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Exhibit 10.26
CREDIT CARD PROGRAM AGREEMENT
BETWEEN
MONOGRAM CREDIT CARD BANK OF GEORGIA
AND
FILENE'S BASEMENT, INC.
JULY 20, 1995
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS
Section 1.1 Specific Terms .......................................... 1
Section 1.2 Interpretation of Terms ................................. 9
Section 1.3 Accounting Terms ........................................ 9
ARTICLE II ESTABLISHMENT OF PROGRAM
Section 2.1 Establishment of Program, Generally ..................... 9
Section 2.2 Extension of Credit by Bank; Maximum Investment ......... 10
Section 2.3 Filene's Basement to Honor Credit Card .................. 11
Section 2.4 Promotion and Implementation of Program ................. 11
Section 2.5 Conversion Costs ........................................ 12
Section 2.6 Competitive Programs .................................... 12
Section 2.7 Confidential Information ................................ 12
ARTICLE III ADMINISTRATION OF PROGRAM
Section 3.1 Preparation of Documents ................................ 13
Section 3.2 Credit Criteria and Credit Approval ..................... 14
Section 3.3 Credit Information; Ownership of Accounts and Customer
Lists ........................................................... 15
Section 3.4 Data Transmission Equipment ............................. 15
Section 3.5 Returns of Merchandise .................................. 16
Section 3.6 Collection of Accounts .................................. 16
Section 3.7 Credit Insurance ........................................ 16
Section 3.8 Value-Added Programs .................................... 17
Section 3.9 Transmittal and Retention of Documents .................. 17
Section 3.10 In-Store Payments ...................................... 17
Section 3.11 Bank's Right to Audit .................................. 18
Section 3.12 Filene's Basement's Right to Audit ..................... 18
ARTICLE IV OPERATING PROCEDURES
Section 4.1 General ................................................. 18
Section 4.2 New Customer Account Establishment Procedures ........... 18
Section 4.3 Purchase Authorization Procedures ....................... 18
Section 4.4 Settlement Procedures ................................... 19
ARTICLE V PAYMENT TO FILENE'S BASEMENT FOR CHARGE SLIPS;
OTHER CHARGES
Section 5.1 Payment to Filene's Basement ............................ 21
Section 5.2 Postage Rate Adjustment ................................. 21
Section 5.3 Business Reply Postage .................................. 21
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Section 5.4 Base Rate Adjustment .................................... 21
Section 5.5 Application Fees ........................................ 22
Section 5.6 Payment by Filene's Basement ............................ 22
ARTICLE VI CHARGEBACK
Section 6.1 Bank's Right to Chargeback .............................. 22
ARTICLE VII FINANCE CHARGES, OTHER CHARGES, ACCOUNT PAYMENT
TERMS
Section 7.1 Bank's Rights ........................................... 23
Section 7.2 Base Finance Charge ..................................... 23
Section 7.3 Notice of Changes ....................................... 23
Section 7.4 Changes in Laws/Regulations; Renegotiation .............. 24
Section 7.5 Late Charges; Returned Check Charges; Other Charges ..... 24
ARTICLE VIII REPRESENTATIONS, WARRANTIES AND COVENANTS OF FILENE'S BASEMENT
Section 8.1 Corporate Existence; Compliance with Law ................ 24
Section 8.2 Executive Offices ....................................... 25
Section 8.3 Corporate Power; Authorization; Enforceable
Obligations ..................................................... 25
Section 8.4 Solvency ................................................ 25
Section 8.5 No Default .............................................. 25
Section 8.6 No Burdensome Restrictions .............................. 26
Section 8.7 Compliance With Law ..................................... 26
Section 8.8 No Litigation ........................................... 26
Section 8.9 Full Disclosure ......................................... 26
Section 8.10 Insurance .............................................. 26
Section 8.11 Accounts; Account Documentation ........................ 27
Section 8.12 First Time Buyer ....................................... 28
Section 8.13 Balance in Account ..................................... 28
Section 8.14 Maintenance of Existence and Conduct of Business ....... 28
Section 8.15 Books and Records ...................................... 28
Section 8.16 Litigation ............................................. 28
Section 8.17 Adverse Transactions ................................... 28
Section 8.18 Events of Default ...................................... 28
Section 8.19 Delivery ............................................... 28
Section 8.20 Services ............................................... 28
Section 8.21 Adjustments ............................................ 29
Section 8.22 Obligations ............................................ 29
Section 8.23 Advertisements ......................................... 29
Section 8.24 Account Documentation .................................. 29
Section 8.25 Trade Names; Trademarks ................................ 29
Section 8.26 Conflicts; Defaults; Etc ............................... 29
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ARTICLE IX REPRESENTATIONS, WARRANTIES AND COVENANTS OF BANK
Section 9.1 Corporate Existence ..................................... 30
Section 9.2 Corporate Power, Authorization; Enforceable Obligation .. 30
Section 9.3 Solvency ................................................ 31
Section 9.4 No Default .............................................. 31
Section 9.5 No Burdensome Restrictions .............................. 31
Section 9.6 Compliance With Law ..................................... 31
Section 9.7 No Litigation ........................................... 31
Section 9.8 Purchase Representation ................................. 32
Section 9.9 Full Disclosure ......................................... 32
Section 9.10 Maintenance of Existence and Conduct of Business ....... 32
Section 9.11 Books and Records ...................................... 32
ARTICLE X FINANCIAL STATEMENTS AND INFORMATION
Section 10.1 Reports and Notices .................................... 32
ARTICLE XI EVENTS OF DEFAULT; RIGHTS AND REMEDIES
Section 11.1 Events of Default ...................................... 33
Section 11.2 Bank Events of Default ................................. 33
Section 11.3 Filene's Basement Events of Default .................... 34
Section 11.4 Remedies ............................................... 36
ARTICLE XII TERM/TERMINATION
Section 12.1 Term ................................................... 36
Section 12.2 Termination ............................................ 36
Section 12.3 Termination for Force Majeure .......................... 36
Section 12.4 Rights Upon Termination ................................ 37
Section 12.5 Survival ............................................... 38
ARTICLE XIII INDEMNIFICATION
Section 13.1 By Bank ................................................ 38
Section 13.2 By Filene's Basement ................................... 38
Section 13.3 Notice ................................................. 39
ARTICLE XIV USE OF FILENE'S BASEMENT MARKS
Section 14.1 Grant of Rights ........................................ 39
Section 14.2 Bank Acknowledgements .................................. 40
Section 14.3 Future Marks ........................................... 40
ARTICLE XV SUBSEQUENT OBLIGATIONS
Section 15.1 Representations and Warranties True .................... 40
Section 15.2 Obligations Performed .................................. 40
Section 15.3 No Events of Default ................................... 40
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Section 15.4 Letter of Credit ....................................... 00
Xxxxxxx 00.0 XXX Xxxxxxxx ........................................... 41
Section 15.6 Resolutions ............................................ 41
Section 15.7 Officer's Certificate .................................. 41
Section 15.8 Financing Statements Executed .......................... 41
ARTICLE XVI PERFORMANCE COLLATERAL
Section 16.1 Letter of Credit ....................................... 41
Section 16.2 Size of LOC ............................................ 41
Section 16.3 Discount Letter of Credit .............................. 42
Section 16.4 Size of Discount LOC ................................... 43
Section 16.5 Cost of LOCs ........................................... 43
ARTICLE XVII FILENE'S BASEMENT PURCHASE OF ACCOUNTS
Section 17.1 Generally .............................................. 43
Section 17.2 Liquidation ............................................ 43
Section 17.3 Survival of Rights ..................................... 44
ARTICLE XVIII MISCELLANEOUS
Section 18.1 Assignability .......................................... 44
Section 18.2 Set-Off by Bank ........................................ 44
Section 18.3 Offsets ................................................ 44
Section 18.4 Securitization/Participation ........................... 44
Section 18.5 Cooperation in Event of Termination .................... 45
Section 18.6 Financial Reports; Right to Audit ...................... 45
Section 18.7 Entire Agreement; Amendments ........................... 45
Section 18.8 Termination of Account Purchase Agreement .............. 45
Section 18.9 Non-Waiver ............................................. 45
Section 18.10 Severability .......................................... 45
Section 18.11 Governing Law ......................................... 46
Section 18.12 Captions .............................................. 46
Section 18.13 Notices ............................................... 46
Section 18.14 Power of Attorney ..................................... 47
Section 18.15 Grant of Security Interest; Precautionary Filing ...... 47
Section 18.16 Further Assurances .................................... 48
Section 18.16 Chargeback ............................................ 47
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CREDIT CARD PROGRAM AGREEMENT
This Credit Card Program Agreement (hereinafter "Agreement") is made as of
the 20th day of July, 1995 between Monogram Credit Card Bank of Georgia, a
Georgia banking corporation with its principal place of business at 0000 Xxxxxxx
Xxxx, Xxxxxxxx 000, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000 ("Bank"), and Filene's
Basement, Inc., a Massachusetts Corporation with its principal place of business
at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000 ("Filene's Basement").
RECITALS
A. Bank has established programs to extend customized revolving credit to
qualified buyers for the purchase of goods and services from various merchants.
X. Xxxxxx'x Basement is engaged in, among other activities, the selling at
retail of Merchandise (as hereinafter defined) to buyers.
C. Pursuant to the Account Purchase Agreement (as hereinafter defined),
Filene's Basement and GE Capital (as hereinafter defined) established a
revolving charge financing program.
X. Xxxxxx'x Basement desires that Bank extend credit to Cardholders (as
hereinafter defined) for the purchase of Merchandise at Stores (as hereinafter
defined), and Filene's Basement and GE Capital wish to supersede and terminate
the Account Purchase Agreement. Bank desires to acquire GECC Accounts (as
hereinafter defined) from GE Capital and convert such GECC Accounts to Bank
Accounts (as hereinafter defined) by notifying consumers in accordance with
applicable laws that GECC Accounts have been replaced by Bank Accounts and Bank
desires to extend credit to qualified persons holding GECC Accounts and
originate new Accounts under the Program (as hereinafter defined).
In consideration of the mutual covenants set forth below and for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Bank and Filene's Basement agree as follows:
ARTICLE I DEFINITIONS
SECTION 1.1 SPECIFIC TERMS. As used in this Agreement, the following terms shall
have the following meanings:
"Account" means and includes the following: (i) any open-end revolving
consumer credit account (including GECC Accounts and Bank Accounts) established
in favor of a Cardholder, pursuant to which a Cardholder may finance his/her
purchase of Merchandise from Stores on credit pursuant to the terms of a Credit
Card Agreement, together with any
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modifications or amendments which may be made to such Credit Card Agreement,
which is to be owned by Bank, and which is to be used for personal, family or
household purposes; (ii) any and all Account Documentation; (iii) all accounts,
accounts receivable, contract rights, chattel paper, choses in action,
Indebtedness, other receivables, general intangibles, documents, instruments and
notes, and the proceeds of the foregoing, relating to the retail purchase of
Merchandise billed in connection with that Credit Card Agreement, including any
of the foregoing that were owed to Persons other than Bank and purchased by
Bank; (iv) any and all goods or other property, contracts of indemnity,
guaranties or sureties, proceeds of insurance and other proceeds at any time
standing as security for the Account; and (v) any and all other rights,
remedies, benefits, interests and titles, both legal and equitable, to which GE
Capital or Bank, in their aforesaid capacities, may now or at any time hereafter
be entitled in respect to the foregoing.
"Account Documentation" means any and all documentation relating to an
Account, including, without limitation, Charge Transaction Data, Credit Card
Applications, Credit Card Agreements, Charge Slips, Credit Card Sales Invoices,
Credit Cards, Credit Slips, checks and stubs, and all correspondence, memoranda,
documents, instruments, certificates, agreements, invoices, sales or shipping
slips, delivery receipts, billing statements, applications, magnetic tapes,
disks, or hardcopy formats, or any other computer-readable data transmissions or
software, and all other materials including, without limitation, tangible and
intangible information arising therefrom or pertaining thereto.
"Account Purchase Agreement" shall mean the Account Purchase Agreement
between Filene's Basement and GE Capital, dated as of September 29, 1989,
including all amendments, modifications, supplements, exhibits and schedules
thereto.
"Active Account" shall mean, with respect to a Settlement Period, an
Account which has a debit or credit balance at any time during such Settlement
Period.
"Actual Interest Expense" means GE Capital's actual interest expense per
annum expressed as a rate calculated monthly by GE Capital's Treasury Operation
and as reported on GE Capital's internal M-11 report, or on any successor to
such report designated by GE Capital, should such report be discontinued during
the term hereof.
"Affiliate" shall mean, with respect to any Person, each Person that
controls, is controlled by or is under common control with such Person directly
or indirectly, or any Affiliate of such Person. For the purpose of this
definition, "control" of a Person shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of its management or
policies, whether through the ownership of voting securities, by contract or
otherwise.
"Aggregate Investment" shall mean, at any time, the aggregate of all
Indebtedness on all Active Accounts as calculated on each relevant Billing Date
during a Settlement Period.
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"Aggregate Outstanding Balance" means, with respect to an Account, the
total outstanding balance owed on any GECC Account converted by Bank, or Bank
Account established by Bank, in connection with the Program, including, without
limitation, finance charges, Credit Insurance Charges, Late Charges, Returned
Check Charges, charges for Value-Added Programs and Other Charges.
"Annual Percentage Rate" means the periodic rate applicable to
Cardholders' Aggregate Outstanding Balances times the number of periods in a
year.
"Applicant" means an individual who has submitted a Credit Card
Application to Bank for a Credit Card under the Program.
"Approved Form" has the meaning set forth in Section 3.1 hereof. Any
capitalized terms used in this Agreement referring to Account Documentation
shall refer to Approved Forms.
"Average Account Balance" means the Aggregate Investment as calculated on
any relevant Billing Date during a Settlement Period, divided by the number of
Active Accounts during such Settlement Period.
"Bank Account(s)" means any Account which either is acquired by Bank on
the Conversion Date or at any other time, or is originated by Bank pursuant to
Sections 2.1 and 2.2 of this Agreement.
"Bankruptcy Code" shall mean the Bankruptcy Reform Act of 1978, as
amended, 11 U.S.C. SEC. 1101 ET SEQ., as the same may be amended from time to
time, and any similar successor statute that may be in effect from time to time.
"Bank Event of Default" shall mean any event described in Section 11.2
hereof.
"Base Rate" shall mean (i) 2.91% per annum, for periods prior to July 1,
1996, or (ii) 3.4%, on or after July 1, 1996.
"Billing Cycle" means the time interval between regular monthly Billing
Dates for an Account.
"Billing Date" means the last day of a Billing Cycle for an Account.
"Business Day" means any day except Saturday or Sunday, or a day on which
banks are required or permitted to be closed in the State of Georgia.
"Cardholder" means any natural person who is or may be obligated to Bank
with respect to an Account and for whom an Account has been opened or converted
by Bank under the Program and includes any natural person who is authorized to
purchase Merchandise from
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Filene's Basement at retail for personal, family or household purposes on credit
under or pursuant to an Account.
"Charge Slip" or "Credit Card Sales Invoice" means a sales receipt,
including but not limited to, an invoice or register tape, evidencing a purchase
of Merchandise from Filene's Basement that is to be charged to the Cardholder's
Account and which evidences an amount to be advanced by Bank to Filene's
Basement on behalf of the Cardholder.
"Charge Transaction Data" means Account/Cardholder identification and
transaction information with regard to each purchase of Merchandise for credit
to the Account/Cardholder, which data are required to be transmitted by Filene's
Basement to Bank in accordance with the Operating Procedures or any
modifications or amendments thereto.
"Code" shall mean the Uniform Commercial Code (or similar personal
property security law) of the jurisdiction with respect to which such term is
used, as in effect from time to time.
"Confidential Information" has the meaning set forth in Section 2.7
hereof.
"Conversion Date" means the date or dates designated by Bank upon which
the GECC Accounts assigned to GE Capital will be acquired by Bank.
"Credit Card" or "Card" means the plastic card issued and owned by Bank
under the Program exclusively for use in connection with the Program at Stores.
"Credit Card Agreement" means the open-end revolving credit agreement
between Bank and a Cardholder pursuant to which a Cardholder may finance the
purchase of Merchandise on credit from Filene's Basement, together with any
modifications or amendments which may be made to such agreement.
"Credit Card Application" means the credit application which must be
completed and submitted for review to Bank in Georgia by Applicants.
"Credit Criteria" means the standards used by Bank when evaluating
applications for Accounts under the Program, which standards may be modified by
Bank from time to time subject to the terms and conditions set forth in
subsection 3.2(b) hereof.
"Credit Insurance" has the meaning set forth in Section 3.7 hereof.
"Credit Insurance Charges" means any charges to a Cardholder as a premium
for Credit Insurance purchased by such Cardholder on an Account.
"Credit Limit" means the maximum amount of credit that will be extended to
a Cardholder by Bank under an Account as established and modified by Bank from
time to time.
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"Credit Slip" means a credit receipt evidencing a return or exchange or
adjustment of Merchandise by Filene's Basement to a Cardholder, or other credit
on an Account.
"Customer List" means any list (whether in hard copy, in magnetic tape
format or other form) identifying Cardholders, including, without limitation,
any list of the names, addresses, telephone numbers and social security numbers
of any or all Cardholders.
"Data Transmission Equipment" shall mean equipment provided by Bank to
Filene's Basement for use with any data capture and transmission vehicle
employed by Bank, whether called "Hypercom" or not.
"Deferred Discount" shall have the meaning set forth in subsection 5.4(b)
of this Agreement.
"Discount" shall have the meaning set forth in subsection 5.1(b).
"Effective Date" means the date on which Bank first establishes a New Bank
Account under Article II of this Agreement.
"Event of Default" shall mean any event described in Article XI hereof.
"Execution Date" means the last date upon which this Agreement is signed
by a party hereto.
"Filene's Basement Event of Default" shall mean any event described in
Section 11.3 hereof.
"Filene's Basement Termination" shall have the meaning set forth in
Subsection 12.2(a).
"Floor Release" means the maximum amount of any charge (or related series
of charges) which Filene's Basement shall have the right to accept from a
Cardholder, in the event that the POS Network and/or Bank's authorization system
are not in operation, and authorizations for Cardholder purchases cannot be
obtained directly from Bank. The Floor Release limit as of the date of this
Agreement shall be $75; any adjustment to the Floor Release limit shall be
effected by mutual agreement between Bank and Filene's Basement.
"GE Capital" means General Electric Capital Corporation, a New York
corporation.
