Document:

Exhibit 10

	

  Exhibit 10.31

  

 

FIRST AMENDMENT

OF ESI 401(k) PLAN

 

 

This First Amendment of ESI 401(k) Plan is adopted by ITT

Educational Services, Inc.

 

Background

 

1.                     Effective May 16, 1998, ITT

Educational Services, Inc. (“Employer”) amended and

 

completely

restated the ESI 401(k) Plan (“Plan”).

 

                                2.       The Employer wishes to amend the Plan

further.

 

Amendment

 

THEREFORE, the Plan is amended as follows:

 

1.             Effective January 1, 2001,

Section 6.1(a) is amended to read as follows:

 

6.1          Actual

Deferral Percentage Test.

(a)                                  With respect to each Plan Year, the

Actual Deferral Percentage for that Plan Year for Highly-Compensated Employees

who are Members for that Plan Year shall not exceed the Actual Deferral

Percentage for that Plan Year for all Non-Highly-Compensated Employees who are

Members for that Plan Year multiplied by 1.25. 

If the Actual Deferral Percentage for those Highly-Compensated Employees

does not meet the foregoing test, the Actual Deferral Percentage for such

Highly-Compensated Employees for that Plan Year may not exceed the Actual

Deferral Percentage for that Plan Year for all Non-Highly-Compensated Employees

who are Members for that Plan Year by more than two percentage points, and the

Actual Deferral Percentage for those Highly-Compensated Employees for the Plan

Year may not be more than 2.0 times the Actual Deferral Percentage for that

Plan Year for all Non-Highly-Compensated Employees who are Members for that

Plan Year (or such lesser amount as the Committee shall determine to satisfy

the provisions of Section 6.3).

If the Committee determines that the foregoing

limitation has been exceeded in any Plan Year, the following provisions shall

apply:

The actual deferral ratio of the Highly-Compensated

Employee with the highest actual deferral ratio shall be reduced to the extent

necessary to meet the Actual Deferral Percentage test or to cause that ratio to

equal the actual deferral ratio of the Highly-Compensated Employee with the

next highest ratio.  This process will

be repeated until the Actual Deferral Percentage test is passed.  Each ratio shall be rounded to the nearest

one one-hundredth of 1% of the Member’s Statutory Compensation.  The amount of Pre-Tax Savings Contributions

made by each Highly-Compensated Employee in excess of the amount permitted

under his or her revised deferral ratio shall be added together.  This total dollar amount of excess

contributions (“excess contributions”) shall then be allocated to some or all

Highly-Compensated Employees by reducing the Pre-Tax Savings of the

Highly-Compensated Employee with the highest dollar amount of Pre-Tax Savings

by the lesser of (i) the amount required to cause that Employee’s Pre-Tax

Savings to equal the dollar amount of the Pre-Tax Savings of the

Highly-Compensated Employee with the next highest dollar amount, or (ii) an

amount equal to the total excess contributions.  This procedure is repeated until all excess contributions are

allocated.  The amount of excess

contributions allocated to a Highly-Compensated Employee (adjusted to reflect

earnings or losses attributable thereto) shall be distributed to him or her in

accordance with the provisions of paragraph (c).

 

A-1

 

2.             Effective January 1, 2001,

Section 6.2(a) is amended to read as follows:

 

6.2          Actual

Contribution Percentage Test.

(a)                                  With respect to each Plan Year, the Actual Contribution

Percentage for that Plan Year for Highly-Compensated Employees who are Members

for that Plan Year shall not exceed the Actual Contribution Percentage for that

Plan Year for all Non-Highly-Compensated Employees who were Members for that

Plan Year multiplied by 1.25.  If the

Actual Contribution Percentage for a Plan Year for those Highly-Compensated

Employees does not meet the foregoing test, the Actual Contribution Percentage

for the Highly-Compensated Employees for the Plan Year may not exceed the

Actual Contribution Percentage for that Plan Year for all

Non-Highly-Compensated Employees who were Members for that Plan Year by more

than two percentage points, and the Contribution Percentage for those

Highly-Compensated Employees for the Plan Year may not be more than 2.0 times

the Actual Contribution Percentage for that Plan Year for all

Non-Highly-Compensated Employees who were Members for that Plan Year (or such lesser

amount as the Committee shall determine to satisfy the provisions of Section

6.3).

