UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act Of 1933
--------------------------
DST SYSTEMS, INC.
-----------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
Delaware 43-1581814
---------------------------------------------
(State of Incorporation) (I.R.S. Employer
Identification No.)
333 West 11th Street, 5th Floor
Kansas City, Missouri 64105-1594
(Address of Principal Executive Offices)
Option Agreements under the
USCS INTERNATIONAL, INC. 1996 Directors' STOCK OPTION PLAN, AS
AMENDED (the "Directors' Plan")
---------------------------------------------------------
(Full Title of the Directors' Plan)
ROBERT C. CANFIELD, ESQ.
Senior Vice President, General Counsel, and Secretary
DST Systems, Inc.
333 West 11th Street, 5th Floor
Kansas City, Missouri 64105-1594
(816) 435-1000
---------------------------------------------------------
(Name, Address, and Telephone Number of Agent for Service)
<PAGE>
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
Title of Proposed Proposed Amount of
securities Amount maximum maximum Regist-
to be to be offering price aggregate ration
registered registered per share offering price fee
------------ ---------- -------------- -------------- --------
<S> <C> <C> <C> <C>
Common Stock, 43,400 $1,251,346 $348
par value shares N/A <F1><F2> <F1>
$0.01 per
share
Interests <F3> N/A N/A <F4>
in the Directors' Plan
<FN>
<F1> Calculated pursuant to Rules 457(h)(1) and 457(c) under the
Securities Act of 1933, as amended (the "Securities Act"),
based upon the aggregate exercise price of outstanding
options. No additional options will be issued pursuant to
this Plan.
<F2> Aggregate exercise price of outstanding options solely for
the purpose of calculating the registration fee in
accordance with Rule 457 under the Securities Act.
<F3> To the extent that the interests in the Directors' Plan
constitute securities, pursuant to Rule 416(c), this
Registration Statement shall be deemed to register an
indeterminate amount of interests in the Directors' Plan.
<F4> Pursuant to Rule 457(h)(2), no registration fee is required
with respect to the interests in the Directors' Plan.
</FN>
</TABLE>
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
EXPLANATORY NOTE
As permitted by the rules of the United States Securities
and Exchange Commission (the "Commission") under the Securities
Act, this Registration Statement omits the information specified
in Part I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed or to be filed by DST Systems,
Inc. (the "Registrant") with the Commission are incorporated in
and made a part of this Registration Statement by reference:
(a) The Registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1997 dated March 16, 1998
(SEC File No. 001-14036) and any amendments thereto (the
"Annual Report");
(b) The following reports and any amendments thereto
filed by the Registrant with the Commission pursuant to
Sections 13(a) or 15(d) of the Securities Exchange Act of
1934, as amended, since the Annual Report: (i) Amendment on
Form 10-K/A dated March 26, 1998 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended December 31,
1997, (ii) Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 1998, June 30, 1998, and September
30, 1998; (iii) Amendment on Form 10-Q/A dated July 14, 1998
to the Registrant's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 1997; (iv) Current
Reports on Form 8-K dated April 24, 1998, July 27, 1998,
September 8, 1998, October 26, 1998, December 22, 1998,
December 23, 1998, February 2, 1999 and February 16, 1999;
and (v) Amendments on Form 8-K/A dated April 13, 1998 and
August 4, 1998 to the Registrant's Current Report dated
March 15, 1996 on Form 8-K;
(c) The description of the Registrant's Common Stock
under the headings "Description of Capital Stock" and
"Dividend Policy" in the Registrant's Registration Statement
on Form S-1 dated September 1, 1995 (SEC File No. 33-96526),
as amended, which is incorporated by reference in the
Company's Registration Statement on Form 8-A filed October
30, 1995 (SEC File No. 1-14036) (the "The Rights 8-A");
(d) The description of the Preferred Stock Purchase
Rights contained in the Rights 8-A;
(e) The first amendment dated July 31, 1998 (the "July
8-A Amendment") to The Rights 8-A (SEC File No. 1-14036);
(f) The Rights Agreement dated as of October 6, 1995
(the "Rights Agreement"), between the Company and State
Street Bank and Trust Company, as rights agent, which is
attached as Exhibit 4.4 to the Company's Registration
Statement on Form S-1 dated September 1, 1995 (SEC File No.
