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MASTER AGREEMENT FOR THE
FORMATION OF A LIMITED LIABILITY COMPANY
DATED AS OF SEPTEMBER 2, 1997
AMONG
BANKBOSTON CORPORATION,
BANKMONT FINANCIAL CORP.,
▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
AND
FIRST ANNAPOLIS CONSULTING, INC.
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TABLE OF CONTENTS
SECTION HEADING PAGE
ARTICLE 1 DEFINED TERMS 1
ARTICLE 2 FORMATION OF LIMITED LIABILITY COMPANY...............6
ARTICLE 3 RELATED AGREEMENTS; CLOSING..........................6
Section 3.1. Formation of the Company and Receivables LLC......7
Section 3.2. Purchase of BKB Receivables.......................7
Section 3.3. Purchase of BKB Overdue Receivables...............7
Section 3.4. Contribution by BKB...............................7
Section 3.5. Purchase of ▇▇▇▇▇▇ Receivables....................8
Section 3.6. Purchase of ▇▇▇▇▇▇ Overdue Receivables............8
Section 3.7. Contribution by ▇▇▇▇▇▇............................8
Section 3.8. Contribution by Bankmont..........................8
Section 3.9. Acquisition of ▇▇▇▇▇▇ Credit Card Operations
Facility by FDR or the Company....................8
Section 3.10. Contribution by FAMIS.............................9
Section 3.11. Account Solicitation and Servicing Agreement......9
Section 3.12. Registration Rights Agreement.....................9
Section 3.13. Termination and Release...........................9
Section 3.14. BKB Services Agreement............................9
Section 3.15. ▇▇▇▇▇▇ Services Agreement.........................9
Section 3.16. Capital Retention Agreement.......................9
Section 3.17. Transitional Services Agreements.................10
Section 3.18. BKB Trademark License............................10
Section 3.19. Management Restricted Units Plan.................10
Section 3.20. Closing..........................................10
ARTICLE 4 REPRESENTATIONS AND WARRANTIES......................10
ARTICLE 5 CERTAIN COVENANTS...................................11
Section 5.1. Ordinary Course Operation........................11
Section 5.2. Certain Additional Covenants.....................11
Section 5.3. Cooperation......................................13
Section 5.4. Current Information..............................13
Section 5.5. Access, Information and Confidentiality..........13
Section 5.6. Consents and Approvals...........................14
Section 5.7. Executive Officers...............................14
Section 5.8. ▇▇▇▇▇▇▇▇▇ Employment Agreement...................15
Section 5.9. Financing........................................15
Section 5.10. FAMIS Employees..................................16
Section 5.11. BKB Structuring Fee..............................16
Section 5.12. Disclosure Supplements...........................16
ARTICLE 6 CONDITIONS TO CLOSING...............................16
Section 6.1. Conditions to Obligation of Each Party...........17
Section 6.2. Additional Conditions to the Obligations of BKB..18
Section 6.3. Additional Conditions to the Obligations of
Bankmont and ▇▇▇▇▇▇..............................18
Section 6.4. Additional Conditions to the Obligations of FA...19
ARTICLE 7 TERMINATION.........................................20
Section 7.1. Grounds For Termination..........................20
Section 7.2. Effects of Termination...........................21
ARTICLE 8 GENERAL.............................................21
Section 8.1. Expenses.........................................21
Section 8.2. Notices..........................................22
Section 8.3. Entire Agreement.................................23
Section 8.4. Governing Law....................................23
Section 8.5. Consent to Jurisdiction..........................23
Section 8.6. Waiver of Certain Damages........................23
Section 8.7. Section Headings.................................23
Section 8.8. Assigns..........................................23
Section 8.9. No Implied Rights or Remedies....................24
Section 8.10. Counterparts.....................................24
Section 8.11. Construction.....................................24
Section 8.12. Severability.....................................24
Section 8.13. Waiver of Right to Jury Trial....................24
Section 8.14. Remedies.........................................24
EXHIBITS
Exhibit A -- Operating Agreement
Exhibit B -- Certificates of Formation
Exhibit C -- Form of BKB Purchase Agreement
Exhibit D -- Form of BKB Overdue Receivables Purchase Agreement
Exhibit E -- Form of BKB Contribution Agreement
Exhibit F -- Form of ▇▇▇▇▇▇ Purchase Agreement
Exhibit G -- Form of ▇▇▇▇▇▇ Overdue Receivables Purchase Agreement
Exhibit H -- Form of ▇▇▇▇▇▇ Contribution Agreement
Exhibit I -- Form of Bankmont Contribution Agreement
Exhibit J -- Terms of ▇▇▇▇▇▇ Credit Card Operations Facility Acquisition
Exhibit K -- Form of FAMIS Contribution Agreement
Exhibit L -- Form of Registration Rights Agreement
Exhibit M -- Form of Termination and Release
Exhibit N -- Form of BKB Services Agreement
Exhibit O -- Form of ▇▇▇▇▇▇ Services Agreement
Exhibit P -- Capital Retention Agreement
Exhibit Q -- Form of Employment Agreement for ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Exhibit R -- Terms of Bridge Loan
Exhibit S -- Form of FDR Release
SCHEDULES
Schedule 4A -- Certain Representations of BKB and FA
Schedule 4B -- Exceptions to Representations and Warranties
Schedule 5.2(b) -- Material Agreements
Schedule 5.2(f) -- Agreements with Employees
Schedule 6.2(d) -- BKB Third Party Consents
Schedule 6.3(d) -- Bankmont and ▇▇▇▇▇▇ Third Party Consents
Schedule 6.4(d) -- FA Third Party Consents
Schedule 7.1(b) -- Required Regulatory Approvals
Schedule 8.1 -- Certain FAMIS Expenses
MASTER AGREEMENT FOR THE
FORMATION OF A LIMITED LIABILITY COMPANY
This is a Master Agreement for the Formation of a Limited Liability
Company, dated as of September 2, 1997 (as in effect from time to time,
this "Agreement"), among (a) BankBoston Corporation, a Massachusetts
corporation ("BKB"), (b) Bankmont Financial Corp., a Delaware corporation
("Bankmont"), (c) ▇▇▇▇▇▇ Trust and Savings Bank, an Illinois banking
corporation ("▇▇▇▇▇▇"), and (d) First Annapolis Consulting, Inc., a
Maryland corporation ("FA").
WHEREAS, the parties hereto wish to form a Delaware limited
liability company for the purpose of engaging in the retail credit card
business, both through the company's own portfolio and as a provider of
marketing services to others on a domestic and international level;
WHEREAS, certain of the parties hereto desire to participate in the
company through the purchase of membership interests in the company
("Membership Interests") and certain of the parties hereto desire to
participate in the company through the contribution or sale to the
company of certain credit card related assets owned by them or their
affiliates in exchange for cash and/or Membership Interests, in each case
upon the terms and conditions more fully set forth herein;
WHEREAS, the parties hereto desire that the company, BKB and ▇▇▇▇▇▇
(or certain Affiliates of BKB and ▇▇▇▇▇▇) enter into certain servicing
arrangements, pursuant to which the company will provide to BKB and
▇▇▇▇▇▇ (or certain Affiliates of BKB or ▇▇▇▇▇▇) certain accounting,
processing and marketing services for their credit card businesses, as
more fully set forth herein; and
WHEREAS, the parties hereto desire to arrange third-party financing
for the company, as more fully set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises, the
mutual covenants set forth below and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE 1
ARTICLE 1. DEFINED TERMS
In addition to the defined terms found elsewhere in this Agreement,
as used in this Agreement the following terms shall have the following
meanings:
"Account Solicitation and Services Agreement" shall have the
meaning set forth in Section 3.11.
"Affiliate" means, with respect to any Person, any other Person
controlling, controlled by or under common control with, such Person. As
used in this definition, (a) "control" (including, with its correlative
meanings, "controlling," "controlled by" and "under common control with")
means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of that Person,
whether through the ownership of voting securities, by contract or
otherwise and (b) with respect to any Person other than a subsidiary of
the Company, the term "Affiliate" shall not include the Company or any
subsidiary of the Company.
"Agreement" has the meaning set forth in the preamble.
"Bankmont" has the meaning set forth in the preamble.
"Bankmont Contribution Agreement" has the meaning set forth in
Section 3.8.
"BKB" has the meaning set forth in the preamble.
"BKB-CT" means Bank of Boston Connecticut.
"BKB-NH" means BankBoston (NH), National Association.
"BKB Assets" means the assets of FNBB and/or BKB-NH to be
contributed to or purchased by the Company, the CEBA Bank and Receivables
LLC, as applicable, pursuant to the BKB Purchase Agreement, the BKB
Overdue Receivables Purchase Agreement and the BKB Contribution
Agreement.
"BKB Contribution Agreement" has the meaning set forth in Section 3.4.
"BKB International Credit Card Business" means the provision of
unsecured lines of credit accessible by VISA(R) or MasterCard(R) to
consumers located outside of the United States, the servicing of such
credit card relationships, and the provision of services incidental
thereto by BKB and its Affiliates.
"BKB Overdue Receivables" has the meaning set forth in Section 3.3.
"BKB Overdue Receivables Purchase Agreement" has the meaning set
forth in Section 3.3.
"BKB Purchase Agreement" has the meaning set forth in Section 3.2.
"BKB Relationship Credit Card Business" means the Credit Card
Business engaged in by BKB and its Affiliates with consumers who are
employees, officers or directors of BKB or BKB's Affiliates or a family
member of any such employee, officer or director or with any other Person
who maintains at least one other ongoing customer relationship with BKB
or any of its Affiliates at the time of reference.
"BKB Services Agreement" has the meaning set forth in Section 3.14.
"BKB Trademark License" has the meaning set forth in Section 3.18.