If the Committee

determines that the limitation under this Section 6.2 has been exceeded in any

Plan Year, the following provisions shall apply:

(i)                                     The actual contribution ratio of the

Highly-Compensated Employee with the highest actual contribution ratio shall be

reduced to the extent necessary to meet the Actual Contribution Percentage test

or to cause that ratio to equal the actual contribution ratio of the Highly-Compensated

Employee with the next highest actual contribution ratio.  This process will be repeated until the

Actual Contribution Percentage test is passed. 

Each ratio shall be rounded to the nearest one one-hundredth of 1% of a

Member’s Statutory Compensation.  The

amount of Matching Company Contributions made by or on behalf of each

Highly-Compensated Employee in excess of the amount permitted under his revised

actual contribution ratio shall be added together.  This total dollar amount of excess contributions (“excess

aggregate contributions”) shall then be allocated to some or all

Highly-Compensated Employees in accordance with the provisions of subparagraph

(ii) of this paragraph (a).

(ii)                                  The Matching Company Contributions of the

Highly-Compensated Employee with the highest dollar amount of those

contributions shall be reduced by the lesser of (i) the amount required to

cause that Employee’s Matching Company Contributions to equal the dollar amount

of those contributions of the Highly-Compensated Employee with the next highest

dollar amount of those contributions, or (ii) an amount equal to the total

excess aggregate contributions.  This

procedure is repeated until all excess aggregate contributions are allocated.  The amount of excess aggregate contributions

allocated to each Highly-Compensated Employee, (adjusted to reflect earnings or

losses attributable thereto), shall be distributed or forfeited in accordance

with the provisions of paragraph (b) below.

A-2

 

 

 

This First Amendment of ESI 401(k) Plan is executed on behalf of

ITT Educational Services, Inc. by its duly authorized officer this 20 day

of May, 2002.

 

	

   

  	

   

  	

  ITT EDUCATIONAL SERVICES,

  INC.

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

                 /s/ Jenny Yonce

  
	

   

  	

   

  	

  (Signature)

  
	

  ATTEST:

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

                Jenny Yonce

  
	

  /s/ Paula K. Crose-Wickham

  	

   

  	

  (Printed)

  
	

  (Signature)

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

  Paula K. Crose-Wickham

  	

   

  	

                 Manager, Benefits & HRIS

  
	

  (Printed)

  	

   

  	

  (Title)

  
	

   

  	

   

  	

   

  
	

  Retirement Specialist

  	

   

  	

   

  
	

  (Title)

  	

   

  	

   

  

 

 

A-3EXHIBIT 10.1

 

ALLIANCE DATA SYSTEMS CORPORATION

LOYALTY MANAGEMENT GROUP CANADA INC.

 

FIFTH AMENDMENT TO AMENDED AND

RESTATED CREDIT AGREEMENT

 

This Fifth Amendment to Amended and Restated Credit Agreement (herein,

the “Amendment”)

is entered into as of May 22, 2002, among Alliance Data Systems

Corporation, a Delaware corporation (the “US Borrower”), Loyalty Management Group

Canada Inc., an Ontario corporation (the “Canadian Borrower”; the US Borrower and

the Canadian Borrower being referred to herein individually as “Borrower”

and collectively as the “Borrowers”), the Banks party to the

Credit Agreement (as such term is defined below) and Harris Trust and Savings

Bank, as a Bank and in its capacity as the Administrative Agent and Collateral

Agent under the Credit Agreement (the “Administrative Agent”).

 

PRELIMINARY STATEMENTS

 

A.       The Borrowers, the Administrative Agent, and the Banks are

currently party to a certain Amended and Restated Credit Agreement, dated as of

July 24, 1998, and amended and restated as of October 22, 1998 (as

amended, restated, modified and supplemented from time to time, the “Credit

Agreement”).  All capitalized

terms used herein without definition shall have the same meanings herein as

such terms have in the Credit Agreement.

 

B.        The Borrowers have requested that the Administrative Agent

and the Banks amend certain definitions and covenants, and make certain other

modifications to the Credit Agreement, and the Administrative Agent and the

Banks party hereto are willing to do so under the terms and conditions set

forth in this Amendment.

 

NOW, THEREFORE, for good and valuable consideration,

the receipt and sufficiency of which is hereby acknowledged, the parties hereto

agree as follows: 

 

SECTION 1.                                                 AMENDMENTS.

