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THIS EXHIBIT CONTAINS CONFIDENTIAL INFORMATION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
CONFIDENTIAL TREATMENT REQUEST UNDER RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED. THE CONFIDENTIAL INFORMATION ON PAGES 1 AND 2 HAS BEEN REPLACED WITH
ASTERISKS.
* Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment
request.
Exhibit 10.19
SECOND AMENDMENT TO CREDIT CARD ACCOUNTS SALE AGREEMENT
THIS SECOND AMENDMENT ("Amendment") to the Credit Card Accounts Sale
Agreement is entered into this 27th day of January, 1999 (the "Effective Date")
among Midland Credit Management, Inc. ("Buyer"), Greenwood Trust Company ("GTC"
or a "Seller"), and U.S. Bank National Association as Trustee (the "Trustee")
for the Discover Card Master Trust I (the "Trust" or a "Seller")
WHEREAS, Sellers and Buyer have entered into that certain Credit Card
Accounts Sale Agreement with an Effective Date of May 27, 1998, as amended by
the First Amendment to the Credit Card Accounts Sale Agreement (the
"Agreement"); and
WHEREAS, the Agreement does not require Sellers to sell to Buyer a minimum
amount or percentage of Accounts each month; and
WHEREAS, Sellers and Buyer desire to amend the Agreement to require
Sellers to sell to Buyer a minimum amount or percentage of Accounts each month
and to extend the term of the Agreement; and
WHEREAS, in consideration of Sellers agreeing to extend the term of the
Agreement and to sell to Buyer a minimum amount of Accounts each month, Sellers
and Buyer desire to amend the Agreement to increase the purchase price paid by
Buyer for such Accounts.
NOW, THEREFORE, in consideration of the mutual agreements set forth in the
Agreement and below, the parties agree as follows:
1. Definitions. Capitalized terms used herein and not otherwise defined have
the respective meanings assigned to them in the Agreement.
2. Amendments to Agreement The Agreement shall be amended as follows:
2.1 Paragraph 1.14 of the Agreement is amended by deleting [*]
appearing in the first line of said Paragraph and replacing it with
[*] and deleting [*] appearing in the second line of said
Paragraph and replacing it with [*]
2.2 Paragraph 2.1 of the Agreement is amended by deleting [*]
appearing in the third line of said Paragraph and replacing it with
[*].
2.3 Paragraph 3.3(b) of the Agreement is amended by adding the following
new sentences after the first sentence in said Paragraph: "For the
months beginning with [*] through and
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* Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment
request.
including [*], Sellers agree to sell to Buyer at least
[*] of all accounts which are available for sale, meet
the definition of an Account and fall within Pool I. Beginning with
[*] through [*], Sellers agree to sell to Buyer at least [*] of all
accounts which are available for sale, meet the definition of an
Account and fall within Pool I. GTC, as Seller and Servicer of the
Accounts, agrees that the Accounts within Pool I will not be
selected in such a manner that a preference as to the geographic
distribution or credit quality of the Accounts is given to any
purchaser of Accounts.
2.4 Paragraph 8.3 of the Agreement is amended by adding the following to
the end of the first sentence of said Paragraph: "; nor shall Buyer
bring or threaten to bring any legal proceeding against any Debtor
in an effort to collect a debt which is barred by the applicable
statute of limitations."
2.5 Article IX of the Agreement is amended by adding the following new
sentence after the fourth sentence in said Paragraph:
"Notwithstanding the foregoing, for those Accounts purchased by
Buyer from and after January 1999, Buyer shall pay to Sellers,
within [*] Business Days after GTC and the Trustee assign the
substitute Accounts to Buyer, the difference, if any, between (I)
(x) [*] times the Unpaid Balance of the Pool I substitute Accounts
plus (y) [*] times the Unpaid Balance of the Pool II substitute
Accounts minus (ii) (x) [*] times the Unpaid Balance of the Pool I
substituted Accounts plus (y) [*] times the Unpaid Balance of the
Pool II substituted Accounts.