"BKB Value-Limited Credit Card Business" means the Credit Card
Business (other than the BKB Relationship Credit Card Business) of BKB
and its Affiliates in the United States, to the extent that the aggregate
outstanding balance of credit card accounts comprising such Credit Card
Business does not exceed $250 million.
"Business Day" means a day other than Saturday, Sunday or any day
on which banks located in the Commonwealth of Massachusetts or the State
of Illinois are authorized or obligated to close.
"CEBA Bank" has the meaning set forth in Section 3.10.
"CEBA Bank Rights" has the meaning set forth in Section 3.10.
"Capital Retention Agreement" has the meaning set forth in Section
3.16.
"Certificates of Formation" has the meaning set forth in Section 3.1.
"Closing" has the meaning set forth in Section 3.21.
"Closing Conditions" means the conditions set forth in Article 6
which must be fulfilled prior to Closing.
"Closing Date" has the meaning set forth in Section 3.21.
"Code" has the meaning set forth in Section 5.2(f).
"Common Units" has the meaning assigned to such term in the
Operating Agreement.
"Company" has the meaning set forth in Article 2.
"Company Business Plan" means the business plan of the Company,
including, without limitation, the capital structure described therein,
as in effect on the date hereof.
"Contribution Agreements" means, collectively, the BKB Contribution
Agreement, the ▇▇▇▇▇▇ Contribution Agreement, the FAMIS Contribution
Agreement and the Bankmont Contribution Agreement.
"Contributed Assets" means, collectively, the BKB Assets, the FAMIS
Assets and the ▇▇▇▇▇▇ Assets.
"Contributed Business" means (a) with respect to BKB, the Credit
Card Businesses of its Credit Card Subsidiaries which are to be
contributed and/or sold to the Company and/or its subsidiaries on the
Closing Date pursuant to the BKB Contribution Agreement, the BKB Purchase
Agreement and the BKB Overdue Receivables Purchase Agreement, (b) with
respect to ▇▇▇▇▇▇, the Credit Card Businesses which are to be contributed
and/or sold to the Company and/or its subsidiaries on the Closing Date
pursuant to the ▇▇▇▇▇▇ Contribution Agreement, the ▇▇▇▇▇▇ Purchase
Agreement, the ▇▇▇▇▇▇ Overdue Receivables Purchase Agreement and, if
applicable, the ▇▇▇▇▇▇ Credit Card Operations Agreement and (c) with
respect to FA, the businesses of its Credit Card Subsidiary which are to
be contributed and/or sold to the Company and/or its subsidiaries on the
Closing Date pursuant to the FAMIS Contribution Agreement.
"Credit Card Business" means the provision of unsecured lines of
credit accessible by Visa(R) or MasterCard(R) to consumers within the
United States of America, the servicing of such credit card
relationships, and the provision of services incidental thereto.
"Credit Card Subsidiaries" means (a) with respect to ▇▇▇, ▇▇▇-▇▇,
▇▇▇-▇▇ and FNBB and (b) with respect to FA, FAMIS. The parties to this
Agreement acknowledge that it is intended that, prior to the Closing
Date, BKB-CT will transfer its Credit Card Business to either FNBB or
BKB-NH. Upon such transfer, BKB-CT shall cease to be a Credit Card
Subsidiary.
"Disclosing Party" has the meaning set forth in Section 5.5(b).
"FA" has the meaning set forth in the preamble.
"FAMIS" has the meaning set forth in Section 3.10.
"FAMIS Assets" means the assets to be contributed to the Company by
FAMIS pursuant to the FAMIS Contribution Agreement.
"FAMIS Contribution Agreement" has the meaning set forth in Section
3.10.
"FAMIS Services Agreement" means a certain Services Agreement,
dated as of June 22, 1995, between FAMIS and FNBB, as amended by a letter
agreement dated November 12, 1996 between such parties.
"FAMIS Affiliate Agreement" means a certain Customer Transaction
Card Affiliate Agreement, dated as of June 22, 1995, between FAMIS and
BKB-CT.
"FDR" has the meaning set forth in Section 3.9.
"FNBB" means BankBoston, N.A., formerly The First National Bank of
Boston.
"Governmental Authority" has the meaning set forth in Section 6.1(a).
"▇▇▇▇▇▇" has the meaning set forth in the preamble.
"▇▇▇▇▇▇ Assets" means the assets of ▇▇▇▇▇▇ to be contributed to
and/or purchased by the Company, Receivables LLC and CEBA Bank, as
applicable, pursuant to the ▇▇▇▇▇▇ Purchase Agreement, the ▇▇▇▇▇▇ Overdue
Receivables Purchase Agreement, the ▇▇▇▇▇▇ Contribution Agreement and, if
applicable, the ▇▇▇▇▇▇ Credit Card Operations Agreement.
"▇▇▇▇▇▇ Contribution Agreement" has the meaning set forth in
Section 3.7.
"▇▇▇▇▇▇ Credit Card Operations" has the meaning set forth in
Section 3.9.
"▇▇▇▇▇▇ Credit Card Operations Agreement" has the meaning set forth
in Section 3.9.
"▇▇▇▇▇▇ Overdue Receivables" has the meaning set forth in Section
3.6.
"▇▇▇▇▇▇ Overdue Receivables Purchase Agreement" has the meaning set
forth in Section 3.6.
"▇▇▇▇▇▇ Purchase Agreement" has the meaning set forth in Section 3.5.
"▇▇▇▇▇▇ Services Agreement" has the meaning set forth in Section 3.15.
"Information" has the meaning set forth in Section 5.5(b).
"Management Restricted Units Plan" has the meaning set forth in
Section 3.19.
"Membership Interests" has the meaning set forth in the recitals hereto.
"▇▇▇▇▇▇▇" has the meaning set forth in Section 5.9(e).
"▇▇▇▇▇▇▇" has the meaning set forth in Section 5.9(e).
"Operating Agreement" shall mean that certain Limited Liability
Company Agreement to be dated as of the Closing Date among the Company,
BKB, Bankmont, ▇▇▇▇▇▇, ▇▇ and the other parties named therein,
substantially in the form of Exhibit A hereto, as in effect from time to
time.
"Person" means any individual, partnership, corporation,
association, trust, limited liability company, joint venture,
unincorporated organization and any government, governmental department
or agency or political subdivision thereof.
"Purchase Agreements" means the BKB Purchase Agreement, the BKB
Overdue Receivables Purchase Agreement, the ▇▇▇▇▇▇ Purchase Agreement,
the ▇▇▇▇▇▇ Overdue Receivables Purchase Agreement and, if applicable, the
▇▇▇▇▇▇ Credit Card Operations Agreement, collectively.
"Receivables LLC" means a Delaware limited liability company to be
formed prior to the Closing Date as a wholly-owned subsidiary of the
Company.
"Registration Rights Agreement" has the meaning set forth in
Section 3.12.
"Regulatory Approvals" shall mean any approval or consent of, or
notice to or filing with any United States or Canadian federal, state or
local banking, regulatory or other governmental agency or authority.
"Related Agreements" means, collectively, the Certificates of
Formation, the Operating Agreement, the Contribution Agreements, the
Purchase Agreements, the Registration Rights Agreement, the Account
Solicitation and Services Agreement, the BKB Services Agreement, the
Capital Retention Agreement, the ▇▇▇▇▇▇ Services Agreement, the BKB
Trademark License and the ▇▇▇▇▇▇▇▇▇ Employment Agreement.
"Required Regulatory Approvals" has the meaning set forth in
Section 7.1(b).
"Required Subdebt Amount" has the meaning set forth in Section
5.9(b).
"Series A Units" has the meaning assigned to such term in the
Operating Agreement.
"▇▇▇▇▇▇▇▇▇ Employment Agreement" has the meaning set forth in
Section 5.8.
"Termination and Release" has the meaning set forth in Section
3.13.
ARTICLE 2
FORMATION OF LIMITED LIABILITY COMPANY
The parties hereto agree that, subject to the terms and conditions
of this Agreement and the other Related Agreements, they shall form a
Delaware limited liability company (the "Company") to operate a consumer
credit card business as set forth in the Operating Agreement. It is
further understood that (a) this Agreement itself shall not constitute or
create a joint venture, partnership, limited liability company or any
other similar arrangement between the parties hereto and (b) no party
hereto shall be authorized to act as agent of any other party hereto.
ARTICLE 3
RELATED AGREEMENTS; CLOSING
Section 3.1. Formation of the Company and Receivables LLC. (a) On or
before the Closing Date, the parties hereto shall cause the Company and
Receivables LLC to be organized and formed under names to be agreed upon
by the parties hereto by filing Certificates of Formation, each
substantially in the form of Exhibit B hereto (as in effect from time to
time, the "Certificates of Formation"), with the Secretary of State of
the State of Delaware.
(b) On the Closing Date, the parties hereto shall enter into the
Operating Agreement.
Section 3.2. Purchase of BKB Receivables. On the Closing Date, BKB
shall cause its Credit Card Subsidiaries, as applicable, to enter into a
Receivables Purchase and Sale Agreement with CEBA Bank, substantially in
the form of Exhibit C hereto (as in effect from time to time, the "BKB
Purchase Agreement"), pursuant to which such subsidiaries shall sell to
CEBA Bank, and CEBA Bank shall purchase from such subsidiaries, the
accounts receivable (other than the BKB Overdue Receivables) generated by
the Credit Card Business of such subsidiaries (excluding the BKB
Relationship Credit Card Business and the BKB Value-Limited Credit Card
Business). In consideration of the foregoing, BKB, or such of its
Affiliates as BKB may designate, shall receive an amount equal to the sum
of all such credit card receivables sold to CEBA Bank, all as more fully
set forth in the BKB Purchase Agreement.