 

Upon the satisfaction of the

conditions precedent set forth in Section 2 hereof, the Credit Agreement

shall be and hereby is amended as follows:

 

1.1.      The

definitions of Adjusted Consolidated Net Worth, Excess Cash Flow, Guarantor,

Material Debt, Senior Secured Leverage Ratio, Subsidiary, and Supplemental

Pledge Agreement appearing in Section 1.1 of the Credit Agreement shall be

amended and restated in their entirety to read as follows:

 

	

  “Adjusted

  Consolidated Net Worth” of any Person means, at any date,

  the Consolidated Net Worth of such Person and its Consolidated Subsidiaries

  plus, in the case of the US Borrower, the then outstanding principal

  amount of the WCAS Subordinated Note (to the extent the WCAS Subordinated

  Note has a maturity 

  

 

 

	

  not earlier than the date which is six months after

  the Final Maturity Date).

  
	

   

  
	

  “Debt”

  of any Person means at any date, without duplication (i) all obligations

  of such Person for borrowed money, (ii) all obligations of such Person

  evidenced by bonds, debentures, notes or other similar instruments,

  (iii) all obligations of such Person to pay the deferred purchase price

  of property or services, except trade accounts payable arising in the

  ordinary course of business, (iv) all obligations of such Person as

  lessee which are capitalized in accordance with generally accepted accounting

  principles, (v) all non-contingent obligations (and, for purposes of

  Section 6.9, Section 6.16 and the definitions of Material Debt and

  Material Financial Obligations, all contingent obligations) of such Person to

  reimburse any bank or other Person in respect of amounts paid under a letter

  of credit or similar instrument, (vi) all Debt secured by a Lien on any

  asset of such Person, whether or not such Debt is otherwise an obligation of

  such Person, and (vii) all Debt of others Guaranteed by such Person.

  
	

   

  
	

  “Excess

  Cash Flow” means, for any fiscal year of the US Borrower,

  (i) Consolidated Net Income for such period plus (minus) (ii) the

  amount of depreciation, depletion, amortization of intangibles, deferred

  taxes and other non-cash expenses (revenues) which, pursuant to generally

  accepted accounting principles, were deducted (added) in determining

  Consolidated Net Income for such period minus (plus) (iii) additions

  (reductions, other than reductions attributable solely to Asset Sales) to

  Working Capital for such period minus (iv) the amount of

  Consolidated Capital Expenditures made during such period (except to the

  extent financed through the incurrence of Debt (other than through the

  incurrence of Loans hereunder or loans under the 364-day Revolver) or with

  equity proceeds) minus (v) the amount of Scheduled

  Repayments of Term Loans, and the amount of voluntary payments of principal

  of outstanding Term Loans, in each case, actually made during such period minus

  (vi) regularly scheduled payments of principal or “rent” (other than

  capitalized interest) due in accordance with the terms of capital leases and

  not otherwise deducted in arriving at Consolidated Net Income to the extent

  actually made during such period minus (vii) the amount of mandatory

  payments of principal of outstanding Term Loans pursuant to

  Sections 2.11(A)(e) and (h) actually made, but only to the extent that

  the net proceeds from the transactions described in such clauses (e) and (h)

  were added to Consolidated Net Income during such period.

  

 

2

 

	

  “Guarantor”

  means, (a) with respect to the Obligations of the US Borrower,

  (i) ADSC, ADSI, and ADSMB and (ii) each other direct and indirect

  Domestic Subsidiary of the US Borrower that becomes a Guarantor from time to

  time, after the Effective Date, pursuant to Section 6.19 and

  (b) with respect to Obligations of the Canadian Borrower, (i) LMG,

  the US Borrower, ADSC, ADSI, and ADSMB and (ii) each other direct and

  indirect Domestic Subsidiary of the US Borrower or Subsidiary of the Canadian

  Borrower that becomes a Guarantor from time to time, after the Effective

  Date, pursuant to Section 6.19; provided that (x) WFNB and ADS

  Reinsurance and their Subsidiaries shall not be required to be Guarantors and

  (y) one or more indirect Subsidiaries of the US Borrower need not be

  Guarantors hereunder to the extent the Consolidated Total Assets of all such

  indirect Subsidiaries not becoming a Guarantor hereunder do not exceed 5% of

  the Consolidated Total Assets of the US Borrower and its Subsidiaries

  taken as a whole.

  
	

   

  
	

  “Material

  Debt” means Debt (other than the Loans and the

  reimbursement obligations hereunder): 

  (i) of a Person and/or one or more of its Subsidiaries, arising

  in one or more related or unrelated transactions, in an aggregate principal

  or face amount exceeding U.S. $25,000,000 and (ii) of a Person

  under the 364-day Revolver.