33-96526);
(g) The first amendment dated as of July 9, 1998 to
Rights Agreement, which is attached as Exhibit 99 to the
July 8-A Amendment;
(h) All other reports subsequently filed by the
Company with the SEC pursuant to Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934, as amended,
prior to the filing of a post-effective amendment to the
Registration Statement related to this Registration
Statement, which indicates that all securities registered
thereunder have been sold or which deregisters all of the
securities offered then remaining unsold.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law ("DGCL")
provides, generally, that a corporation shall have the power to
indemnify any person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit
or proceeding (except actions by or in the right of the
corporation) by reason of the fact that such person is or was a
director, officer, employee or agent of the corporation against
all expenses, judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection
with such action, suit or proceeding if such person acted in good
faith and in a manner such person reasonably believed to be in or
not opposed to the best interest of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable
cause to believe his or her conduct was unlawful. A corporation
may similarly indemnify such person for expenses actually and
reasonably incurred by such person in connection with the defense
or settlement of any action or suit by or in the right of the
corporation, provided such person acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to
the best interests of the corporation, and, in the case of
claims, issues and matters as to which such person shall have
been adjudged liable to the corporation, provided that a court
shall have determined, upon application, that, despite the
adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such court shall deem proper.
Section 102(b)(7) of the DGCL provides, generally, that the
certificate of incorporation may contain a provision eliminating
or limiting the personal liability of a director to the
corporation or its stockholders for monetary damages for breach
of fiduciary duty as a director, provided that such provision may
not eliminate or limit the liability of a director (i) for any
breach of the director's duty of loyalty to the corporation or
its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of
law, (iii) under section 174 of Title 8 of the DGCL, or (iv) for
any transaction from which the director derived an improper
personal benefit. No such provision may eliminate or limit the
liability of a director for any act or omission occurring prior
to the date when such provision becomes effective.
The DST Certificate of Incorporation provides that the
directors and officers of DST, or persons who are or were serving
at the request of DST as directors or officers of other
corporations, shall be indemnified to the maximum extent
permitted by law against expenses incurred by such individuals in
defending a civil or criminal action, suit or proceeding brought
against such officers and directors in their capacities as such.
Such expenses shall be paid by DST in advance of the final
disposition of such action, suit or proceeding. As to directors
and officers, the DST Certificate of Incorporation requires
receipt by DST of an undertaking by or on behalf of the director
or officer to repay such amount if it is ultimately determined
that the director or officer is not entitled to be indemnified by
DST as authorized by the DGCL. The foregoing right of
indemnification and advancement of expenses is not exclusive of
any other rights of indemnification and advancement of expenses
to which any such individual may be entitled by by-law,
agreement, vote of stockholders or disinterested directors or
otherwise.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The Exhibits to this Registration Statement on Form S-8 are
listed in the Exhibit Index of this Registration Statement, which
Exhibit Index is incorporated herein by reference in response to
this Item.
ITEM 9. UNDERTAKINGS.
Rule 415 Offering
-----------------
(a) The Registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the
Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
and
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the Registration Statement or any material
change to such information in the Registration
Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
above do not apply if the information required to be
included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the Registrant
with the Commission pursuant to Section 13 or Section 15(d)
of the Exchange Act that are incorporated by reference in
the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
shall be deemed to be a new Registration Statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the
low or high end of the estimated maximum offering range may
be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) ( 230.424(b) of this
chapter) if, in the aggregate, the changes in volume and
price represent no more than 20% change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration
Statement.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(b) The Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing
of the annual report of the Registrant pursuant to Section 13(a)
or Section 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by
reference in this Registration Statement shall be deemed to be a
new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of
the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
(Remainder of page intentionally left blank.)