"GECC Account(s)" means any Account originated by Filene's Basement and
assigned to GE Capital pursuant to the terms of the Account Purchase Agreement,
or any predecessor agreement, that meets certain credit and other criteria set
by Bank in its discretion, except the following shall not constitute GECC
Accounts for the purpose of this Agreement: (i) such Accounts which have been
written off by GE Capital prior to the Conversion Date. (ii) such
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Accounts that are ninety (90) days or more past due, and (iii) those for which a
cardholder is bankrupt or deceased.
"Indebtedness" shall mean any obligation not written off by Bank incurred
by a Cardholder in respect of an Account, including, without limitation, any
charges for Merchandise, finance charges, Credit Insurance Charges, Late
Charges, Returned Check Charges, charges for Value-Added Programs and any other
charges in respect of an Account.
"Indemnified Party" has the meaning set forth in Article XIII hereof.
"Indemnifying Party" has the meaning set forth in Article XIII hereof.
"Initial Term" has the meaning set forth in Section 12.1 hereof.
"In-Store Payment" means a payment on an Account made by a Cardholder (or
any person acting on behalf of such Cardholder) at a Store.
"Late Charges" means charges or fees to Cardholders for late payments on
Accounts, which charges or fees are set by Bank from time to time and instituted
and implemented by Bank.
"Licensee" shall mean Jewelry Promotions, Inc., Xxxxx Furs, Inc., Model
Imperial Supply Co., Inc., Liberty Xxxxxxx, Inc. and Vacation Outlet-National
Leisure Group, Inc. and Persons who pursuant to any now existing or future
agreement with Filene's Basement, (i) are from time to time authorized by
Filene's Basement to make credit sales of Merchandise pursuant to Accounts, (ii)
lease space from Filene's Basement in one or more Stores, and (iii) are
designated by Filene's Basement to Bank in a written notice.
"Lien" shall mean any mortgage or deed of trust, pledge, hypothecation,
assignment, deposit arrangement, lien, charge, claim, security interest
(including, without limitation, any interest of a buyer of accounts or chattel
paper which is subject to Article 9 of the Uniform Commercial Code),
encumbrance, preference, priority or other security or preferential arrangement
of any kind or nature whatsoever (including, without limitation, any lease or
title retention agreement, any financing lease having substantially the same
economic effect as any of the foregoing, and the filing of, or agreement to
file, any financing statement pursuant to the Uniform Commercial Code).
"LOC Termination" shall mean a termination of this Agreement pursuant to
Section 12.2, other than a Filene's Basement Termination.
"Xxxx(s)" has the meaning set forth in Article XIV hereof and Exhibit A
hereto.
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"Maximum Investment" shall mean an Aggregate Investment of seventy five
million dollars ($75,000,000) or such higher amount as Bank, in its sole
discretion, shall from time to time specify to Filene's Basement.
"Merchandise" shall mean those goods and services, including accessories
and delivery services sold in conjunction therewith, sold at retail by Filene's
Basement or a Licensee in a Store to the general public for personal, family, or
household use. Merchandise shall include only items that are new and unused at
the time of sale, however Merchandise may also include items that are returned
to Filene's Basement and restored to Filene's Basement inventory and
subsequently offered for resale as new and unused, to the extent permitted by
law. Merchandise shall also include work or labor to be performed by or at the
instance of Filene's Basement to or for the benefit of a Cardholder in the
ordinary course of business. Such work or labor may include Merchandise used or
to be used in the performance of such work or labor.
"Monthly Billing Cycle Outstandings" means the sum of the Aggregate
Outstanding Balances of all Accounts as calculated for each relevant Billing
Date in a Settlement Period.
"Net Credit Volume" for any period means total dollar amount of credit
sales of Merchandise made pursuant to Charge Slips less the total dollar amount
of any Credit Slips, as reflected in Charge Transaction Data received by Bank
during such period.
"New Bank Account(s)" means a Bank Account originated by Bank on or after
the Effective Date.
"New Xxxx(s) has the meaning set forth in Section 14.3 hereof.
"Obligations" shall mean any and all liabilities, obligations, covenants,
and duties owing by Filene's Basement or any Affiliate of Filene's Basement to
Bank arising under this Agreement (or any modification, alteration or amendment
thereof), of any kind or nature, present or future, now existing or hereafter
arising, and however acquired. The term includes, without limitation, any fee,
charge, expense, attorney's fee or other sum chargeable to Filene's Basement or
any Affiliate of Filene's Basement pursuant to this Agreement, as the same may
be modified, altered or amended.
"Operating Procedures" means the written instructions and procedures
established by Bank in connection with the Program, as the same may be
supplemented, amended or modified by Bank from time to time, including, without
limitation, any advertising guidelines, and which Operating Procedures shall be
consistent with Bank's standard practice for Bank's other private label credit
card programs.
"Other Charges" means any and all other charges on Accounts (other than
finance charges, Late Charges, and Returned Check Charges) set, instituted and
implemented by Bank to the extent permitted by law.
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"Person" shall mean any individual, sole proprietorship, partnership,
joint venture, trust, unincorporated organization, association, corporation,
institution, public benefit corporation, entity, or government (whether federal,
state, county, city, municipal, or otherwise, including, without limitation, any
instrumentality, division, agency, body, or department thereof).
"Portfolio Average Daily Balance" shall mean the amount calculated as
follows: the sum of the daily aggregate Indebtedness during each Billing Cycle
in a Settlement Period divided by the number of days in that Billing Cycle, each
such quotient occurring in such Settlement Period then added together, and the
resulting total divided by the number of Billing Cycles in such Settlement
Period.
"POS Network" means the electronic communication system between Filene's
Basement and Bank to facilitate the operation of the Program.
"Program" means the credit card program established by this Agreement and
made available to qualified Cardholders for the purchase of Merchandise sold by
Filene's Basement. The term "Program" includes the extension of credit,
xxxxxxxx, collections, accounting between the parties, and all aspects of the
customized revolving credit plan established by Bank as contemplated herein.
"Program Accounts Portfolio" means all Accounts owned by Bank.
"Renewal Term" has the meaning set forth in Section 12.1 hereof.
"Returned Check Charges" means charges or fees to Cardholders for returned
checks received by Bank or Filene's Basement as payment on an Account, which
charges are set by Bank from time to time and instituted and implemented by
Bank.
"Settlement Date" shall mean a Business Day no later than the tenth day
after the last day of the last Billing Cycle in a Settlement Period.
"Settlement Period" shall mean a monthly period beginning on the first day
after the last day of the final Billing Cycle in a calendar month and ending on
the last day of the last Billing Cycle in the next calendar month, except that
the first Settlement Period under this Agreement shall begin upon the
establishment of the first New Bank Account hereunder, and if that first New
Bank Account shall be established on or after the 25th day of a calendar month,
the first Settlement Period shall end on the last day of the final Billing Cycle
in the next calendar month.
"Solvent" shall mean, when used with respect to an entity, that (a) the
present fair salable value of such entity's assets exceed the total amount of
its liabilities; and (b) such entity is able to pay its debts as they become
due; and (c) such entity does not have unreasonably
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small capital to carry on its business as theretofore operated and all
businesses in which such entity is about to engage.
"Stores" means retail stores now or hereafter operated by Filene's
Basement and located in the United States using one or more of the Marks;
"Store" shall also include (i) any location or operation which sells Merchandise
by mail order or over the telephone, and (ii) any department within a retail
store operated by Filene's Basement, which department is leased from Filene's
Basement by a Licensee.
"UCC" means the Uniform Commercial Code (or similar personal property law)
of the jurisdiction with respect to which such term is used, as in effect from
time to time.
"Value-Added Programs" means any program offered by or through Bank under
which Bank or a third party designated by Bank makes products or services
available to Cardholders as set forth in Section 3.8 hereof. Under no
circumstances shall Credit Insurance be considered a Value-Added Program.
SECTION 1.2 INTERPRETATION OF TERMS. Wherever from the context it appears
appropriate, each term stated in either the singular or plural shall include the
singular and the plural, and pronouns stated in the masculine, feminine, or
neuter gender shall include the masculine, the feminine, and the neuter.
SECTION 1.3 ACCOUNTING TERMS. Any accounting term used herein shall have, unless
otherwise specifically provided herein, the meaning customarily given in
accordance with Generally Accepted Accounting Procedures (GAAP). That certain
terms or computations are explicitly modified by the phrase "in accordance with
GAAP" shall in no way be construed to limit the foregoing. All other undefined
terms contained herein shall, unless the context indicates otherwise, have the
meanings provided for by the Code in the State of Georgia to the extent the same
are used or defined therein. The words "herein", "hereunder", and other words of
similar import refer to this Agreement as a whole, as the same may from time to
time be amended or supplemented, and not to any particular section, subsection,
or clause contained in this Agreement.
ARTICLE II ESTABLISHMENT OF PROGRAM
SECTION 2.1 ESTABLISHMENT OF PROGRAM, GENERALLY.
(a) Pursuant to the terms and conditions of this Agreement, Bank will
establish, and Filene's Basement will participate in, the Program for the
purpose of extending open-end credit accessed by Credit Cards available to
qualified Applicants (up to applicable Credit Limits) for the purchase of
Merchandise from Stores.
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(b) Bank will pay Filene's Basement the sum of $100,000, within five days
of the Effective Date, as a signing bonus.
(c) Any and all new Accounts opened in favor of Cardholders on or
subsequent to the Effective Date will be opened and maintained by Bank as Bank
Accounts.
(d) On the Conversion Date, Bank shall acquire from GE Capital all GECC
Accounts and thereafter convert said GECC Accounts into Bank Accounts.
(e) Filene's Basement agrees to cooperate fully with GE Capital and Bank
in undertaking the conversion described in subsection 2.1(d), such cooperation
to include, but not be limited to, the taking of any and all actions by Filene's
Basement which either Bank or GE Capital reasonably deems necessary or advisable
in order to give effect to the acquisition of GECC Accounts by Bank on the
Conversion Date, the conversion of such GECC Accounts into Bank Accounts, and
the implementation of any corresponding changes in the terms and conditions
governing Cardholders' subsequent usage of such Accounts. The costs incurred by
the parties in effecting the conversion shall be borne as provided in Section
2.5.
(f) With respect to each Applicant under the Program who qualifies for
credit under the Credit Criteria, Bank shall open an Account, issue a Credit
Card and extend credit on such Account (up to applicable Credit Limits) for the
purchase of Merchandise. The terms and conditions upon which a Cardholder may
use the Credit Card, and upon which Bank may extend credit to a Cardholder,
shall be governed by the Credit Card Agreement between such Cardholder and Bank.
SECTION 2.2 EXTENSION OF CREDIT BY BANK; MAXIMUM INVESTMENT.
(a) Subject to Credit Limits applicable to each Account and to the terms
and conditions in the Credit Card Agreement, Bank shall extend credit to
Cardholders in amounts set forth as the "total" for any purchase(s) reflected in
Charge Transaction Data received and accepted by Bank, provided that Bank shall
not be obligated to extend any credit to Cardholders if, after giving effect to
any such proposed extension of credit, the aggregate outstanding balance of all
Accounts owned by Bank would equal or exceed the Maximum Investment. Bank shall
have full recourse against Filene's Basement for all Accounts and transactions
not authorized by Bank.
(b) In the event that the aggregate unpaid balance of Accounts equals or
exceeds eighty percent (80%) of the Maximum Investment then in effect, Bank
shall notify Filene's Basement in writing that the aggregate of Indebtedness
under this Agreement has reached such level, and, within ninety (90) days after
the date of such notice, Bank shall elect any one of the following options and
give Filene's Basement written notice of such election within said ninety day
period:
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(i) Bank may, in its sole discretion, increase the Maximum
Investment to an amount Bank deems acceptable, but in any event to a sum
equal to or higher than the amount which, at the time of the election of
this option, would not then immediately trigger the provisions stated in
the preceding subsection. If Bank elects this option, Bank's written
notice to Filene's Basement shall include the amount of the increased
Maximum Indebtedness; or
(ii) Bank may obtain funds from one or more lending institutions, of
Bank's sole choice and in such manner as Bank deems appropriate and
consistent with the provisions of this Agreement, for the purpose of
securitizing or participating with Bank in funding a portion of the
Accounts, such portion to be unlimited in amount and at Bank's sole
expense and discretion (provided that Bank shall continue to be obligated
under this Agreement with respect to such Accounts as if Bank had not
securitized or participated out such Accounts); or
(iii) Bank may elect not to increase the Maximum Investment to an
amount required in subsection 2.2(b)(i); in such event, Filene's Basement
shall be entitled to terminate this Agreement in accordance with the
provisions of subsection 12.2(c).
(c) Filene's Basement expressly acknowledges Bank's right to establish a
Maximum Investment, and, in this regard, hereby releases Bank from any and all
losses incurred as a result of Bank taking any action contemplated under this
Section 2.2, including but not limited to any losses resulting from Bank's
refusal to approve any extensions of credit to Cardholders, or to increase the
Maximum Indebtedness, or losses sustained by Filene's Basement relating to a
lender liability claim.
SECTION 2.3 FILENE'S BASEMENT TO HONOR CREDIT CARD. Filene's Basement shall
honor the Credit Cards for purchase(s) of Merchandise at all Stores in
accordance with the Operating Procedures.
SECTION 2.4 PROMOTION AND IMPLEMENTATION OF PROGRAM.
(a) Bank and Filene's Basement shall cooperate with each other and
actively support and promote the Program to Cardholders, both existing and
potential, in order to encourage the acquisition and usage of Accounts by
Cardholders. Except as otherwise provided in Article XIV hereof, advertising,
including any direct marketing by Bank, shall be subject to the approval of both
parties hereto.
(b) Within 30 days after the last day of each calendar year, Filene's
Basement will provide Bank with an itemized accounting documenting expenses for
all Filene's Basement activities directly relating to the promotion of Accounts
during such calendar year. Within 30 days following Bank's receipt of such
itemized accounting, Bank will reimburse Filene's Basement for any such expenses
in an amount not to exceed .10% of the Net Credit Volume
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during such calendar year (in addition to amounts paid by Bank to Filene's
Basement under Section 3.8.
(c) Filene's Basement will maintain, within each Filene's Basement Store,
in places prominent and readily accessible to the public, Credit Card
Applications and credit card application displays. Filene's Basement will
include in its advertising reference to the Program with a frequency and a size
and prominence at least equal to the reference made in such advertising to any
other credit card. All such advertising and promotional material stating any
consumer credit terms and/or conditions will be subject to Bank's prior written
approval. Filene's Basement will not, without Bank's prior consent, use Bank's
name or logo type in any advertisement or promotion materials.
(d) Subject to Filene's Basement approval, Bank may, at its option,
through mailings, or other advertising media, solicit Cardholders for the
purpose of promoting the usage of Accounts. Filene's Basement agrees to
cooperate with Bank in such solicitation, at Bank's expense.
(e) Filene's Basement may elect, at its option, to provide to Bank (at the
address so stated by Bank and using Bank's insert requirements) inserts for
placement into customer billing statements each month. Filene's Basement will be
responsible for ensuring that the delivery, size and weight requirements of
inserts are in accordance with the specifications set forth in the Operating
Procedures and for the supply of insert stock. Filene's Basement will also be
solely responsible for the costs of producing such inserts. The insertion
service by Bank will be at no cost to Filene's Basement as long as all insert
and weight requirements have been met by Filene's Basement and no additional
postage is required because of the inserts. Notwithstanding the foregoing, any
insert required by law, or regulation or the Operating Procedures as well as any
collection and/or customer service letters, will take precedence over any
Filene's Basement insert.
SECTION 2.5 CONVERSION COSTS. The first $100,000 of the combined costs of the
parties to effect the conversion of the Program from GE Capital to Bank shall be
borne by Filene's Basement; all costs in excess of $100,000 shall be borne by
Bank.
SECTION 2.6 COMPETITIVE PROGRAMS. Filene's Basement shall not, unless Bank
agrees in writing, make available, or enter into the provision of any credit
program, credit facility, or credit card program other than (i) credit provided
in connection with the Program hereunder; (ii) credit provided by generally
accepted multi-purpose credit or charge cards such as American Express,
Mastercard, Visa and Discover, including any cooperative marketing program
established to support such cards (except that any so called "co-branded" card,
even if issued by any of the foregoing, shall be prohibited); and (iii) credit
provided in connection with accounts for commercial or business customers.
SECTION 2.7 CONFIDENTIAL INFORMATION. All confidential material and information
supplied by one party to the other party hereunder, including but not limited to
information concerning the
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terms of this Agreement, the Program Accounts Portfolio, the Customer List
(including the names and addresses of Cardholders), or either party's marketing
plans, objectives and financial results, is confidential and proprietary
("Confidential Information"). Confidential Information shall not include
information in the other party's possession prior to disclosure, information
lawfully obtained from a third party not subject to a confidentiality agreement
with another party, or information in the public domain unless that Confidential
Information is in the public domain because of a party's breach of its
obligations hereunder. A party shall use the other's Confidential Information
solely in the exercise of its rights and performance of its obligations pursuant
to this Agreement. Each party shall receive the other party's Confidential
Information in confidence and not disclose Confidential Information to any third
party (other than Affiliates) except as (i) authorized by this Agreement, (ii)
may be agreed upon in writing by the other party, or (iii) otherwise required by
law (in which case, the disclosing party, to the extent possible, shall seek
confidential treatment thereof). Each party shall use its best efforts to ensure
that its officers, employees, and agents take such action as shall be necessary
or advisable to preserve and protect the confidentiality of Confidential
Information. Nothing contained in this Section 2.7 shall effect the rights and
obligations of the parties with respect to the Customer List as specified in
subsection 3.3(b) hereof.
ARTICLE III ADMINISTRATION OF PROGRAM
SECTION 3.1 PREPARATION OF DOCUMENTS.
(a) Filene's Basement agrees to provide at its expense: (i) all necessary
and proper imprinters, (ii) promotional material, and (iii) authorization
devices and the installation thereof (other than the equipment listed in Section
3.4), provided that such expense does not exceed $20,000 in any calendar year.
Any expense for such items in excess of $20,000 in any calendar year shall be
approved by Filene's Basement, and the payment of such expense shall be agreed
to by the parties.
(b) Bank agrees to provide at its expense: (i) billing and collection
forms, and Credit Card Application forms, (ii) Credit Cards for all customer
accounts approved by Bank from the date hereof, (iii) embossing service, (iv)
communication lines for authorization purposes, and (v) such internal forms as
Bank may require to implement this Agreement.
(c) Bank agrees to provide at Filene's Basement expense: (i) sales slip
forms, (ii) customer refund forms, and (iii) customer payment receipt forms.