  
	

   

  
	

  “Senior

  Secured Leverage Ratio” of any Person means, at any time,

  the ratio of (x) all amounts owing by such Person to the Administrative

  Agent, the Collateral Agent or any Bank pursuant to the terms of this

  Agreement or any other Credit Document and to the holders of the loans under

  the 364-day Revolver to (y) Consolidated EBITDA of such Person for the

  four fiscal quarters then most recently ended.  

  
	

   

  
	

  “Subsidiary”

  means, as to any Person, any corporation or other entity of which securities

  or other ownership interests having ordinary voting power to elect a majority

  of the board of directors or other persons performing similar functions are

  at the time directly or indirectly owned by such Person; unless otherwise

  specified, “Subsidiary” means a Subsidiary of the US Borrower.  Notwithstanding the foregoing,

  Subsidiaries of WFNB whose primary business purpose is to facilitate the sale

  and securitization of WFNB’s credit card receivables shall not constitute a

  Subsidiary for purposes of Sections 6.9 (Negative Pledge), 6.16 (Debt

  Limitation), 6.19 (Equity Ownership, Limitation on Creation of Subsidiaries),

  and 6.24 (Limitation on Voluntary Prepayments and Modifications of

  Indebtedness, Modifications of Certain Agreements, etc.) of this Agreement.

  

 

3

 

	

  “Supplemental

  Pledge Agreement” shall mean the Residual Pledge Agreement,

  dated as of July 24, 1998, between the US Borrower and the

  Administrative Agent.

  
	

   

  

 

1.2.      Section

1.1 of the Credit Agreement shall be amended by adding the following new

definition thereto in alphabetical order:

 

	

  “ADSC”

  means ADS Commercial Services, Inc., a Delaware corporation.

  
	

   

  
	

  “ADSMB”

  means ADS MB Corporation, a Delaware corporation.

  
	

   

  
	

  “ADS

  Reinsurance” means ADS Reinsurance Ltd., a Bermuda

  corporation.

  
	

   

  
	

  “Consolidated

  Total Assets” of any Person means total assets of such Person

  and its Subsidiaries, determined on a consolidated basis in accordance with

  generally accepted accounting principles.

  

 

1.3.      Section 1.1

of the Credit Agreement shall be amended by deleting the definitions of

“Eligible IPO”, “Equity Issuance”, “Equity Issuance Documents”, “New

Preferred Stock”, and “Year 2000 Problem”.

 

 1.4.      Section 2.11(A)(e) of the Credit

Agreement (mandatory prepayments arising out of asset sales) shall be amended

by deleting the second proviso appearing at the end thereof and inserting the

following proviso in lieu thereof:

 

	

  provided,

  further, that the Net Cash Proceeds from an Asset Sale

  shall not be required to be used to so repay Term Loans to the extent the

  assets sold pursuant to such Asset Sale, at the time of such Asset Sale, secured

  Debt permitted pursuant to Section 6.16 (other than Debt outstanding

  under this Agreement and the 364-day Revolver) and such Net Cash Proceeds do

  not exceed the amount of Debt so secured.

  

 

 1.5.      Section 2.11(A)(f) of the Credit

Agreement (mandatory prepayments arising out of issuance of Debt) shall be

amended by striking the phrase “(other than Debt permitted by Section 6.16

as in effect on the Restatement Effective Date)” and inserting the phrase

“(other than Debt permitted by Section 6.16)” in lieu thereof.

 

 1.6.      Section 2.11(A)(g) of the Credit

Agreement (mandatory prepayments arising out of issuance of equity) shall be

amended by inserting at the end thereof a proviso which shall read as follows:

 

	

  ; provided, however, that cash proceeds

  not exceeding U.S. $52,000,000 from the US Borrower’s follow-on offering

  of its equity securities applied to repay the WCAS Subordinated Note on 

  

 

4

 

	

  or before December 31, 2002, shall not be

  required to be applied as a mandatory prepayment hereunder.

  

 

 1.7.      Section 2.13 of the Credit Agreement

(Funding Losses) shall be amended by striking the phrase “(pursuant to

Article 2, 6 or 7 or otherwise)” appearing in the third line and inserting

the phrase “(pursuant to Article 2, 7 or 9 or otherwise)” in lieu thereof, and

such Section shall be further amended by striking the phrase “Section 2.2,

2.9, or 2.11” appearing in the sixth line and inserting the phrase

“Section 2.2, 2.9 or 2.10” in lieu thereof.