Section 3.3. Purchase of BKB Overdue Receivables. On the Closing
Date, BKB shall cause its Credit Card Subsidiaries, as applicable, to
enter into an Overdue Receivables Purchase and Sale Agreement with
Receivables LLC, substantially in the form of Exhibit D hereto (as in
effect from time to time, the "BKB Overdue Receivables Purchase
Agreement"), pursuant to which such subsidiaries shall sell to
Receivables LLC, and Receivables LLC shall purchase from such
subsidiaries, certain accounts receivable generated by the Credit Card
Business of such subsidiaries (excluding the BKB Relationship Credit Card
Business and the BKB Value-Limited Credit Card Business), including,
without limitation, all accounts receivable which are over thirty (30)
days in arrears or charged off as of the Closing Date (the "BKB Overdue
Receivables"). In consideration of the foregoing, BKB or such Affiliates
of BKB as BKB may designate, shall receive an amount equal to the sum of
all such credit card receivables sold to Receivables LLC pursuant to this
Section 3.3, all as more fully set forth in the BKB Overdue Receivables
Purchase Agreement.
Section 3.4. Contribution by BKB. On the Closing Date, BKB shall
cause its Credit Card Subsidiaries, as applicable, to enter into a
Contribution Agreement with the Company substantially in the form of
Exhibit E hereto (as in effect from time to time, the "BKB Contribution
Agreement"), pursuant to which such subsidiaries shall contribute to the
Company, and the Company shall assume from such subsidiaries, the
intangible assets (other than the accounts receivable) associated with
the Credit Card Business of such subsidiaries (excluding the BKB
Relationship Credit Card Business and the BKB Value-Limited Credit Card
Business). In consideration of the foregoing, BKB, or such of its
subsidiaries as BKB may designate, shall receive Membership Interests
comprised of (a) $50 million in stated value of Series A Units, and (b) a
19% share of all Common Units, all as more fully set forth in the BKB
Contribution Agreement.
Section 3.5. Purchase of ▇▇▇▇▇▇ Receivables. On the Closing Date,
▇▇▇▇▇▇ shall enter into a Receivables Purchase and Sale Agreement with
CEBA Bank, substantially in the form of Exhibit F hereto (as in effect
from time to time, the "▇▇▇▇▇▇ Purchase Agreement"), pursuant to which
▇▇▇▇▇▇ shall sell to CEBA Bank, and CEBA Bank shall purchase from ▇▇▇▇▇▇,
the accounts receivable (other than the ▇▇▇▇▇▇ Overdue Receivables)
generated by the Credit Card Business of ▇▇▇▇▇▇. In consideration of the
foregoing, ▇▇▇▇▇▇, or such of its Affiliates as ▇▇▇▇▇▇ may designate,
shall receive an amount equal to the sum of all such credit card
receivables sold to CEBA Bank, all as more fully set forth in the ▇▇▇▇▇▇
Purchase Agreement.
Section 3.6. Purchase of ▇▇▇▇▇▇ Overdue Receivables. On the Closing
Date, ▇▇▇▇▇▇ shall enter into an Overdue Receivables Purchase and Sale
Agreement with Receivables LLC, substantially in the form of Exhibit G
hereto (as in effect from time to time, the "▇▇▇▇▇▇ Overdue Receivables
Purchase Agreement"), pursuant to which ▇▇▇▇▇▇ shall sell to Receivables
LLC, and Receivables LLC shall purchase from ▇▇▇▇▇▇, certain accounts
receivable generated by the Credit Card Business of ▇▇▇▇▇▇, including,
without limitation, all accounts receivable which are over thirty (30)
days in arrears or charged off as of the Closing Date (the "▇▇▇▇▇▇
Overdue Receivables"). In consideration of the foregoing, ▇▇▇▇▇▇, or such
of its Affiliates as ▇▇▇▇▇▇ may designate, shall receive an amount equal
to the sum of all such credit card receivables sold to Receivables LLC
pursuant to this Section 3.6, all as more fully set forth in the ▇▇▇▇▇▇
Overdue Receivables Purchase Agreement.
Section 3.7. Contribution by ▇▇▇▇▇▇. On the Closing Date, ▇▇▇▇▇▇
shall enter into a Contribution Agreement with the Company, substantially
in the form of Exhibit H hereto (as in effect from time to time, the
"▇▇▇▇▇▇ Contribution Agreement"), pursuant to which ▇▇▇▇▇▇ shall
contribute to the Company, and the Company shall assume from ▇▇▇▇▇▇, the
intangible assets (other than the accounts receivable) associated with
the Credit Card Business of ▇▇▇▇▇▇. In consideration of the foregoing,
▇▇▇▇▇▇ shall receive Membership Interests comprised of (a) $28,299,320 in
stated value of Series A Units, and (b) a 15.02% share of all Common
Units, all as more fully set forth in the ▇▇▇▇▇▇ Contribution Agreement.
Section 3.8. Contribution by Bankmont. On the Closing Date, Bankmont
shall enter into a Contribution Agreement with the Company, substantially
in the form of Exhibit I hereto (as in effect from time to time, the
"Bankmont Contribution Agreement"), pursuant to which Bankmont shall
purchase Membership Interests comprised of (a) $101,700,680 in stated
value of Series A Units and (b) a 53.98% share of all Common Units for an
aggregate purchase price of $115 million, all as more fully set forth in
the Bankmont Contribution Agreement.
Section 3.9. Acquisition of ▇▇▇▇▇▇ Credit Card Operations by FDR or
the Company. In the event that on the Closing Date ▇▇▇▇▇▇ shall not have
consummated the sale of certain assets and liabilities relating to its
credit card operations facility (the "▇▇▇▇▇▇ Credit Card Operations
Facility") to First Data Resources Inc. ("FDR") substantially on the
terms set forth on Exhibit J hereto or on such other terms as may be
agreed to by FDR and ▇▇▇▇▇▇, then, on the Closing Date, the Company shall
purchase the ▇▇▇▇▇▇ Credit Card Operations from ▇▇▇▇▇▇ on terms to be
negotiated in good faith by the parties hereto, which terms shall be
consistent with the Proposed Term Sheet dated August 12, 1997 among, BKB,
FA and Bankmont, including, without limitation, an offer of employment by
the Company to all individuals who are employees of the ▇▇▇▇▇▇ Credit
Card Business.
Section 3.10. Contribution by FAMIS. On or prior to the Closing Date,
FA shall transfer to First Annapolis Marketing Information Services,
Inc., a Maryland corporation ("FAMIS"), all of FA's rights (the "CEBA
Bank Rights") to the application filed on behalf of FA to form a CEBA
Bank (the "CEBA Bank") to be based in Delaware. On the Closing Date, FA
shall cause FAMIS to enter into a Contribution Agreement with the
Company, substantially in the form of Exhibit K hereto (as in effect from
time to time, the "FAMIS Contribution Agreement"), pursuant to which
FAMIS shall contribute to the Company, and the Company shall assume from
FAMIS, (a) substantially all of the assets of FAMIS, and (b) the CEBA
Bank Rights. In consideration of the foregoing, certain shareholders of
FAMIS shall receive Membership Interests comprised of (a) $20 million in
stated value of Series A Units and (b) a 12% share of all Common Units,
all as more fully set forth in the FAMIS Contribution Agreement.
Section 3.11. Account Solicitation and Servicing Agreement. On the
Closing Date, the Company will enter into an Account Solicitation and
Servicing Agreement with the CEBA Bank, in form and substance reasonably
satisfactory to the parties hereto (as in effect from time to time, the
"Account Solicitation and Servicing Agreement"), pursuant to which, among
other things, the Company will solicit new credit card account
relationships for the CEBA Bank and manage the CEBA Bank's credit card
account relationships.
Section 3.12. Registration Rights Agreement. On the Closing Date,
each of the parties listed on the signature pages thereto (or such other
permitted transferee as such parties may designate) shall execute and
deliver counterparts of a Registration Rights Agreement, substantially in
the form of Exhibit L hereto (as in effect from time to time, the
"Registration Rights Agreement").
Section 3.13. Termination and Release. On the Closing Date, FA shall
cause FAMIS to enter into, and BKB shall cause FNBB to enter into, a
Termination and Release in substantially the form attached hereto as
Exhibit M (the "Termination and Release").
Section 3.14. BKB Services Agreement. On the Closing Date, the
parties shall cause the Company to enter into a Services Agreement with
BKB, substantially in the form of Exhibit N (as in effect from time to
time, the "BKB Services Agreement"). Without limiting the foregoing, the
BKB Services Agreement shall include the Operations Manual (as defined
therein) which shall have been reviewed by and mutually agreed to by BKB
and the Company prior to the Closing Date.
Section 3.15. ▇▇▇▇▇▇ Services Agreement. On the Closing Date, the
parties shall cause the Company to enter into a Servicing Agreement with
▇▇▇▇▇▇, substantially in the form of Exhibit O hereto (as in effect from
time to time, the "▇▇▇▇▇▇ Services Agreement").
Section 3.16. Capital Retention Agreement. On the Closing Date, First
Annapolis Capital, LLC, the Company, CEBA Bank and Receivables LLC shall
enter into the Capital Retention Agreement, substantially in the form of
Exhibit P hereto (as in effect from time to time, the "Capital Retention
Agreement").
Section 3.17. Transitional Services Agreements. On the Closing Date,
the Company shall enter into a separate Transitional Services Agreement
with each of FA, Bankmont and BKB (or a respective Affiliate) with
respect to the provision of services by each of FA, Bankmont and BKB and
their respective applicable Affiliates to the Company on such terms as
may be reasonably satisfactory to the parties hereto.
Section 3.18. BKB Trademark License. On the Closing Date, BKB will
enter into a Trademark License Agreement (the "BKB Trademark License")
with the Company on such terms as may be reasonably satisfactory to the
parties hereto.
