EXHIBIT 10.1
AMENDMENT NUMBER NYC-0-06-2807
[***] = Pursuant to 17 CFR 240.24b-2(b), confidential information has been
omitted and has been filed separately with the Securities and Exchange
Commission pursuant to a Confidential Treatment Application filed with the
Commission.
This Amendment Number NYC-0-06-2807 ("Amendment Agreement") is made
and entered into as of this 18th day of August 2006 (the "Amendment Effective
Date") between American Express Travel Related Services Company, Inc., having
its principal place of business at American Express Tower, World Financial
Center, New York, New York 10285 ("AMEX") and Regulus West LLC, a Delaware
limited liability company, having its principal place of business at 000 Xxxxxx
Xxxxx, Xxxx, Xxxxxxxxxx 00000 ("Vendor").
RECITALS
WHEREAS, AMEX and Vendor wish to amend certain of their
understandings as set forth in that certain Remittance Processing Services
Agreement dated as of October 25, 1999, as amended (the "Agreement"), the term
of which expires on September 30, 2006;
WHEREAS, AMEX and Vendor entered into the Agreement (incorporated
herein by reference) for remittance processing and related services as described
in the Procedures Manual, attached as Exhibit A therein, and as otherwise
identified in the Agreement (the "Services");
WHEREAS, the parties are in the process of migrating a substantial
volume of additional AMEX remittances to Vendor for processing via the Services
(the "Migration Process");
WHEREAS, the parties are presently negotiating a comprehensive
amendment to the Agreement ("Comprehensive Amendment"), which shall include,
among other things, the terms and conditions contained in this Amendment and an
exhibit regarding Vendor's performance of certain modified services (the
"Modified Services Exhibit") intended to be implemented during the fourth
calendar quarter of 2006;
WHEREAS, the parties desire to amend the Agreement pending the
execution of the Comprehensive Amendment.
NOW, THEREFORE, IN CONSIDERATION of the mutual promises and
agreements set forth below and other good and valuable consideration, the
parties agree as follows:
Page 1 of 10
AMENDED TERMS
NOW, THEREFORE, in consideration of the mutual promises and
covenants contained herein, the parties agree as follows:
A. The Term of the Agreement, as set forth in Section 2.01 thereof,
is hereby extended to October 31, 2009.
B. AMEX hereby acknowledges that Vendor, in reliance on AMEX's
agreement to direct additional processing volume to Vendor as set forth herein,
will make certain modifications to AMEX's required special handling procedures,
and negotiate the Comprehensive Amendment and the Modified Services Exhibit,
will (a) revise the Fees for the Services, (b) expand its capacity through the
hiring of employees and the acquisition of equipment, and (c) enter into a
facilities lease renewal for the Xxxxxxxx Park Vendor Service Location ("Lease
Renewal").
C. Except as modified by the mutual agreement of the parties, the
terms of Schedule A attached hereto shall be included in the Agreement, shall
take effect upon execution of the Comprehensive Amendment, and shall replace the
2nd Amended and Restated Exhibit E to the Agreement.
D. In the event that the Annualized Aggregate Volume (as such term
is defined in Schedule A) does not equal or exceed [***] million items by
October 31, 2006 AMEX shall reimburse Vendor for Vendor's investment in unused
capacity acquired in reliance on AMEX's agreement to migrate additional volume
to Vendor's Services, which investment shall total no more than $[***] as
calculated in Schedule B attached hereto. To the extent that AMEX is required to
reimburse Vendor pursuant to this Section D, Vendor shall provide AMEX with
detailed documentary evidence of Vendor's actual investment. Any amount payable
by AMEX pursuant to this Section D shall exclude (i) the then current fair
market value of any equipment included in Vendor's investment amount which is
retained by Vendor for its use in connection with Vendor's customers other than
AMEX, and (ii) any proceeds received by Vendor from the sale or other
disposition of such equipment.
E. During the Migration Process, except for same day processing
timeliness and daily transmission deadlines, the service levels set forth in
Exhibit B to the Agreement shall not be binding upon Vendor, provided, however,
that Vendor shall use its commercially reasonable efforts to meet the service
levels set forth in Exhibit B to the Agreement.
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F. (i) AMEX agrees to maintain an Annualized Vendor Service Location
Volume (as such term is defined in Schedule A) equal to or greater than [***]
million items per Contract Year at the Xxxxxxxx Park Vendor Service Location.
(ii) Commencing as of September 1, 2006, in the event
that the Annualized Vendor Service Location Volume at the Xxxxxxxx Park Vendor
Service Location falls below [***] million items per Contract Year at any time
prior to October 31, 2009, for any reason except (a) AMEX's termination of the
Agreement, as amended, for cause, or (b) a reduction in volume in response to
Regulus' failure to perform the Services in accordance with the terms of the
Agreement including any applicable service levels, Vendor, in its sole
discretion, shall have the option of closing the Xxxxxxxx Park Vendor Service
Location upon prior written notice to AMEX.
