Exhibit 10.8
Confidential Treatment
Requested . Confidential
treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality
request. Omissions are designated as “ [Redacted]
.” A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.
SECOND AMENDMENT
TO
CREDIT CARD PROGRAM
AGREEMENT
This SECOND AMENDMENT TO CREDIT CARD
PROGRAM AGREEMENT, dated as of June 1, 2005, (this “
Amendment ”) is made and entered into as of
May 19, 2006, by and among Federated Department Stores, Inc.,
a Delaware corporation, (“ FDS ”), FDS Bank, a
federally-chartered stock savings bank (“ FDS Bank
”), FACS Group, Inc., an Ohio corporation (“
FACS ”), Macy’s Department Stores, Inc., an Ohio
corporation (“ Macy’s ”),
Bloomingdale’s, Inc., an Ohio corporation (“
Bloomingdale’s ”; and together with FDS, FDS
Bank, FACS and Macy’s, the “ FDS Companies
”), and Department Stores National Bank, a national banking
association (as assignee of Citibank, N.A., a national banking
association) (“ Bank ”).
WHEREAS, the FDS Companies and Bank
are parties to that certain Credit Card Program Agreement dated, as
of June 1, 2005, as amended by the First Amendment to Credit
Card Program Agreement and the letter agreement, each dated as of
October 24, 2005 (the “ Program Agreement
”);
WHEREAS, the parties hereto have
agreed to permit the sale, pursuant to the Purchase Agreement, of
those May Assets (as defined in the Purchase Agreement) and May
Liabilities (as defined in the Purchase Agreement) relating to May
Accounts (as defined in the Purchase Agreement) that have been
converted from May Co. credit Systems to FACS Group, Inc. credit
Systems prior to the Third Closing Date (as defined in the Purchase
Agreement); and
WHEREAS, the parties hereto desire
to amend the Program Agreement in accordance with Section 18.5
of the Program Agreement.
NOW, THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally
bound, agree as follows:
1. Defined Terms
. Capitalized terms used
without definition in this Amendment have the meanings assigned to
them in the Program Agreement.
2. References to May
Accounts . All
provisions of the Program Agreement (including the Schedules
thereto) referring to the “May Accounts,” the
“May Purchase Price,” the “Third Closing,”
the “Third Closing Date” and the “Final Third
Closing Statement” shall apply mutatis mutandis to the
“Converted May Accounts,” the “CM Purchase
Price,” the “CM Closing,” the “CM Closing
Date” and the “Final CM Closing Statement” (in
each case, as defined in the Purchase Agreement), respectively;
provided, however,
that references to the “Third
Closing” in the definition of “Adverse Sales
Development” and Section 16.2(d)(iv) of the Program
Agreement shall apply solely to such closing and not to the CM
Closing. All provisions of the Program Agreement referring to the
“May Accounts,” the “May Purchase Price”,
the “Third Closing,” the “Third Closing
Date” and the “Final Third Closing Statement”
shall continue to apply thereto as set forth in the Program
Agreement, but references to the “May Accounts” shall
be deemed to exclude “Converted May
Accounts.”
3. Amendment of
Section 2.2(b) . Section 2.2(b) of the Program Agreement is
hereby amended by adding the following text at the end of such
Section:
“For the avoidance of doubt,
from the CM Closing Date until the Third Closing Date, Bank shall
not have the right to issue, offer or market a Credit Card bearing
the following names of FDS retail divisions or have any other
rights hereunder with respect to the offering of any products or
services with respect to such FDS retail divisions:
(a) Robinson’s-May, (b) Meier & Frank,
(c) Foley’s, (d) Marshall Fields, (e)
Lord & Taylor and (f) David’s
Bridal.”
4. Amendment of
Section 9.3(a) . Section 9.3(a) of the Program Agreement is
hereby amended by adding the following text at the end of such
Section:
“Except to the extent paid
pursuant to the previous sentence, not later than 10 A.M. (Eastern
time) on each Business Day, Bank shall pay to FDS Bank an amount
determined in accordance with Schedule 9.3(a)(i).”
5. Amendment of
Section 17.1 . Section 17.1(f) of the Program Agreement is
hereby amended by replacing such section in its entirety with the
following text:
“(f) any Solicitation
Materials distributed by an FDS Company and not (i) approved
by the Operating Committee or (ii) provided by
Bank;”.
6. Amendment of
Section 17.2 .
(a) Section 17.2 of the Program
Agreement is hereby amended by adding “(direct or
indirect)” after the word “damages” in the
portion of the sentence that is before clause (a) of
Section 17.2.
(b) Section 17.2(g) of the
Program Agreement is hereby amended by replacing the words
“any third party” with the words “any
Governmental Authority or other third party”.
7. Amendment of Schedule
1.1(e) . Schedule
1.1(e) of the Program Agreement is hereby amended by replacing such
Schedule in its entirety with Schedule 1.1(e) attached
hereto.
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8. Amendment of Schedule
1.1(f) . Schedule
1.1(f) of the Program Agreement is hereby amended by replacing such
Schedule in its entirety with Schedule 1.1(f) attached
hereto.
9. Amendment of Schedule
1.1(k) . Schedule
1.1(k) of the Program Agreement is hereby amended by replacing such
Schedule in its entirety with Schedule 1.1(k) attached
hereto.
10. Amendment of Schedule
1.1(l) . Schedule
1.1(l) of the Program Agreement is hereby amended by replacing such
Schedule in its entirety with Schedule 1.1(l) attached
hereto.