(d) All forms to be used by Bank to evidence sales of Merchandise which
result in Accounts or to be used in the billing or collection of Accounts,
shall, at Bank's option, state that the Accounts are owned by and are serviced
by Bank, and shall be otherwise subject to approval by Bank prior to actual
usage. No change in such forms shall be effected without Bank's prior written
consent, which will not be unreasonably withheld.
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(e) All Account Documentation shall be in a form prepared and/or approved
by Bank (each an "Approved Form") and each Approved Form shall clearly disclose
that Bank is the creditor. Bank may prepare new Approved Forms and/or modify
Approved Forms at any time in its sole discretion.
(f) A Cardholder's minimum monthly payments initially shall be as set
forth below. Bank may change such minimum payment at any time after prior
consultation with Filene's Basement.
New Balance Minimum Monthly Payment
----------- -----------------------
Up to $20.00 New Balance
$20.01 to $200.00 $20.00
$200.01 to $250.00 $25.00
$250.01 to $300.00 $30.00
$300.01 to $350.00 $35.00
$350.01 to $400.00 $40.00
$400.01 to $450.00 $45.00
$450.01 to $500.00 $50.00
Over $500 1/10 of the new balance, rounded to
the next higher dollar
SECTION 3.2 CREDIT CRITERIA AND CREDIT APPROVAL.
(a) Bank shall, in its sole discretion but in compliance with law,
establish the Credit Criteria used in evaluating Applicants in connection with
the Program and may, in its sole discretion but in compliance with law, modify
such Credit Criteria from time to time as it deems necessary subject to the
terms and conditions set forth in subsection 3.2(b) below.
(b) Unless otherwise agreed by Bank and Filene's Basement, to the extent
permitted by law, Filene's Basement will process all applications for credit,
strictly applying instructions and criteria supplied by Bank. Bank will review
all applications for credit submitted to Bank or Filene's Basement by or on
behalf of prospective Cardholders and will approve for credit those applicants
which Bank deems creditworthy in accordance with credit standards and other
reasonable criteria set initially by Bank and customarily used in its business
practice. Standards of acceptability and eligibility may be revised from time to
time by Bank in accordance with reasonable credit considerations customarily
used in its business practice, after consultation with Filene's Basement.
(c) Bank, in its sole discretion, shall determine the creditworthiness of
individual Applicants under the Program, and shall periodically review the
creditworthiness of Cardholders in order to determine the range of Credit Limits
to be made available to individual Cardholders and whether to suspend or
terminate credit privileges of any Cardholder. Bank shall be identified to
Cardholders as the creditor for all purposes. The rejection for credit of
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any Applicant, or any number of Applicants as a result of the application of the
agreed upon credit criteria, shall not give rise to any claim, liability,
demand, offset, defense or counterclaim by Filene's Basement against Bank,
including, but not limited to, any lender liability claim. Further, Bank shall
not assume any liability in regard to the range of credit availability
respecting a particular Cardholder.
(d) Specific credit approval shall be obtained from Bank by Filene's
Basement for each sale at the time of actual purchase.
SECTION 3.3 CREDIT INFORMATION; OWNERSHIP OF ACCOUNTS AND CUSTOMER LISTS.
(a) Bank may furnish credit information and other information concerning
creditworthiness with respect to any Applicant or Cardholder to credit bureaus,
credit interchanges and any others who may lawfully receive such information for
their own use. Bank is the sole and exclusive owner of the Program Accounts
Portfolio and each Account (including the names and addresses of Cardholders
incorporated therein), Charge Transaction Data, Charge Slips, Credit Card Sales
Invoices, Credit Slips, receipts or evidences of payment or purchases by
Cardholders and other Account Documentation. Bank as the sole and exclusive
owner of Accounts, shall be entitled to receive all payments made by Cardholders
on Accounts and Filene's Basement acknowledges and agrees that it has no right,
title or interest in, or rights to, the Program Accounts Portfolio, Accounts or
any payments made in connection with the same.
(b) Filene's Basement acknowledges and agrees that Bank is the sole and
exclusive owner of the Customer List, and agrees that both during the term of
this agreement and thereafter, Bank may use such Customer List in connection
with its administration and operation of the Program as provided in this
Agreement, provided that, if Filene's Basement purchases all Accounts upon the
termination of the Program, as described in this Agreement, Bank will make no
further use of the Customer List after all obligations of any Person to Bank or
GE Capital relating to the Program have been discharged and, in such event, all
right, title and interest to the Customer List shall be conveyed to Filene's
Basement. It also is acknowledged and agreed that, during the Initial Term and
any Renewal Term and subject both to customers' requests not to be solicited and
applicable law, Bank from time to time shall allow Filene's Basement to use the
Customer List to conduct mailings to promote Merchandise (provided that no such
communications shall include references to any financial products offered by a
Person other than Bank or an Affiliate). Filene's Basement shall return the
Customer List to Bank immediately upon completion of its use thereof and shall
not, and shall not allow any other Person to, copy, sell, rent or disclose the
Customer List.
SECTION 3.4 DATA TRANSMISSION EQUIPMENT. Data Transmission Equipment is provided
subject to the following conditions:
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(a) The Data Transmission Equipment is either owned by Bank or is under
lease to Bank from a financing or leasing source and all of the Data
Transmission Equipment is to be used solely in the operation of the Program
pursuant to this Agreement;
(b) Filene's Basement shall not have any right or interest in Data
Transmission Equipment other than as a permitted user during the term of this
Agreement;
(c) Upon the termination of this Agreement, all of the Data Transmission
Equipment shall be promptly returned by Filene's Basement, at its expense and in
good condition (ordinary wear and tear excepted), to Bank or its designated
agent pursuant to Bank's instructions;
(d) If Filene's Basement fails to promptly return the Data Transmission
Equipment furnished to Filene's Basement in good condition (ordinary wear and
tear excepted), Filene's Basement shall be responsible for the unamortized cost
of such Data Transmission Equipment, and shall reimburse Bank, either the
unamortized cost thereof, or if applicable, all rental due or to become due on
the Data Transmission Equipment.
The Data Transmission Equipment provided to Filene's Basement as of the
Effective Date is as follows: five (5) Telzon terminals and one (1) Hypercom
terminal; any further Data Transmission Equipment will be provided by Bank at a
cost to be negotiated by Bank and Filene's Basement.
SECTION 3.5 RETURNS OF MERCHANDISE. Filene's Basement is authorized to accept
returns of Merchandise and credit the Accounts of Cardholders effecting such
returns. Filene's Basement will pay Bank, daily, the amount of credits made to
Accounts by reason of such returns as evidenced by Credit Slips. Further,
Filene's Basement is authorized to make adjustments in the amount of finance
charges payable by Cardholders whose Accounts are credited for returned
Merchandise, provided that Filene's Basement promptly notifies Bank thereof.
Bank shall xxxx Xxxxxx'x Basement for such adjusted finance charges.
SECTION 3.6 COLLECTION OF ACCOUNTS. The exclusive right to effect collection of
all Accounts shall be vested in Bank, which may use any collection strategy
allowed by applicable law.
SECTION 3.7 CREDIT INSURANCE.
(a) Bank or any Person authorized by Bank shall have the right to solicit
and offer to Cardholders and Applicants credit life, credit property and/or
other types of credit insurance (collectively "Credit Insurance") on the
Accounts under a credit insurance program. The Credit Insurance will be under a
master group plan with Bank or an Affiliate of Bank underwritten by an insurer
selected by Bank. To the extent permitted by applicable law, the monthly charges
incurred by a Cardholder under an Account for such Credit Insurance shall be
charged as an insurance service transaction to the applicable Cardholder's
Account, and Bank shall service and xxxx Cardholders who have purchased Credit
Insurance under Accounts. The
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Credit Insurance offers may be in direct mail or statement inserts or such other
manner determined by Bank in its sole discretion.
(b) Bank shall be listed as the loss payee under any Credit Insurance
policy/certificate sold in connection with Accounts.
(c) Bank and Filene's Basement understand that Credit Insurance is
regulated under applicable state laws and regulations. Bank makes no
representations or warranties with respect to the availability of Credit
Insurance on any Account(s).
(d) To the extent permitted by applicable law, Bank shall pay Filene's
Basement 50% of Bank's net annual income from the marketing of such insurance,
net of all claims incurred in connection with such insurance. To the extent that
is not permitted by applicable law, either because Filene's Basement does not
have the necessary licenses or otherwise, the parties will agree on another
equitable arrangement.
SECTION 3.8 VALUE-ADDED PROGRAMS. Bank or any Person authorized by Bank, may
from time to time in Bank's reasonable discretion solicit through mailings,
billing statements, promotional inserts, telemarketing and other advertising
media (including, but not limited to, bang tail envelopes) any or all
Cardholders for items other than Merchandise sold by Filene's Basement, offered
by Bank or a third party, including, without limitation, second mortgages,
savings and investment products, insurance (other than Credit Insurance), credit
card protection plans, legal services, auto clubs and extended warranties, and
such other products and services as Bank may determine. Such solicitation may be
conducted by Bank (or any Person authorized by Bank) in the name of Bank or
Filene's Basement with Filene's Basement's prior written approval, and as the
parties may agree; provided, however, that all such solicitations shall be
subject to the approval of Filene's Basement, which approval shall not be
unreasonably withheld. The parties shall each receive 50% of the net profits
from such Value-Added Programs, after Bank receives reimbursement for its
out-of-pocket expenses related thereto.
SECTION 3.9 TRANSMITTAL AND RETENTION OF DOCUMENTS. Filene's Basement shall
promptly transmit to Bank all Credit Card Applications. Filene's Basement
authorizes Bank to microfilm or otherwise copy all Account Documentation in its
possession with the identification of Accounts and destroy all original Account
Documentation in the ordinary course of business as Bank may see fit, in
accordance with applicable laws.
SECTION 3.10 IN-STORE PAYMENTS. Filene's Basement shall not advertise or
otherwise promote that Cardholders (or other persons acting on behalf of
Cardholders) may make In-Store Payments. Without derogating the restriction in
the preceding sentence, if any In-Store Payment is made, Filene's Basement shall
give the person making such In-Store Payment a receipt for such payment and
shall be deemed to hold such In-Store Payment in trust for such Cardholder until
such payment is either delivered to Bank or is applied by Bank to reduce amounts
payable by Bank to Filene's Basement. Filene's Basement shall transmit In-Store
Payment information to Bank. In-Store Payments shall be credited to the Account
of the
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relevant Cardholder as of the date of actual receipt by Bank. In the event that
In-Store Payments received by Filene's Basement exceed amounts so payable by
Bank to Filene's Basement at the time Filene's Basement informs Bank of such
In-Store Payments, Filene's Basement shall be required to transmit such excess
In-Store Payments to Bank within one (1) Business Day of the day received.
Filene's Basement shall notify Bank of any In-Store Payments within twenty-four
(24) hours of receipt thereof by providing such information with the Charge
Transaction Data.
SECTION 3.11 BANK'S RIGHT TO AUDIT. Bank shall have the right, during normal
business hours and on reasonable notice, to inspect and audit Filene's
Basement's records, from time to time, as it deems appropriate, as such records
pertain to Accounts, at Bank's expense.
SECTION 3.12 FILENE'S BASEMENT'S RIGHT TO AUDIT. Filene's Basement shall have
the right, during normal business hours and on reasonable notice, to inspect and
audit Bank's records, from time to time, as it deems appropriate, as such
records pertain to payments to be made by Bank to Filene's Basement under
Sections 3.7 and 3.8, at Filene's Basement's expense; provided that if any such
audit reveals a shortfall in payments during the period subject to the audit,
Bank will reimburse Filene's Basement for such shortfall.
ARTICLE IV OPERATING PROCEDURES
SECTION 4.1 GENERAL. Filene's Basement shall follow all applicable Operating
Procedures in connection with the Program including, but not limited to,
distributing Credit Card Applications, opening new Accounts, seeking
authorizations for charges, handling credit transactions with Cardholders and
transmitting Charge Transaction Data.
SECTION 4.2 NEW CUSTOMER ACCOUNT ESTABLISHMENT PROCEDURES.
(a) Bank will accept and process Credit Card Applications.
(b) All Credit Card Applications will be reviewed promptly by Bank and
decisioned for approval and credit line assignment, and all such decisions that
are made at the point of sale will promptly be reported by Bank to Filene's
Basement. Filene's Basement will use its reasonable best efforts to communicate
such point of sale credit decisions to applicants.
(c) Approved Accounts will be forwarded a customized Credit Card by Bank
within ten (10) days of the date of approval.
SECTION 4.3 PURCHASE AUTHORIZATION PROCEDURES.
(a) Filene's Basement must complete a Charge Slip. The Account number must
be printed or written on the Charge Slip. If such Cardholder does not have
his/her Credit Card,
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Filene's Basement must either (i) call Bank's Central Credit Office (via a toll
free number) and request the Account number by providing the operator with such
Cardholder's name, address and form of positive identification (preferably a
valid driver's license or other photo ID) to the extent the request or
recordation of such identification does not violate applicable law, or (ii)
otherwise access the necessary information through the POS Network.
(b) Filene's Basement must have the Cardholder sign the Charge Slip, once
all of the purchase information is filled in as requested. Filene's Basement
shall verify that the signing of the person signing the Charge Slip reasonably
appears to be the same as the signature appearing on the Credit Card being used.
(c) Subject to the provisions of subsection 4.3(e) below, Filene's
Basement must obtain authorization through the existing POS Network for all
purchases and record the authorization code on the Charge Slip. For
authorization on system referrals, Filene's Basement must call the Bank office
supporting this Agreement for an authorization code. Bank shall be responsible
for providing toll-free phone numbers for direct authorizations.
(d) Credit Slips need not be authorized but must be completely filled out
and signed by the Cardholder.
(e) Filene's Basement shall immediately input the Charge Transaction Data
into the POS Network, as applicable, at the time the transaction occurs. In the
event that the P0S Network and/or Bank's authorization system are not in
operation, and authorizations for Cardholder purchases cannot be obtained
directly from Bank, Filene's Basement shall have a Floor Release (as defined in
the Operating Procedures) per transaction and/or Cardholder. Any adjustment to
the Floor Release limit shall be effected by mutual agreement between Bank and
Filene's Basement.
(f) In connection with the Program, Filene's Basement shall make available
to Cardholders documents that have been approved by Bank.
SECTION 4.4 SETTLEMENT PROCEDURES.
(a) All Charge Transaction Data will be electronically transmitted to Bank
using POS Network settlement procedures. Filene's Basement will retain a copy of
the Charge Slip.
(b) All Charge Transaction Data presented to Bank will be reviewed and
processed by Bank. Bank will use its best efforts to review and forward the full
amount shown as the total of purchases reflected in Charge Slips included in
such Charge Transaction Data presented less (i) the Discount, (ii) the total
amount of any Credit Slips included in such Charge Transaction Data submitted by
Filene's Basement, (iii) the portion of any Charge Slip or Credit Slip to be
charged back to Filene's Basement under this Agreement, (iv) the total amount of
any In-Store Payments accepted and held by Filene's Basement, and (v) any other
amounts due and payable to Bank pursuant to this Agreement, via wire transfer
within the time
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provided herein. If the electronic data transmission or daily computer tape
reflecting such Charge Transaction Data sent by Filene's Basement is received by
Bank by 10:00 a.m. Eastern Time on a Business Day, Bank shall forward the funds
by initiating a wire transfer of funds on the next Business Day after the day of
receipt by Bank of the electronic data transmissions or daily computer tape
reflecting such Charge Transaction Data. If Bank receives electronic data
transmissions or daily computer tapes from Filene's Basement after 10:00 a.m.
Eastern Time on any Business Day, such electronic data transmissions or daily
computer tapes shall be deemed received by 10:00 a.m. Eastern Time the following
Business Day, and Bank shall forward the funds by initiating a wire transfer on
the Business Day following the Business Day on which such electronic data
transmissions or daily computer tapes are deemed received, except that if an
electronic transmission or daily computer tape for Charge Transaction Data are
received by Bank by midnight Eastern Time on any Saturday, Bank will initiate a
wire transfer of funds for such Charge Transaction Data on the next Business
Day.
(c) As provided in Sections 3.7 and 3.8 hereof, Filene's Basement is to
receive 50% of the net profits from Credit Insurance and Value-Added Programs,
after Bank receives reimbursement for its out-of-pocket expenses related
thereto. Bank shall send to Filene's Basement a statement, on the 15th day of
each month during the term of this Agreement, showing in reasonable detail all
items of income and expense relating to such Credit Insurance and Value-Added
Programs during the immediately preceding calendar month, together with payment
of the amount shown on such statement as the amount due to Filene's Basement
therefrom.
(d) In connection with the settlement procedures outlined above, the
parties agree that all settlements made hereunder shall be net of any and all
other adjustments contemplated by this Agreement, including but not limited to
credits, other adjustments and purchases pursuant to this Agreement, and in
connection therewith Bank shall have the right to set off any amounts due to it
pursuant to this Agreement against any amounts to be transmitted to Filene's
Basement hereunder.
(e) Any costs or expenditures by the parties to this Agreement other than
as explicitly set forth herein shall be at the sole expense of the party
incurring such costs or other expenditures and shall not entitle that party to
seek reimbursement of such costs or other expenditures from the other party to
this Agreement. Accordingly, subject to the reimbursement provisions of this
Agreement, if any, each of the parties alone shall be liable for the payment of
all sums due to third parties retained by such party in performing its
obligations hereunder.
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ARTICLE V PAYMENT TO FILENE'S BASEMENT FOR CHARGE SLIPS; OTHER
CHARGES
SECTION 5.1 PAYMENT TO FILENE'S BASEMENT.
(a) Subject to Bank's right to deduct certain sums in accordance with the
terms of this Agreement, Bank will pay Filene's Basement for each Charge Slip
submitted pursuant to this Agreement an amount equal to the unpaid cash balance
(i.e. unpaid principal indebtedness) thereunder, as provided in this Agreement,
less the Discount.
(b) Effective July 25, 1995, the Discount shall be an amount equal to 1.4%
of Net Credit Volume.
SECTION 5.2 POSTAGE RATE ADJUSTMENT. In the event the U.S. First Class postage
rate is increased after July 1, 1995, Filene's Basement shall pay to Bank on
each Settlement Date an amount equal to the product of (i) the excess of (x) the
weighted average unit price paid by Bank for U.S. First Class postage with
respect to the Filene's Basement Program on the last day of the previous
Settlement Period, over (y) the weighted average unit price paid by Bank for
U.S. First Class postage with respect to the Filene's Basement Program as of
July 1, 1995. MULTIPLIED BY (ii) the number of Cardholders to which Bank mailed
correspondence (including without limitation letters and billing statements)
during the previous Settlement Period. This provision shall apply to each
postage increase during the term of this Agreement.