Section 3.19. Management Restricted Units Plan. On the Closing Date,
the Company shall enter into an incentive compensation plan (the
"Management Restricted Units Plan") providing for the granting to
selected employees of the Company certain restricted rights in up to four
percent (4%) of the Common Units of the Company on such terms as may be
agreed to by the parties hereto.
Section 3.20. Closing. Subject to the provisions of Article 6 hereof,
the consummation of the transactions contemplated by this Agreement shall
take place at a closing (the "Closing") to be held at the Chicago,
Illinois offices of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, on a mutually acceptable date not
later than the tenth Business Day after receipt of the Required
Regulatory Approvals or on such other date or at such other place as
shall be agreed to in writing by all of the parties hereto. The date on
which the Closing actually occurs is referred to herein as the "Closing
Date."
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Each of the parties hereto hereby represents and warrants to each
of the other parties hereto that (a) all of the representations and
warranties of such party and its Affiliates which are set forth in the
Related Agreements and on Schedule 4A hereto are true and correct as of
the date hereof as though made at and as of the date hereof (except as
specified on Schedule 4B hereto and excluding any representations and
warranties made by the Company or any of its subsidiaries) and shall be
true and correct in all material respects as of the Closing Date, with
respect to such party and its Affiliates and the Company, as though made
at and as of the Closing Date, except to the extent that any such
representation and warranty is made as of a specified date other than the
date hereof or the Closing Date, in which case such representation and
warranty shall be true and correct as of such specified date and (b)
except for the Required Regulatory Approvals listed on Schedule 7.1(a)
hereto and the consents of nongovernmental third parties listed on
Schedules 6.2(d), 6.3(d) and 6.4(d) hereto to be obtained by such party
and its Affiliates, no Regulatory Approvals or consents of
nongovernmental third parties are required in connection with the
execution, delivery or performance by such party or any of its Affiliates
of this Agreement or any of the Related Agreement to which such party or
any of its Affiliates is or is to be a party.
ARTICLE 5
CERTAIN COVENANTS
Section 5.1. Ordinary Course Operation. During the period commencing
on the date hereof and ending on the Closing Date, each of BKB and FA
agrees to cause each of its respective Credit Card Subsidiaries to, and
▇▇▇▇▇▇ shall:
(a) operate its respective Contributed Business only in the
ordinary course on a basis consistent with past practice; provided,
however, that for purposes of this Section 5.1(a), the
implementation of repricing strategies, account segmentation
strategies and direct marketing programs by ▇▇▇▇▇▇ as recommended
by FA pursuant to an engagement letter between ▇▇▇▇▇▇ and FA shall
be considered to be in the ordinary course of ▇▇▇▇▇▇' business.
(b) use all reasonable efforts to preserve its Contributed
Business and to keep available the services of the full-time
officers and employees engaged therein to the extent required to
conduct its Contributed Business in substantially the same manner
as conducted on the date hereof; provided, that changes in credit
card receivable portfolio size shall not be deemed to breach this
clause (b);
(c) use all reasonable efforts to maintain good relations
with cardholders and other Persons having a business relationship
with its Contributed Business;
(d) preserve and maintain all permits, licenses, approvals
and authorizations necessary to operate its Contributed Business
and renew the same if any should expire;
(e) use all reasonable efforts to maintain in full force and
effect all of the material contracts which constitute Contributed
Assets;
(f) comply in all material respects with all laws,
ordinances, rules and regulations applicable to its Contributed
Business; and
(g) maintain the books of account and records related to its
Contributed Business in the ordinary course consistent with past
practices.
Section 5.2. Certain Additional Covenants. During the period
commencing on the date hereof and ending on the Closing Date, without the
prior written consent of the other parties hereto or except as expressly
permitted or required by this Agreement, none of BKB and FA will permit
its respective Credit Card Subsidiaries to, and ▇▇▇▇▇▇ shall not:
(a) make any material change in accounting methods,
principles or practices used by such Person in its Contributed
Business, unless required by law or by changes in GAAP;
(b) except as set forth on Schedule 5.2(b) hereto, (i) enter
into any material contract, transaction or commitment related to
such Person's Contributed Business or (ii) terminate or materially
change any material contracts which constitute Contributed Assets,
in each case, other than in the ordinary course of business
consistent with past practice;
(c) (i) except as set forth in item 2 in Schedule 5.2(b)
hereto, transfer or otherwise dispose of or encumber any of the
Contributed Assets, other than in the ordinary course of business
consistent with past practice; (ii) cancel any debt or waive or
compromise any claim or right related to such Person's Contributed
Business, other than in the ordinary course of business consistent
with past practice; (iii) make any capital expenditure or
commitment related to such Person's Contributed Business, other
than in the ordinary course of business consistent with past
practice; (iv) except with respect to endorsements of negotiable
instruments in the ordinary course of its business, incur, assume
or guarantee any indebtedness for borrowed money related to such
Person's Contributed Business which will constitute a liability to
the Company as of the Closing Date other than (A) purchase money
indebtedness, (B) indebtedness for borrowed money pursuant to
credit agreements, credit lines and other borrowing facilities and
arrangements in effect on the date of this Agreement, (C)
refinancing of existing indebtedness, or (D) indebtedness incurred
by such Person pursuant to any revolving credit facility utilized
to finance its Contributed Business; or (v) agree to do any of the
foregoing;
(d) unless required by applicable law or pursuant to this
Agreement or the other Related Agreements, materially alter or vary
its methods or policies of underwriting, originating, selling or
servicing, or buying or selling rights to service, the Contributed
Assets, except as specifically set forth in the proviso to Section
5.1(a) with respect to ▇▇▇▇▇▇;
(e) except as contemplated hereby or by the other Related
Agreements, enter into any servicing agreement with respect to the
Contributed Assets;
(f) enter into or amend any employment, bonus, severance, or
retirement contract or arrangement, or increase any salary or other
form of compensation payable or to become payable to any current or
former employee, officer, or director engaged in such Person's
Contributed Business (including any beneficiary thereof), except
(i) as may be required in order to obtain any favorable
determination letter with respect to any employee benefit plan
intended to be qualified under Section 401(a) of the Internal
Revenue Code of 1986, as amended (the "Code"), (ii) merit increases
to employees (including directors and executive officers) in
accordance with past practices and general increases to employees
(excluding directors and executive officers) as a class in
accordance with past practice or as required by law, (iii) bonus
payments made to FAMIS employees prior to the Closing and (iv)
other obligations which would not become obligations of the Company
upon Closing; or
(g) enter into any agreement, understanding or transaction
with any Affiliate related to such Person's Contributed Business,
other than (i) on arms-length terms in the ordinary course of
business consistent with past practices, or (ii) as expressly
contemplated hereby or by the other Related Agreements.
Section 5.3. Cooperation. Each of the parties hereto will cooperate
in good faith and use all reasonable efforts to cause the transactions
contemplated by this Agreement and the other Related Agreements to be
consummated in accordance with the terms and conditions hereof and
thereof. The foregoing obligations in this Section 5.3 shall not be
deemed to require any party hereto to waive any right under this
Agreement or any other Related Agreement.
Section 5.4. Current Information. During the period commencing on
the date hereof and ending on the Closing Date, each of BKB, ▇▇▇▇▇▇ and
FA will cause one or more of its representatives to confer on a regular
and frequent basis with representatives of the other parties hereto with
respect to the Contributed Assets and the status of the ongoing
Contributed Business operations of their respective Credit Card
Subsidiaries. Each of BKB, ▇▇▇▇▇▇ and FA will promptly notify the other
parties hereto of any material change in the normal course of its
respective Credit Card Subsidiaries' Contributed Business or in its
Credit Card Business, as the case may be, or in the operation of any
properties relating thereto. To the extent permitted by applicable law,
each of the parties hereto (a) will promptly notify the other parties
hereto of any governmental complaints, investigations or hearings (or
communications indicating that the same may be contemplated) or the
institution or the threat of litigation, involving such party which would
be reasonably likely in any manner to challenge, prevent, alter or
materially delay any of the transactions contemplated hereby or by the
other Related Agreements, and (b) will keep the other parties hereto
informed with respect to such events. Each of the parties hereto will
also notify the other parties hereto of the status of regulatory
applications and third party consents related to the transactions
contemplated hereby and by the other Related Agreements.
Section 5.5. Access, Information and Confidentiality. (a) During the
period commencing on the date hereof and ending on the Closing Date, each
of BKB, ▇▇▇▇▇▇ and FA shall, and cause each of its respective Credit Card
Subsidiaries to, afford to the parties hereto and their respective
representatives (including, without limitation, officers and employees
and their authorized agents, consultants and advisors) such access during
normal business hours to its books, records, properties, personnel,
customers and other information related to such Person's Contributed
Assets and Contributed Business as the parties hereto may reasonably
request, unless restricted by law.
(b) Each party to this Agreement shall hold, and shall cause its
subsidiaries and the respective directors, officers, employees, agents,
consultants and advisors of such party and its subsidiaries to hold, in
strict confidence, at all times from and after the date hereof, unless
disclosure to a banking or other regulatory authority is necessary in
connection with any necessary regulatory approval or unless compelled to
disclose by judicial or administrative process or, in the written opinion
of its counsel, by other requirement of law or the applicable
requirements of any regulatory agency or relevant stock exchange, all
non-public records, books, contracts, reports, instruments, computer data
and other data and information, including, without limitation, all
information regarding customers, pricing policies, methods of operation,
proprietary computer programs, sales, products, profits, costs, markets,
key personnel, formulae, product applications, technical processes and
trade secrets (collectively, "Information") concerning the Company, any
other party hereto and any Affiliate of any other party hereto (or, if
required under a contract with a third party, such third party) furnished
or made available to it by such other parties, the Company or any
representative thereof pursuant to this Agreement or any other Related
Agreement, except to the extent that such Information can be shown to
have been (i) previously known by such party on a non-confidential basis,
(ii) available to such party on a non-confidential basis from a source
other than the disclosing party, (iii) in the public domain through no
fault of such party, or (iv) later lawfully acquired from other sources
by the party to which it was furnished or made available, and none of the
parties shall release or disclose such Information to any other person,
except its auditors, attorneys, financial advisors, bankers, other
consultants and advisors who have a need to know and are advised of the
confidentiality of such Information, and, to the extent permitted above,
to banking and other regulatory authorities. In the event that a party to
this Agreement receives notice that it will be compelled to disclose any
Information in connection with any necessary regulatory approval or by
judicial or administrative process, such party shall provide the party
who provided such Information (the "Disclosing Party") with prompt prior
written notice of such requirement so that the Disclosing Party may seek
a protective order or other appropriate remedy and/or waive the terms of
this Section 5.5 with respect to the disclosure of such Information. In
the event that such protective order or other remedy is not obtained,
only that portion of the Information which is legally required to be
disclosed shall be so disclosed.
