Document:

Exhibit 10.1

  

  

  

  

  EXCHANGE AGREEMENT

  

  

  This EXCHANGE AGREEMENT (this “Agreement”)
      is made and entered into as of April 25, 2019, by and between Alliance Data Systems Corporation, a Delaware corporation (the “Company”), and ValueAct Holdings,
      L.P., a Delaware limited liability partnership, on behalf of itself and the funds it advises (the “Investor”).

  

  

  RECITALS

  

  

  WHEREAS, the Investor is, as of the date hereof, the beneficial owner of 5,207,646 shares of the Company’s common stock, par
      value $.01 per share (“Common Stock”);

  

  

  WHEREAS, the Company has authorized the issuance of preferred stock designated as Series A Non-Voting Convertible Preferred
      Stock, par value $.01 per share (the “Series A Preferred Stock”); and

  

  

  WHEREAS, the Company and the Investor desire to exchange (the “Exchange”) a portion of the Common Stock beneficially owned by the Investor for certain shares of the Company’s Series A Preferred Stock (such shares of Series A Preferred Stock, the “Exchange Shares”), on the terms and subject to the conditions set forth herein.

  

  

  NOW, THEREFORE, in consideration of the foregoing and of the mutual representations, warranties, covenants and agreements
      contained in this Agreement, and other good, valuable and lawful consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the parties hereby agree as follows:

  

  

  ARTICLE I

  DEFINITIONS; INTERPRETATION

  

  

  Section 1.1  Definitions.  In this Agreement, unless the context
      otherwise requires:

  

  

  (a)  “Bankruptcy Exceptions”
      means any limitation imposed by any applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, receivership, moratorium or similar law affecting creditors’ rights and remedies generally, with respect to enforceability, by general
      principles of equity, including principles of commercial reasonableness, good faith and fair dealing, regardless of whether enforcement is sought in a proceeding at law or in equity.

  

  

  (b)  “Business Combination” means
      a merger, consolidation, statutory share exchange or similar transaction that requires the approval of the Company’s stockholders.

  

  

  (c)  “Business Day” means any day other than a Saturday or a Sunday or a day on which banking institutions in Salt
        Lake City, Utah, Wilmington, Delaware, or Plano, Texas are authorized or obligated by law, executive order or governmental decree to be closed.

  
    

    
      

    

  

  
  

  

  (d)  “Constituent Documents” means, with respect to any entity, its certificate or articles of incorporation, bylaws and any other similar charter or other organizational documents.

  

  

  (e)  “Exchange Act” means the Securities Exchange Act of 1934, as amended.

  

  

  (f)  “Governmental Entity” means any governmental body, whether administrative, executive, judicial, legislative, regulatory, or taxing, including any international, federal, state,
      territorial, county, municipal or other government or governmental agency, arbitrator, authority, board, body, branch, bureau, or comparable agency or entity, commission, corporation, court, department, instrumentality, mediator, panel, system or
      other political unit of any of the foregoing.

  

  

  (g)  “Non-Employee Directors” has the meaning set forth in Rule 16b-3(b)(3) of the Exchange Act.

  

  

  (h)  “Securities Act” means the Securities Act of 1933, as amended.

  

  

  Section 1.2  Interpretation.  The terms defined in the singular
      have a comparable meaning when used in the plural, and vice versa.  References to “herein,” “hereof,” “hereunder” and the like refer to this Agreement as a whole and not to any particular section or provision, unless the context requires otherwise. 
      The headings contained in this Agreement are for reference purposes only and are not part of this Agreement.  Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed followed by the words “without
      limitation.”  No rule of construction against the draftsperson shall be applied in connection with the interpretation or enforcement of this Agreement, as this Agreement is the product of negotiation between sophisticated parties advised by counsel. 
      References to “$” mean the lawful currency of the United States of America.  Except as expressly stated in this Agreement, all references to any statute, rule or regulation are to the statute, rule or regulation as amended, modified, supplemented or
      replaced from time to time (and, in the case of statutes, include any rules and regulations promulgated under the statute) and to any section of any statute, rule or regulation include any successor to the section.

