of the State of New York. 6. The parties hereto agree that Policy Management Systems Investments, Inc. shall execute this Consent by or on August 2, 2000 and the failure by them to so execute this Consent by such date shall be an Event of Default under the Credit Agreement. IN WITNESS WHEREOF, the parties hereto have executed and delivered this Consent as of the date first written. BORROWER: POLICY MANAGEMENT SYSTEMS -------- CORPORATION By: /S/ G. Larry Wilson ---------------------- Title: Chief Executive Officer ------------------------- GUARANTORS: MYND CORPORATION F/K/A CYBERTEK ---------- 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/ G. Larry Wilson ---------------------- Title: Director -------- POLICY MANAGEMENT SYSTEMS INVESTMENTS, INC. By:Elizabeth D. Powers --------------------- Title: President ------------ BANKS: BANK OF AMERICA, N.A. ----- By:_/S/__John E. Williams --- ------------------ Title:_Managing Director ___ --------------------------- WACHOVIA BANK, N.A. By: /S/ John H. Graham ------------------- Title: Assistant Vice President -------------------------- FIRST UNION NATIONAL BANK By: /S/ Franklin M. Wessinger ---------------------------- Title: Senior Vice President -----------------------