Exhibit 10.26
CERTAIN PORTIONS OF THIS EXHIBIT
HAVE BEEN OMITTED AND
FILED
SEPARATELY WITH THE
SECURITIES
AND EXCHANGE COMMISSION
PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT.
THE
SYMBOL
“****” HAS BEEN INSERTED
IN PLACE OF THE PORTIONS SO
OMITTED.
EXECUTION VERSION
AMENDMENT TO MEMBER BUSINESS AGREEMENT
This Amendment (the
“Amendment”) is made to that certain agreement made as
of July 1, 2003 (the “Agreement”), by and between
MasterCard International Incorporated, a Delaware corporation
having its principal place of business at 2000 Purchase
Street, Purchase, NY 10577-2509 (“MasterCard”); HSBC
Bank USA, National Association, a national banking association with
its principal offices at One HSBC Center, Buffalo, New York 14203
(“HSBC Bank”) and HSBC Bank Nevada N.A. f/k/a Household
Bank (SB), N.A., a national banking association with its principal
place of business at 1111 Town Center Drive, Las Vegas, NV 89144,
(“HBON”), (HSBC Bank and HBON, together,
“HSBC”), each for itself and on behalf of its
Affiliates. Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to them in the Agreement.
Except as expressly modified herein, all terms of the Agreement
shall remain in full force and effect as stated in the Agreement
and, in the event of a conflict between the terms of this Amendment
and the Agreement, the terms of this Amendment shall
govern.
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1.
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The parties
hereby amend Sections 1.4, 1.7, 1.22 and 1.23 of the Agreement by
deleting such Sections in their entirety and adding in their places
the following Sections:
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“1.4
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‘****
Volume’ shall mean for any Calendar Year, HSBC MasterCard
Volume of $****.”
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“1.7
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‘Card’ shall include, without
limitation, any bank card, credit card, charge card, travel and
entertainment card, debit card, ATM card, prepaid card, smart card,
virtual card or similar card issued by HSBC, any travelers check,
or electronic currency or remote payment system that can be
accessed using a Card. However, for purposes of this Agreement,
“Card” shall not include a single purpose credit,
charge or prepaid card accepted only at retail locations of a
limited number of merchants and their Affiliates whose names and
marks alone with HSBC appear on the face of such card, or a line of
credit not accessible by a Card.”
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“1.22
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‘MasterCard Volume Share’ shall mean
for any period of calculation, a percentage equal to a fraction,
the denominator of which is total HSBC Card Volume (or any portion
thereof, e.g., HSBC Volume on Consumer Credit Cards) in the Area of
Use and the numerator of which is the HSBC MasterCard Volume (or
any portion thereof, e.g., HSBC MasterCard Volume on Consumer
Credit Cards) in the Area of Use, such percentage to be rounded to
the nearest whole number.”
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“1.23
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‘****
Volume’ shall mean for any Calendar Year, HSBC MasterCard
Volume of $****.”
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2.
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The parties
hereby amend Section 1 of the Agreement by adding to such
Section 1 alphabetically the following definitions:
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“‘Account’ means
the line of credit associated with a Card or multiple Cards sharing
the same account number.”
“‘Credit Card’
means a Card that is not a Debit Card.”
“‘**** Portfolio’
means Credit Cards offered by or related to **** or any Affiliate
of or successor to **** by and/or through HSBC.”
“‘**** Volume
Share’ means MasterCard Volume Share for Credit Cards of
****%.”
“‘**** Volume
Share’ means MasterCard Volume Share for Credit Cards of
****%.”
“‘Named Segments’
means the **** Portfolio, **** Portfolio, **** Portfolios and ****
Portfolios, collectively.”
“‘Rest of
Business,’ or ‘ROB’ means HSBC’s Accounts
that: (i) are not Accounts associated with Named Segments;
(ii) are not co-branded Accounts for which MasterCard has a
direct co-brand arrangement with a merchant partner; and
(iii) are not Accounts associated with Debit
Cards.”
“‘**** Portfolio’
means HSBC-branded Credit Cards that are offered to **** customers
or to cardholders or prospective cardholders through
****.”
“‘Share of New
Issuance’ in any Calendar Year means a fraction, the
numerator of which is the number of New MasterCard-branded Credit
Card Accounts approved and boarded on HSBC’s cardholder
system of record in such Calendar Year and the denominator of which
is the total number of all Credit Card Accounts approved and
boarded on HSBC’s cardholder system of record in such
Calendar Year, expressed as a percentage, and as further qualified
in Section 2.4B.”
“‘**** Portfolio’
means **** Cards offered to cardholders associated with **** and
****.”
“‘**** Portfolio’
means HSBC-branded Credit Cards that are offered to cardholders or
prospective cardholders in the U.S. under **** program or any
successor program thereto and which bear the name and marks of such
program.”
“‘**** Portfolio’
means HSBC-branded Credit Cards that are **** with a **** at least
**** for the corresponding Account and are offered to cardholders
or prospective cardholders in the U.S. for **** Purposes, excluding
HSBC-branded Credit Cards that are (i) issued through ****;
and (ii) **** with a **** partner or other ****
relationship.”
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3.