 

1.8.      Section 2.14

(Computation of Interest and Fees) shall be amended by striking the cross–reference

to “Section 2.11(a)” appearing at the end thereof and inserting the

cross-reference “Section 2.12(a)” in lieu thereof.

 

 1.9.      Section 3.2(g) of the Credit

Agreement (Each Borrowing) shall be amended by inserting in the 3rd

line thereof immediately following the phrase “purported to be covered thereby”

the additional parenthetical phrase “(subject to the exceptions set forth

therein and in Sections 6.19 and 10.1(a))”, and the parenthetical

exceptions for Canadian Security Document filings appearing in lines 9 through

13 thereof shall be restated to read as follows:  “(except, in respect of the Canadian Security Documents, such

filings with (w) Quebec filing offices to the extent the value of

Collateral located therein at any one time does not exceed U.S. $2,000,000

in the aggregate, (x) the Ontario PPSA filing office to the extent the

Ontario Public Service Employees’ Union strike prevents the filing thereof, (y) Canadian

trademark authorities to the extent the filing thereof is separately

contemplated by the undertaking dated the Effective Date, and (z) land

registry offices in connection with leased premises with respect to which

landlord consent has not been obtained).”

 

 1.10.    Section 4.13 of the Credit Agreement

(Year 2000 Compliance) shall be deleted in its entirety.

 

 1.11.    Section 6.1(g) of the Credit Agreement

shall be amended and restated to read as follows:

 

	

  (g)     promptly after the mailing thereof to the

  public shareholders of the US Borrower, copies of all financial statements,

  reports and proxy statements so mailed;

  

 

 1.12.    Section 6.7 of the Credit Agreement

(Mergers and Sales of Assets) shall be amended and restated in its entirety to

read as follows:  

 

	

  Section 6.7.     Mergers

  and Sales of Assets.  The Credit Parties will not (x)  consolidate or merge with

  or into any other Person or (y) sell, lease or otherwise transfer,

  directly or indirectly, any substantial part of the assets of any Credit

  Party and its Subsidiaries, taken as a whole, to any other Person; except

  that the following shall be permitted: 

  (a) (i) any Credit Party other than the Canadian Borrower

  may merge with the US Borrower or another Guarantor if after giving effect to

  such merger, no Default shall 

  

 

5

 

	

  have occurred and be continuing and (ii) any

  Person may be merged with or into any Credit Party pursuant to an acquisition

  permitted by Section 6.22(b), provided that such Credit Party is the

  surviving corporation of such merger, (b) the sale of credit card

  receivables pursuant to securitizations of such credit card receivables, and

  (c) assets sold and leased back in the normal course of the Borrowers’

  business.

  

 

 1.13     Section 6.9(l) of the Credit Agreement

(Negative Pledge) shall be amended by striking the cross-reference to

“Section 6.16(vii)” appearing therein and inserting the cross-reference

“Section 6.16(vi)” in lieu thereof.

 

 1.14.    Section 6.13 of the Credit Agreement

(Adjusted Consolidated Net Worth) shall be amended and restated in its entirety

to read as follows:

 

	

  Section 6.13   Adjusted

  Consolidated Net Worth.  The US Borrower will not

  permit its Adjusted  Consolidated Net

  Worth at any time to be less than the sum of (i) U.S. $500,000,000,

  plus (ii) an amount equal to 50% of the amount by which the US

  Borrower’s quarterly Consolidated Net Income (determined at the end of each

  fiscal quarter, commencing March 31, 2002) exceeds zero, plus

  (iii) 100% of any proceeds from equity issuances of capital stock of the

  US Borrower (other than (A) in connection with exercises of stock

  options of the officers, directors and employees of the US Borrower in the

  ordinary course of business and (B) proceeds of equity issuances of

  capital stock used to pay the WCAS Subordinated Note pursuant to

  Section 6.24 hereof).