11. Amendment of Schedule
4.8(b)(ii) . Schedule 4.8(b)(ii) of the Program Agreement is
hereby amended by replacing such Schedule in its entirety with
Schedule 4.8(b)(ii) attached hereto.
12. Amendment of Schedule
9.3(a) . Section
(a) of Schedule 9.3(a) of the Program Agreement is hereby
amended by replacing such section in its entirety with the
following text:
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“(a)
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Monthly Net
Credit Sale Share: The compensation payable to FDS on a monthly
basis shall be reduced by an amount equal to the product of the
aggregate Net Credit Sale Share paid to FDS Bank pursuant to
Schedule 9.3(a)(i) during the preceding Fiscal Month multiplied by
the annualized Funding Cost for such Fiscal Month, divided by 360,
and multiplied by 20.”
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13. New Schedule 9.3(a)(i)
. The Program Agreement
is hereby amended by adding a new Schedule 9.3(a)(i) attached
hereto.
14. Amendment of Schedule
9.3(c) . Schedule
9.3(c) of the Program Agreement is hereby amended by adding the
following new clause (v) at the end thereof:
“(v) For the avoidance of
doubt, the parties acknowledge and agree that all May Accounts
shall be covered by and subject to the provisions of this Schedule
9.3(c) from and after the Third Closing Date.”
15. Waiver of Compliance with
Section 2.2(d) . Bank hereby waives compliance by FDS or any of
its Affiliates with Section 2.2(d) of the Program Agreement
solely with respect to the issuance by FDS Bank of FDS Debit Cards
to customers whose Credit Card Applications have been declined by
Bank in accordance with the terms and provisions of the Program
Agreement, provided that in the event FDS or any of its
Affiliates determines and communicates in writing to the OTS its
decision not to offer, issue or market any of the FDS Debit Cards
in furtherance of the implementation of the business plan of FDS
Bank (which FDS or one of its Affiliates shall do as promptly as
practicable following such determination), such waiver shall no
longer apply and the provisions of Section 2.2(d) shall
continue to apply to FDS and its Affiliates following the date
hereof. At the request of FDS, the FDS Companies and Bank shall
engage in discussions regarding mutually agreeable extensions of
the scope of the waiver of Section 2.2(d).
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16. Capacity; Authorization;
Validity .
(a) FDS hereby represents and
warrants to Bank as of the date hereof:
(i) Each FDS Company has all
necessary corporate or similar power and authority to
(A) execute and enter into this Amendment and (B) perform
the obligations required of such FDS Company hereunder and the
other documents, instruments and agreements to be executed and
delivered by such FDS Company pursuant hereto.
(ii) The execution and delivery by
the FDS Companies of this Amendment and all documents, instruments
and agreements executed and delivered by the FDS Companies pursuant
hereto, and the consummation by the FDS Companies of the
transactions specified herein, have been duly and validly
authorized and approved by all necessary corporate or similar
actions of the FDS Companies.
(iii) This Amendment (A) has
been duly executed and delivered by the FDS Companies,
(B) constitutes the valid and legally binding obligation of
the FDS Companies, and (C) is enforceable against the FDS
Companies in accordance with its terms (subject to applicable
bankruptcy, insolvency, reorganization, receivership or other laws
affecting the rights of creditors generally and by general equity
principles including those respecting the availability of specific
performance).
(b) Bank hereby represents and
warrants to the FDS Companies as of the date hereof:
(i) Bank has all necessary corporate
or similar power and authority to (A) execute and enter into
this Amendment and (B) perform the obligations required of it
hereunder and the other documents, instruments and agreements to be
executed and delivered by Bank pursuant hereto.
(ii) The execution and delivery by
Bank of this Amendment and all documents, instruments and
agreements executed and delivered by Bank pursuant hereto, and the
consummation by Bank of the transactions specified herein, has been
duly and validly authorized and approved by all necessary corporate
or similar actions of Bank.
(iii) This Amendment (A) has
been duly executed and delivered by Bank, (B) constitutes the
valid and legally binding obligation of Bank and (C) is
enforceable against Bank in accordance with its terms (subject to
applicable bankruptcy, insolvency, reorganization, receivership or
other laws affecting the rights of creditors generally and by
general equity principles including those respecting the
availability of specific performance).
17. Effect of Amendment
. This Amendment is
hereby incorporated into and made a part of the Program Agreement.
Except as amended by this Amendment, all terms and provisions of
the Program Agreement shall continue and remain in full force and
effect and binding upon the parties thereto.
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18. Binding Effect
. This Amendment shall be
binding in all respects and inure to the benefit of the successors
and permitted assigns of the parties hereto.
19. Governing Law
. This Amendment and all
rights and obligations hereunder, including matters of
construction, validity and performance, shall be governed by and
construed in accordance with the laws of the State of Delaware
applicable to contracts made to be performed within such State and
applicable federal law.
20.
Counterparts/Facsimiles . This Amendment may be executed in any number of
counterparts, all of which together shall constitute one and the
same instrument, but in making proof of this Amendment, it shall
not be necessary to produce or account for more than one such
counterpart. Any facsimile of an executed counterpart shall be
deemed an original.
[Remainder of Page Intentionally
Left Blank]
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IN WITNESS WHEREOF, each of the
parties hereto has caused this Amendment to be duly executed as of
the date first above written.
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DEPARTMENT
STORES NATIONAL BANK
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By:
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