Section 5.6. Consents and Approvals. Each of the parties hereto
shall use all reasonable efforts and cooperate in good faith with the
other parties hereto with a view to (a) obtaining as soon as practicable
all Required Regulatory Approvals and all third-party consents required
for the consummation of the transactions contemplated hereby and by the
other Related Agreements, and each party hereto shall make available to
the other parties hereto all information reasonably required in
connection with obtaining such approvals and consents; and (b) satisfying
all other Closing Conditions. Each of the parties hereto shall deliver to
the other parties hereto copies of all proposed filings to be made by
such party with banking, regulatory and other Governmental Authorities,
shall use its reasonable efforts to accommodate any suggestions or
recommendations made by the other parties hereto with respect thereto and
shall deliver to the other parties hereto, as soon as practicable, copies
of all final applications to Governmental Authorities, in each case with
respect to the transactions contemplated by this Agreement and the
Related Agreements.
Section 5.7. Executive Officers. On the Closing Date, the parties
hereto shall take such action as is necessary and proper to cause the
Company to appoint and employ, on terms satisfactory to the Management
Committee (as defined in the Operating Agreement), which in some
instances shall include incentives in the form of cash bonuses and/or
Management Restricted Units (as defined in the Operating Agreement) based
on performance parameters, the following individuals to serve as
executive officers of the Company, to hold the office(s) set forth
opposite their respective names in the table below, and such individuals
shall have accepted such offices until their successors are duly
appointed:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ President and Chief Executive Officer
▇▇▇▇ ▇▇▇▇▇▇▇ Executive Vice President, Corporate
Development
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ Executive Vice President, Marketing
and Analysis
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Vice President, Credit Policy and
Risk Management
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Vice President, Operations
The parties agree to cooperate in hiring a Chief Financial Officer (who
will be an Executive Vice President), a General Counsel and officers in
charge of human resources and information technology.
Section 5.8. ▇▇▇▇▇▇▇▇▇ Employment Agreement. On the Closing Date,
the parties hereto shall cause the Company to enter into an employment
agreement with ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, substantially in the form attached
hereto as Exhibit Q (as in effect from time to time, the "▇▇▇▇▇▇▇▇▇
Employment Agreement").
Section 5.9. Financing.
(a) Cooperation. The parties hereto agree to cooperate in good
faith with each other and use all reasonable efforts to secure
third-party financing for the Company and/or its subsidiaries in amounts
sufficient to enable the Company and/or its subsidiaries to operate their
businesses after the Closing as contemplated by the Company Business
Plan, provided, however, that the parties hereto agree that none of the
parties hereto or any of their respective Affiliates shall be required to
provide any portion of such financing or any credit enhancements or
guaranties therefor other than as described in paragraph (c) below and,
in the case of Bankmont, the Bankmont Contribution Agreement.
(b) Subordinated Debt. The parties hereto agree to cooperate in
good faith with each other and use all reasonable efforts to cause the
Company (or one of its subsidiaries) to issue subordinated indebtedness
on the Closing Date in an amount sufficient to enable the Company to
effect the transactions contemplated to occur at the Closing pursuant to
this Agreement and the Related Agreements (the "Required Subdebt
Amount").
(c) Bridge Loan. In the event that the Company is unable to issue
subordinated indebtedness on the Closing Date in an amount at least equal
to the Required Subdebt Amount, then BKB and Bankmont shall provide or
cause to be provided a temporary bridge loan to the Company in an
aggregate amount equal to (i) the lesser of (A) $200 million and (B) the
Required Subdebt Amount, minus (ii) the amount of subordinated
indebtedness issued on the Closing Date pursuant to paragraph (b) above.
Any bridge loan shall be made 75% by Bankmont and 25% by BKB and shall be
on the terms set forth on Exhibit R hereto.
(d) Warehouse Line of Credit. The parties hereto agree to cooperate
in good faith with each other and use all reasonable efforts to obtain a
warehouse line of credit for the CEBA Bank and Receivables LLC on the
Closing Date in such amount as is necessary to finance the acquisition
and servicing by the CEBA Bank and Receivables LLC of the accounts
receivable sold by FNBB and BKB-NH and ▇▇▇▇▇▇ to the CEBA Bank and
Receivables LLC pursuant to the BKB Purchase Agreement, the BKB Overdue
Receivables Purchase Agreement, the ▇▇▇▇▇▇ Purchase Agreement and the
▇▇▇▇▇▇ Overdue Receivables Purchase Agreement.
(e) Securitization. The parties hereto agree to cooperate in good
faith with each other and to use all reasonable efforts to arrange for
the securitization contemplated by the Company Business Plan with respect
to certain of the accounts receivable sold by FNBB, BKB-NH and ▇▇▇▇▇▇ to
the CEBA Bank and Receivables LLC pursuant to the BKB Purchase Agreement,
the BKB Overdue Receivables Purchase Agreement, the ▇▇▇▇▇▇ Purchase
Agreement and the ▇▇▇▇▇▇ Overdue Receivables Purchase Agreement.
Section 5.10. FAMIS Employees. The parties hereto hereby agree to
cooperate in good faith and to use reasonable efforts to cause the
Company, on the Closing Date, to make offers of employment to
substantially all of the then-current active employees of FAMIS at the
same base salary and with substantially similar employee benefits,
recognizing all prior service with FAMIS through the Closing Date.
Section 5.11. BKB Structuring Fee. The parties hereto agree to cause
the Company to pay to BKB by wire transfer of immediately available funds
on the Closing Date as a fee for services in connection with structuring
the transactions contemplated in this Agreement the sum of $5 million.
Section 5.12. Disclosure Supplements. From time to time prior to the
Closing Date, each party hereto will promptly give notice to the other
parties hereto of any matter hereafter arising which, if existing,
occurring or known at the date of this Agreement, would have been
required to be set forth or described by such party in the Schedules or
Exhibits hereto or to any Related Agreement or is necessary to correct
any information provided by such party in the Schedules or Exhibits
hereto or to any Related Agreement or has caused any representation or
warranty of such party herein or in any Related Agreement to become
inaccurate. No such notice shall be deemed to supplement or amend this
Agreement or any Related Agreement or any Schedules or Exhibits hereto or
thereto; provided, however, that upon consummation of the Closing, all
matters disclosed in notices given pursuant to and in accordance with the
terms of this Section 5.12 shall be treated as having been disclosed
herein or in the applicable Related Agreement as of the date hereof for
purposes of such party's indemnity obligations thereunder.
ARTICLE 6
CONDITIONS TO CLOSING
Section 6.1. Conditions to Obligation of Each Party. The respective
obligations of each of the parties hereto to consummate the Closing under
this Agreement and the other Related Agreements shall be subject to the
satisfaction, prior to or at Closing, of each of the following
conditions:
(a) No Injunction. On the Closing Date, there shall be no (i)
injunction, restraining order or decree of any nature of any United
States or Canadian federal, state or local court, governmental
commission, board or other regulatory authority or agency
("Governmental Authority") of competent jurisdiction in effect that
restrains or prohibits the consummation of any transaction
contemplated under this Agreement or any other Related Agreement or
(ii) pending action, suit or proceeding brought by any Governmental
Authority which seeks to restrain or prohibit consummation of any
such transaction.
(b) Regulatory Approvals. Each Required Regulatory Approval
shall have been obtained and any applicable waiting period in
respect thereof shall have expired or been terminated, and each
such Required Regulatory Approval shall be in full force and
effect.
(c) Financings. The Company and/or its subsidiaries shall
have received financing as contemplated by Sections 5.9(b) and/or
(c), as applicable, and 5.9(d).
(d) Other Transactions. Each of the Related Agreements shall
have been duly executed and delivered by each party thereto and
shall be in full force and effect, and the transactions
contemplated by the Contribution Agreements shall have been
consummated and have become effective in accordance with their
respective terms.
(e) FDR Assignment and Release. FDR shall have entered into a
Consent to Assignment and Release ("Release") substantially in the
form of Exhibit S hereto and the Company shall have accepted such
Release.
(f) FAMIS Employees. On the Closing Date, the Company shall
employ such former employees of FAMIS as are reasonably necessary
to operate the business of the Company and its subsidiaries as
contemplated by the Company Business Plan.
(g) Tax Treatment. No party hereto shall have delivered to
the other parties hereto a written legal opinion of such party's
external legal counsel (referred to in Section 8.2 hereof) to the
effect that, due to any changes occurring after the date hereof in
applicable law or in the transactions contemplated by this
Agreement and the Related Agreements, the contributions to be made
by any of the parties hereto or their respective Affiliates
pursuant to their respective Contribution Agreements would not
constitute tax free "exchanges" under Section 721 of the Code.