(iii) If Vendor closes the Xxxxxxxx Park Vendor Service
Location solely for the reason set forth in the preceding section, AMEX shall
reimburse Vendor solely for any direct lease termination fees actually paid
pursuant to the Lease Renewal, but in no event greater than an amount equal to
the balance of Vendor's obligation to pay Basic Rent and Additional Rent
pursuant to the Lease Renewal, subject to a cap on Additional Rent liability of
[***] percent ([***]%) of the actual Basic Rent obligation payable pursuant to
this section F(iii). Vendor shall use its commercially reasonable efforts to
mitigate and/or otherwise assist in vacating, subleasing, assigning and/or
lessening Vendor's potential liability as Lessee under the Lease Renewal,
including, without limitation, undertaking good faith negotiations with its
landlord in an effort to limit Vendor's lease termination liability.
(iv) Other than as set forth in Paragraph F(iii) above,
AMEX shall not be liable in any manner whatsoever for Vendor's breach of, or
other obligations under, the Lease Renewal or underlying lease, including,
without limitation, Paragraph 3.12 of the Lease Renewal.
G. Immediately after execution of this Amendment, AMEX and Vendor
shall continue good faith negotiations of the Comprehensive Amendment; provided
however, that in the event the Comprehensive Amendment is not entered into by
December 31, 2006, then AMEX shall have the right to terminate the Agreement and
this Amendment upon thirty (30) days written notice, provided, however that (i)
such notice of termination shall be of no force or effect and AMEX shall have no
right to terminate pursuant to this Section G if AMEX and Vendor enter into the
Comprehensive Amendment prior to the expiration of the thirty (30) day notice
period. Included among the terms of the Modified Services Exhibit shall be an
agreement by AMEX and Vendor that the Xxxxxxxx Park Vendor Service Location
shall implement the Modified Services only after the Modified Services have been
implemented in the Los Angeles and Dallas Vendor Service Locations. AMEX and
Vendor hereby agree that no Modified Services shall be provided by Vendor, and
no revision of prices in connection with additional processing volume shall be
applied, until the Comprehensive Amendment and the Modified Services Exhibit
have been executed.
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H. (i) AMEX hereby acknowledges that Vendor intends to include
remittance transactions processed pursuant to the Agreement in Vendor's offshore
data entry program, whereby certain data entry functions included in the
Services are to be performed by Vendor's subcontractor, eFunds Corporation, in
India. AMEX agrees to cooperate with Vendor's implementation efforts with regard
to offshore data entry and the parties shall agree in good faith upon the terms
and conditions to be included in the Comprehensive Amendment regarding such
subcontracting and offshore data entry;
(ii) Vendor shall remain at all times primarily
responsible for the acts and omissions of all subcontractors, including eFunds
Corporation, and shall retain all liability and responsibility under the
Agreement and this Amendment as if such subcontracted activities were performed
by Vendor.
(iii) Vendor must obtain AMEX's prior written express
consent to the selection of any other subcontractor(s).
(iv) Vendor and its subcontractors must comply with AMEX's
Information Protection Contract Requirements as set forth in Schedule C attached
hereto and incorporated herein by reference.
I. (i) Upon execution of this Amendment, in exchange for [***]
($[***]) and other good and valuable consideration, AMEX shall sell to Vendor,
free from all liabilities, liens, mortgages, debts, taxes, other encumbrances
and any violations of record as of the date hereof, all of AMEX's right, title
and interest in and to the following equipment, "as is", without any warranties
of any sort: (a) OPEX Model 150, Serial 165 Mail Extractor & Sorter, and (b)
OPEX IEM, Serial 191, Image and Export (collectively, the "Equipment"). AMEX
shall contemporaneously execute the Xxxx of Sale attached hereto as Schedule D
with respect to the Equipment.
(ii) Upon termination or expiration of the Agreement for
any reason, in exchange for
one dollar ($1.00) and other good and valuable consideration, Vendor shall sell
to AMEX, free from all liabilities, liens, mortgages, debts, taxes, other
encumbrances and any violations of record as of the date hereof, all of Vendor's
right, title and interest in and to the Equipment, "as is", without any
warranties of any sort. Vendor shall contemporaneously execute a Xxxx of Sale in
the form attached hereto as Schedule D with respect to the Equipment.
J. AMEX hereby agrees to implement an electronic deposit settlement
process in connection with the Services no later than June 30, 2007. As used
herein, an "electronic deposit settlement process" means a method of clearing
check payments through ARC standard entry class ACH debit originations and/or
Check 21 electronic cash letters without the delivery of paper checks to a bank,
Federal Reserve Bank or other financial institution for deposit. In the event
that, through no fault of Vendor, an electronic deposit settlement process is
not implemented in connection with the Services by June 30, 2007, Vendor
reserves the right to revise the prices set forth in Schedule A, by increasing
the price per remittance transaction processed by $[***] prospectively.