  

  

  ARTICLE II

  THE EXCHANGE AND CLOSING; CONDITIONS TO THE CLOSING

  

  

  Section 2.1  The Exchange and Closing.

  

  

  (a)  Subject to the satisfaction or waiver of the conditions set forth in Section 2.2, the closing of the Exchange (the “Closing”) will take place  at 12:01 a.m. eastern time on the date hereof (the “Closing
          Date”) remotely through the electronic exchange of documents and signature pages.

  

  

  (b)  At the Closing, the Investor will cause the delivery, by book-entry transfer, of the aggregate number of shares of
      Common Stock indicated on Schedule A to the Company or its designated agent to be exchanged hereunder, and the Company will cause the delivery to the Investor or its designated agent of the aggregate number of Exchange Shares indicated on Schedule A
      in book-entry form to an account or accounts designated by the Investor and the

  
    

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  Company shall deliver evidence
        satisfactory to the Investor of the issuance of such Exchange Shares.

  

  

  Section 2.2  Conditions to Closing.

  

  

  (a)  The respective obligations of each of the Investor and the Company to consummate the Exchange are subject to the
      fulfillment (or waiver by the Company and the Investor, as applicable) prior to the Closing of the condition that no provision of any applicable United States or other law and no judgment, injunction, order, decree, action or interpretation of any
      Governmental Entity shall prohibit or restrain consummation of, or otherwise impose material limits on the ability of any party to this Agreement to consummate, the Exchange as contemplated by this Agreement.

  

  

  (b)  The obligation of the Investor to consummate the Exchange is also subject to the fulfillment (or waiver by the
      Investor) at or prior to the Closing of each of the following conditions:

  

  

  (i)  (A) the representations and warranties of the Company set forth in Article III of this Agreement shall be true and
      correct in all material respects as though made on and as of the Closing Date (other than representations and warranties that by their terms speak as of another date, which representations and warranties shall be true and correct in all material
      respects as of such other date) and (B) the Company shall have performed in all material respects all obligations required to be performed by it under this Agreement on or prior to the Closing Date; and

  

  

  (ii)  the Investor shall have received a certificate signed on behalf of the Company by an executive officer of the
      Company certifying that the conditions set forth in Section 2.2(b)(i) have been satisfied.

  

  

  (c)  The obligation of the Company to consummate the Exchange is also subject to the fulfillment (or waiver by the Company)
      at or prior to the Closing of each of the following conditions:

  

  

  (i)  (A) the representations and warranties of the Investor set forth in Article IV of this Agreement shall be true and
      correct in all material respects as though made on and as of the Closing Date (other than representations and warranties that by their terms speak as of another date, which representations and warranties shall be true and correct in all material
      respects as of such other date) and (B) the Investor shall have performed in all material respects all obligations required to be performed by it under this Agreement on or prior to the Closing Date; and

  

  

  (ii)  the Company shall have received a certificate signed on behalf of the Investor by an authorized person of the
      Investor certifying that the conditions set forth in Section 2.2(c)(i) have been satisfied.

  
    

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  ARTICLE III

  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

  

  

  The Company represents and warrants to the Investor as of the date hereof and as of the Closing Date that:

  

  

  Section 3.1  Organization; Authority; Enforceability.  The Company
      is duly organized, validly existing and in good standing under the laws of the State of Delaware and has the requisite corporate power and authority to execute and deliver this Agreement and to carry out its obligations hereunder, which includes the
      effectuation of the Exchange and the issuance of the Exchange Shares.  The execution, delivery and performance by the Company of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary
      corporate action on the part of the Company, and no further approval or authorization is required on the part of the Company.  The terms of the transactions contemplated by this Agreement, including the disposition of shares of Common Stock by the
      Investor and the acquisition of Exchange Shares by the Investor, each pursuant to the Exchange, have been approved by the Company’s Board of Directors or a duly formed committee of the Board of Directors that is composed solely of two or more
      Non-Employee Directors in accordance with Rule 16b-3(d) and Rule 16b-3(e) under the Exchange Act for the purpose of exempting such transactions from Section 16(b) of the Exchange Act.  This Agreement is a valid and legally binding obligation of the
      Company enforceable against the Company in accordance with its terms and conditions, except as enforceability may be limited by the Bankruptcy Exceptions.