2.6 Article XI of the Agreement is amended by adding the following new
sentence after the fourth sentence in said Paragraph:
"Notwithstanding the foregoing, for those Accounts purchased by
Buyer from and after December, 1998, Buyer shall pay to Sellers,
within [*] Business Days after GTC and the Trustee assign the
substitute Accounts to Buyer, the difference, if any, between (I)
(x) [*] times the Unpaid Balance of the Pool I substitute Accounts
plus (y) [*] times the Unpaid Balance of the Pool II substitute
Accounts minus (ii) (x) [*] times the Unpaid Balance of the Pool I
substituted Accounts plus (y) [*] times the Unpaid Balance of the
Pool II substituted Accounts.
2.7 Adding the new Paragraph 13.13 to the Agreement:
"13.13 TERMINATION. This Agreement may be terminated by either
Seller at any time and shall be of no further force and effect upon
the occurrence of the following: (I) Buyer's breach or default in
the performance of any covenant, agreement, representation or
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warranty hereunder; (ii) Buyer becomes insolvent or generally fails
to pay, or admits in writing its inability to pay, its debts as they
become due; or Buyer applies for, consents to, or acquiesces in the
appointment of, a trustee, receiver or other custodian for the
Bankrupt Party or any property thereof, or makes a general
assignment for the benefit of creditors; or in the absence of such
application, consent or acquiescence, a trustee, receiver or other
custodian is appointed for the Buyer or for a substantial part of
its property and is not discharged within thirty (30) days; or any
bankruptcy, reorganization, debt arrangement, or other case or
proceeding under any bankruptcy or insolvency law, or any
dissolution, liquidation, or similar proceeding, is commenced by the
Buyer, is consented to or acquiesced in by the Buyer or remains
undismissed for thirty (30) days; or the Buyer takes any corporate
action to authorize, or in furtherance of, any of the foregoing; or
(iii) either Seller reasonably determines that the continued sale of
Accounts to Buyer is likely to adversely affect such Seller's public
image due to industry misconduct on the part of Buyer, its parent
company or affiliates. If either Seller elects to terminate this
Agreement pursuant to this Section 13.13, no further sales of
Accounts shall be made by Sellers to Buyer under this Agreement; it
being understood that no termination of this Agreement shall release
or be construed as releasing Buyer from any liability or damage to
either Seller arising out of, in connection with or otherwise
relating to, directly or indirectly, Buyer's breach or default of
any of its representations, warranties, covenants, agreements,
duties or obligations arising hereunder.
3. Miscellaneous Provisions
3.1 Reaffirmation. As hereby amended, the Agreement is hereby ratified
and reaffirmed by each of the parties thereto. In the event of any
irreconcilable conflict between the provisions of this Amendment and
the provisions of the Agreement, the terms of this Amendment shall
prevail.
3.2 Captions. The various captions in this Amendment are included for
convenience only and shall not affect the meaning or interpretation
of any provision of this Amendment.
3.3 Governing Law. This Amendment shall be construed in accordance with
the laws of the state of Delaware, without reference to the conflict
of law provisions of such state, and the obligations, rights and
remedies of the parties hereunder shall be determined in accordance
with such laws.
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3.4 Execution in Counterparts. This Amendment may be executed in any
number of counterparts and by the different parties hereto in
separate counterparts, each of which when so executed shall be
deemed to be an original and all of which when taken together shall
constitute one and the same Amendment.
IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by
their respective officers thereunto duly authorized as of the date first written
above.
BUYER:
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: President
SELLER:
GREENWOOD TRUST COMPANY
By: /s/ X. X. Xxxx
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Name: X. X. Xxxx
Title: President
U.S. BANK NATIONAL ASSOCIATION, as
Trustee for the Discover Card Master Trust I
By: /s/ Xxxxxx X. Xxxxxxx
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Name:
Title:
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