Exhibit 10.4


 


AMENDMENT NUMBER ONE


 


This Amendment (“Amendment No. 1”)
is made and entered into as of June 8, 2009


 


	
  BETWEEN:

  	
  CITI CARDS CANADA INC.,

  
	
   

  	
  a corporation organized and existing  under the laws of Ontario, having its  head office at the City of
  Mississauga,  in the
  Province of Ontario, 

  
	
   

  	
  (“Citi Cards”)

  
	
   

  	
  OF THE FIRST PART

  
	
   

  	
   

  
	
  AND:

  	
  ZALE CANADA CO.,

  
	
   

  	
  a corporation organized and existing  under the laws of Nova Scotia, having  its principal place of
  business for North  America at
  901 W. Walnut Hill Lane,  Irving, Texas, U.S.A. 75038, 

  
	
   

  	
  (“Zale”)

  
	
   

  	
  OF THE SECOND PART

  
	
   

  	
   

  
	
  AND:

  	
  TXDC, L.P.,

  
	
   

  	
  a limited partnership organized and existing  under the laws of the
  State of Texas, in theUnited States of America, having a place of  business at 901 W. Walnut
  Hill Lane, Irving,  Texas, U.S.A.
  75038, 

  
	
   

  	
  (“TXDC”)

  
	
   

  	
  OF THE THIRD PART

  



 


WHEREAS Citi Cards (as successor in interest to Citi
Commerce Solutions of Canada Ltd. by amalgamation, effective July 2,
2007), Zale and TXDC entered into a Private Label Credit Card Program Agreement
dated March 1, 2007 (“Agreement”);


 


WHEREAS Citi Cards, Zale and TXDC wish to make certain
amendments to the Agreement;


 


AND WHEREAS Citi Cards, Zale and TXDC intend that, except as
expressly set forth below, the terms and conditions of the Agreement shall
remain unmodified and shall continue in full force and effect;


 


NOW, THEREFORE, in consideration of the terms and
conditions herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by each of the
Parties, Citi Cards, Zale and TXDC agree together as follows:


 

















 


AMENDMENTS:  Effective as
of June 8, 2009, the Agreement shall be amended as follows:


 


1.             Amendments
to Section 2.:  Section 2. of the
Agreement is revised as follows:


 


(a)           The second paragraph of Section 2.(b)(i) of
the Agreement is deleted and replaced by the following provision:


 


“Citi Commerce will at all times solely control all aspects of the
operation of the Private Label Program, including Account Issuance Criteria standards
and credit policy, (e.g., the decision whether or not to extend credit for any
Applicant for a Credit Card, and if so, the amount of credit to be extended,
and whether or not to continue or terminate any individual Account), customer
service operations, collections policy and operations, marketing fulfillment
operations, and accounting operations. Notwithstanding the foregoing, Citi
Commerce shall give Zale at least sixty (60) days’ notice of any change to its
standards and policies that is a material change.  Except as otherwise provided in this
Agreement, Citi Commerce will be the sole and exclusive owner of all materials
used in connection with the operation of the Private Label Program.”


 


(b)           Section 2.(b)(ii)(1) of the
Agreement is revised by deleting the text “(as solely determined by Citi
Commerce, acting reasonably)” in the fifth and sixth lines.


 


(c)           Section 2.(b)(ii)(2) of the
Agreement is revised by deleting the text “(as solely determined by Citi
Commerce, acting reasonably)” in the seventh and eighth lines.


 


2.             Amendments
to Section 14.: Section 14. of the
Agreement is revised as follows:


 


(a)           Section 14.(a)(ii) is
revised by deleting the word “or” at the end of the sentence and inserting a
semi-colon in its place.


 


(b)           Section 14.(a)(iii) is
revised by deleting the period at the end of the sentence and inserting a
semi-colon in its place.


 


(c)           Section 14.(a) is
revised by adding the following new provision at the end:


 


“(iv)        Zale provides
written notice to Citi Commerce on or before June 30, 2009 that this
Agreement is terminated, with such termination to be effective on or before October 31,
2009.


 


(d)           Section 14.(b)(i) is
revised by adding the following new paragraph at the end:


 


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(e)           “Without prejudice to any of
Citi Commerce’s other rights and remedies under this Agreement, Citi Commerce
shall not invoke Section 13.(a)(xii) of the Agreement as an Event
of Default during the period commencing on June 8, 2009 and ending on March 31,
2010, and thereafter shall invoke Section 13.(a)(xii) only upon
ninety (90) days’ written notice to Zale.”