  

  

  Section 3.2  Capitalization.  The authorized capital stock of the
      Company and the outstanding capital stock of the Company as of April 5, 2019 is set forth on Schedule B.  The outstanding shares of capital stock of the Company have been duly authorized and are validly issued and outstanding, fully paid and
      non-assessable, and subject to no preemptive rights (and were not issued in violation of any preemptive rights).

  

  

  Section 3.3  Exchange Shares.  The Exchange Shares have been duly and validly authorized by all necessary action on the part of the Company, and, when issued
      and delivered pursuant to this Agreement, such Exchange Shares will be duly and validly issued and fully paid and non-assessable, and will not be issued in violation of any preemptive rights.

  

  

  Section 3.4  Non-Contravention.  Neither the execution, delivery
      or performance by the Company of this Agreement nor the consummation of the transactions contemplated hereby constitutes or will constitute (i) a breach or violation of any provision of the Constituent Documents of the Company; (ii) a violation of
      any law, regulation or order applicable to the Company; or (iii) a material breach or violation of, a conflict with, the loss of a benefit under, a default (or an event which, with notice or lapse of time or both, would constitute a default) under an
      event of termination or cancellation under, an event giving rise to acceleration of the performance required by or rights or obligations under, or an event resulting in the creation of, any lien, security interest, charge or encumbrance upon any of
      the properties or assets of the Company under any of the terms, conditions or provisions of any material agreement, note, bond, mortgage, indenture, deed of trust, license, lease or other instrument or obligation to which the Company is a party or by
      which it may be bound.  Other than the filing of any current report on Form 8-K required to be filed with the Securities and Exchange Commission (“SEC”) (which
      shall be filed

  
    

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  following execution of this Agreement in accordance with applicable law), such filings and approvals as are required to be made or obtained
      following execution of this Agreement under any state “blue sky” laws, and such consents and approvals that have been made or obtained, no material notice to, filing with or review by, or authorization, consent or approval of, any Governmental Entity
      is required to be made or obtained by the Company in connection with the consummation by the Company of the Exchange.

  

  

  Section 3.5  Anti-Takeover Matters.  The Board of Directors of the Company has taken all necessary action to ensure that the transactions contemplated by
      this Agreement and the consummation of the transactions contemplated hereby, will be exempt from any anti-takeover or similar provisions of the Company’s certificate of incorporation and bylaws, and any other provisions of any applicable
      “moratorium,” “control share,” “fair price,” “interested stockholder” or other anti-takeover laws and regulations of any jurisdiction, including Section 203 of the General Corporation Law of the State of Delaware.  The Company does not have any
      shareholder rights plan or similar anti-takeover plan or arrangement in effect relating to the accumulation of beneficial ownership of any of the Company’s securities or a change in control of the Company.  The Company agrees that it will not adopt a
      shareholder rights plan or similar anti-takeover plan or arrangement unless such take-over defenses shall not apply to the acquisition or ownership by the Investor of any or all of the shares of Common Stock received by the Investor upon the
      conversion of any Exchange Shares.

  

  

  Section 3.6  Offering of Securities.  Neither the Company nor any person acting on its behalf has taken any action (including any offering of any securities
      of the Company under circumstances which would require the integration of such offering with the offering of the Exchange Shares under the Securities Act and the rules and regulations of the SEC promulgated thereunder), which would subject the
      offering, issuance or transfer of the Exchange Shares to the Investor pursuant to this Agreement to the registration requirements of the Securities Act.