SECTION 5.3 BUSINESS REPLY POSTAGE. Filene's Basement shall pay to Bank all
costs associated with postage-paid business reply postage on applications
submitted through the mail by Applicants to Bank. Bank shall render invoices for
such amount monthly.
SECTION 5.4 BASE RATE ADJUSTMENT.
(a) On each Settlement Date, Bank will calculate for the previous
Settlement Period the difference between the Actual Interest Expense and the
Base Rate (the "Base Rate Adjustment"). The Base Rate Adjustment will be divided
by twelve (12) and then multiplied by the Portfolio Average Daily Balance for
the previous Settlement Period. The product of the above calculation will be
paid by Bank to Filene's Basement to the extent Actual Interest Expense is less
than the Base Rate, or paid by Filene's Basement to Bank to the extent Actual
Interest Expense exceeds the Base Rate.
(b) Notwithstanding anything contained herein to the contrary, during the
first 18 months after the Effective Date, to the extent that on a Settlement
Date, the (x) sum of (i) the Discount multiplied by the Net Credit Volume for
the immediately preceding Settlement Period, plus (ii) the Base Rate Adjustment
on such Settlement Date multiplied by the Portfolio Average Daily Balance for
such Settlement Period divided by (y) the Net Credit Volume for such Settlement
Period is greater than 1.97%, Filene's Basement may defer up to $300,000 of
amounts payable by Filene's Basement under subsection 5.4(a) during such
18-month period
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until the end of such 18-month period. The amount so deferred shall be referred
to herein as the "Deferred Discount." In the event that the aggregate amount so
deferred at any time during the 18-month period under the Deferred Discount
exceeds $300,000, Filene's Basement shall pay Bank such excess amounts on a
monthly basis. Upon the expiration of such 18-month period, Filene's Basement
shall pay Bank the total amount of the Deferred Discount, and there shall be no
further deferral of such payment. To the extent that Bank changes the minimum
monthly payment schedule as set forth in subsection 3.1(f) in such a manner as
to have a material and adverse effect on Filene's Basement's costs as set forth
in this Section 5.4, then the parties agree to negotiate in good faith to make
any necessary changes in the provisions of this Section 5.4 to address such
effect.
SECTION 5.5 APPLICATION FEES. Filene's Basement shall pay to Bank on each
Settlement Date (i) a one-time $5.50 fee per Credit Card Application phoned to
Bank during the Settlement Period by Filene's Basement, and (ii) a one-time
$3.80 fee per Credit Card Application faxed to Bank during the Settlement Period
by Filene's Basement.
SECTION 5.6 PAYMENT BY FILENE'S BASEMENT. Any amounts payable by Filene's
Basement to Bank hereunder shall be paid within fifteen (15) days after xxxxxxxx
are rendered by Bank.
ARTICLE VI CHARGEBACK
SECTION 6.1 BANK'S RIGHT TO CHARGEBACK.
(a) Bank shall have the right, at its option, to chargeback to Filene's
Basement the amount of any Charge Slip or Credit Slip if with respect to such
Charge Slip or Credit Slip, or the underlying transaction:
(i) Any warranty made by Filene's Basement pursuant to Section 8.11
proves to be false or inaccurate in any respect, and as a result thereof,
the Charge Slip or Credit Slip is otherwise unbillable or uncollectible,
in each case as reasonably determined by Bank;
(ii) The Cardholder asserts any claim or defense against Bank as a
result of any act or omission of Filene's Basement allegedly in violation
of any applicable law, statute, ordinance, rule or regulation;
(iii) The Cardholder disputes the amount or existence of such
Account or refuses to pay alleging dissatisfaction with Merchandise
received, a breach of any warranty or representation by Filene's Basement
in connection with the transaction, or an offset or counterclaim against
Bank based on an act or omission of Filene's Basement, provided any
disputes constitute bona fide claims presented by Cardholders in good
faith in the reasonable opinion of Bank, after inquiry to Filene's
Basement; and
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(iv) If the Cardholder disputes a Charge Slip and Filene's Basement
cannot supply Bank with a copy of the Charge Slip as soon as reasonably
practicable, but in no event later than ten (10) days of Bank's written
request.
(b) Bank shall have the right, at its option, to chargeback to Filene's
Basement the amount of any Charge Slip or Credit Slip relating to a GECC Account
if with respect to such Charge Slip or Credit Slip, or the underlying
transaction, GE Capital would have had the right to chargeback such amount under
the terms of the Account Purchase Agreement.
(c) Bank may compromise and settle any claim made by any Cardholder if
such claim may give Bank a right to chargeback in accordance with subsection
6.1(a) above up to the face amount of any Charge Slip or Credit Slip. With
respect to chargebacks pursuant to Subparagraphs 6.l(a)(ii) and 6.l(a)(iii)
above, Bank agrees to use commercially reasonable efforts to cooperate with
Filene's Basement in resolving such disputes.
(d) If Bank exercises its rights of chargeback in accordance with this
Agreement, Bank shall set off amounts charged back against any sums due Filene's
Basement under this Agreement or, if chargebacks exceed sums due Filene's
Basement, Bank may demand payment from Filene's Basement for the full amount of
such excess by netting such amounts against amounts due to Filene's Basement
pursuant to Section 4.4. Bank shall give Filene's Basement five (5) days'
written notice prior to charging back any amounts to Filene's Basement, or such
other lesser notice as the parties may agree. If the full face amount or any
portion thereof of any Charge Slip is charged back, Bank shall assign, without
recourse, all right to payment for such Charge Slip or portion thereof to
Filene's Basement.
ARTICLE VII FINANCE CHARGES, OTHER CHARGES, ACCOUNT PAYMENT
TERMS
SECTION 7.1 BANK'S RIGHTS. Bank will have the sole right and obligation to
establish the rate and other terms of Cardholder's finance charges in accordance
with all applicable state and federal banking and consumer credit laws and to
modify such rates or terms in its sole discretion from time to time. Bank shall
retain all finance charges.
SECTION 7.2 BASE FINANCE CHARGE. Bank and Filene's Basement agree that, subject
to the last sentence of this Section 7.2, the rate of finance charges on
Accounts shall initially be established at 21% Annual Percentage Rate. Bank may
change the method of compounding following consultation with Filene's Basement.
The rate of finance charges on Accounts shall not be changed prior to
consultation with Filene's Basement, provided that if such change is required by
applicable state and federal banking and consumer credit laws, Bank may change
such rate, consulting with Filene's Basement as soon as reasonably practicable.
SECTION 7.3 NOTICE OF CHANGES. Bank shall notify Filene's Basement of any
intended change in finance charge rate(s) other than the changes referred to in
Section 7.2 above, not less than
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ten (10) days prior to the intended effective date of such change unless such
change is mandated by law or regulation (in which case prior notice need not be
given).
SECTION 7.4 CHANGES IN LAWS/REGULATIONS; RENEGOTIATION. Notwithstanding anything
to the contrary contained in this Agreement, Bank may engage Filene's Basement
in renegotiation of this Agreement if (i) usury rates of the State of Georgia
change, (ii) laws regulating Bank, affecting the Program, change, or (iii)
federal or state regulation preempts the exportation of Bank's credit card rate
structure, which changes negatively affect Bank's yield requirements under this
Agreement and in Bank's reasonable judgment could have a material adverse effect
on Bank. In the event of a renegotiation pursuant to this Section 7.4, if new
terms acceptable to the parties are not agreed upon in writing within ninety
(90) days after the date renegotiations begin, this Agreement shall terminate on
the one hundred eighty-first (181st) day after such renegotiation begins, or at
Bank's option, the date Bank would be required to make changes to the Program to
comply with applicable law or regulation.
SECTION 7.5 LATE CHARGES; RETURNED CHECK CHARGES; OTHER CHARGES. The right and
obligation to establish and from time to time modify the rate(s) and other terms
of Late Charges, Returned Check Charges and Other Charges on Accounts is solely
that of Bank, which has and unilaterally shall establish and modify such rate(s)
under this Agreement (within applicable legal parameters); provided that in
setting any such charges, Bank shall take into consideration the rates
prevailing among major retailers. Bank shall retain all such charges or fees.
ARTICLE VIII REPRESENTATIONS, WARRANTIES AND COVENANTS OF
FILENE'S BASEMENT
To induce Bank to establish and administer the Program, to originate and
administer Accounts, to extend credit to Cardholders and to pay funds to
Filene's Basement, which funds shall constitute an advance by Bank to
Cardholders in connection with Accounts, Filene's Basement makes the following
representations, warranties and covenants to Bank, each and all of which shall
survive the execution and delivery of this Agreement, and each and all of which
shall be deemed to be restated and remade on each date on which Bank extends
credit, originates, administers or remits funds with respect to Accounts or
administers the Program:
SECTION 8.1 CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Filene's Basement is a
corporation duly organized, validly existing and in good standing under the laws
of the state in which it was incorporated, and (a) is duly qualified as a
foreign corporation and in good standing under the laws of each jurisdiction
where its ownership or lease of property or the conduct of its business requires
such qualification, (b) has a perpetual existence, (c) has the requisite power
and authority and the legal right to own, pledge, mortgage, and operate its
properties, to lease the properties it operates under lease, and to conduct its
business as now, heretofore, and proposed to be conducted, (d) has all necessary
licenses, permits, consents, or approvals from or by, and has made all necessary
filings with, and has given all necessary
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notices to, all governmental authorities having jurisdiction, to the extent
required for such ownership, operation, and conduct; and (e) is in compliance
with its articles of incorporation and its by-laws.
SECTION 8.2 EXECUTIVE OFFICES. The chief executive office and principal place of
business of Filene's Basement where records with respect to Accounts are kept is
at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000, or at such other place as
Filene's Basement shall, from time to time, specify to Bank. Without thirty (30)
days' prior written notice to Bank, Filene's Basement shall not transfer its
chief executive offices or change its principal mailing address. Filene's
Basement shall inform Bank within thirty (30) days after it becomes aware of any
change of address of a Store. Filene's Basement shall not change its corporate
name without first providing Bank thirty (30) days' prior written notice.
SECTION 8.3 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS. The
execution, delivery, and performance of this Agreement by Filene's Basement and
all instruments and documents to be delivered by Filene's Basement pursuant to
this Agreement: (a) are within Filene's Basement corporate power; (b) have been
duly authorized by all necessary or proper corporate action, including the
consent of shareholders where required; (c) are not in contravention of any
provision of Filene's Basement articles of incorporation or bylaws; (d) will not
violate any law or regulation or any order or decree of any court or
governmental instrumentality applicable to Filene's Basement; (e) will not
conflict with or result in the breach of, or constitute a default under, any
indenture, mortgage, deed of trust, lease, agreement, or other instrument to
which Filene's Basement is a party or by which Filene's Basement or any of its
property is bound; and (f) do not require of Filene's Basement any filing or
registration with or the consent or approval of any governmental body, agency,
authority, or any other Person which has not been made or obtained previously.
This Agreement has been duly executed and delivered by Filene's Basement and
constitutes the legal, valid, and binding obligation of Filene's Basement,
enforceable against Filene's Basement in accordance with its terms, except as
such enforcement may be limited by applicable bankruptcy, moratorium,
reorganization, or other laws affecting the rights of creditors generally.
Filene's Basement has obtained or will obtain (as provided in Article XV hereof)
any and all necessary consents of third parties required of it in order to enter
into this Agreement and to consummate the transactions contemplated hereby, and
the execution and delivery of this Agreement and performance by Filene's
Basement of the transactions contemplated hereby will not result in Filene's
Basement being in default under any of the provisions of its Certificate of
Incorporation, By-Laws, other corporate or legal documents, or of any material
credit or other agreement to which it is a party.
SECTION 8.4 SOLVENCY. Filene's Basement is Solvent.
SECTION 8.5 NO DEFAULT. Filene's Basement (i) is not in default with respect to
any contract, agreement, document, lease, or other instrument to which it or any
Affiliate of it is a party or by which it or any of its property may be bound,
and (ii) has not received any notice of default pursuant to any such contract,
agreement, lease, or other instrument, which, in either case,
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would have a material adverse effect on the business, operations, property, or
financial or other condition of it or any of its Affiliates. No Event of Default
by Filene's Basement, or Filene's Basement Event of Default, or event which,
with the giving of notice, the lapse of time, or both, would be an Event of
Default by Filene's Basement or Filene's Basement Event of Default, has occurred
and is continuing. There are no corporate entities, other than subsidiaries and
Filene's Basement Corp. (the parent corporation of Filene's Basement) which
constitute Affiliates of Filene's Basement.
SECTION 8.6 NO BURDENSOME RESTRICTIONS. No contract, lease, agreement, or other
instrument to which Filene's Basement is a party or is bound and no provision of
applicable law or governmental regulation materially and adversely affects or
may be reasonably likely to so affect its business, operations, property, or
financial or other condition, the Accounts or the value thereof, the
Indebtedness or the value thereof, Bank's right, title and interest and Lien in
and to the Accounts and Indebtedness, or the priority of such Lien.
SECTION 8.7 COMPLIANCE WITH LAW. (i) The Merchandise description, pricing,
charges and related wording and content of the Approved Forms where such wording
and content is furnished by Filene's Basement, (ii) Filene's Basement sales
materials or practices, including, but not limited to, the sales order form,
sales invoice, promotional materials and similar forms, and/or (iii) actions of
Filene's Basement employees, sales representatives or agents, will be in
material compliance with all applicable provisions of federal and state laws and
implementing regulations.
SECTION 8.8 NO LITIGATION. No action, claim, or proceeding is now pending or, to
the knowledge of Filene's Basement, threatened against Filene's Basement at law,
in equity, or otherwise, before any court, board, commission, agency, or
instrumentality of any federal, state, or local government or of any agency or
subdivision thereof or before any arbitrator or panel of arbitrators which, if
adversely determined, might affect the validity or enforceability of any
Account, which might result in any material adverse change in the value of any
Account or which might have a material adverse effect on the ability of Filene's
Basement to perform its obligations hereunder nor, to the knowledge of Filene's
Basement, does a state of facts exist which might give rise to any such
proceedings.
SECTION 8.9 FULL DISCLOSURE. No information contained in this Agreement or any
other agreement or writing executed or issued by Filene's Basement or any
statement furnished by or on behalf of Filene's Basement in connection with this
Agreement or any other agreement or writing executed or issued in connection
with this Agreement, contains any untrue statement of a material fact or omits
to state a material fact necessary to make the statements contained herein or
therein not misleading.
SECTION 8.10 INSURANCE. Filene's Basement maintains, and at all times has
maintained and will maintain, insurance policies with solvent insurers in such
amounts and insuring it against such types of loss or damage as are customarily
maintained by corporations engaged in similar businesses with respect to its
property.
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SECTION 8.11 ACCOUNTS; ACCOUNT DOCUMENTATION.
(a) Each Charge Slip, Credit Slip and Account and each sale of Merchandise
in connection with such Charge Slip, Credit Slip and/or Account (1) is free and
clear of any and all Liens in favor of any Person other than Bank or GE Capital,
as the case may be, (2) arises in connection with a bona fide final sale and
delivery of Merchandise by Filene's Basement in the ordinary course of business
(subject to usual return policies); (3) is for a liquidated amount as stated in
the Account Documentation relating thereto; (4) is authorized and created in
accordance with this Agreement and Bank's instructions as communicated to
Filene's Basement by Bank; (5) is valid and enforceable against the Cardholder
in accordance with its terms; (6) is not subject to any defense, deduction,
offset, counterclaim or recoupment assertable by the Cardholder or any other
Person obligated therefor or by Filene's Basement creditors or assigns, except
for those defenses, offsets, counterclaims or recoupments created as a result of
acts, or an omission to act where there is a duty to act, by Bank; (7) is for
new and unused Merchandise; however, items of Merchandise which are returned by
a Cardholder to Filene's Basement, and which are accepted for return by Filene's
Basement and restored to Filene's Basement inventory of Merchandise held for
resale, will, except as prohibited by law, be deemed either "new and unused" or
"used and reconditioned", as contemplated by this provision, and, in any event,
such Merchandise has been or will be delivered by Filene's Basement to the
Cardholder and accepted by the Cardholder; (8) is not in excess of the amount of
credit approved by Bank for such Cardholder; (9) bears a signature of a
Cardholder which is genuine and not forged or unauthorized; and (10) the
Merchandise relating to such transaction is primarily for personal, family or
household purposes.
(b) Each transaction did not involve a cash advance or Merchandise not
listed in the Charge Transaction Data and only Merchandise sold by Filene's
Basement is the subject of the transaction.
(c) Filene's Basement has not received, directly or indirectly, and will
refuse to accept, any reimbursement, payment or trade-in for the charges listed
in such Charge Transaction Data (other than from Bank) and has not and will not,
either directly or indirectly, take or grant any right or security interest in
any Charge Transaction Data (other than to Bank) which is the subject of the
transaction.
(d) The transaction giving rise to the Charge Transaction Data was
conducted by Filene's Basement in accordance with all material laws and
regulations that pertain to the sales of Merchandise by Filene's Basement
hereunder and that the Charge Transaction Data are not invalid, illegible,
inaccurate or incomplete.
(e) There is no fact nor any claim or defense of the Cardholder, that
would impair the validity, enforceability, or collectibility of the obligation
of the Cardholder evidenced by the Charge Transaction Data.
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SECTION 8.12 FIRST TIME BUYER. Whenever the POS Network indicates first-time
card usage. Filene's Basement will verify Cardholder identification by
requesting a valid driver's license and printing the license number on a sales
slip, unless prohibited by applicable law. If a driver's license is
unobtainable, Filene's Basement may substitute a major credit card or other form
of identification, all as specified by Bank, to the extent permitted by
applicable law.
SECTION 8.13 BALANCE IN ACCOUNT. Filene's Basement has taken, and will take, no
action, and has not failed to take and will not fail to take any action, which
would cause the balance in each Account not to be valid and enforceable against
the Cardholder.
SECTION 8.14 MAINTENANCE OF EXISTENCE AND CONDUCT OF BUSINESS. Filene's Basement
shall do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence. Filene's Basement shall transact
business so as not to misrepresent itself as the owner of Accounts or
Indebtedness owned by Bank hereunder.
SECTION 8.15 BOOKS AND RECORDS. Filene's Basement shall keep adequate records
and books of account with respect to its business activities, in which proper
entries, reflecting all of Filene's Basement financial transactions, are made in
accordance with GAAP.