Page 4 of 10
K. The following Schedules are attached hereto and incorporated
herein by this reference:
Schedule A - Compensation
Schedule B - Regulus Investment in Capacity for Additional
American Express Volume
Schedule C - Information Protection Contract Requirements
Schedule D - Xxxx of Sale
GENERAL
A. Except as otherwise modified herein, the capitalized terms used
in this Amendment shall have the meaning specified in the Agreement.
B. Except as amended herein and by the terms of all prior amendments
not inconsistent with this Amendment, the remaining provisions of the
Agreement shall continue in full force and effect.
C. This Amendment may be signed in counterparts, all of
which taken together shall constitute one single Amendment between the
parties.
D. The parties agree that this Amendment shall terminate and be of
no further force and effect immediately upon the full execution of the
Comprehensive Amendment. Notwithstanding the foregoing or anything to the
contrary in the Agreement, the parties hereby agree that their respective rights
and obligations set forth in the Amended Terms Sections D, E, F, G, H and I
above, shall survive termination of this Amendment solely if not included in the
Comprehensive Amendment, but in no event longer than the Term of the Agreement,
as amended.
E. (i) The terms and conditions of the Agreement and this Amendment,
the negotiations preceding it, and the basis for any claims or demands giving
rise to the Agreement and this Amendment are considered by the parties to be
confidential, and may not hereafter be communicated by any party to any other
person or entity for any purpose whatsoever, except to legal counsel for the
parties and their respective accountants, and except as required to enforce the
terms of the Agreement and this Amendment or to respond to legal process. Any
such disclosure shall be accompanied by a statement that the terms of the
Agreement and this Amendment are confidential. The parties agree that the
provisions of this Section E (i) shall survive the termination or expiration of
the Agreement and this Amendment for whatever reason.
(ii) Each party hereby represents that (a) it has policies in place
to safeguard copies of the Agreement and this Amendment, (b) it is restricting
access to the Agreement and this Amendment to only those personnel who have a
need to know the information contained therein and who are under a duty to keep
it confidential, and (c) it is taking reasonable steps to maintain the
confidentiality of all pricing and other financial terms of this Amendment, and
Schedules A, B and C.
Page 5 of 10
IN WITNESS WHEREOF, AMEX and Vendor have caused this Amendment
Agreement to be executed on their behalf by their duly authorized officers, as
of the date first written above.
AMERICAN EXPRESS TRAVEL REGULUS WEST, LLC
RELATED SERVICES COMPANY, INC.
By: /s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxxxx Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxx Name: Xxxxxxxx Xxxxxxxxx
(Type or print) (Type or print)
Title: Director of Operations - Title: President
Global Procurement
Page 6 of 10
SCHEDULE A
Compensation
[*** - 2 pages omitted]
[***] = Pursuant to 17 CFR 240.24b-2(b), confidential information has been
omitted and has been filed separately with the Securities and Exchange
Commission pursuant to a Confidential Treatment Application filed with the
Commission.
Page 7 of 10
SCHEDULE B
Regulus Investment in Capacity for Additional American Express Volume
[*** - 1 page omitted]
[***] = Pursuant to 17 CFR 240.24b-2(b), confidential information has been
omitted and has been filed separately with the Securities and Exchange
Commission pursuant to a Confidential Treatment Application filed with the
Commission.
Page 8 of 10
SCHEDULE C
Information Protection Contract Requirements
[*** - 7 pages omitted]
[***] = Pursuant to 17 CFR 240.24b-2(b), confidential information has been
omitted and has been filed separately with the Securities and Exchange
Commission pursuant to a Confidential Treatment Application filed with the
Commission.
Page 9 of 10
SCHEDULE D
Xxxx of Sale
[***] = Pursuant to 17 CFR 240.24b-2(b), confidential information has been
omitted and has been filed separately with the Securities and Exchange
Commission pursuant to a Confidential Treatment Application filed with the
Commission.
KNOW ALL MEN BY THESE PRESENTS THAT________________________, in
exchange for $[***] paid and delivered by _________________________ ("Buyer"),
and other good and valuable consideration, the sufficiency and receipt of which
is hereby acknowledged, does hereby sell, assign, convey, transfer and deliver
to Buyer, its successors and assigns, the following equipment free from all
liabilities, liens, mortgages, debts, taxes, other encumbrances and any
violations of record as of the date hereof, "as is", without any warranties of
any sort:
(i) OPEX Model 150, Serial 165 Mail Extractor & Sorter
(ii) OPEX IEM, Serial 191, Image Export
Dated as of ____________________
AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.
[OR REGULUS WEST, LLC, AS APPLICABLE]
By:
Name:
(Type or print)
Title:
Date:
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