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933,
as amended, the registrant certifies that it has reasonable
grounds to believe that it meets all of the requirements for
filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in City of Kansas City, State of
Missouri, on March 2, 1999.
DST SYSTEMS, INC.
By: /s/Thomas A. McDonnell
-------------------------------------
President and Chief Executive Officer
Each person whose signature appears below hereby constitutes
and appoints each of the Company's Chief Executive Officer,
General Counsel, and Chief Financial Officer (currently Thomas A.
McDonnell, Robert C. Canfield, and Kenneth V. Hager respectively)
as such person's true and lawful attorney-in-fact and agent, each
acting alone, with full power of substitution and resubstitution,
for and in such person's name, place and stead, in any and all
capacities, to sign any or all amendments (including post-
effective amendments) to this Registration Statement, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission
and any exchange on which the Registrant's stock registered
hereunder is traded, granting unto such attorneys-in-fact and
agents, each acting alone, full power and authority to do and
perform each and every act and thing required and necessary to be
done in and about the premises, as fully to all intents and
purposes as such person might or could do in person, hereby
ratifying and confirming all that such attorneys-in-fact and
agents, each acting alone, or such person's substitute or
substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933,
as amended, this Registration Statement has been signed by the
following persons in the capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/ A. Edward Allinson Director February 25, 1999
-----------------------
/s/ George L. Argyros Director February 25, 1999
-----------------------
/s/ Michael G. Fitt Director February 25, 1999
-----------------------
/s/ William C. Nelson Director February 25, 1999
-----------------------
/s/ M. Jeannine Director February 25, 1999
Strandjord
-----------------------
/s/ Thomas A. McDonnell President, Chief February 25, 1999
---------------------- Executive Officer
(Principal Executive
Officer), and Director
/s/ Thomas A. McCullough Director February 25, 1999
-----------------------
/s/ James C. Castle Director February 25, 1999
-----------------------
/s/ Kenneth V. Hager Vice President, February 25, 1999
----------------------- Chief Financial Officer,
and Treasurer (Principal
Financial Officer)
/s/ John J. Faucett Controller February 25, 1999
----------------------- (Principal Accounting
Officer)
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description of Exhibit
--------- ----------------------
4.1 Agreement and Plan of Merger, dated September 2, 1998
by and among DST Systems, Inc., DST Acquisitions, Inc.
and USCS International, Inc., which is attached as
Exhibit 2 to DST's Registration Statement on Form S-4
dated November 20, 1998, as amended, (SEC File No. 333-
67611), is hereby incorporated by reference as Exhibit
4.1.
4.2 DST's Delaware Certificate of Incorporation, as
restated, which is attached as Exhibit 3.1 to DST's
Registration Statement on Form S-1 dated September 1,
1995 (SEC File No. 33-96526) (the "IPO Registration
Statement"), is hereby incorporated by reference as
Exhibit 4.2.
4.3 Amended and Restated By-Laws of DST Systems, Inc.,
which are attached as Exhibit 3.2 to DST's IPO
Registration Statement, are hereby incorporated by
reference as Exhibit 4.3
4.4.1 The Certificate of Designations dated October 16, 1995,
establishing the Series A Preferred Stock of the
Company, which is attached as Exhibit 4.3 to the
Company's S-1 Registration Statement, is hereby
incorporated by reference as Exhibit 4.4.1.
4.4.2 The Summary of the Preferred Stock Purchase Rights set
forth in Form 8-A dated November 15, 1995 (SEC File No.
1-14036) (the "The Rights 8-A") is hereby incorporated
by reference as Exhibit 4.4.2.
4.4.3 The first amendment dated July 30, 1998 (the "July 8-A
Amendment") to The Rights 8-A is hereby incorporated by
reference as Exhibit 4.4.3.