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The parties
hereby amend Section 2.1 of the Agreement by deleting the
first full paragraph of such Section 2.1 and adding in its
place the following paragraph:
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2.1
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“Subject
to Section 2.2, and provided that HSBC for each Calendar Year
during the Term generates HSBC MasterCard Volume at least equal to
the **** and maintains **** for **** at least equal to the ****,
HSBC **** for Volume charged to MasterCard Cards issued by HSBC in
the Area of Use shall be ****. The following rates for **** shall
be ****. HSBC acknowledges that MasterCard shall establish fees for
all Other Services in the Area of Use from time to time and HSBC
shall comply with the procedures and charges for Other Services as
may be so established for Other Services utilized by
HSBC.”
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4.
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The parties
hereby amend Section 2.1A of the Agreement by deleting such
Section 2.1A in its entirety and adding in its place the
following Section, along with Schedule I, attached
hereto:
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A.
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“Commencing on ****, HSBC’s **** and
****, subject to the provisions of Section 2.1C, shall be as
set forth in the table in Schedule I for the specified levels of
HSBC MasterCard Volume generated in the Area of Use during each
Calendar Year of the Term.”
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5.
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The parties
hereby amend Section 2.1C of the Agreement by deleting such
Section 2.1C in its entirety and adding in its place the
following Section, along with Schedule II, attached
hereto:
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C.
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“In the
event HSBC MasterCard Volume for any Calendar Year during the Term
is **** than the **** Volume **** for **** for any Calendar Year
during the Term is less than the ****, then the following
provisions shall apply, as applicable:
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1.
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“In the
event that in any Calendar Year, **** for **** is **** the ****,
but HSBC MasterCard Volume is **** the **** Volume, HSBC’s
**** and **** for such Calendar Year shall be calculated pursuant
to the table in Schedule II.
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2.
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“Notwithstanding the foregoing, in any
Calendar Year in which HSBC MasterCard Volume does not meet or
exceed the **** Volume and/or the **** Volume (the
“****”), HSBC shall have the ability to ****, as
applicable, over a **** as follows:
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2
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(a)
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“First,
HSBC shall have **** (the “****”) to **** the ****
Volume **** or **** Volume **** by generating HSBC MasterCard
Volume in such **** that, ****, equals or exceeds the **** Volume
or **** Volume, as applicable.
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i.
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If HSBC **** a
**** Volume **** for the **** pursuant to this
Section 2.1C(2)(a), then HSBC’s **** and **** for such
**** shall be calculated pursuant to **** of the table in Schedule
I instead of ****. If HSBC **** the **** Volume **** in such
manner, then HSBC’s **** and **** for the **** shall be
calculated pursuant to the table in Schedule II and HSBC shall have
a **** to **** the **** pursuant to Section 2.1C(2)(b) below;
provided, however, that MasterCard shall **** at the end of the
**** and HSBC shall **** at the end of the **** an **** what HSBC
**** in the **** pursuant to **** of Schedule I and what HSBC ****
for the ****.
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ii.
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If HSBC **** a
**** Volume **** for the **** pursuant to Section 2.1C(2)(a),
then HSBC’s **** and **** for such **** shall be calculated
pursuant to the **** for HSBC MasterCard Volume of >$**** and
<$**** in Schedule II, instead of ****. If HSBC does not ****
the **** Volume **** in such manner, HSBC’s **** and **** for
the **** shall be calculated at **** and HSBC shall have a **** to
**** the **** pursuant to Section 2.1C(2)(b) below; provided,
however, that MasterCard shall **** at the end of the **** and HSBC
shall **** at the end of the **** an **** what HSBC **** in the
**** pursuant to Schedule II if it generated HSBC MasterCard Volume
of >$**** and <$**** and what HSBC **** for the **** pursuant
to ****.
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(b)
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“If the
**** is **** in the ****, then HSBC shall have an **** period (the
“****”) to **** the **** by generating HSBC MasterCard
Volume in such **** that, ****, equals or exceeds the **** Volume
or **** Volume, as applicable.
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i.
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If HSBC **** a
**** Volume **** for the **** in the **** pursuant to
Section 2.1C(2)(b), then MasterCard shall **** to HSBC in that
Calendar Year the **** HSBC pursuant to Section 2.1C(2)(a)(i),
above. If HSBC **** the **** in such manner, then ****, calculated
in Section 2.1C(2)(a)(i), shall be applied to HSBC’s
**** and **** for the ****.
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ii.
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If HSBC **** a
**** Volume **** the **** in the **** pursuant to
Section 2.1C(2)(b), then MasterCard shall **** to HSBC in that
Calendar Year the **** HSBC pursuant to
Section 2.1C(2)(a)(ii), above. If HSBC **** the **** in such
manner, then ****, calculated in Section 2.1C(2)(a)(ii), shall
be applied to HSBC’s **** and **** for the ****.
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3.
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“In the
event that in any Calendar Year, **** for **** is **** the ****,
HSBC’s **** and **** shall be calculated pursuant to the
table in Schedule II, notwithstanding any **** with respect to HSBC
MasterCard Volume.”
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6.
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The parties
hereby amend Section 2.4B of the Agreement by deleting such
Section 2.4B in its entirety and adding in its place the
following Section, along with Schedule III, attached
hereto:
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B.
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“Additional Support based
upon HSBC’s **** MasterCard-branded **** in those certain
segments listed below, and specifically for developing and growing
HSBC’s MasterCard-branded **** in the Area of Use (the
“****”). For each Calendar Year, commencing in ****, in
which the **** is **** and HSBC **** a **** of **** within the
Named Segm
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