SECTION 8.16 LITIGATION. Filene's Basement shall notify Bank in writing,
promptly upon learning thereof, (i) of any litigation, against Filene's
Basement, whether or not the claim shall be considered to be covered by
insurance and (ii) of the institution of any suit or administrative proceeding
against any Person, that as to either (i) or (ii), if adversely determined,
would have a material adverse effect on Filene's Basement business, operations
or financial or other condition, the Accounts or the value thereof, the
Indebtedness or the value thereof, Bank's rights, title and interest and Lien in
and to the Accounts and the Indebtedness, or the priority of such Lien.
SECTION 8.17 ADVERSE TRANSACTIONS. Filene's Basement shall not permit or agree
to any extension, compromise, or settlement, or make any changes or modification
of any kind or nature with respect to any Account, including any of the terms
relating thereto.
SECTION 8.18 EVENTS OF DEFAULT. Filene's Basement shall not take or omit to take
any action, which act or omission would constitute an Event of Default by
Filene's Basement or a Filene's Basement Event of Default pursuant hereto.
SECTION 8.19 DELIVERY. Filene's Basement has delivered, or will deliver on a
timely basis, all Merchandise covered by each Charge Slip, and the Cardholder
has accepted or is willing to accept such delivery, and such Merchandise has
been installed (if Filene's Basement contractually assumes the responsibility
for installation) and accepted by such Cardholder.
SECTION 8.20 SERVICES. Filene's Basement shall provide and maintain adequate
services with respect to the Merchandise covered by an Account and shall comply
with all of its warranties
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and other obligations with respect to the Merchandise, the sale of which has
been charged to an Account.
SECTION 8.21 ADJUSTMENTS. Each Credit Slip delivered by Filene's Basement to
Bank represents a bona fide adjustment by Filene's Basement of a credit sale for
which Bank has accepted the Charge Slip.
SECTION 8.22 OBLIGATIONS. Filene's Basement has fulfilled all of its material
obligations to Cardholders under the terms of all Credit Card sales of
Merchandise.
SECTION 8.23 ADVERTISEMENTS. Filene's Basement advertisements that refer to
credit terms under the Program are in conformity with the Operating Procedures
and applicable programs approved by Bank. Filene's Basement covenants that,
other than with respect to matters required therein by Bank, any such
advertisements shall be in conformity with and not in violation of, any
applicable law, rule, regulation, or consent decree entered into by or with any
governmental department or agency.
SECTION 8.24 ACCOUNT DOCUMENTATION. On and after the Execution Date, Filene's
Basement shall not use, with respect to new Cardholders, any Account
Documentation, other than Approved Forms.
SECTION 8.25 TRADE NAMES; TRADEMARKS. Filene's Basement is the owner or licensee
of the Marks and has the sole and exclusive right, power and authority to
license to Bank the use of the Marks as set forth in Article XIV hereof and the
use of the Marks by Bank in a manner approved (or deemed approved) by Filene's
Basement shall not (i) violate any applicable Federal, state or local law, rule
or regulation or (ii) infringe upon the right(s) of any third party. Filene's
Basement shall execute such documents as Bank reasonably may request from time
to time to ensure that right, title and interest in the Marks resides in
Filene's Basement.
SECTION 8.26 CONFLICTS; DEFAULTS; ETC. Neither the execution and delivery of
this Agreement nor the consummation of the transactions contemplated hereby by
Filene's Basement will (i) conflict with, violate, result in the breach of,
constitute an event which would, or with the lapse of time or action by a third
party or both would result in a default under, or accelerate Filene's Basement's
performance required by, the terms of any material contracts, instruments or
agreements to which Filene's Basement is a party or by which it is bound, or by
which Filene's Basement's assets are bound, except for conflicts, breaches and
defaults which would not have a material adverse effect upon Filene's Basement,
the Program or Filene's Basement's ability to perform its obligations under this
Agreement, (ii) conflict with or violate the articles of incorporation or
by-laws, or any other equivalent organizational document(s) of Filene's
Basement, (iii) except for any lien that may be created by this Agreement,
result in the creation of any lien, restriction, charge or encumbrance upon any
of the Accounts, (iv) violate any law or conflict with, or require any consent
or approval under, any judgment, order, writ, decree, permit or license, to
which Filene's Basement is a party or by which it is bound or affected, except
to the extent that such violation or the failure to obtain such consent or
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approval would not have a material adverse effect upon Filene's Basement, the
Program or Filene's Basement's obligation under this Agreement, (v) require the
consent or approval of any party to any material contract, instrument or
commitment to which Filene's Basement is a party or by which it is bound, other
than the approvals of regulatory authorities which will be applied for, or (vi)
except for the filing of UCC financing statements and notices, if any, require
any filing with, notice to, consent or approval of, or any other action to be
taken with respect to, any regulatory authority, other than the approval of
regulatory authorities which have been previously obtained.
ARTICLE IX REPRESENTATIONS, WARRANTIES AND COVENANTS OF BANK
To induce Filene's Basement to enter into this Agreement and participate
in the Program, all as herein provided for, Bank makes the following
representations and warranties to Filene's Basement, each and all of which will
survive the execution and delivery of this Agreement, and each and all of which
will be deemed to be restated and remade on each day on which Bank establishes
or remits funds, with respect to Accounts and/or administers the Program:
SECTION 9.1 CORPORATE EXISTENCE. Bank is a bank duly organized, validly existing
and in good standing under the laws of the State of Georgia, and (a) is duly
qualified as a foreign corporation and in good standing under the laws of each
jurisdiction where its ownership or lease of property or the conduct of its
business requires such qualification, (b) has a perpetual existence, (c) has the
requisite power and authority and the legal right to own, pledge, mortgage, and
operate its properties, to lease the properties it operates under lease, and to
conduct its business as now, heretofore, and proposed to be conducted, (d) has
all necessary licenses, permits, consents, or approvals from or by, and has made
all necessary filings with, and has given all necessary notices to, all
governmental authorities having jurisdiction, to the extent required for such
ownership, operation, and conduct; and (e) is in compliance with its articles of
incorporation and its by-laws.
SECTION 9.2 CORPORATE POWER, AUTHORIZATION; ENFORCEABLE OBLIGATION. The
execution, delivery, and performance of this Agreement and all instruments and
documents to be delivered to Bank hereunder: (i) are within Bank's power, (ii)
have been duly authorized by all necessary or proper action, including the
consent of shareholders where required; (iii) are not in contravention of any
provisions of Bank's articles of incorporation or by-laws; (iv) will not violate
any law or regulation or any order or decree of any court or governmental
instrumentality; (v) will not conflict with or result in the breach of, or
constitute a default under any indenture, mortgage, deed of trust, lease
agreement, or other instrument to which Bank is a party or by which Bank or any
of its property is bound; and (vi) do not require any filing or registration
with or the consent or approval of any governmental body, agency, authority, or
any other person which has not been made or obtained previously. This Agreement
has been duly executed and delivered by Bank, and constitutes the legal, valid,
and binding obligation of Bank, enforceable against Bank in accordance with its
terms, except as such enforcement may be limited by applicable bankruptcy,
moratorium, reorganization, or
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other laws affecting the rights of creditors generally. Bank has obtained any
and all necessary consents of third parties required of it in order to enter
into this Agreement and to consummate the transactions contemplated hereby, and
the execution and delivery of this Agreement and performance by Bank of the
transactions contemplated hereby will not result in Bank being in default under
any of the provisions of its Certificate of Incorporation, By-Laws, other
corporate or legal documents, or of any material credit or other agreement to
which it is a party.
SECTION 9.3 SOLVENCY. Bank is Solvent.
SECTION 9.4 NO DEFAULT. Bank (i) is not in default with respect to any contract,
agreement, document, lease, or other instrument to which it or any Affiliate of
it is a party or by which it or any of its property may be bound, and (ii) has
not received any notice of default pursuant to any such contract, agreement,
lease, or other instrument, which, in either case, would have a material adverse
effect on the business, operations, property, or financial or other condition of
it or any of its Affiliates. No Event of Default by Bank, or Bank Event of
Default, or event which, with the giving of notice, the lapse of time, or both,
would be an Event of Default by Bank or a Bank Event of Default, has occurred
and is continuing.
SECTION 9.5 NO BURDENSOME RESTRICTIONS. No contract, lease, agreement, or other
instrument to which Bank is a party or is bound and no provision of applicable
law or governmental regulation materially and adversely affects or may be
reasonably likely to so affect its business, operations, property, or financial
or other condition in a way which reasonably may have a material and adverse
effect on the Program.
SECTION 9.6 COMPLIANCE WITH LAW. All actions of Bank taken in administering the
Program, preparing the Operating Procedures and Approved Forms, setting credit
terms and finance charge rates, and in the Credit Application evaluation process
and billing and collection of Accounts will be in material compliance with all
applicable provisions of federal and state laws and implementing regulations,
including but not limited to, the federal Truth-In-Lending Act, Equal Credit
Opportunity Act and Fair Credit Reporting Act and implementing regulations,
provided that Bank does not make any representation or warranty as to (i) the
Merchandise description, pricing, charges and related wording and content that
appears in the Approved Forms where such wording and content is furnished by a
Person other than Bank or a Person retained by Bank, including Filene's
Basement, (ii) Filene's Basement sales materials or practices, including, but
not limited to, the sales order form, sales invoice, promotional materials and
similar forms, and/or (iii) actions of Filene's Basement employees, sales
representatives or agents.
SECTION 9.7 NO LITIGATION. There are no judgments, orders or decrees in effect
or legal action pending or threatened against Bank or of which it has knowledge,
which, if determined adversely, would have a material adverse effect on the
financial condition of Bank or its ability to perform its obligations under this
Agreement.
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SECTION 9.8 PURCHASE REPRESENTATION. Upon any purchase of any Accounts by
Filene's Basement from Bank under the terms of this Agreement, Bank warrants
that all information provided to Filene's Basement is, to the best of Bank's
knowledge, information and belief, true and correct in all material respects.
SECTION 9.9 FULL DISCLOSURE. No information contained in this Agreement or any
other agreement or writing executed or issued by Bank or any statement furnished
by or on behalf of Bank in connection with this Agreement or any other agreement
or writing executed or issued in connection with this Agreement, contains any
untrue statement of a material fact or omits to state a material fact necessary
to make the statements contained herein or therein not misleading.
SECTION 9.10 MAINTENANCE OF EXISTENCE AND CONDUCT OF BUSINESS. Bank shall do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence.
SECTION 9.11 BOOKS AND RECORDS. Bank shall keep adequate records and books of
account with respect to its business activities, in which proper entries,
reflecting all of Bank's financial transactions, are made in accordance with
applicable accounting procedures.
ARTICLE X FINANCIAL STATEMENTS AND INFORMATION
SECTION 10.1 REPORTS AND NOTICES. As long as this Agreement remains in effect,
Filene's Basement shall deliver to Bank:
(a) Within ninety (90) days after the close of each fiscal year, a copy of
the annual financial statements of Filene's Basement, consisting of a balance
sheet and related statements of income and changes in financial position, all
prepared in accordance with GAAP, certified by independent certified public
accountants. Quarterly financial statements will also be submitted upon
completion to Bank, but not on an audited basis unless available.
(b) Within two (2) Business Days after Filene's Basement becomes aware of
the existence of any Event of Default, Filene's Basement Event of Default or any
event which. with the giving of notice or passage of time or both, would
constitute an Event of Default or Filene's Basement Event of Default, or any
development or other information which is likely to have material adverse effect
on the business, operations, property, or financial or other condition of
Filene's Basement, the Accounts or the value thereof, the Indebtedness or the
value thereof, Bank's rights, title and interest and Lien in and to the Accounts
and Indebtedness, the priority of such Lien, or Filene's Basement ability to
perform its obligations pursuant to this Agreement, telephonic or telegraphic
notice specifying the nature of such Event of Default or Filene's Basement Event
of Default, or event, development, or information, including the anticipated
effect thereof, which notice shall be promptly confirmed in writing within five
(5) days.
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(c) Such other information respecting the Accounts or the value thereof,
the Indebtedness or the value thereof, or Filene's Basement business or
financial condition or prospects, as Bank may, from time to time, reasonably
request.
ARTICLE XI EVENTS OF DEFAULT; RIGHTS AND REMEDIES
SECTION 11.1 EVENTS OF DEFAULT. The occurrence of any one or more of the
following events (regardless of the reason therefor) shall constitute an Event
of Default hereunder:
(a) A party hereto shall fail to make any payment of any amount due
pursuant to this Agreement when due and payable or declared due and payable
pursuant to the terms of this Agreement, and the same shall remain unremedied
for a period of ten (10) days after the non-defaulting party shall have made
written demand therefor.
(b) Except as provided in subsection 11.1(a) above, a party hereto shall
materially fail or neglect to perform, keep, or observe any item, provision,
condition, or covenant contained in this Agreement that is required to be
performed, kept, or observed, and the same shall remain unremedied for a period
of thirty (30) days after the non-defaulting party shall have given written
notice thereof.
(c) Any material representation, warranty or statement made or delivered
by a party hereto or any of its respective officers, employees, agents or
representatives shall not be true and correct in any material respect as of the
date when made or reaffirmed.
SECTION 11.2 BANK EVENTS OF DEFAULT. The occurrence of any one or more of the
following events (regardless of the reason therefor) shall constitute a Bank
Event of Default hereunder:
(a) The Federal Deposit Insurance Corporation or any other regulatory
authority having jurisdiction over Bank shall order the appointment of a
custodian, receiver, liquidator, assignee, trustee, or sequestrator (or similar
official) of Bank or of any substantial part of its properties, or order the
winding up or liquidation of the affairs of Bank, and such order shall not be
vacated, discharged, stayed, or bonded within thirty (30) days (or such shorter
time period as provided by applicable law) from the date of entry thereof.
(b) Bank shall (i) consent to the institution of proceedings specified in
(a) above or to the filing of any such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee, or
sequestrator (or similar official) of Bank or any substantial part of its
properties, (ii) fail generally to pay its debts as such debts become due, or
(iii) take corporate action in furtherance of any such action.
(c) There shall be entered a court order which enjoins, restrains or in
any material way prevents Bank from conducting all or any part of its business
affairs in the ordinary
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course or concerning any failure to pay any federal, state or local tax or other
debt of Bank unless the same is being contested in good faith.
SECTION 11.3 FILENE'S BASEMENT EVENTS OF DEFAULT. The occurrence of any one or
more of the following events (regardless of the reason therefor) shall
constitute a Filene's Basement Event of Default hereunder:
(a) Any material adverse change in the operations, assets, condition
(financial or otherwise) or business of Filene's Basement including without
limitation, if Filene's Basement shall cease, or substantially change the nature
of, its business or if there shall be a substantial cessation of Filene's
Basement regular course of business. If Bank elects to terminate this Agreement
solely based on the occurrence of a material adverse change as provided in this
subsection 11.3(a), Filene's Basement shall have the right to request that a
determination be made by an independent arbitrator or other mediator (the
"Arbitrator") that a material adverse change has occurred. The identity of such
Arbitrator shall be determined by mutual agreement of Bank and Filene's Basement
within five days of the date of Bank's notice electing to terminate this
Agreement. If the parties fail to agree on the identity of the Arbitrator during
such period, each of Bank and Filene's Basement shall request its respective
independent certified public accountants to each nominate three persons to serve
as the Arbitrator, and the accountants shall agree upon one person identified on
such lists. To the extent that an Arbitrator is not appointed and a final
decision rendered by him within thirty (30) days of the delivery of Bank's
notice of termination (based on this subsection 11.3(a)) or to the extent such
Arbitrator renders a decision that the notice of termination was effective based
upon the occurrence of a material adverse change, such notice shall be deemed
effective as of the date issued by Bank. To the extent the Arbitrator renders a
decision that the notice of termination was not effective because a material
adverse change has not occurred, such notice of termination shall not be deemed
effective and the Program shall continue. All costs and expenses incurred in
connection with the Arbitrator shall be borne by the party against whom the
Arbitrator's decision is made.
(b) If Filene's Basement shall wind up or dissolve its operations or is
wound up or dissolved.
(c) If Filene's Basement or Filene's Basement Corp. shall be acquired
(whether by merger, consolidation, change of control (as defined below) or
otherwise) by any Person not an Affiliate of Filene's Basement or Filene's
Basement Corp., as the case may be, as of the Effective Date of this Agreement.
For purposes of this Section, a "change of control" shall mean any sale of all
or substantially all of the assets of an entity (whether in one or a series of
transactions) or if an entity is merged or consolidated into another corporation
or more than 50% of the capital stock of an entity is transferred or offered for
sale other than in the course of daily trading activity.
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(d) Filene's Basement shall no longer be Solvent or a petition under the
Bankruptcy Code or similar law shall be filed by Filene's Basement or a petition
shall be filed against Filene's Basement and such shall not be dismissed within
ninety (90) days.
(e) A decree or order by a court having jurisdiction (i) for relief in
respect of Filene's Basement or pursuant to the Bankruptcy Code or any other
applicable bankruptcy or other similar law, (ii) for appointment of a custodian,
receiver, liquidator, assignee, trustee, or sequestrator (or similar official)
of Filene's Basement or of any substantial part of its properties, or (iii)
ordering the winding tip or liquidation of the affairs of Filene's Basement,
shall be entered, and shall not be vacated, discharged, stayed, or bonded within
thirty (30) days from the date of entry thereof.
(f) Filene's Basement shall (i) file a petition seeking relief pursuant to
the Bankruptcy Code or any other applicable bankruptcy or other similar law,
(ii) consent to the institution of proceedings pursuant thereto or to the filing
of any such petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, or sequestrator (or similar
official) of Filene's Basement or of any substantial part of its properties,
(iii) fail generally to pay its debts as such debts become due, or (iv) take
corporate action in furtherance of any such action.
(g) Any events shall arise which result in the acceleration due to default
of the maturity of any indebtedness in a principal amount in excess of $500,000
of Filene's Basement or any guarantor or surety of the obligations of Filene's
Basement to others under any instrument, agreement or undertaking with respect
to such indebtedness.
(h) Final judgment or judgments for the payment of money in amounts
greater than $500,000 shall be rendered against Filene's Basement and the same
shall not be either (x) covered by insurance or the insurer shall not have
accepted liability therefor or (y) vacated, stayed, bonded, paid, or discharged
prior to expiration of the applicable appeal period.