4.4.4 The Rights Agreement dated as of October 6, 1995 (the
"Rights Agreement"), between the Company and State
Street Bank and Trust Company, as rights agent, which
is attached as Exhibit 4.4 to the Company's IPO
Registration Statement, is hereby incorporated by
reference as Exhibit 4.4.4.
4.4.5 The first amendment dated as of July 9, 1998 to the
Rights Agreement, which is attached as Exhibit 99 to
the July 8-A Amendment, is hereby incorporated by
reference as Exhibit 4.4.5.
4.5 The description of the Company's Common Stock, set
forth under the headings "Description of Capital Stock"
and "Dividend Policy" in the IPO Registration
Statement, is hereby incorporated by reference as
Exhibit 4.5.
4.6.1* The USCS International, Inc. 1996 Directors' Stock
Option Plan (the "Directors' Plan") dated as of April
18, 1996, which is attached as Exhibit 10.5 to USCS
International, Inc.'s Registration Statement on Form S-
1/A (SEC File No. 333-3842) dated May 29, 1996, is
hereby incorporated by reference as Exhibit 4.6.1.
4.6.2* First Amendment dated February 22, 1998, to the
Directors' Plan.
5.1 Opinion of Sonnenschein Nath & Rosenthal, counsel to
DST, regarding legality (including consent).
23.1 Consent of Sonnenschein Nath & Rosenthal (included in
Exhibit 5.1).
23.2 Consent of PricewaterhouseCoopers LLP, independent
accountants.
24 Power of Attorney (included on signature page).
*The Directors' Plan and the amendments thereto are included
as exhibits only to the extent that they are incorporated into
the option agreements being assumed.
AMENDMENT DATED 2/22/98 TO 1996 DIRECTORS' PLAN
Paragraph 8(a) of the Directors' Plan is amended as follows:
"The option price for the Shares to be issued pursuant
to any Option shall in no event be less than the fair market
value of such Shares on the date the Option is granted.
Fair market value of the Common Stock shall be determined in
good faith by the Board, using such criteria as it deems
relevant; provided, however, that in the event the Common
Stock is listed on a national securities exchange (within
the meaning of Section 6 of the Exchange Act) or on the
NASDAQ National Market System (or any successor national
market system), the fair market value per Share shall be the
closing price on such exchange on the date of grant of the
Option, as reported in THE WALL STREET JOURNAL (or, if no so
reported, as otherwise reported by the National Association
of Securities Dealers Automated Quotation (NASDAQ) System),
or, if there is a public market for the Common Stock but the
Common Stock is not listed on a national securities
exchange, the fair market value per Share shall be the
average of the last reported bid and asked prices of the
Common Stock on the date of grant, as reported in THE WALL
STREET JOURNAL."
Exhibit 5.1
Sonnenschein Nath & Rosenthal
4520 Main Street
Kansas City, Missouri 64111
March 2, 1999
DST Systems, Inc.
333 West 11th Street, 5th Floor
Kansas City, Missouri 64105-1594
Re: Registration Statement on Form S-8 in connection with
the registration of the offer and sale of DST Common
Stock pursuant to option agreements (the "Agreements")
under the USCS International, Inc. 1996 Directors'
Stock Option Plan, as amended (the "Plan")
Ladies and Gentlemen:
In connection with the preparation of the above-referenced
Registration Statement (the "Registration Statement"), which is
being filed on or about the date of this letter on behalf of DST
Systems, Inc., a Delaware corporation (the "Corporation"), and in
connection with which we have acted as counsel to the
Corporation, you have asked us to provide you this opinion letter
in accordance with subsection (b)(5) of Item 601 of Regulation S-
K promulgated by the United States Securities and Exchange
Commission. The Registration Statement relates to the offer and
sale pursuant to the Agreements of up to 43,400 shares (the
"Shares") of the Corporation's Common Stock, par value $0.01 per
share (the "Common Stock").