 


3.             Amendment
to Section 15.:  Section  15. of
the Agreement is revised by deleting the first paragraph of Section 15.(a) (including
the heading) and inserting the following provision in its place:


 


“Purchase Option:  In the event of the termination, non-renewal
or expiration of this Agreement pursuant to any of the provisions of this
Agreement other than pursuant to Section 14.(a)(iv) of this
Agreement resulting from a Zale notice of termination or Section 14.(b)(i) of
this Agreement resulting from a Zale Event of Default, Zale has the option (the
“Purchase Option”) to purchase, or to arrange for an Affiliate of Zale
or for a third party to purchase, the Purchase Assets (as defined in Section 16.(a))
at an aggregate purchase price determined in accordance with Section 15.(b) (the
“Purchase Price”).”


 


4.             Amendment
to Attachment B:  Attachment B to the
Agreement is deleted in its entirety and replaced with the Attachment B
annexed hereto.


 


5.             General:


 


(a)           On and after the date hereof, each reference in the Agreement to “this
Agreement” and each reference to “the Agreement” in any and all other
agreements, documents and instruments delivered by Citi Cards, Zale or TXDC in
accordance with the Agreement will mean and be a reference to the Agreement, as
amended by this Amendment No. 1.


 


(b)           Except as specifically amended by this Amendment No. 1, the
Agreement will remain in full force and effect and is hereby ratified and
confirmed by the Parties.


 


(c)           In the event of any inconsistency or conflict between the Agreement and
this Amendment No. 1, the terms and conditions and provisions of this
Amendment No. 1 will govern and control.


 


(d)           Capitalized terms used and
not otherwise defined in this Amendment No. 1 will have the meanings
assigned to such terms in the Agreement.


 


6.             Governing
Law: This Amendment No. 1
will be governed by the laws of the jurisdiction set forth as the governing law
jurisdiction in the Agreement.


 


7.             Counterparts:  This Amendment No. 1 may be executed in one or
more counterparts and by different Parties in separate counterparts. All of
such 


 


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counterparts will
constitute one and the same instrument and will become effective when one or
more counterparts of this Amendment No. 1 have been signed by a Party and
delivered to the other Party. Any Party may deliver an executed copy of this
Amendment No. 1 by facsimile transmission to another Party, and such
delivery will have the same force and effect as any other delivery of a
manually signed copy of this Amendment No. 1.


 


IN WITNESS WHEREOF Citi Cards, Zale and TXDC have
caused this Amendment No. 1 to be executed as of June 8, 2009 by
their proper officers or other representatives duly authorized in that behalf.


 


	
  CITI CARDS CANADA INC.

  	
   

  	
  ZALE CANADA CO.

  
	
  (as successor in interest
  to Citi Commerce  Solutions of
  Canada Ltd. by amalgamation, effective July 2, 2007)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Robert A. Fleig

  	
   

  	
  Name:

  
	
   

  	
  Title:

  	
  General Counsel

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  TXDC, L.P.

  	
   

  	
   

  
	
  By: Zale Delaware, Inc.,
  its general partner

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  



 


(With respect to Section 9.,
and  as expressly granted in


Section 18., of the Agreement)


 


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Attachment B


 


Merchant Fees and Revenue
Sharing


 


1.             Merchant
Fees: Zale agrees to pay a
Merchant Fee for each net Card Sale transaction type described in the Discount
Rate Schedule set out hereinbelow equal to the product obtained by multiplying
the total dollar amount of the net Card Sale by the applicable net Card Sale
transaction type discount rate, as shown in the Discount Rate Schedule set out
hereinbelow.


 


Citi
agrees to refund a Merchant Fee to Zale for each Return of a net Card Sale of a
transaction type described in the Discount Rate Schedule set out hereinbelow
equal to the product obtained by multiplying the total dollar amount of the
Return for the net Card Sale by the applicable net Card Sale transaction type discount
rate, as shown in the Discount Rate Schedule set out hereinbelow.


 


Citi
Commerce will provide Zale with written notice of any change to any Merchant
Fee hereunder at least thirty (30) days prior to the implementation of any such
change by Citi Commerce.


 


DISCOUNT
RATE SCHEDULE


 


	
  Card Sale Transaction Type

  	
   

  	
  Discount Rate

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Three (3) Month Same as Cash

  	
   

  	
  —

  	
  %

  
	
  Six (6) Month Same as Cash

  	
   

  	
  —

  	
  %

  
	
  Twelve (12) Month Same as Cash

  	
   

  	
  —

  	
  %

  
	
  Revolve

  	
   

  	
  —

  	
  %

  



 


2.       Revenue Sharing
Payments: Citi Commerce will pay to Zale, by not later than ten (10) Business
Days following the end of each calendar month, the applicable amount of the
Late Fee Revenue Rebate that has accrued in respect of Accounts under the
Private Label Program during such calendar month (hereinafter called “Revenue
Sharing Payments”).


 


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