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EXHIBIT (d)(4)
POLICY MANAGEMENT SYSTEMS CORPORATION
PROMISSORY NOTE
$19,000,000 June 20, ▇▇▇▇
▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
PAYMENT WITH RESPECT TO THIS NOTE IS SUBJECT TO A SUBORDINATION AGREEMENT (THE
"SUBORDINATION AGREEMENT"), DATED AS OF THE DATE HEREOF AMONG THE MAKER, THE
LENDER, AND BANK OF AMERICA, N.A., AS AGENT, AND EACH HOLDER OF THIS NOTE, BY
ITS ACCEPTANCE HEREOF SHALL BE BOUND BY
THE PROVISIONS OF THE SUBORDINATION AGREEMENT.
FOR VALUE RECEIVED, the undersigned, POLICY MANAGEMENT SYSTEMS CORPORATION,
a South Carolina corporation ("MAKER"), hereby promises to pay to the order of
COMPUTER SCIENCES CORPORATION, a Nevada corporation ("LENDER"), at such address
as Lender may specify and in accordance with the terms of this Promissory Note
(this "NOTE"), the principal amount of NINETEEN MILLION DOLLARS ($19,000,000),
together with all accrued and unpaid interest (the "LOAN").
1. INTEREST. Interest will accrue on the unpaid principal balance of the
Loan, from the date of issue until such date that the Loan has been entirely
repaid or converted, at a simple rate per annum equal to the lesser of (a) the
London Inter-Bank Offered Rate, adjusted for reserve requirements, for three
month U.S. Dollar deposits, as quoted by Bank of America, N.A., plus two and
three quarters percent (275 basis points) or (b) the maximum rate permitted by
applicable law. Interest shall not be due and payable until the date set forth
in Section 2 below.
2. REPAYMENT OF LOAN. The entire principal balance of the Loan, together
with all interest accrued thereon, will become immediately due and payable upon
the earlier to occur of any of the following:
(i) July 3, 2001; or
(ii) Only to the extent permitted by the terms of the subordination
agreement by and among Lender, Maker and Bank of America, N.A., as agent
for the Senior Lenders (as defined therein) (the "Subordination
Agreement"), immediately prior to the occurrence of the "Event of Default"
as described and defined in Section 6.1(k) of the Credit Agreements (as the
term "Credit Agreements" is defined in the Subordination Agreement); or
(iii) Subject to the terms of the Subordination Agreement, upon
acceleration of this Note after the occurrence of any Event of Default (as
defined below).
3. DEFAULT AND ACCELERATION.
(a) Event of Default. "EVENT OF DEFAULT" means the occurrence of any of the
following:
(i) the failure of Maker to punctually and faithfully observe or
perform any of the other covenants, conditions or obligations imposed upon
Maker by this Note, which failure is not remedied within 10 business days
following written notice thereof from
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Lender;
(ii) there is an assignment by Maker for the benefit of creditors or a
composition with creditors;
(iii) Maker petitions or applies to any tribunal for, or consents to
the appointment of, or the taking of possession by, a trustee, receiver,
custodian, liquidator or similar official of any substantial amount of its
assets, or commences any proceedings under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or other
liquidation law of any jurisdiction;
(iv) an order for relief is entered in an involuntary case under the
bankruptcy laws of the United States, or an order, judgment or decree is
entered appointing a trustee, receiver, custodian, liquidator or similar
official or adjudicating Maker bankrupt or insolvent, or ordering or
approving Maker's liquidation or reorganization, or any significant
modification of the rights of its creditors or approving the petition in
any such proceedings, and such order, judgment or decree remains in effect
for 5 business days; or any involuntary petition or complaint is filed
against Maker under the bankruptcy laws of the United States seeking the
appointment of a trustee, receiver, custodian, liquidator or similar
official, and such petition or complaint has not been dismissed within 10
business days of the filing thereof; or
(v) there is levied any writ of execution or other judicial process
upon any material portion of the property of Maker not released within 5
business days thereafter.
(b) Acceleration. Subject to the terms of the Subordination Agreement, in
the event any Event of Default has occurred and is continuing, Lender may
declare the unpaid balance of the Loan immediately due and payable, whereupon
this Note will forthwith mature and become due and payable without presentment,
demand, protest or other notice, all of which are hereby waived, and Lender may
proceed to protect and enforce its rights by suit in equity, action at law or
other appropriate proceeding, whether for the specific performance of any
obligation herein contained, or for an injunction against a violation of any of
the terms or provisions hereof, or in aid of the exercise of any power granted
hereby or by equity or at law; provided, however, that upon the occurrence of
any Event of Default described in Section 3(a)(ii), (iii), (iv) or (v), the
unpaid balance of the Loan will automatically become due and payable without any
action by Lender.
(c) Expenses. In the event any Event of Default has occurred, Maker shall
pay to Lender such additional amount as will be sufficient to cover the actual
costs and expenses of enforcement and collection, including without limitation,
actual attorneys' fees, expenses and disbursements.
4. MISCELLANEOUS.
(a) Good Faith Best Efforts. Maker shall not take any action for the
purpose of avoiding or seeking to avoid the observance or performance of any of
the terms to be observed or performed hereunder by Maker. Maker shall at all
times in good faith use its best efforts in carrying out all such action as may
be necessary or appropriate in order to make effective the transactions
contemplated by this Note.
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(b) Amendment and Waiver. This Note may not be modified or amended, and the
observance of any term of this Note may not be waived (either generally or in a
particular instance and either retroactively or prospectively), without the
prior written consent of the Lender and the Senior Lenders.
(c) Rights, Powers, Privileges and Remedies. No delay or omission on the
part of Lender in exercising any right, power or privilege hereunder will
operate as a waiver thereof, nor will any waiver or omission on the part of
Lender of any right, power or privilege hereunder operate as a waiver of any
other right, power or privilege hereunder nor will any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder. All remedies, either under this Note or at law or otherwise afforded
to Lender, will be cumulative.
(d) Governing Law. This Note will be construed in accordance with, and the
rights of the parties hereto will be governed by, the internal laws of the State
of California.
(e) Successors and Assigns. This Note will be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns. Neither this Note nor any of the rights, interests or obligations
hereunder may be assigned, by operation of law or otherwise, in whole or in part
by Maker to any person or entity without the prior written consent of Lender.
(f) Replacement Notes. Upon receipt of evidence satisfactory to Maker of
the loss, theft, destruction or mutilation of this Note, Maker shall issue a new
Note of like tenor in lieu of such lost, stolen, destroyed or mutilated Note.
(g) Notices. All notices and other communications required or permitted
hereunder will be in writing and will be delivered by facsimile, courier or
nationally-recognized overnight delivery service addressed as follows:
if to Lender: with copies to:
Computer Sciences Corporation ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
if to Maker: with copies to:
Policy Management Systems Corporation ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP
One PMSC Center ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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IN WITNESS WHEREOF, this Note has been duly executed and delivered as of
the date first above written.
MAKER:
POLICY MANAGEMENT SYSTEMS
CORPORATION
a South Carolina corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Executive Vice President
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