Pursuant to an Agreement and Plan of Merger dated as of
September 2, 1998, among the Corporation, DST Acquisition, Inc.,
a Delaware corporation and a wholly-owned subsidiary of DST (the
"Acquisition Sub"), and USCS International, Inc., a Delaware
corporation ("USCS"), Acquisition Sub was merged with and into
USCS and USCS became a wholly-owned subsidiary of the Corporation
(the "Merger") on December 21, 1998. In connection with the
Merger, the Corporation assumed certain of the obligations of
USCS under the Agreements, and the Shares will be substituted for
the stock of USCS that was to be issued under the Agreements
prior to the Merger.
Based upon and subject to our examination described herein
and the assumptions, exceptions, qualifications, and limitations
set forth herein, we are of the opinion that the issuance of the
Shares that will be originally issued under the Agreements has
been duly authorized and the Shares will, when issued pursuant to
and in accordance with the terms of the applicable Agreements and
the Plan, be validly issued, fully paid, and non-assessable.
In connection with this opinion, we have examined and relied
upon, without further investigation, the following in connection
with rendering the opinions expressed herein: (a) the Plan and
the form of the Agreements; (b) the Corporation's Certificate of
Incorporation, as restated, certified by the Secretary of State
of Delaware as of December 16, 1998 and the Corporation's Bylaws;
(c) the Registration Statement, (d) minutes of directors' and
stockholders' meetings, and (e) such other documents,
certificates, records, and oral statements of public officials
and the officers of the Corporation as we deemed necessary for
the purpose of rendering the opinions expressed herein.
In our examinations, we have assumed the genuineness of all
signatures, the legal capacity of all natural persons, the
authenticity, accuracy and completeness of all documents
submitted to us as originals, the conformity to original
documents of all documents submitted to us as certified,
conformed, or photostatic copies or by facsimile or electronic
mail, and the authenticity of the originals from which such
copies, facsimiles, or electronic transmissions were made. In
our examination of documents, including the Agreements, executed
by persons, legal or natural, other than the Corporation, we have
assumed that such persons had the power, corporate or otherwise,
to enter into and perform all obligations thereunder and that
such documents are valid and binding. We have also assumed the
conformity of all Agreements to the form reviewed of such
Agreements.
This opinion letter is limited to the specific legal issues
that it expressly addresses, and accordingly, no opinion may be
inferred or implied beyond the matters expressly stated in this
letter. We express no opinion as to the law of any jurisdiction
other than the General Corporation Law of the State of Delaware,
as amended. We are not admitted to the Delaware Bar. In
expressing our opinions set forth herein, we have reviewed and
relied upon, without further investigation, such laws as
published in generally available sources.
We consent to the filing of this opinion letter, or a
reproduction thereof, as an exhibit to the Registration
Statement. In giving such consent, however, we are not admitting
that we are within the category of persons whose consent is
required under Section 7 of the Securities Act of 1933, as
amended, or the rules or regulations promulgated by the
Securities and Exchange Commission thereunder.
This opinion letter is rendered as of the date set forth
above, and we have no continuing obligation hereunder to inform
you of changes in the applicable law or the facts after such date
or facts of which we become aware after the date hereof, even
though such changes could affect our opinions expressed herein.
Very truly yours,
SONNENSCHEIN NATH & ROSENTHAL
By: /s/ John F. Marvin
Exhibit 23.2
Consent of Independent Auditors
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of our report dated February
26, 1998 relating to the consolidated financial statements of DST
Systems, Inc. appearing in DST Systems, Inc.'s Annual Report on
Form 10-K for the year ended December 31, 1997 and our report
dated February 6, 1998 relating to the consolidated financial
statements of USCS International, Inc., appearing in USCS
International, Inc.'s Annual Report on Form 10-K for the year
ended December 31, 1997. We also consent to the reference to us
under the heading "Selected Consolidated Financial Data" in DST
Systems, Inc.'s Annual Report on Form 10-K. However, it should
be noted that PricewaterhouseCoopers LLP has not prepared or
certified such "Selected Consolidated Financial Data."
PricewaterhouseCoopers LLP
Kansas City, Missouri
March 1, 1999