  

  

  Section 3.7  Brokers and Finders.  No broker, finder or investment banker is entitled to any financial advisory, brokerage, finder’s or other fee or
      commission in connection with this Agreement or the transactions contemplated hereby based upon arrangements made by or on behalf of the Company or any subsidiary of the Company for which the Investor could have any liability.

  

  

  ARTICLE IV

  REPRESENTATIONS AND WARRANTIES OF THE INVESTOR

  

  

  The Investor represents and warrants to the Company as of the date hereof and as of the Closing Date that:

  

  

  Section 4.1  Organization; Authority; Enforceability.  The Investor is duly organized, validly existing and in good standing under the laws of the State of
      Delaware and has the requisite limited partnership power and authority to execute and deliver this Agreement and to carry out its obligations hereunder.  The execution, delivery and performance by the Investor of this Agreement and the consummation
      of the transactions contemplated hereby have been duly authorized by all necessary limited partnership action on the part of the Investor, and no further approval or authorization is required on the part of the Investor.  This Agreement is a valid
      and

  
    

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  legally binding obligation of the Investor enforceable against the Investor in accordance with its terms and conditions, except as
      enforceability may be limited by the Bankruptcy Exceptions.

  

  

  Section 4.2  Title.  The Investor is the beneficial owner of all shares of Common Stock being exchanged by it hereunder, and all such shares are owned by the
      Investor free and clear of all liens and other encumbrances.  The Investor has the absolute and unrestricted right, power and capacity to surrender and exchange the shares of Common Stock being exchanged by it hereunder, free and clear of all liens
      and other encumbrances, and the Investor is not a party to or bound by, and the shares of Common Stock being exchanged by it hereunder are not subject to, any agreement, understanding or other arrangement (i) granting any option, warrant or right of
      first refusal with respect to such shares to any person or (ii) restricting its right to surrender and exchange such shares as contemplated by this Agreement.

  

  

  Section 4.3  Restricted Securities.  The Investor acknowledges that the Exchange Shares and the Common Stock issuable upon conversion thereof have not been
      registered under the Securities Act or under any state securities laws.  The Investor (i) is acquiring such securities pursuant to an exemption from registration under the Securities Act for its own account solely for investment with no present
      intention or plan to distribute any of such securities to any person nor with a view to or for sale in connection with any distribution thereof, in each case in violation of the Securities Act, (ii) will not sell or otherwise dispose of any of such
      securities, except in accordance with their terms and in compliance with the registration requirements or exemption provisions of the Securities Act and any other applicable securities laws, (iii) has such knowledge and experience in financial and
      business matters and in investments of this type that the Investor is capable of evaluating the merits and risks of the investment in such securities and of making an informed investment decision, and (iv) is an “accredited investor” (as that term is
      defined by Rule 501 of Regulation D under the Securities Act).

  

  

  Section 4.4  Non-Contravention. Neither the execution, delivery or performance by the Investor of this Agreement nor the consummation of the transactions
      contemplated hereby constitutes or will constitute (i) a breach or violation of any provision of the Constituent Documents of the Investor; (ii) a violation of any law, regulation or order applicable to the Investor; or (iii) a material breach or
      violation of, a conflict with, the loss of a benefit under, a default (or an event which, with notice or lapse of time or both, would constitute a default) under an event of termination or cancellation under, an event giving rise to acceleration of
      the performance required by or rights or obligations under, or an event resulting in the creation of, any lien, security interest, charge or encumbrance upon any of the properties or assets of the Investor under any of the terms, conditions or
      provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which the Investor is a party or by which it may be bound, or to which the Investor may be bound or subject.  Other than
      the filing of any Schedule 13D/A and Form 4 required to be filed with SEC (which shall be filed following execution of this Agreement in accordance with applicable law), and such consents and approvals that have been made or obtained, no material
      notice to, filing with or review by, or authorization, consent or approval of, any Governmental Entity is required to be made or obtained by the Investor in connection with the consummation by the Investor of the Exchange.