(i) There shall, due to any action or failure to act by Filene's Basement,
occur any loss, theft, damage, destruction, sale or encumbrance to or of any of
the Accounts, or any levy, seizure, or attachment thereof or thereon shall be
made which Filene's Basement shall not have either cured or reimbursed Bank
within thirty (30) days after written notice thereof to Filene's Basement;
provided, however, that Filene's Basement may, at its option, purchase the
affected Accounts within such thirty (30) day period in lieu of cure or
reimbursement. The purchase price payable for any Account purchased pursuant
hereto shall be the aggregate of the balance of the Account, including (x) the
unpaid principal balance plus finance charges earned but unpaid, and (y)
out-of-pocket costs and reasonable expenses paid or incurred by Bank in any
attempted collection of such Account, including reasonable attorneys' fees.
(j) Filene's Basement shall fail to provide a new LOC or Discount LOC at
least 45 days before expiration of the existing LOC or Discount LOC (during the
time period that such Discount LOC is required).
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(k) Any of the conditions subsequent set forth in Article XV shall not
have occurred on or before the date specified therein with respect to each such
condition.
SECTION 11.4 REMEDIES. Upon the occurrence of an Event of Default, or Filene's
Basement Event of Default, or Bank Event of Default, all of the defaulting
party's obligations hereunder may, in the non-defaulting party's sole
discretion, be deemed immediately due and payable without notice or demand. The
non-defaulting party will have the right to declare this Agreement terminated
and/or to discontinue originating or offering Accounts and establishing
Indebtedness as applicable.
ARTICLE XII TERM/TERMINATION
SECTION 12.1 TERM. This Agreement will continue in full force and effect until
the close of business on June 30, 2000 (the "Initial TERM") and shall be
automatically renewed for successive one (1) year terms (each a "Renewal Term")
thereafter, unless terminated as provided in other provisions of this Agreement.
SECTION 12.2 TERMINATION. The following termination provisions shall also apply:
(a) Filene's Basement shall have the right to terminate this Agreement
upon fifteen (15) days' written notice if any Bank Event of Default or Event of
Default with respect to Bank shall occur (a "Filene's Basement Termination"),
and upon Filene's Basement Termination, Bank shall not draw down on the LOC and
shall return the LOC.
(b) Bank shall have the right to terminate this Agreement upon fifteen
(15) days' written notice if any Filene's Basement Event of Default or Event of
Default with respect to Filene's Basement shall occur.
(c) Filene's Basement shall have the right, upon fifteen (15) days' prior
written notice to Bank, to terminate this Agreement, if Bank makes an election
pursuant to Section 2.2(b)(iii) hereof.
(d) Either party may terminate this Agreement effective at the end of the
Initial Term or any Renewal Term by giving at least six (6) months prior written
notice to the other party.
SECTION 12.3 TERMINATION FOR FORCE MAJEURE.
(a) This Agreement may be terminated by either Bank or Filene's Basement
without penalty after the passing of one hundred eighty (180) days following the
notice by one party to the other that its performance hereunder is prevented or
materially impeded, without the ability to cure, by one of the following force
majeure events: acts of God, fire, earthquake, explosion, accident, computer
failure, war, nuclear disaster, riot or material changes in
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applicable laws or regulations, including, but not limited to, a change in state
or federal law rendering it illegal, impossible or untenable for the notifying
party or its ultimate parent corporation to perform as contemplated in this
Agreement.
(b) Any such disability will not be considered a breach of this Agreement
during the period of such disability (i.e., prior to one hundred eighty (180)
days), if the disabled party promptly advises the other party in writing that it
is unable to perform due to such a force majeure event, setting forth: (i) the
nature of the event; (ii) its expected effect(s) and duration; (iii) any
expected development which may further affect performance hereunder; and (iv)
the efforts which in the sole reasonable judgment and discretion of such
notifying party will be made to cure such force majeure event or provide
substitute performance.
(c) Such one hundred eighty (180) day period may be shortened upon written
agreement executed by duly authorized officers of both parties or if required by
applicable law or regulation.
SECTION 12.4 RIGHTS UPON TERMINATION.
(a) Except as otherwise expressly provided herein, upon termination of
this Agreement, each party shall be required to fulfill its respective
obligations hereunder (unless prohibited by law), including without limitation,
its obligations to provide customer service and Account Documentation, until all
Accounts are liquidated or otherwise disposed of by the parties hereto.
(b) Notwithstanding any other provision of this Agreement, Bank shall be
deemed the sole owner of the Program Accounts Portfolio, including, without
limitation, the Customer List, and upon termination of this Agreement, and
should Filene's Basement not purchase the Program Accounts Portfolio from Bank
as provided in Article XVII hereof, Bank shall have the right, in addition to
and retaining all other rights it may have under this Agreement or applicable
law, to liquidate the Program Accounts Portfolio in any lawful manner which may
be expeditious or economically advantageous to Bank, including, without
limitation, using the Customer List for the sale of new and existing items under
Value-Added Programs pursuant to Section 3.8 hereof, issuing a replacement or
substitute card, and transferring and/or selling the Customer List, or any part
thereof, with or without the Program Accounts Portfolio, to a third party.
During such liquidation, Bank may use the Marks in communicating with
Cardholders. Filene's Basement agrees to cooperate with Bank and take any
reasonable action requested by Bank to effectuate such liquidation in an orderly
manner (provided that Filene's Basement shall not be required to incur
out-of-pocket expenses in so doing), including accepting existing Credit Cards
or replacement or substitute cards for twelve (12) months following the
effective date of termination. All gross finance charges billed on Accounts to
Cardholders will be retained by Bank, and Bank will absorb all finance charge
credits on Accounts and finance charges associated with write-offs on Accounts,
and all losses, including losses on the sale, if any, of Accounts.
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SECTION 12.5 SURVIVAL. The covenants, agreements, representations, warranties
and obligations of the parties contained herein or in any certificate or other
writing or Exhibits delivered pursuant hereto or in connection herewith shall
survive the termination of this Agreement according to the following schedule:
The following Sections shall survive indefinitely--Article I; Section 2.7;
Section 3.3; Section 3.6; Section 3.10; Section 4.4; Section 5.1 (provided
that there will be no Discount after termination); Section 7.1; Section 7.2;
Section 7.3; Section 7.5 (provided that none of Article VII will survive in the
event Filene's Basement purchases the Accounts as provided in Article XVII);
Article VIII; Article IX; Section 11.4; Section 12.4; Article XIII; Article XIV;
Article XVII; and Article XVIII (except that Section 18.6 will survive for only
24 months after termination, and, with respect to Section 18.15, the security
interest will survive only so long as Bank has Accounts still on its books, and
Bank will terminate the security in the event Filene's Basement purchases the
Accounts as provided in Article XVII); the following Sections shall survive for
24 months after such termination: Section 3.5; Section 3.11; Section 3.12;
Article VI; and Section 18.6; the following Sections shall survive for 12 months
after such termination: Section 2.1; Section 2.3; paragraphs 2.4(b) and (e);
Section 3.4; Section 4.3; and Section 5.6. All other Sections will not survive
the termination of this Agreement.
ARTICLE XIII INDEMNIFICATION
SECTION 13.1 BY BANK. Bank agrees to protect, indemnify and hold Filene's
Basement and its Affiliates and their officers, directors and employees harmless
against and in respect of any and all liabilities, expenses (including attorney
fees), judgments, damages, claims, actions or proceedings by whomsoever asserted
arising out of, connected with or resulting from any act or omission of any of
Bank's employees, officers, directors, agents or licensees, or any breach by
Bank of the terms, covenants, warranties, conditions or other provisions hereof
or obligations hereunder, or contained in any other instrument or document
delivered by Bank in connection herewith, or pursuant hereto, or, if made by a
non-party to this Agreement, any claim, demand, allegation, offset, defense or
counterclaim which, if true or proven, would constitute such a breach.
SECTION 13.2 BY FILENE'S BASEMENT. Filene's Basement agrees to protect,
indemnify and hold Bank and its Affiliates and their officers, directors and
employees harmless against and in respect of any and all liabilities, expenses
(including attorneys' fees), judgments, damages, claims, actions or proceedings
by whomsoever asserted arising out of, connected with or resulting from any act
or omission of any of Filene's Basement employees, officers, directors, agents
or licensees, or the sale of Merchandise including any breach by Filene's
Basement of any warranty given in connection with the sale of Merchandise or any
breach of the terms, covenants, warranties, conditions or other provisions
hereof or obligations hereunder, or contained in any other instrument or
document delivered by Filene's Basement in connection herewith, or pursuant
hereto or, if made by a non-party to this Agreement, any claim, demand,
allegation, offset, defense or counterclaim which, if true or proven, would
constitute such a breach.
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SECTION 13.3 NOTICE. In the event that any legal proceeding shall be instituted
or that any claim or demand shall be asserted by any Person in respect of which
payment may be sought by one party hereto from another party hereto pursuant to
this Article XIII, the party seeking indemnification (the "Indemnified Party")
shall promptly cause written notice of the assertion of any claim of which it
has knowledge which is covered by this indemnity to be forwarded to the other
party or parties (the "Indemnifying Party"), which notice shall be given within
sufficient time to respond to such proceeding, claim, or demand. The
Indemnifying Party shall have the right, to the extent of its indemnification,
at its option and its own expense, to be represented by counsel of its choice,
which counsel must be reasonably satisfactory to the Indemnified Party, and to
defend against, negotiate, settle, or otherwise deal with any proceeding, claim,
or demand which is related to any loss, liability, damage, or deficiency
indemnified against hereunder; provided, however, that no settlement shall be
made without the prior written consent of the Indemnified Party, which consent
shall not be unreasonably withheld; and provided, further, that the Indemnifying
Party shall keep the Indemnified Party advised as to the status of the matter.
The Indemnified Party may participate in any such proceeding with counsel of its
choice at its own expense. If the Indemnified Party refuses to approve a
proposed settlement that is acceptable to the claimant, the Indemnifying Party
may, at its option, deposit the proposed settlement with the Indemnified Party
and thereupon be relieved of any further indemnity obligation with respect to
such proceeding, claim or demand, including, without limitation, attorneys'
fees, costs and expenses thereafter incurred. If the Indemnifying Party defends
against a claim that is ultimately settled or adjudicated for an amount which is
not recoverable by the Indemnified Party, the Indemnified Party shall promptly
reimburse the Indemnifying Party for all costs and expenses incurred in
defending such claim. The parties hereto agree to cooperate fully with the
defense, negotiation, or settlement of any such legal proceeding, claim or
demand.
ARTICLE XIV USE OF FILENE'S BASEMENT MARKS
SECTION 14.1 GRANT OF RIGHTS. Filene's Basement hereby grants to Bank a
non-exclusive, royalty-free, non-transferable right and license to use the
service xxxx "Filene's Basement" and any other xxxx listed on Exhibit A attached
hereto (the "Marks") in the United States in connection with the creation,
establishment, marketing and administration of, and the provision of services
related to, the Program, all pursuant to, and in accordance with, this
Agreement. Those services shall include, without limitation, the solicitation of
Cardholders, acceptance of Credit Card Applications, issuance and reissuance of
Credit Cards, the provision of accounting services to Cardholders, the provision
of billing statements and other correspondence relating to Accounts to
Cardholders, the extension of credit to Cardholders, the advertisement or
promotion of the Program and the collection and liquidation of the Program
Accounts Portfolio. The license granted hereby shall terminate upon the later of
(i) the termination of this Agreement or (ii) the date on which the Aggregate
Investment is zero. The foregoing notwithstanding, it is understood that in no
event shall the termination of this Agreement affect the rights of Bank (or any
authorized purchaser of Accounts) to liquidate the Accounts after
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termination, which liquidation may include, without limitation, the billing of
such Accounts using the Marks.
SECTION 14.2 BANK ACKNOWLEDGEMENTS. Bank acknowledges and agrees that: (i) the
Marks and all good will associated therewith are the property of Filene's
Basement, (ii) Bank shall not acquire any right, title or interest to the Marks
through its use thereof pursuant to this Agreement, and (iii) any rights which
arise from use of the Marks by Bank shall inure to the benefit of Filene's
Basement, and Bank hereby assigns any such rights to Filene's Basement. Bank
further acknowledges and agrees that it shall not attack the title or interest
of Filene's Basement in or to the Marks and shall assist Filene's Basement, at
Filene's Basement expense, in protecting Filene's Basement rights in the Marks
(to the extent necessary).
SECTION 14.3 FUTURE MARKS. If Filene's Basement adopts a trademark, trade name,
service xxxx, logo or other proprietary xxxx which used by Filene's Basement in
connection with its retail business but which is not listed on Exhibit A hereto
(a "New Xxxx") and Bank requests that Filene's Basement add such New Xxxx to
Exhibit A hereto and license its use hereunder, Filene's Basement shall not
unreasonably fail to do so, and such New Xxxx shall be added to Exhibit A by
amendment of this Agreement.
ARTICLE XV SUBSEQUENT OBLIGATIONS
Notwithstanding any other provision of this Agreement, Bank shall be
obligated to originate Accounts and this Agreement shall become operative upon
its execution. Nevertheless, Filene's Basement covenants to satisfy all of the
following conditions specified to be complied with:
SECTION 15.1 REPRESENTATIONS AND WARRANTIES TRUE. All representations and
warranties of Filene's Basement contained in this Agreement shall be true in all
material respects on the date hereof and the date all other subsequent
obligations have been satisfied or waived.
SECTION 15.2 OBLIGATIONS PERFORMED. Filene's Basement shall have performed or
observed all terms, conditions, covenants and obligations hereunder to be
performed or observed by Filene's Basement as of the date hereof and the date
all other conditions precedent have been satisfied or waived.
SECTION 15.3 NO EVENTS OF DEFAULT. There shall have been no Filene's Basement
Event of Default or Event of Default by Filene's Basement under this Agreement
or an event which would constitute such Filene's Basement Event of Default or
Event of Default by Filene's Basement after a period of notice, the lapse of
time, or both, on the date hereof and the date all other conditions precedent
have been satisfied or waived.
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SECTION 15.4 LETTER OF CREDIT. Bank shall have received, in a form and from a
bank satisfactory to Bank, the Letters of Credit further described in Article
XVI not later than August 8, 1995.
SECTION 15.5 FBC GUARANTY. Bank has received a guaranty of Filene's Basement's
obligations hereunder from Filene's Basement Corp., a Massachusetts corporation,
substantially in the form of Schedule 15.5 attached hereto.
SECTION 15.6 RESOLUTIONS. Bank has received a copy of resolutions not later than
July 25, 1995, of the board of directors of Filene's Basement, certified by the
Secretary or an Assistant Secretary of Filene's Basement to be duly adopted and
in full force and effect as of the date hereof, authorizing (i) the execution,
delivery and performance by Filene's Basement of this Agreement and (ii)
specific officers to execute and deliver this Agreement on behalf of Filene's
Basement.
SECTION 15.7 OFFICER'S CERTIFICATE. Bank has received a certificate not later
than August 31, 1995, executed by the chief financial officer of Filene's
Basement and Filene's Basement Corporation in the form of Schedule 15.8 attached
hereto.
SECTION 15.8 FINANCING STATEMENTS EXECUTED. Appropriate financing statements
have been executed, which, upon filing, will properly perfect Bank's security
interests under this Agreement.
ARTICLE XVI PERFORMANCE COLLATERAL
SECTION 16.1 LETTER OF CREDIT. Filene's Basement shall provide Bank with, and
shall at all times have in effect, an irrevocable letter of credit ("LOC") in a
form and issued by a bank satisfactory to Bank, each one valid for a period of
not less than twelve (12) months, upon which Bank may draw as an amount due and
payable by Filene's Basement to Bank in the event: (i) Filene's Basement does
not elect to purchase all Accounts upon any termination of this Agreement, other
than a Filene's Basement Termination, as specified in Article XVII or (ii) such
LOC is not renewed within forty-five days of its scheduled expiration.
SECTION 16.2 SIZE OF LOC. The LOC as of the Effective Date shall be $4.4
million, and shall be adjusted quarterly at the end of each calendar quarter to
equal at least 13% of the reasonable estimate by Bank of the highest calculation
of the Aggregate Investment as of each Billing Date during the next calendar
quarter; PROVIDED that:
(a) The term of such LOC shall begin on January 1 of a calendar year, and
shall expire at the end of such calendar year; PROVIDED that the terms of such
LOC shall provide for adjustment of the amount of such LOC in accordance with
the provisions of subsections 16.2(b) and 16.2(c) below.
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(b) Bank shall provide to Filene's Basement its estimate of the highest
calculation of the Aggregate Investment as of each Billing Date during the next
calendar quarter no later than sixty (60) days prior to the next calendar
quarter, and Filene's Basement shall notify the bank which has issued the LOC to
adjust the LOC amount thirty (30) days prior to the next calendar quarter, such
adjustment to be effective on the first day of the next calendar quarter;
PROVIDED that with respect to the first calendar quarter of each year, Bank
shall provide to Filene's Basement by January 1 its estimate of the highest
calculation of the Aggregate Investment as of each Billing Date during the next
calendar quarter, and the amount of the LOC shall be adjusted by Filene's
Basement no later than January 31 of such year.
(c) Bank may require Filene's Basement to adjust the amount of the LOC at
any time during the calendar quarter should Bank's reasonable estimate of such
Aggregate Investment calculations underestimate the Aggregate Investment during
such calendar quarter, in which case Filene's Basement shall make such
adjustment within five (5) business days of Bank's notice that such adjustment
is required.
(d) The quarterly financial statements to be submitted by Filene's
Basement to Bank pursuant to Section 10.1 of this Agreement shall include,
without limitation, projections of Filene's Basement's sales for such next
quarter.
(e) The amount of the LOC shall be adjusted as set forth in the next
sentence for the remaining term of this Agreement: (i) upon Bank's reasonable
determination that the financial condition of Filene's Basement has
significantly deteriorated, (ii) if Filene's Basement does not renew the LOC at
least forty-five days before such LOC is due to expire, or (iii) if Filene's
Basement fails to maintain the amount of the LOC in accordance with the
provisions of this Section 16.2, including without limitation in accordance with
the adjustments set forth in subsections 16.2(b) and 16.2(c) above. The amount
of the LOC shall be adjusted quarterly at the end of each calendar quarter to
equal at least 13% of the reasonable estimate by Bank of the Aggregate
Investment as of the end of the calendar year in which such LOC is scheduled to
expire.
(f) In the event that Filene's Basement is unable to comply or does not
comply with the provisions of this Article XVI as to the amount of the LOC, and
if Filene's Basement does not cure such lack of compliance within five (5) days
of Bank's notice to Filene's Basement thereof, Bank shall have the sole right
and option to draw on the LOC and retain the proceeds thereof and, if the
proceeds thereof are not equal to thirteen percent (13%) of the reasonable
estimate by Bank of the Aggregate Investment as of the end of the calendar year
in which such LOC is scheduled to expire, Bank may deduct from the amount to be
paid to Filene's Basement under the various provisions of this Agreement the
difference between the proceeds of the LOC received by Bank and such thirteen
percent (13%).