  

 

 1.15.    Section 6.16 of the Credit Agreement

(Debt Limitation) shall be amended and restated in its entirety to read as

follows:

 

	

  Section 6.16.  Debt

  Limitation.  The US

  Borrower shall not, and shall not permit any of its Subsidiaries, whether now

  existing or created in the future, to create or retain any Debt other than

  (i) any Debt created or retained by the US Borrower or such Subsidiary

  on or before May 2, 1998, (ii) any Debt created or retained by the

  US Borrower or such Subsidiary in connection with the funds made available to

  the Borrowers pursuant to this Agreement or the 364–day Revolver

  (including any intercompany loans of such funds), provided that such loans

  made by the US Borrower and its Subsidiaries to (x) the Canadian

  Borrower shall not exceed U.S. $20,000,000 and (y) ADSNZ shall not

  exceed U.S. $1,500,000 in aggregate principal amount outstanding at any

  time, and all such loans from the US Borrower to WFNB shall be made pursuant

  to and evidenced by the WFNB Note, (iii) issuances by WFNB of

  certificates of deposit to the extent no Default results therefrom pursuant

  to the other covenants contained in this 

  

 

6

 

	

  Article 6, (iv) intercompany loans not

  otherwise permitted by clause (ii) of this Section 6.16 made by the US

  Borrower to ADSI and WFNB, provided that any such intercompany

  loans to WFNB shall be made pursuant to and evidenced by the WFNB Note,

  (v) Debt of the US Borrower outstanding pursuant to the WCAS

  Subordinated Note in an aggregate principal amount not to exceed

  U.S. $52,000,000, less all repayments of principal thereof,

  (vi) obligations of the US Borrower or its Subsidiaries as lessee in

  respect of leases of property which are capitalized in accordance with

  generally accepted accounting principles and shown on the balance sheet of

  the US Borrower and its Subsidiaries and which in the aggregate do not at any

  one time exceed 10% of the Adjusted Consolidated Net Worth of the US Borrower

  at such time, (vii) the loans outstanding from time to time under the

  364-day Revolver in a principal amount not to exceed U.S. $50,000,000 at

  any one time outstanding, and (viii) other unsecured Debt of the US

  Borrower and/or its Subsidiaries not to exceed U.S. $10,000,000 in the

  aggregate outstanding at any time. 

  Notwithstanding anything to the contrary above in this

  Section 6.16, the US Borrower may, subject to the applicability of the

  other covenants contained in this Agreement, issue Permitted Subordinated

  Debt.

  

 

 1.16.    Section 6.19 of the Credit Agreement

(Equity Ownership; Limitation on Creation of Subsidiaries) shall be amended by

(i) inserting the phrase “except as otherwise provided in the definition

of Guarantor hereunder,” at the beginning of clause (A)(iii) thereof,

(ii) striking the word “counterpart” appearing in clause (A)(iii) and

inserting the word “supplement” in lieu thereof, and (iii) inserting the

phrase “subject to the 65% limitation contained in clause (A) above for

Foreign Subsidiaries” immediately at the end of clause (B)(y) thereof.

 

 1.17.    Subsection (a) of Section 6.21 of

the Credit Agreement (Limitation on Issuance of Capital Stock) shall be amended

and restated in its entirety to read as follows:

 

	

  (a)     The US Borrower will not, and will not

  permit any of its Subsidiaries to, issue (i) any preferred stock or

  (ii) any common stock redeemable at the option of the holder thereof.

  

 

 1.18.    Section 6.22 of the Credit Agreement

(Investments; Restricted Acquisitions) shall be amended by striking the phrase

“Domestic Subsidiaries” appearing in subsection (a)(i) thereof and

inserting the word “Subsidiaries” in lieu thereof.

 

1.19.    Section 6.24

of the Credit Agreement (Limitation on Voluntary Payments and Modifications of

Indebtedness; Modifications of Certain Other Agreements; etc.) shall be amended

and restated in its entirety to read as follows:

 

	

  Section 6.24  

  Limitation on Voluntary Payments and Modifications of Indebtedness,

  Modifications of Certain Other Agreements, etc. The US

  Borrower will not, and will not permit 

  

 

7

 

	

  any of its Subsidiaries to, (i) make (or give

  any notice in respect of) any voluntary or optional payment or prepayment on

  or redemption or acquisition for value of, or make any pre–payment or

  redemption as a result of any asset sale, change of control or similar event

  of (including, in each case, without limitation, by way of depositing with

  the trustee with respect thereto or any other Person, money or securities

  before due for the purpose of paying when due) the WCAS Subordinated Note or

  any Permitted Subordinated Debt or (ii) amend or modify, or permit the

  amendment or modification of, any provision of the WCAS Subordinated Note,

  the License Agreements or the WFNB Note; provided, however, the US Borrower

  may prepay the WCAS Subordinated Note in the aggregate principal amount not

  to exceed U.S. $52,000,000, on or before December 31, 2002, if, and

  only if, the prepayment of the WCAS Subordinated Note is made directly or

  indirectly from the proceeds of the US Borrower’s follow-on equity offering.