Section 6.2. Additional Conditions to the Obligations of BKB. The
obligations of BKB to consummate the Closing under this Agreement and the
other Related Agreements shall be subject to the satisfaction, prior to
or at Closing, of each of the following additional conditions:
(a) Representations and Warranties. The representations and
warranties of each of the other parties hereto or any of their
Affiliates which are set forth in this Agreement or in the Related
Agreements shall be true and correct in all material respects as of
the Closing Date as though made at and as of the Closing Date,
except to the extent that any representation and warranty is made
as of a specified date other than the Closing Date, in which case
such representation and warranty shall be true and correct as of
such date.
(b) Performance of Covenants. Each of the other parties
hereto shall have performed in all material respects all
obligations and agreements, and complied in all material respects
with all covenants and conditions, contained in this Agreement to
be performed or complied with by such party prior to or at the
Closing.
(c) Certificates. BKB shall have received a certificate of
each of the other parties hereto, dated the Closing Date, executed
on behalf of each of such parties to the effect that the conditions
specified in Sections 6.2(a) and 6.2(b) with respect to such party
have been fulfilled.
(d) Consents. All consents of non-governmental third parties
required for the consummation of the transactions contemplated
hereby by BKB and its Affiliates, including, without limitation,
BKB's Credit Card Subsidiaries, as set forth on Schedule 6.2(d)
shall have been obtained and shall be in full force and effect on
the Closing Date.
(e) Additional Deliveries. Each of the other parties hereto
shall have furnished BKB with such certificates, instruments or
other documents in the name or on behalf of such party, executed by
appropriate officers of such parties or others, including, without
limitation, certificates or correspondence of Governmental
Authorities or non-governmental third parties, to evidence
fulfillment of the conditions set forth in this Article 6 to be
fulfilled by Persons other than BKB and its Affiliates as BKB may
reasonably request; provided, however, that any such certificate,
instrument or other document so requested by BKB shall be of a type
that is customary in transactions similar to the transactions
contemplated hereby.
Section 6.3. Additional Conditions to the Obligations of Bankmont
and ▇▇▇▇▇▇. The obligations of Bankmont and ▇▇▇▇▇▇ to consummate the
Closing under this Agreement and the other Related Agreements shall be
subject to the satisfaction, prior to or at Closing, of each of the
following additional conditions:
(a) Representations and Warranties. The representations and
warranties of each of the other parties hereto or any of their
Affiliates which are set forth in this Agreement or the Related
Agreements shall be true and correct in all material respects as of
the Closing Date as though made at and as of the Closing Date,
except to the extent that any representation and warranty is made
as of a specified date other than the Closing Date, in which case
such representation and warranty shall be true and correct as of
such date.
(b) Performance of Covenants. Each of the other parties
hereto shall have performed in all material respects all
obligations and agreements, and complied in all material respects
with all covenants and conditions, contained in this Agreement to
be performed or complied with by such party prior to or at the
Closing.
(c) Certificates. Bankmont and ▇▇▇▇▇▇ shall have received a
certificate of each of the other parties hereto, dated the Closing
Date, executed on behalf of each of such parties to the effect that
the conditions specified in Sections 6.3(a) and 6.3(b) with respect
to such party have been fulfilled.
(d) Consents. All consents of non-governmental third parties
required for the consummation of the transactions contemplated
hereby by ▇▇▇▇▇▇, Bankmont and their respective Affiliates as set
forth on Schedule 6.3(d) shall have been obtained and shall be in
full force and effect on the Closing Date.
(e) Additional Deliveries. Each of the other parties hereto
shall have furnished Bankmont and ▇▇▇▇▇▇ with such certificates,
instruments or other documents in the name or on behalf of such
party, executed by appropriate officers of such parties or others,
including, without limitation, certificates or correspondence of
Governmental Authorities or non-governmental third parties, to
evidence fulfillment of the conditions set forth in this Article 6
to be fulfilled by Persons other than Bankmont, ▇▇▇▇▇▇ and their
respective Affiliates as Bankmont and ▇▇▇▇▇▇ may reasonably
request; provided, however, that any such certificate, instrument
or other document so requested by Bankmont and ▇▇▇▇▇▇ shall be of a
type that is customary in transactions similar to the transactions
contemplated hereby.
Section 6.4. Additional Conditions to the Obligations of FA. The
obligations of FA to consummate the Closing under this Agreement and the
other Related Agreements shall be subject to the satisfaction, prior to
or at Closing, of each of the following additional conditions:
(a) Representations and Warranties. The representations and
warranties of each of the other parties hereto or any of their
Affiliates which are set forth in this Agreement or the Related
Agreements shall be true and correct in all material respects as of
the Closing Date as though made at and as of the Closing Date,
except to the extent that any representation and warranty is made
as of a specified date other than the Closing Date, in which case
such representation and warranty shall be true and correct as of
such date.
(b) Performance of Covenants. Each of the other parties
hereto shall have performed in all material respects all
obligations and agreements, and complied in all material respects
with all covenants and conditions, contained in this Agreement to
be performed or complied with by such party prior to or at the
Closing.
(c) Certificates. FA shall have received a certificate of
each of the other parties hereto, dated the Closing Date, executed
on behalf of each of such parties to the effect that the conditions
specified in Sections 6.4(a) and 6.4(b) with respect to such party
have been fulfilled.
(d) Consents. All consents of non-governmental third parties
required for the consummation of the transactions contemplated
hereby by FA and its Affiliates, including, without limitation, its
Credit Card Subsidiary, as set forth on Schedule 6.4(d) shall have
been obtained and shall be in full force and effect on the Closing
Date.
(e) Additional Deliveries. Each of the other parties hereto
shall have furnished FA with such certificates, instruments or
other documents in the name or on behalf of such party, executed by
appropriate officers of such parties or others, including, without
limitation, certificates or correspondence of Governmental
Authorities or non-governmental third parties, to evidence
fulfillment of the conditions set forth in this Article 6 to be
fulfilled by Persons other than FA and its Affiliates as FA may
reasonably request; provided, however, that any such certificate,
instrument or other document so requested by FA shall be of a type
that is customary in transactions similar to the transactions
contemplated hereby.
ARTICLE 7
TERMINATION
Section 7.1. Grounds For Termination. This Agreement may be
terminated at any time prior to the Closing:
(a) by mutual written consent of all of the parties hereto;
(b) by any of the parties hereto (i) thirty (30) days after
the date on which any request or application for a Regulatory
Approval necessary for the consummation of the transactions
contemplated hereby and listed on Schedule 7.1(b) hereto (the
"Required Regulatory Approvals") shall have been denied, unless
within the thirty (30) day period following such denial a petition
for rehearing or an amended application has been filed with the
applicable Governmental Authority; provided, however, that no party
hereto shall have the right to terminate this Agreement pursuant to
this Section 7.1(b) if such denial shall be due to the failure of
the party seeking to terminate this Agreement to perform or observe
in any material respect the covenants and agreements of such party
set forth herein, or (ii) if any federal or state banking or other
Governmental Authority shall have issued a final permanent order,
injunction or other legal restraint or prohibition preventing the
consummation of the transactions contemplated hereby and the time
for appeal or petition for reconsideration of such order,
injunction, restraint or prohibition shall have expired without
such appeal or petition being granted or such order, injunction,
restraint or prohibition shall otherwise have become final and
non-appealable;
(c) by any of the parties hereto (but only if the terminating
party is not then in material breach of any representation,
warranty, covenant or other agreement contained herein or in any of
the other Related Agreements) in the event of a material breach by
any other party hereto of any representation, warranty, covenant or
other agreement contained herein or in any of the other Related
Agreements, which breach is not cured after thirty (30) days'
written notice thereof is given to the party committing such
breach; or
(d) by any of the parties hereto if the Closing shall not
have occurred on or prior to December 31, 1997, unless the failure
of the Closing to occur by such date shall be due to the failure of
the party seeking to terminate this Agreement hereunder to perform
or observe in any material respect the covenants and agreements of
such party set forth in this Agreement or in any other Related
Agreements.
Section 7.2. Effects of Termination. In the event of termination of
this Agreement by any of the parties hereto as provided in Section 7.1,
this Agreement shall forthwith become null and void (other than this
Section 7.2 and Section 5.5(b) (Confidentiality)), which shall remain in
full force and effect), and there shall be no further liability on the
part of any of the parties hereto or their respective officers or
directors to the other parties hereto, except any liability of the
parties hereto under said Section 5.5(b) and, in the event of a willful
breach by any of the parties hereto of any representation, warranty,
covenant or agreement contained in this Agreement, in which case the
breaching party shall remain liable for any and all damages, costs and
expenses, including all reasonable attorneys' fees, sustained or incurred
by the non-breaching parties as a result thereof or in connection
therewith or with the enforcement of any of their rights hereunder,
whether sustained or incurred prior to, on or after the date hereof. In
no event shall any party hereto or any of such party's officers or
directors have any liability to any other party hereto arising out of or
relating to this Agreement in the event that the Closing occurs;
provided, that nothing herein shall limit the liability of any person
under any Related Agreement.
ARTICLE 8
GENERAL
Section 8.1. Expenses. Except as expressly set forth in this
Agreement or the Related Agreements, each party shall pay its own
expenses and costs incidental to the completion of the transactions
contemplated hereby incurred prior to July 1, 1997, excluding third party
fees paid by FA regarding formation of the CEBA Bank, legal fees paid by
BKB and its Affiliates regarding the BKB credit card portfolio
securitization and legal fees incurred by Bankmont or its Affiliates
regarding securitization of ▇▇▇▇▇▇' credit card portfolio, which shall be
reimbursed by the Company. The Company shall bear the legal, accounting
and other incidental costs of creating and financing the Company from
July 1, 1997 onwards, including, without limitation, all such expenses
incurred by FAMIS as set forth on Schedule 8.1 hereto.