SECTION 16.3 DISCOUNT LETTER OF CREDIT. Filene's Basement shall provide Bank
with, and shall at all times have in effect, an irrevocable letter of credit
("Discount LOC") in a form and issued by a bank satisfactory to Bank, each one
valid for a period of not less than twelve (12)
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months, upon which Bank may draw as an amount due and payable by Filene's
Basement to Bank in the event that (i) Filene's Basement does not pay to Bank
the Deferred Discount when due or (ii) such Discount LOC is not renewed within
forty-five days of its scheduled expiration OR (iii) the amount of such Discount
LOC is not maintained in accordance with the provisions of Section 16.4. In the
event that Filene's Basement is unable to comply or does not comply with the
provisions of Section 16.4 as to the amount of the Discount LOC, and if Filene's
Basement does not cure such lack of compliance within five (5) days of Bank's
written notice to Filene's Basement thereof, Bank shall have the sole right and
option to draw on the Discount LOC and retain the proceeds thereof to pay the
outstanding amount of the Deferred Discount. Notwithstanding anything contained
herein to the contrary, Filene's Basement shall have no responsibility for
maintaining the Discount LOC following its payment in full of the Deferred
Discount.
SECTION 16.4 SIZE OF DISCOUNT LOC. The discount LOC as of the Effective Date
shall be $100,000, and shall be adjusted thereafter as follows: (i) as of the
date upon which the Deferred Discount reaches $90,000, the amount of the
Discount LOC shall be $200,000 and shall remain in effect until the Deferred
Discount reaches $180,000 and (ii) as of the date upon which the Deferred
Discount reaches $180,000, the amount of the Discount LOC shall be $300,000.
SECTION 16.5 COST OF LOCS. Within fifteen (15) Business Days after its receipt
of written notice from Filene's Basement advising Bank of the actual annual fee
paid by Filene's Basement with respect to the LOC and the Discount LOC, Bank
will reimburse Filene's Basement for such amount, provided that in no event will
the amount reimbursable by Bank hereunder in respect of the LOC or the Discount
LOC exceed two percent (2%) of the face amount of the LOC or the Discount LOC,
as the case may be.
ARTICLE XVII FILENE'S BASEMENT PURCHASE OF ACCOUNTS
SECTION 17.1 GENERALLY. Upon termination of this Agreement by either party for
any reason, Filene's Basement shall have the option, by written notice given to
Bank within fifteen (15) days of the date of such notice of termination, to
purchase all Accounts held by Bank on the date of such purchase for an amount in
cash equal to the aggregate of (i) the unpaid principal indebtedness under such
Accounts as of the date of purchase plus (ii) finance charges on all such
Accounts accrued but unpaid to the date of purchase, (iii) all out-of-pocket
costs and expenses paid or incurred by Bank in any attempted collection of such
Accounts, including reasonable attorneys' fees.
SECTION 17.2 LIQUIDATION. If upon the expiration or termination of this
Agreement by either party for any reason, Filene's Basement shall not exercise
its option to purchase Accounts then held by Bank for the purchase price
pursuant to Section 17. 1, appropriate notices that the Program has been
discontinued shall be sent to all Cardholders, provided Bank will pay such
expense. Bank shall then have the right to elect one of the following courses of
action:
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(a) To liquidate the remaining Accounts by collection and servicing
thereof in the normal course; or
(b) To convert the remaining Accounts into an existing MasterCard, Visa or
similar charge card program sponsored by any Affiliate of General Electric
Company, at the end of which no further fees shall accrue relating to the
Program; or
(c) To liquidate the remaining Accounts in any other lawful manner which
may be expeditious or economically advantageous to Bank.
In any of the foregoing events, Filene's Basement shall not be further liable
for any charges under Article V of the Agreement, nor shall Filene's Basement be
responsible to Bank for damages specifically resulting from such liquidation
pursuant to Section 17.2.
SECTION 17.3 SURVIVAL OF RIGHTS. The rights and obligations of the parties
hereto shall survive termination of this Agreement except as specifically set
forth in this Agreement.
ARTICLE XVIII MISCELLANEOUS
SECTION 18.1 ASSIGNABILITY. Neither Filene's Basement nor Bank may assign its
respective rights or delegate its obligations under this Agreement without the
prior written consent of the other party, which consent will not be unreasonably
withheld; provided, however, that either party may assign all or part of its
rights or delegate all or part of its duties under this Agreement to Affiliates
without such prior written consent.
SECTION 18.2 SET-OFF BY BANK. Bank shall have the right, after the occurrence of
an Event of Default and without further notice to set-off against, appropriate
and apply any and all money or property of Filene's Basement in its possession
in payment of amounts owed to Bank or its Affiliates by Filene's Basement, to
deduct the amounts due Filene's Basement from Bank pursuant to this Agreement,
charge any reserve or to draw on the Letter of Credit by presenting the Letter
of Credit to the issuer thereof for payment in such amounts with a corresponding
reduction in the Letter of Credit for such payment.
SECTION 18.3 OFFSETS. At any time Bank is obligated to make a payment to
Filene's Basement hereunder, Bank shall have the right to offset against such
payment any amounts then due and owing by Filene's Basement to Bank, regardless
of the origin of such indebtedness.
SECTION 18.4 SECURITIZATION/PARTICIPATION. Bank will have the right to
securitize or participate all of any portion of the Accounts at any time
(provided that Bank shall continue to be obligated under this Agreement with
respect to such Accounts as if Bank had not securitized or participated out such
Accounts).
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SECTION 18.5 COOPERATION IN EVENT OF TERMINATION. Both Bank and Filene's
Basement agree to fully cooperate with each other in the event of termination of
this Agreement, regardless of the cause of such termination, in the orderly
transfer of Accounts. Bank shall provide computer tapes and other such support
to expedite the transfer.
SECTION 18.6 FINANCIAL REPORTS; RIGHT TO AUDIT. Filene's Basement shall submit
to Bank annually, an audited balance sheet. Further, Bank shall have the right
to inspect and audit Filene's Basement records, from time to time, as it deems
appropriate, on reasonable notice during normal business hours, as such records
pertain to Accounts. Filene's Basement shall have the right to inspect and audit
Bank's records, from time to time, as it deems appropriate, on reasonable notice
during normal business hours, as such records pertain to the assessment of
finance charges on Accounts and the credit or payment to Filene's Basement
relating to Accounts. Bank agrees to provide Filene's Basement with reports
relating to the Accounts containing such information or data as agreed to by
Bank and Filene's Basement, and the frequency of delivery of such reports shall
be agreed to by the parties hereto.
SECTION 18.7 ENTIRE AGREEMENT; AMENDMENTS. This Agreement constitutes the entire
understanding of the parties relative to the subject matter hereof and
supersedes all prior and contemporaneous agreements and understandings, whether
oral or written, relating to the subject matter hereof. This Agreement may not
be varied, altered, amended or supplemented, nor may any of its provisions be
waived, except by a writing duly executed by an authorized officer of the party
to be obligated. This Agreement shall be binding upon and inure to the benefit
of the permitted successors and assigns of Bank and the permitted successors or
assigns of Filene's Basement.
SECTION 18.8 TERMINATION OF ACCOUNT PURCHASE AGREEMENT. Effective as of the
Conversion Date, the Account Purchase Agreement shall be terminated. As provided
therein, certain provisions of the Account Purchase Agreement survive such
termination. and the parties have additionally agreed that the confidentiality
provisions of the Account Purchase Agreement shall survive such termination.
SECTION 18.9 NON-WAIVER. No delay by either party hereto in exercising any of
its rights hereunder, or partial or single exercise of such rights, will operate
as a waiver of that or any other right. The exercise of one or more of either
party's rights hereunder will not be a waiver of, nor preclude the exercise of,
any rights or remedies available to such party under this Agreement or in law or
at equity.
SECTION 18.10 SEVERABILITY. If at any time subsequent to the date hereof, any
provision of this Agreement shall be held by any court of competent jurisdiction
to be illegal, void or unenforceable, such provision shall be of no force and
effect, but the illegality or unenforceability of such provision shall have no
effect upon and shall not impair the enforceability of any other provision of
this Agreement.
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SECTION 18.11 GOVERNING LAW. This agreement and all rights and obligations
hereunder, including, but not limited to, matters of construction, validity and
performance, will be governed and construed in accordance with the laws of the
State of Georgia.
Section 18.12 CAPTIONS. Captions of the Sections of this Agreement are for
convenient reference only and are not intended as a summary of such Sections and
do not affect, limit, modify or construe the contents thereof.
SECTION 18.13 NOTICES. All notices, demands, instructions and other
communications required or permitted to be given to or made upon any party
hereto shall be in writing and shall be personally delivered or sent by
registered or certified mail, postage prepaid, return receipt requested, by
recognized carrier of overnight mail or by prepaid telegram (with messenger
delivery specified), or by facsimile (receipt confirmed). Notice given by
registered or certified mail, postage prepaid, shall be deemed to be given for
purposes of this Agreement three (3) Business Days after the date sent. Notice
given by recognized carrier of overnight mail shall be deemed to have been given
on the second Business Day after delivery thereof to the carrier. Notice given
by personal delivery shall be deemed to be given when delivered. Notice given by
prepaid telegram or facsimile shall be deemed to be given when sent, if properly
addressed to the party to whom sent. Unless otherwise specified in a notice in
writing sent or delivered in accordance with the foregoing provisions of this
Section 18.13, notices, demands, instructions and other communications shall be
given to or made upon the respective parties hereto at their respective
addresses (or to their respective facsimile number) indicated below:
If to Bank: Monogram Credit Card Bank of Georgia
0000 Xxxxxxx Xxxx, Xxxxxxxx 000, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
President
Facsimile No. (000) 000-0000
With copy to: General Electric Capital Corporation
0000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Monogram Credit Card Bank of
Georgia Counsel
Facsimile No. (000) 000-0000
If to Filene's Basement: 00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: Chief Financial Officer
Facsimile No.: 000-000-0000
With a copy to: Xxxxx, Xxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
00
00
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxxxx, Esq.
Either party may change the person, address or facsimile number to which
notice shall be sent by giving written notice of such change to the other
party in the manner provided herein.
SECTION 18.14 POWER OF ATTORNEY. Filene's Basement authorizes and empowers Bank
(a) to sign and endorse Filene's Basement name on all checks, drafts, money
orders or other forms of payment with regard to Accounts under the Agreement;
(b) to xxx Cardholders for collection of Accounts in the name of Bank; (c) to
use the Marks in any collection action on an Account; (d) to do all the things
reasonably necessary to carry out or enforce the Account; and (e) to do any and
all other things which Bank determines as necessary or advisable to do to carry
out the terms of this Agreement. This limited power of attorney conferred hereby
will be deemed a power coupled with an interest and will be irrevocable while
any Account remains unpaid.
SECTION 18.15 GRANT OF SECURITY INTEREST; PRECAUTIONARY FILING. The parties
hereto agree that the transactions contemplated herein shall constitute a credit
card program operated by Bank, and Bank is the absolute owner of all Accounts,
except as otherwise set forth herein. To secure payment of and performance by
Filene's Basement of any and all indebtedness, liabilities or obligations
whatsoever of Filene's Basement to Bank, however arising, pursuant to this
Agreement, including but not limited to liabilities and obligations that may be
deemed to exist in the event of any recharacterization of any transactions
contemplated hereby, Filene's Basement hereby grants to Bank a first priority
continuing security interest in and to the following property or interests in
property of Filene's Basement, whether now existing or hereafter created or
acquired, together with the proceeds thereof: (i) all Accounts and Account
Documentation which may from time to time become subject to this Agreement; (ii)
returned Merchandise relating to all Accounts; (iii) Filene's Basement's books
and records evidencing, securing or relating to Accounts; (iv) all deposits,
credit balances and reserves on Bank's books relative to any Accounts; and (v)
all proceeds of the foregoing. All creditors of Filene's Basement seeking to
obtain a security interest in any of the foregoing collateral shall be required
to subordinate their security interests to the security interest of Bank in the
foregoing collateral as a condition precedent to obtaining any such security
interest, except for creditors who obtain priority by operation of law. With
respect to creditors who obtain and perfect security interests in the collateral
referred to above by a means other than the grant of a security interest and the
filing of a financing statement on form UCC-1 or otherwise, Filene's Basement
shall use commercially reasonable efforts to cause any liens obtained by such
persons that may have priority over Bank with respect to the collateral referred
to above to be released or subordinated to Bank's lien. In furtherance and not
in limitation of any of the foregoing. Filene's Basement agrees to cooperate
fully with Bank as Bank may reasonably request in order to give effect to the
security interest granted by this Section 18.15, including, without limitation,
the execution of UCC-1 or comparable statements in order to perfect such
security interest. For filing purposes, Filene's Basement agrees to provide Bank
with prior written notice of any change in location of its principal executive
offices.
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SECTION 18.16 FURTHER ASSURANCES. Filene's Basement and Bank each agree to
produce or execute such other documents or agreements as may be necessary or
desirable for the execution and implementation of this Agreement and the
consummation of the transactions contemplated hereby.
IN WITNESS WHEREOF, Bank and Filene's Basement have set their hands hereto
as of the date of this Agreement.
MONOGRAM CREDIT CARD BANK OF GEORGIA
By: /s/ Xxxxxxx Xxxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice-Chairman
FILENE'S BASEMENT, INC.
By: /s/ Xxxxxx Xxxxxx
----------------------------------
Name: XXXXXX XXXXXX
Title: EXECUTIVE VICE PRESIDENT AND CFO
General Electric Capital Corporation is executing this Agreement solely for the
purpose of ratifying the terms of Section 18.8 of this Agreement:
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ XXXXXX [illegible]
----------------------------------
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SCHEDULE 15.5
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT made this 24th day of August, 1995, by and between
Filene's Basement Corp. (hereinafter referred to as "Guarantor"), and Monogram
Credit Card Bank of Georgia (hereinafter referred to as "Bank").
RECITALS
X. Xxxxxx'x Basement, Inc. ("Basement") is desirous of entering into that
certain Credit Card Program Agreement dated July 20, 1995 between Bank and
Basement ("Program Agreement").
B. Guarantor owns all of the outstanding capital stock of Basement and has
consented to Basement's entering into the Program Agreement.
C. Bank has declined to enter the Program Agreement unless Guarantor
guarantees the obligations of Basement thereunder and further undertakes the
obligations set forth herein.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, the parties hereby agree as follows:
1. UNCONDITIONAL GUARANTY. Guarantor unconditionally guarantees separately
to Bank and its successors and assigns the full and punctual payment,
performance and observance by Basement of all the terms, covenants, conditions
and indemnifications in the Program Agreement contained on Basement's part to be
kept, performed or observed with respect to Bank. If, at any time, default
beyond any applicable notice and cure periods shall be made by Basement in the
performance or observance of any of the terms, covenants, conditions or
indemnifications in the Program Agreement contained on Basement's part to be
kept, performed or observed Guarantor will keep, perform and observe the same,
as the case may be, in place and stead of Basement.
2. WAIVER OF NOTICE; NO RELEASE OF LIABILITY. Any act of Bank, or the
successors or assigns of Bank, consisting of a waiver of any of the terms or
conditions of the Program Agreement, or the giving of any consent to any matter
or thing relating to the Program Agreement, or the granting of any indulgences
or extensions of time to Basement, may be done without notice to Guarantor and
without releasing the obligations of Guarantor hereunder, except where Bank
expressly or clearly through its actions has released Basement of its
obligations under the Program Agreement. The obligations of Guarantor hereunder
shall not be released by Bank's receipt, application
55
or release of any security given for the performance and observance of covenants
and conditions in the Program Agreement contained on Basement's part to be
performed or observed, nor by any modification of the Program Agreement. The
liability of Guarantor hereunder shall in no way be affected by (a) the release
or discharge of Basement in any creditors, receivership, bankruptcy or other
proceedings; (b) the impairment, limitation or modification of liability of
Basement or the estate of Basement in bankruptcy, or of any remedy for the
enforcement of Basement's liability under the Program Agreement, resulting from
the operation of any present or future provision of the Federal Bankruptcy Code
or other statute or from the decision in any court; (c) the rejection or
disaffirmance of the Program Agreement in any such proceedings; (d) any
disability or other defense of Basement except as otherwise provided in the
Program Agreement; (e) the cessation from any cause whatsoever of the liability
of Basement under the Program Agreement, except as otherwise provided in or
permitted by the Program Agreement; or (f) the exercise by Basement of any
rights or remedies reserved to Basement under the Program Agreement.
3. JOINDER; STATUTE OF LIMITATIONS. Guarantor agrees that it may be joined
in any action against Basement in connection with the obligations of Basement
under the Program Agreement as guaranteed by this Guaranty and recovery may be
had against Guarantor in any action or proceeding against Basement and Bank may
enforce the obligations of Guarantor hereunder without first taking any action
whatsoever against Basement or its successors and assigns, or pursue any other
remedy or apply any security it may hold.
4. DE FACTO SUBSTITUTION. In the event this Guaranty shall be held
ineffective or unenforceable by any court of competent jurisdiction, or in the
event of any limitation of liability of Guarantor hereon other than as expressly
provided herein, then Guarantor shall be deemed to be a party under the Program
Agreement with the same force and effect as if Guarantor were expressly named as
a joint and several party with Basement therein with respect to the obligations
of Basement thereunder hereby guaranteed.
5. AMENDMENT OR ASSIGNMENT OF AGREEMENT. The provisions of the Program
Agreement may be changed, modified, amended or waiver by agreement between Bank
and Basement at any time, or by course of conduct, without the consent of or
without notice to Guarantor thereunder. This Guaranty shall guarantee the
performance of the Program Agreement as so changed, modified, amended or waived.
Any assignment of the Program Agreement shall not affect this Guaranty and Bank
if Bank disposes of its interest in the Program Agreement. "Bank", as used in
this Guaranty, shall include Bank's successors and assigns.
6. REPLACEMENT OF GUARANTOR. In the event that, at any time during the
term of this Guaranty, Guarantor should cease to transact business or cease to
be duly organized, validly existing and/or in good standing, Guarantor shall
obtain a substitute Guaranty to the benefit of Bank, substantially in accordance
with the terms and
2
56
conditions of this Guaranty, from a guarantor acceptable to Bank whose capital
and overall financial condition is generally comparable to that of Guarantor.
7. REPRESENTATION AND WARRANTIES. Guarantor represents, warrants and
covenants to Bank as follows:
(i) Guarantor is a corporation duly organized, validly existing and
in good standing under the laws of the State of Massachusetts and has all
requisite corporate power and authority to own, operate and carry on its
business as now being conducted.