  

 

 1.20.    Section 11.4 of the Credit Agreement

(Sharing of Set-Offs) shall be amended by striking the phrase “in accordance

with the provisions of Section 2.12(B)” and inserting the phrase “pro rata

in accordance with their share of the outstanding Obligations” in lieu thereof.

 

 1.21.    The information for notices to the Credit

Parties set forth on the signature page to the Original Credit Agreement shall

be amended to read as follows:

 

	

  Address:

  	

   

  	

  800 Tech Center Drive

  
	

   

  	

   

  	

  Gahanna, OH 

  43230

  
	

  Attention:

  	

   

  	

  Treasurer

  
	

  Telephone:

  	

   

  	

  (614) 729-4900

  
	

  Facsimile:

  	

   

  	

  (614) 729-4949

  

 

With a copy to:

 

	

  Address:

  	

   

  	

  17655 Waterview Parkway

  
	

   

  	

   

  	

  Dallas, TX 

  75252

  
	

  Attention:

  	

   

  	

  General Counsel

  
	

  Telephone:

  	

   

  	

  (972) 348-5135

  
	

  Facsimile:

  	

   

  	

  (972) 348-5330

  

 

SECTION 2.                CONDITIONS

PRECEDENT.

 

The effectiveness of this Amendment shall be subject

to the satisfaction of the following conditions precedent:

 

(a)      The Borrowers, the Guarantors, the

Administrative Agent, and the Banks shall have executed and delivered this

Amendment.

 

8

 

(b)     All legal matters incident to the execution

and delivery of this Amendment and the instruments and documents contemplated

hereby shall be satisfactory to the Administrative Agent and its counsel. 

 

SECTION 3.                                                 REPRESENTATIONS.

 

In order to induce the

Banks to execute and deliver this Amendment, each Borrower hereby represents to

each Bank that as of the date hereof, after giving effect to this Amendment,

the representations and warranties set forth in Section 4 of the Credit

Agreement are and shall be and remain true and correct (except that the

representations contained in Section 4.4 shall be deemed to refer to the

most recent financial statements of each Borrower delivered to the

Administrative Agent) and, after giving effect to this Amendment, (i) each

Borrower is in full compliance with all of the terms and conditions of the

Credit Agreement and (ii) no Default or Event of Default has occurred and

is continuing under the Credit Agreement.

 

SECTION 4.                                                 MISCELLANEOUS.

 

(a)           Each Borrower and Guarantor has

heretofore executed and delivered to the Administrative Agent and the Banks

certain Security Documents and the other Credit Documents and each Borrower and

Guarantor hereby acknowledges and agrees that, notwithstanding the execution

and delivery of this Amendment, the Security Documents and the other Credit

Documents remain in full force and effect and the rights and remedies of the

Administrative Agent, the Collateral Agent and the Banks thereunder, the

obligations of each Borrower and Guarantor thereunder, and the liens and

security interests created and provided for thereunder remain in full force and

effect and shall not be affected, impaired or discharged hereby.  Nothing herein contained shall in any manner

affect or impair the priority of the liens and security interests created and

provided for by the Security Documents and the other Credit Documents as to the

indebtedness which would be secured thereby prior to giving effect to this

Amendment.

 

(b)           Except as specifically amended herein

or waived hereby, the Credit Agreement shall continue in full force and effect

in accordance with its original terms. 

Reference to this specific Amendment need not be made in the Credit

Agreement, the Notes, or any other instrument or document executed in

connection therewith, or in any certificate, letter or communication issued or

made pursuant to or with respect to the Credit Agreement, any reference in any

of such items to the Credit Agreement being sufficient to refer to the Credit

Agreement as amended hereby.

 

(c)           The Borrowers agree to pay on demand

all costs and expenses of or incurred by the Administrative Agent in connection

with the negotiation, preparation, execution and delivery of this Amendment and

otherwise relating to this credit facility.

 

(d)           This Amendment may be executed in any

number of counterparts, and by the different parties on different counterpart

signature pages, all of which taken together shall constitute one and the same

agreement.  Any of the parties hereto

may execute this Amendment by signing any such counterpart and each of such

counterparts shall for all purposes be deemed to be an original.  This Amendment shall be governed by the laws

of the State of New York.

 

[SIGNATURE PAGES TO FOLLOW]

 

9

 

This Fifth Amendment to

Amended and Restated Credit Agreement is entered into as of the date and year

first above written. 