Section 8.2. Notices. All notices, demands and other communications
hereunder shall be in writing or by written telecommunication, and shall
be deemed to have been duly given if delivered personally or if mailed by
certified mail, return receipt requested, postage prepaid or if sent by
overnight courier or sent by written telecommunication (answerback
confirmed), as follows:
If to BKB: BankBoston Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
and
BankBoston Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, Esq.
with a copy sent
contemporaneously to: ▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
If to Bankmont: Bankmont Financial Corp.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
with a copy sent
contemporaneously to: ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
If to FA: First Annapolis Consulting, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
with a copy sent
contemporaneously to: ▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.,
Esq.
Section 8.3. Entire Agreement. This Agreement (including the
Exhibits and Schedules hereto), together with the other Related
Agreements (including the Exhibits and Schedules thereto) contains the
entire understanding of the parties hereto and thereto, supersedes all
prior agreements and understandings relating to the subject matter hereof
and thereof and shall not be amended except by a written instrument
hereafter signed by all of the parties hereto or thereto. No waiver of
any provision of this Agreement shall be effective unless evidenced by a
written instrument signed by the waiving party. Each of the parties
hereto further acknowledges and agrees that, in entering into this
Agreement and entering into the other Related Agreements, it has not in
any way relied upon any oral or written agreements, statements, promises,
information, arrangements, understandings, representations or warranties,
express or implied, not specifically set forth in this Agreement or the
other Related Agreements.
Section 8.4. Governing Law. This Agreement shall be governed by,
and construed and enforced in accordance with, the laws of the State of
Delaware without regard to its conflict of laws rules.
Section 8.5. Consent to Jurisdiction. Each of the parties hereto
agrees that any suit, action or proceeding instituted against such party
under or in connection with this Agreement may be brought in a court of
competent jurisdiction in the State of Delaware. By execution hereof,
each party hereto irrevocably waives any objection to, and any right of
immunity on the grounds of, improper venue, the convenience of the forum,
the personal jurisdiction of such courts or the execution of judgments
resulting therefrom. Each party hereto hereby irrevocably accepts and
submits to the jurisdiction of such courts in any such action, suit or
proceeding.
Section 8.6. Waiver of Certain Damages. EACH OF THE PARTIES HERETO
TO THE FULLEST EXTENT PERMITTED BY LAW IRREVOCABLY WAIVES ANY RIGHTS THAT
IT MAY HAVE TO PUNITIVE, SPECIAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES IN
RESPECT OF ANY LITIGATION BASED UPON, OR ARISING OUT OF, THIS AGREEMENT
OR ANY RELATED AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS OR ACTIONS OF ANY OF THEM RELATING THERETO.
Section 8.7. Section Headings. The headings of sections and
subsections are for reference only and shall not limit or control the
meaning thereof.
Section 8.8. Assigns. This Agreement and the other Related
Agreements shall be binding upon and inure to the benefit of the parties
hereto and their respective heirs, successors and permitted assigns.
Neither this Agreement nor any other Related Agreements nor the
obligations of any party hereunder or thereunder shall be assignable or
transferable by such party without the prior written consent of the other
parties hereto.
Section 8.9. No Implied Rights or Remedies. Except as otherwise
expressly provided herein, nothing herein expressed or implied is
intended or shall be construed to confer upon or to give any Person,
except the parties hereto, any rights or remedies under or by reason of
this Agreement.
Section 8.10. Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
Section 8.11. Construction. The language used in this Agreement will
be deemed to be the language chosen by the parties to express their
mutual intent, and no rule of strict construction will be applied against
any party.
Section 8.12. Severability. The invalidity or unenforceability of any
particular provision of this Agreement or any other Related Agreement
shall not affect the other provisions hereof or thereof, and this
Agreement shall be construed in all respects as if such invalid or
unenforceable provision was omitted.
Section 8.13. Waiver of Right to Jury Trial. EACH OF THE PARTIES
HERETO HEREBY WAIVES ITS RIGHTS TO A TRIAL BY JURY IN ANY LITIGATION IN
ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF, THIS
AGREEMENT OR ANY OF THE OTHER RELATED AGREEMENTS, OR THE VALIDITY,
INTERPRETATION OR ENFORCEMENT HEREOF OR THEREOF OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Section 8.14. Remedies. The parties hereto will be entitled to
enforce their rights under this Agreement specifically (without posting a
bond or other security), to recover damages by reason of any breach of
any provision of this Agreement and to exercise all other rights existing
in their favor. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of
this Agreement and that any party hereto may in its sole discretion apply
to any court of law or equity of competent jurisdiction for specific
performance and/or injunctive relief in order to enforce or prevent any
violation of the provisions of this Agreement.
IN WITNESS WHEREOF, and intending to be legally bound hereby, the
parties hereto have caused this Master Agreement for the Formation of a
Limited Liability Company to be duly executed and delivered as a sealed
instrument as of the date and year first above written.
BANKBOSTON CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
BANKMONT FINANCIAL CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: General Counsel
▇▇▇▇▇▇ TRUST AND SAVINGS BANK
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: General Counsel
FIRST ANNAPOLIS CONSULTING, INC.
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
Schedule 4A to
Master Agreement
CERTAIN REPRESENTATIONS
BKB hereby represents and warrants to each of the other parties hereto:
1. Organization. BKB is corporation duly organized, validly
existing and in good standing under the laws of the State of
Massachusetts.
2. Authority; Enforceability. BKB has the requisite power and
authority to enter into and carry out its obligations under this
Agreement. The execution, delivery and performance of this Agreement have
been duly authorized by all necessary action on the part of BKB. This
Agreement has been duly executed and delivered by BKB and constitutes the
legal, valid and binding obligation of BKB, enforceable against BKB in
accordance with its terms, except as enforcement thereof may be limited
by receivership, conservatorship, and supervisory powers of bank
regulatory authorities generally as well as bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or similar laws of
general applicability relating to or affecting creditors' rights or to
general equity principles (regardless of whether such matters are
considered in a proceeding in equity or at law) and the availability of
equitable remedies.
FA hereby represents and warrants to each of the other parties hereto:
1. Organization. FA is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland.
2. Authority; Enforceability. FA has the requisite power and
authority to enter into and carry out its obligations under this
Agreement. The execution, delivery and performance of this Agreement have
been duly authorized by all necessary action on the part of FA. This
Agreement has been duly executed and delivered by FA and constitutes the
legal, valid and binding obligation of FA, enforceable against FA in
accordance with its terms, except as enforcement thereof may be limited
by receivership, bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or similar laws of general applicability
relating to or affecting creditors' rights or to general equity
principles (regardless of whether such matters are considered in a
proceeding in equity or at law) and the availability of equitable
remedies.
Schedule 4B to
Master Agreement
EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES OF RELATED AGREEMENTS
---------------------------------------------------------------------------
RELATED AGREEMENT EXCEPTED REPRESENTATION OR WARRANTY
---------------------------------------------------------------------------
----------------------------------------------------------------------------
Account Solicitation and Services Document not yet drafted at time of
Agreement signing
----------------------------------------------------------------------------
Bankmont Contribution Agreement Second
and third sentences of Section
4.2 (delivery and execution of
agreement); first sentence of
Section 4.4 (permits)
----------------------------------------------------------------------------
BKB Contribution Agreement Second
and third sentences of Section
4.2 (delivery and execution of
agreement); first sentence of
Section 4.5 (delivery of
Cardholder Agreements)
----------------------------------------------------------------------------
BKB Overdue Receivables Purchase Second and third sentences of Section
Agreement 4.2 (delivery and execution of
agreement); last sentence of Section
4.4 (sale of receivables)
----------------------------------------------------------------------------
BKB Purchase Agreement Second and
third sentences of Section 4.2
(delivery and execution of
agreement); last sentence of
Section 4.4 (sale of
receivables)
----------------------------------------------------------------------------
BKB Services Agreement Section 11.3(c) (authorization);
Section 11.3(d) (delivery)
----------------------------------------------------------------------------
BKB Trademark License Document not yet drafted at time of
signing
----------------------------------------------------------------------------
Capital Retention Agreement No exceptions
----------------------------------------------------------------------------
Certificate of Formation No representations or warranties in
this Related Agreement
----------------------------------------------------------------------------
FAMIS Contribution Second and third
sentences of Section 4.2
(delivery and execution of
agreement); Section 4.4
(governmental approvals); the
second sentence of Section 4.10
(delivery of contracts and
leases)
----------------------------------------------------------------------------
▇▇▇▇▇▇ Contribution Agreement Second
and third sentences of Section
4.2 (delivery and execution of
agreement); the last sentence of
4.4 (contribution of assets),
first sentence of Section 4.5
(delivery of Cardholder
Agreements)
----------------------------------------------------------------------------
▇▇▇▇▇▇ Credit Card Operations All warranties and representations
Agreement in this Related Agreement are
excepted (document not applicable at
time of signing)
----------------------------------------------------------------------------
▇▇▇▇▇▇ Overdue Receivables Purchase Second and third sentences of Section
Agreement 4.2 (delivery and execution of
agreement); last sentence of Section
4.4 (sale of receivables)
----------------------------------------------------------------------------
▇▇▇▇▇▇ Purchase Agreement Second and
third sentences of Section 4.2
(delivery and execution of
agreement); last sentence of
Section 4.4 (sale of
receivables)
----------------------------------------------------------------------------
▇▇▇▇▇▇ Services Agreement Section 4(a)(iii) (execution of
agreement)
----------------------------------------------------------------------------
Operating Agreement (LLC Agreement) This Schedule 4B not applicable to
this Related Agreement
----------------------------------------------------------------------------
Registration Rights Agreement This Schedule 4B not applicable to
this Related Agreement
----------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇ Employment Agreement This Schedule 4B not applicable to
this Related Agreement
----------------------------------------------------------------------------
Schedule 5.2(b) to
Master Agreement
BKB MATERIAL AGREEMENTS
None
FA MATERIAL AGREEMENTS
1. Material contracts, transactions and commitments entered into by
FAMIS in connection with the formation of, and for the benefit of, the
Company, and development of its business operations, including those
expressly referred to in this Agreement and in the Exhibits and Schedules
hereto (including Schedule 8.1).