(ii) Guarantor has the corporate right, power and authority to enter
into this Guaranty and all agreements entered into in connection with the
contemplated transaction.
(iii) Neither the execution and delivery of this Guaranty nor the
consummation of the transactions contemplated hereby will constitute (i) a
default under or a breach of any of the terms or provisions of the Certificate
of Incorporation or By-laws of Guarantor, or (ii) a breach of any agreement to
which Guarantor is a party or by which Guarantor is bound.
(iv) There is no action, suit, proceeding or investigation pending,
or to the knowledge of Guarantor threatened against or affecting Guarantor
before any court, arbitrator or administrative or governmental body which if
decided adversely will affect adversely Guarantor's ability to perform its
obligations under this Agreement; Guarantor is not subject to any injunction,
order or decree of any court or administrative agency which relates to the
Accounts (as defined in the Program Agreement) or this Guaranty.
(v) the principal place of business and chief executive offices of
Guarantor are located at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000.
(vi) This Guaranty and any other documents to be executed by
Guarantor in connection therewith have been duly and validly executed and
delivered by Guarantor and constitute valid and binding obligations of Guarantor
enforceable in accordance with the terms thereof and hereof, except to the
extent enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or similar laws in force from to time to time which affect creditor's
rights generally and by legal and equitable limitations on the enforceability of
specific remedies.
8. WAIVERS OF PRESENTMENT AND NOTICES. Guarantor waives any defense by
reason of any legal disability of Basement, and further waives any presentments
and notices of acceptance of this Guaranty as well as all notices of the
existence, creation, or incurring of new or additional obligations under the
Program Agreement.
3
57
9. NO WAIVER BY BASEMENT. No delay on the part of Bank in exercising any
right hereunder or under the Program Agreement, if permitted under the Program
Agreement, shall operate as a waiver of such right or of any other right of Bank
hereunder or under the Program Agreement, if permitted under the Program
Agreement, nor shall any delay, omission or waiver on any one occasion be deemed
a waiver of the same or any other right on any other future occasion.
10. WHOLE AGREEMENT. This instrument constitutes the entire agreement
between Bank and Guarantor with respect to the subject matter hereof, supersedes
all prior oral or written agreements or understandings with respect thereto and
may not be changed, modified, discharged or terminated orally or in any matter
other than by an agreement in writing signed by Guarantor and Bank.
11. APPLICABLE LAW. This Guaranty shall be governed by and construed in
accordance with the laws of the State of Georgia.
12. GUARANTOR'S SUCCESSORS. Guarantor's obligations under this Guaranty
shall be binding on the successors, legal representatives and assigns of
Guarantor. Guarantor shall not be released by any assignment or delegation by it
of its obligations hereunder.
13. ATTORNEYS' FEES. If Bank is required to enforce Guarantor's
obligations hereunder, Guarantor shall pay to Bank all reasonable costs incurred
by it in connection with such enforcement, including without limitation,
reasonable attorneys' fees.
14. CAPTIONS. The paragraph headings appearing herein are for purposes of
identification and reference only and shall not be used in interpreting this
Guaranty.
15. INTERPRETATIONS; SEVERABILITY. It is agreed that if any provision of
this Guaranty or the application of any provision to any person (including Bank)
or any circumstance shall be determined to be invalid or unenforceable, such
determination shall not affect any other provisions of this Guaranty or the
application of such provision to any other person (including Bank) or
circumstance, all of which other provision shall remain in full force and
effect. It is the intention of the parties hereto that if any provision of this
Guaranty is capable of two constructions, one of which would render the
provision valid, the provision shall have the meaning which renders it valid.
16. AMENDMENT, EXTENSION AND RENEWALS. This Guaranty shall apply to the
Program Agreement, any amendment, extension or renewal thereof, and to any
extended term following the term granted in such Agreement, or any amendment,
extension or renewal thereof.
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58
17 NOTICES. All notices, demands, instructions and other communications
required or permitted to be given to or made upon any party thereto shall be in
writing and shall be personally delivered or sent by registered or certified
mail, postage prepaid, return receipt requested, by recognized carrier of
overnight mail or by prepaid telegram (with messenger delivery specified).
Notice given by registered or certified mail, postage prepaid, shall deemed to
have been given on the second business day after delivery thereof to the
carrier. Notice given by personal delivery shall be deemed to be given when
delivered. Notice given by prepaid telegram shall be deemed to be given when
sent, it properly addressed to the party to who sent. Unless otherwise specified
in a notice in writing sent or delivered in accordance with the foregoing
provisions of this Section 17, notices, demands, instructions and
communications shall be given to or made upon the respective parties hereto at
their respective addresses indicated below:
If to Guarantor: Filene's Basement Corp.
00 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Chief Financial Officer
With a copy to: Xxxxx, Xxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxxxx, Esq.
If to Bank: Monogram Credit Card Bank
of Georgia
0000 Xxxxxxx Xxxx
Xxxxxxxx 000, Xxxxx 000
Xxxxxxx, XX 00000
Attn: President
Either party may change the person or address to which notice shall be sent by
giving written notice of such change to the other party in the manner provided
herein.
18. FINANCIAL STATEMENTS. Guarantor shall furnish to Bank, as requested by
Bank, annual and quarterly financial statements of Guarantor, including balance
sheets and earnings statements. Bank agrees that Forms 10-K and 10-Q filed by
Guarantor with the Securities and Exchange Commission shall meet these
requirements.
ACKNOWLEDGMENT: ENFORCEABILITY. GUARANTOR REPRESENTS AND WARRANTS THAT
GUARANTOR HAS READ THIS GUARANTY AND UNDERSTANDS THE CONTENTS HEREOF AND THAT
THIS GUARANTY IS ENFORCEABLE AGAINST GUARANTOR IN ACCORDANCE WITH ITS TERMS.
5
59
IN WITNESS WHEREOF, the parties have executed this Guaranty Agreement as
of the day and year first above written.
Guarantor:
FILENE'S BASEMENT CORP.
By:
----------------------------------
Name: Xxxxxx X. Xxxxxx
-------------------------
Title: Executive Vice President
-------------------------
and Chief Financial Officer
Bank:
MONOGRAM CREDIT CARD BANK
OF GEORGIA
By:
----------------------------------
Name:
-------------------------
Title:
-------------------------
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Officer's Certificate
Section 15.8
Reference is hereby made to that certain Credit Card Program
Agreement (the "Agreement"), dated as of July 20, 1995, between Monogram Credit
Card Bank of Georgia ("Bank") and Filene's Basement, Inc.
This is to certify that all the obligations set forth in Article XV
of the Agreement have been fulfilled as of the date hereof.
--------------------------------
[ ] Xxxxxx X. Xxxxxx
Chief Financial Officer,
Filene's Basement, Inc.
--------------------------------
[ ] Xxxxxx X. Xxxxxx
Chief Financial Officer,
Filene's Basement Corp.
61
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT made this 24th day of August, 1995, by and between
Filene's Basement Corp. (hereinafter referred to as "Guarantor"), and Monogram
Credit Card Bank of Georgia (hereinafter referred to as "Bank").
RECITALS
X. Xxxxxx'x Basement, Inc. ("Basement") is desirous of entering into that
certain Credit Card Program Agreement dated July 20, 1995 between Bank and
Basement ("Program Agreement").
B. Guarantor owns all of the outstanding capital stock of Basement and has
consented to Basement's entering into the Program Agreement.
C. Bank has declined to enter the Program Agreement unless Guarantor
guarantees the obligations of Basement thereunder and further undertakes the
obligations set forth herein.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, the parties hereby agree as follows:
1. UNCONDITIONAL GUARANTY. Guarantor unconditionally guarantees separately
to Bank and its successors and assigns the full and punctual payment,
performance and observance by Basement of all the terms, covenants, conditions
and indemnifications in the Program Agreement contained on Basement's part to be
kept, performed or observed with respect to Bank. If, at any time, default
beyond any applicable notice and cure periods shall be made by Basement in the
performance or observance of any of the terms, covenants, conditions or
indemnifications in the Program Agreement contained on Basement's part to be
kept, performed or observed Guarantor will keep, perform and observe the same,
as the case may be, in place and stead of Basement.
2. WAIVER OF NOTICE; NO RELEASE OF LIABILITY. Any act of Bank, or the
successors or assigns of Bank, consisting of a waiver of any of the terms or
conditions of the Program Agreement, or the giving of any consent to any matter
or thing relating to the Program Agreement, or the granting of any indulgences
or extensions of time to Basement, may be done without notice to Guarantor and
without releasing the obligations of Guarantor hereunder, except where Bank
expressly or clearly through its actions has released Basement of its
obligations under the Program Agreement. The obligations of Guarantor hereunder
shall not be released by Bank's receipt, application
62
or release of any security given for the performance and observance of covenants
and conditions in the Program Agreement contained on Basement's part to be
performed or observed, nor by any modification of the Program Agreement. The
liability of Guarantor hereunder shall in no way be affected by (a) the release
or discharge of Basement in any creditors, receivership, bankruptcy or other
proceedings; (b) the impairment, limitation or modification of liability of
Basement or the estate of Basement in bankruptcy, or of any remedy for the
enforcement of Basement's liability under the Program Agreement, resulting from
the operation of any present or future provision of the Federal Bankruptcy Code
or other statute or from the decision in any court; (c) the rejection or
disaffirmance of the Program Agreement in any such proceedings; (d) any
disability or other defense of Basement except as otherwise provided in the
Program Agreement; (e) the cessation from any cause whatsoever of the liability
of Basement under the Program Agreement, except as otherwise provided in or
permitted by the Program Agreement; or (f) the exercise by Basement of any
rights or remedies reserved to Basement under the Program Agreement.
3. JOINDER; STATUTE OF LIMITATIONS. Guarantor agrees that it may be joined
in any action against Basement in connection with the obligations of Basement
under the Program Agreement as guaranteed by this Guaranty and recovery may be
had against Guarantor in any action or proceeding against Basement and Bank may
enforce the obligations of Guarantor hereunder without first taking any action
whatsoever against Basement or its successors and assigns, or pursue any other
remedy or apply any security it may hold.
4. DE FACTO SUBSTITUTION. In the event this Guaranty shall be held
ineffective or unenforceable by any court of competent jurisdiction, or in the
event of any limitation of liability of Guarantor hereon other than as expressly
provided herein, then Guarantor shall be deemed to be a party under the Program
Agreement with the same force and effect as if Guarantor were expressly named as
a joint and several party with Basement therein with respect to the obligations
of Basement thereunder hereby guaranteed.
5. AMENDMENT OR ASSIGNMENT OF AGREEMENT. The provisions of the Program
Agreement may be changed, modified, amended or waiver by agreement between Bank
and Basement at any time, or by course of conduct, without the consent of or
without notice to Guarantor thereunder. This Guaranty shall guarantee the
performance of the Program Agreement as so changed, modified, amended or waived.
Any assignment of the Program Agreement shall not affect this Guaranty and Bank
if Bank disposes of its interest in the Program Agreement. "Bank", as used in
this Guaranty, shall include Bank's successors and assigns.
6. REPLACEMENT OF GUARANTOR. In the event that, at any time during the
term of this Guaranty, Guarantor should cease to transact business or cease to
be duly organized, validly existing and/or in good standing, Guarantor shall
obtain a substitute Guaranty to the benefit of Bank, substantially in accordance
with the terms and
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conditions of this Guaranty, from a guarantor acceptable to Bank whose capital
and overall financial condition is generally comparable to that of Guarantor.
7. REPRESENTATION AND WARRANTIES. Guarantor represents, warrants and
covenants to Bank as follows:
(i) Guarantor is a corporation duly organized, validly existing and
in good standing under the laws of the State of Massachusetts and has all
requisite corporate power and authority to own, operate and carry on its
business as now being conducted.
(ii) Guarantor has the corporate right, power and authority to enter
into this Guaranty and all agreements entered into in connection with the
contemplated transaction.
(iii) Neither the execution and delivery of this Guaranty nor the
consummation of the transactions contemplated hereby will constitute (i) a
default under or a breach of any of the terms or provisions of the Certificate
of Incorporation or By-laws of Guarantor, or (ii) a breach of any agreement to
which Guarantor is a party or by which Guarantor is bound.
(iv) There is no action, suit, proceeding or investigation pending,
or to the knowledge of Guarantor threatened against or affecting Guarantor
before any court, arbitrator or administrative or governmental body which if
decided adversely will affect adversely Guarantor's ability to perform its
obligations under this Agreement; Guarantor is not subject to any injunction,
order or decree of any court or administrative agency which relates to the
Accounts (as defined in the Program Agreement) or this Guaranty.
(v) the principal place of business and chief executive offices of
Guarantor are located at 00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000.
(vi) This Guaranty and any other documents to be executed by
Guarantor in connection therewith have been duly and validly executed and
delivered by Guarantor and constitute valid and binding obligations of Guarantor
enforceable in accordance with the terms thereof and hereof, except to the
extent enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or similar laws in force from to time to time which affect creditor's
rights generally and by legal and equitable limitations on the enforceability of
specific remedies.
8. WAIVERS OF PRESENTMENT AND NOTICES. Guarantor waives any defense by
reason of any legal disability of Basement, and further waives any presentments
and notices of acceptance of this Guaranty as well as all notices of the
existence, creation, or incurring of new or additional obligations under the
Program Agreement.
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9. NO WAIVER BY BASEMENT. No delay on the part of Bank in exercising any
right hereunder or under the Program Agreement, if permitted under the Program
Agreement, shall operate as a waiver of such right or of any other right of Bank
hereunder or under the Program Agreement, if permitted under the Program
Agreement, nor shall any delay, omission or waiver on any one occasion be deemed
a waiver of the same or any other right on any other future occasion.
10. WHOLE AGREEMENT. This instrument constitutes the entire agreement
between Bank and Guarantor with respect to the subject matter hereof, supersedes
all prior oral or written agreements or understandings with respect thereto and
may not be changed, modified, discharged or terminated orally or in any matter
other than by an agreement in writing signed by Guarantor and Bank.
11. APPLICABLE LAW. This Guaranty shall be governed by and construed in
accordance with the laws of the State of Georgia.
12. GUARANTOR'S SUCCESSORS. Guarantor's obligations under this Guaranty
shall be binding on the successors, legal representatives and assigns of
Guarantor. Guarantor shall not be released by any assignment or delegation by it
of its obligations hereunder.
13. ATTORNEYS' FEES. If Bank is required to enforce Guarantor's
obligations hereunder, Guarantor shall pay to Bank all reasonable costs incurred
by it in connection with such enforcement, including without limitation,
reasonable attorneys' fees.
14. CAPTIONS. The paragraph headings appearing herein are for purposes of
identification and reference only and shall not be used in interpreting this
Guaranty.
15. INTERPRETATIONS; SEVERABILITY. It is agreed that if any provision of
this Guaranty or the application of any provision to any person (including Bank)
or any circumstance shall be determined to be invalid or unenforceable, such
determination shall not affect any other provisions of this Guaranty or the
application of such provision to any other person (including Bank) or
circumstance, all of which other provision shall remain in full force and
effect. It is the intention of the parties hereto that if any provision of this
Guaranty is capable of two constructions, one of which would render the
provision valid, the provision shall have the meaning which renders it valid.
16. AMENDMENT, EXTENSION AND RENEWALS. This Guaranty shall apply to the
Program Agreement, any amendment, extension or renewal thereof, and to any
extended term following the term granted in such Agreement, or any amendment,
extension or renewal thereof.
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17 NOTICES. All notices, demands, instructions and other communications
required or permitted to be given to or made upon any party thereto shall be in
writing and shall be personally delivered or sent by registered or certified
mail, postage prepaid, return receipt requested, by recognized carrier of
overnight mail or by prepaid telegram (with messenger delivery specified).
Notice given by registered or certified mail, postage prepaid, shall deemed to
have been given on the second business day after delivery thereof to the
carrier. Notice given by personal delivery shall be deemed to be given when
delivered. Notice given by prepaid telegram shall be deemed to be given when
sent, it properly addressed to the party to who sent. Unless otherwise specified
in a notice in writing sent or delivered in accordance with the foregoing
provisions of this Section 17, notices, demands, instructions and
communications shall be given to or made upon the respective parties hereto at
their respective addresses indicated below:
If to Guarantor: Filene's Basement Corp.
00 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Chief Financial Officer
With a copy to: Xxxxx, Xxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxxxx, Esq.
If to Bank: Monogram Credit Card Bank
of Georgia
0000 Xxxxxxx Xxxx
Xxxxxxxx 000, Xxxxx 000
Xxxxxxx, XX 00000
Attn: President
Either party may change the person or address to which notice shall be sent by
giving written notice of such change to the other party in the manner provided
herein.
18. FINANCIAL STATEMENTS. Guarantor shall furnish to Bank, as requested by
Bank, annual and quarterly financial statements of Guarantor, including balance
sheets and earnings statements. Bank agrees that Forms 10-K and 10-Q filed by
Guarantor with the Securities and Exchange Commission shall meet these
requirements.
ACKNOWLEDGMENT: ENFORCEABILITY. GUARANTOR REPRESENTS AND WARRANTS THAT
GUARANTOR HAS READ THIS GUARANTY AND UNDERSTANDS THE CONTENTS HEREOF AND THAT
THIS GUARANTY IS ENFORCEABLE AGAINST GUARANTOR IN ACCORDANCE WITH ITS TERMS.
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IN WITNESS WHEREOF, the parties have executed this Guaranty Agreement as
of the day and year first above written.
Guarantor:
FILENE'S BASEMENT CORP.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxx
-----------------------
Title: Executive Vice President
-----------------------
and Chief Financial Officer
Bank:
MONOGRAM CREDIT CARD BANK
OF GEORGIA
By: /s/ Xxxxxxx Xxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxx
-----------------------
Title: Vice-Chairman
-----------------------
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Officer's Certificate
Reference is hereby made to that certain Credit Card Program
Agreement (the "Agreement"), dated as of July 20, 1995, between Monogram Credit
Card Bank of Georgia ("Bank") and Filene's Basement, Inc.
This is to certify that all the obligations set forth in Article XV
of the Agreement have been fulfilled as of the date hereof.
/s/ Xxxxxx X. Xxxxxx
---------------------------------
[ ] Xxxxxx X. Xxxxxx
Chief Financial Officer,
Filene's Basement, Inc.
/s/ Xxxxxx X. Xxxxxx
---------------------------------
[ ] Xxxxxx X. Xxxxxx
Chief Financial Officer,
Filene's Basement Corp.