 

	

   

  	

  ALLIANCE DATA SYSTEMS CORPORATION, as a Borrower and

  Guarantor

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Robert Armiak

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  LOYALTY MANAGEMENT GROUP CANADA INC.,

  as a Borrower

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Robert Armiak

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
							

 

Accepted and agreed to as

of the date and year last above written.

 

	

   

  	

  HARRIS TRUST AND SAVINGS BANK, in its

  individual capacity as a Bank and as the

  Administrative Agent

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/Thad D. Rasche

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  JPMORGAN CHASE BANK

  
	

   

  	

   

  
	

   

  	

  By

  	

   

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  BANK ONE, NA

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Illegible

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title 

  	

  Director

  
								

 

10

 

	

   

  	

  UNION BANK OF CALIFORNIA,

  N.A.

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Clifford F. Cho

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  THE HUNTINGTON NATIONAL

  BANK

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Illegible

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

  Vice President

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  KZH ING-2 LLC

  
	

   

  	

   

  
	

   

  	

  By

  	

   

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  KZH ING-3 LLC

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Joyce Fraser-Bryant

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

  Authorized Agent

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  PILGRIM AMERICA HIGH INCOME

  INVESTMENTS,

  LTD.

  
	

   

  	

   

  
	

   

  	

  By:

  	

  ING Investments, Inc., as its Investment

  Manager

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Michel Prince

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  ING PRIME RATE TRUST

  
	

   

  	

   

  
	

   

  	

  By

  	

  ING Investments, Inc., as its Investment

  Manager

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Michel Prince

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
																

 

11

 

	

   

  	

  PILGRIM CLO 1999-1 LTD.

  
	

   

  	

   

  
	

   

  	

  By

  	

  ING Investments, Inc., as its Investment

  Manager

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Michel Prince

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  
	

   

  	

  SUNTRUST BANK

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Brian K. Peters

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  ARCHIMEDES FUNDING II, LTD.

  
	

   

  	

   

  
	

   

  	

  By:

  	

  ING Capital Advisors LLC, as Collateral

  Manager

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Gordon Cook

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  ARCHIMEDES FUNDING III,

  LTD.

  
	

   

  	

   

  
	

   

  	

  By:

  	

  ING Capital Advisors LLC, as Collateral

  Manager

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Gordon Cook

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  SEQUILS-ING I (HBDGM), LTD.

  
	

   

  	

   

  
	

   

  	

  By

  	

  ING Capital Advisors LLC, as Collateral

  Manager

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Gordon Cook

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
										

 

12

 

	

   

  	

  VAN KAMPEN PRIME RATE

  INCOME TRUST

  
	

   

  	

   

  
	

   

  	

  By

  	

  Van Kampen Investment Advisory Corp.

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Illegible

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

  Executive Director

  
	

   

  	

   

  	

   

  
	

   

  	

  WACHOVIA BANK, NATIONAL

  ASSOCIATION

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Laura B. Smith

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  BARCLAYS BANK PLC

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Alison A. McGuigan

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
						

 

13

 

GUARANTORS’ ACKNOWLEDGMENT AND

CONSENT

 

By their execution of

this Amendment, the undersigned each acknowledge and agree that they are

Guarantors under the Credit Agreement and have guaranteed the Guaranteed

Obligations under Article 10 of the Credit Agreement.  Each of the undersigned hereby consents to

the Amendment to the Credit Agreement as set forth above and confirms that all

of each of the undersigned’s obligations as a Guarantor remain in full force

and effect.  The undersigned further

agree that the consent of the undersigned to any further amendments to the

Credit Agreement shall not be required as a result of this consent having been

obtained.  The undersigned acknowledge

that the Administrative Agent and the Banks are relying on these assurances in

entering into the Amendment set forth above.

 

	

   

  	

  ADS

  ALLIANCE DATA SYSTEMS, INC., as a

  Guarantor

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Robert Armiak

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  ADS

  COMMERCIAL SERVICES, INC., as a

  Guarantor

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Robert Armiak

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  ADS

  MB CORPORATION, as Guarantor

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Robert Armiak

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  LMG

  TRAVEL SERVICES LIMITED, as a

  Guarantor

  
	

   

  	

   

  
	

   

  	

  By

  	

  /s/ Robert Armiak

  
	

   

  	

   

  	

  Name

  	

   

  
	

   

  	

   

  	

  Title

  	

   

  
					

 

14

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00041-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00041-of-00352.parquet"}]]