2. On or prior to the Closing Date, FA will enter into agreements
with FAMIS pursuant to which FA will purchase substantially all of the
tangible personal property of FAMIS, including an automobile used by ▇▇.
▇▇▇▇▇▇▇▇▇, at book value net of depreciation, and will enter into a lease
with FAMIS or the Company with respect to such property, on arms-length
terms.
BANKMONT MATERIAL AGREEMENTS
None
▇▇▇▇▇▇ MATERIAL AGREEMENTS
None
Schedule 6.2(d) to
Master Agreement
BKB THIRD PARTY CONSENTS
BKB will require consents from third parties to transfer the following
agreements:
(1) Fair, ▇▇▇▇▇ & Co. CrediTable Scorecard Agreement
(2) Fair, ▇▇▇▇▇ & Co. Behavioral Scoring Agreement
(3) Credit Data of New England Contract
(4) TransUnion Contract
(5) Axciom Contract
(6) Di-▇▇▇▇ Contract
(7) ALL Third-Party Agency Agreements for Pre- and Post-Charge-Offs
(8) U-$ave Agreement
(9) FDR Service Agreement
Schedule 6.3(d) to
Master Agreement
BANKMONT AND ▇▇▇▇▇▇ THIRD PARTY CONSENTS
1. The non-governmental consents required by ▇▇▇▇▇▇ and Bankmont
are those contained in Schedule 2.1(h) of the Contribution Agreement
between ▇▇▇▇▇▇ and the Company.
2. The consent to assign that certain real estate lease on property
commonly known as ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ (the
"Buffalo Grove Property"), as well as third party consents for assignment
of contractual rights for ▇▇▇▇▇▇ credit card operations in connection
with the Buffalo Grove Property.
Schedule 6.4(d) to
Master Agreement
FA THIRD PARTY CONSENTS
-------------------------------------=====================================
COMPANY DESCRIPTION
-------------------------------------=====================================
Hewlett Packard Computer Equipment and Software
-------------------------------------=====================================
Trans National Phone System
-------------------------------------=====================================
BE Realty Limited Partnership Boston facilities
-------------------------------------=====================================
American Trading Real Estate Delaware facilities
-------------------------------------▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Management Maryland facilities
-------------------------------------=====================================
First Security Service Corporation Facility Security
-------------------------------------=====================================
Accent Interior Landscape Office Maintenance
-------------------------------------=====================================
EBSCO Subscription Services Publications
-------------------------------------=====================================
Town Coach Inc. Transportation
-------------------------------------=====================================
World Com T-1 Line
-------------------------------------=====================================
Platinum Technologies Data warehouse consultants
-------------------------------------=====================================
Pitney ▇▇▇▇▇ Postage Services
-------------------------------------=====================================
Xerox Note Payable Telecopiers
-------------------------------------=====================================
AT&T Corporation Phone System
-------------------------------------=====================================
Software Licenses
-------------------------------------=====================================
[Dell Computer Warranties]
-------------------------------------=====================================
[Leases for new furniture,
computers, etc.]
-------------------------------------=====================================
Schedule 7.1(b) to
Master Agreement
BKB REQUIRED REGULATORY APPROVALS
(1) Approval from the Board of Governors of the Federal Reserve System
(or the Federal Reserve Bank of Boston acting under delegated
authority) of the BKB investments and the transaction contemplated
by the Master Agreement under Section 4(c)(8) of the Bank Holding
Company Act of 1956 and Regulation Y.
(2) Approval from the Office of the Comptroller of the Currency ("OCC")
of BKB's direct ownership of the Company and indirect ownership of
CEBA Bank under the Change in Bank Control Act, in the event the
direct ownership by BKB of the Company and thereby indirect
ownership of CEBA Bank is not included and approved in the
application of CEBA Bank to the OCC to charter a national banking
association as a limited purpose "credit card bank" under the
provisions of the Competitive Equality Banking Act.
BANKMONT REQUIRED REGULATORY APPROVALS
(1) Approval from the Board of Governors of the Federal Reserve System
(or the Federal Reserve Bank of Chicago acting under delegated
authority) of the Bankmont investments and the transaction
contemplated by the Master Agreement under Section 4(c)(8) of the
Bank Holding Company Act of 1956 and Regulation Y (permissible
non-banking activities) and Regulation H, provided that any joint
venture commitments be reasonably acceptable to Bankmont.
(2) If direct ownership by Bankmont of the Company and thereby indirect
ownership of CEBA Bank is not included and approved as a part of
the application of CEBA Bank, to the Office of the Comptroller of
the Currency ("OCC") to charter a national banking association as a
limited purpose "credit card bank" under the provisions of the
Competitive Equality Banking Act, approval by the OCC of Bankmont's
direct ownership of the Company and indirect ownership of CEBA
Bank. under the Change in Bank Control Act.
(3) Confirmation by the Federal Reserve Bank of Chicago that any
Bankmont representatives serving on the Board of Directors of CEBA
Bank. if any, will not violate Regulation L as promulgated by the
Board of Governors of the Federal Reserve System.
(4) Confirmation by the Illinois Commissioner of Banks and Real Estate
that no approvals or notices are required in connection with the
transactions contemplated by the Master Agreement.
(5) Approval from the Superintendent of Financial Institutions of
Canada for Bank of Montreal to acquire a substantial interest in a
permitted entity pursuant to the Bank Act [Canada].
FA REQUIRED REGULATORY APPROVALS
(1) Approval of the Office of the Comptroller of the Currency ("OCC")
to commence business as a federally-chartered credit card bank
chartered in the State of Delaware for the CEBA Bank.
(2) Approval of a request for subscription to stock of the Federal
Reserve Bank of Philadelphia for the CEBA Bank.
(3) Approval of an application for federal deposit insurance with the
Federal Deposit Insurance Corporation ("FDIC") for the CEBA Bank.
(4) Approval of Delaware leased space by the Delaware Historical
Commission in connection with FDIC and OCC applications.
(5) If required, approval by the Delaware Commissioner of Banks as to
the formation and registration of the Company as a bank holding
company under applicable Delaware law.
▇▇▇▇▇▇ REQUIRED REGULATORY APPROVALS
(1) Approval by the Board of Governors of the Federal Reserve System
(or the Federal Reserve Bank of Chicago acting under delegated
authority) of the ▇▇▇▇▇▇ contribution in exchange for Membership
Interests in the Company, and the transactions contemplated by the
Master Agreement including with respect to (a) Section 4(c)(8) of
the Bank Holding Company Act of 1956 and Federal Reserve Board
Regulation Y (permissible non-banking activities), provided that
any joint venture commitments be reasonably acceptable to ▇▇▇▇▇▇,
(b) Regulation H (if applicable) and (c) 12 U.S.C. Section 335 as
to member bank ownership interests in companies.
(2) If direct ownership by ▇▇▇▇▇▇ of the Company and thereby indirect
ownership of CEBA Bank is not included and approved as a part of
the application of CEBA Bank, to the Office of the Comptroller of
the Currency ("OCC") to charter a national banking association as a
limited purpose "credit card bank" under the provisions of the
Competitive Equality Banking Act, approval by the OCC of ▇▇▇▇▇▇'
direct ownership of the Company and indirect ownership of CEBA Bank
under the Change in Bank Control Act.
(3) Confirmation by the Federal Reserve Bank of Chicago that any ▇▇▇▇▇▇
representatives serving on the Board of Directors of CEBA Bank, if
any, will not violate Regulation L as promulgated by the Board of
Governors of the Federal Reserve System.
(4) Approval or confirmation by the Illinois Commissioner of Banks and
Real Estate that no approvals or notices are required in connection
with the transactions contemplated by the Master Agreement or the
ownership of the Membership Interests in the Company or indirect
ownership of CEBA Bank, including pursuant to Section 5(11) of the
Illinois Banking Act.
Schedule 8.1 to
Master Agreement
CERTAIN FAMIS EXPENSES
Before closing of the transactions contemplated by the Master Agreement,
FAMIS will incur the following expenses, not in the ordinary course of
business, for the benefit of the Company, including but not limited to:
Recruiting Expenses incurred by FAMIS or FA, necessary for the formation
of the Company to hire new employees into FAMIS who are anticipated to
become employees of the Company. These job positions include (by way of
example only) and are not limited to chief financial officer, financial
staff, human resources, information technology, marketing, analysis,
operations and administration. These expenses may include the cost of a
Human Resources consultant, agency fees, and advertisements.
Salaries and other direct costs, including benefits, of such new
employees hired for the benefit of the Company.
Fees and expense reimbursements incurred under the agreement between
FAMIS and Platinum Technology dated June 30, 1997 for the development of
the Company's credit card data warehouse.
Facility expenses including but not limited to, rent expense, security
deposits, telephone, utilities, security monitoring costs, maintenance,
and janitorial services, incurred with respect to the facilities obtained
for the benefit of the Company located at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ and
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇.
Furniture and other tangible personal property (other than computers and
related equipment) acquired for the benefit of the Company, including but
not limited to, copiers, fax machines, modular furniture and
installation, conference room furniture and office furniture.
The cost of additional computer equipment and services, such as
installation and programming, acquired for the benefit of the Company.
These costs may include personal computers, printers and software
licensing.
Costs incurred to increase the computer data storage and processing
capacity necessary to include the ▇▇▇▇▇▇ portfolio as well as additional
growth.
Any cost related to the conversion of Accounts to be acquired pursuant to
this Agreement, including but not limited to, additional staff for the
Company, third party consulting fees and travel.
The start-up costs incurred to develop employee benefit plans for
employees of the Company, including but not limited to profit sharing,
medical and dental.