  

  

  Section 4.5  Brokers and Finders.  No broker, finder or investment banker is entitled to any financial advisory, brokerage, finder’s or other fee or
      commission in connection

  
    

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  with this Agreement or the transactions contemplated hereby based upon arrangements made by or on behalf of the Investor for which the Company
      could have any liability.

  

  

  ARTICLE V

  ADDITIONAL AGREEMENTS

  

  

  Section 5.1  Commercially Reasonable Efforts.  Subject to the terms and conditions of this Agreement, each party will use its commercially reasonable efforts
      in good faith to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or desirable, or advisable under applicable laws, so as to permit consummation of the Exchange, as promptly as practicable, and to
      otherwise enable consummation of the transactions contemplated hereby, and each party shall use commercially reasonable efforts to cooperate with the other party to that end.

  

  

  Section 5.2  Transfer of Exchange Shares.  Subject
      to compliance with applicable securities laws and the terms of the Exchange Shares, the Company shall take all steps as may be reasonably requested by the Investor to cause the Company’s transfer agent to administer any transfer of the Exchange
      Shares by the Investor.

  

  

  Section 5.3  Listing.  The Company shall use commercially reasonable efforts to list for trading on the New York Stock Exchange or such other national
      securities exchange upon which the Common Stock is then listed, any shares of Common Stock into which any Exchange Shares shall convert pursuant to the terms thereof; provided, however, that the Company will not undertake to register such shares of
      Common Stock or any transfer of such shares of Common Stock under the Securities Act.

  

  

  Section 5.4  Notification of Future Repurchases; Agreement to Effect Future Exchanges.  Following this Exchange, (i) the Company shall notify the Investor as
      soon as reasonably practicable of any plan or program to repurchase shares of the Company’s Common Stock (which, for the avoidance of doubt, shall not include notice of any individual repurchase(s) made pursuant to such plan or program); and (ii) the
      Company shall use commercially reasonable efforts to permit the Investor to exchange any of its shares of Common Stock for shares of Series A Preferred Stock on terms consistent with the transactions contemplated hereby to the extent that such
      exchange is required in order for the Investor not to be presumed to control the Company for purposes of the Change in Bank Control Act of 1978, as amended (the “CIBC Act”); provided, that in no event shall the Company be obligated to effect any such exchange more than once per calendar year (unless otherwise necessary to enable the Investor not to be presumed to control the Company for purposes of the
        CIBC Act as a result of any action by the Company) and in no event shall the foregoing require the Company to obtain any approvals of the Company’s stockholders or register any shares of its capital stock under the Securities Act or any
      state securities laws.

  
    

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  ARTICLE VI

  MISCELLANEOUS

  

  

  Section 6.1  Termination.  This Agreement may be terminated at any time prior to the Closing:

  

  

  (a)  by either the Investor or the Company if the Closing shall not have occurred by May 13, 2019; provided, however, that in the event the Closing has not
      occurred by such date, the parties will consult in good faith to determine whether to extend the term of this Agreement, it being understood that the parties shall be required to consult only until the fifth Business Day after such date and not be
      under any obligation to extend the term of this Agreement thereafter; provided, further, that the right to terminate this Agreement under this Section 6.1(a) shall not be available to any party whose breach of any representation or warranty or failure to perform any obligation under
      this Agreement shall have caused or resulted in the failure of the Closing to occur on or prior to such date;

  

  

  (b)  by either the Investor or the Company in the event that any Governmental Entity shall have issued an order, decree or
      ruling or taken any other action restraining, enjoining or otherwise prohibiting the transactions contemplated by this Agreement (or if any such Governmental Entity informs the Investor or the Company that it intends to disapprove any notice or
      application required to be filed by such party in order to consummate the transactions contemplated by this Agreement) and such order, decree, ruling or other action shall have become final and non-appealable; or

  

  

  (c)  upon the mutual written consent of the Investor and the Company.

  

  

  In the event of termination of this Agreement as provided in this Section 6.1, this Agreement shall forthwith become void and there shall be no
      liability on the part of either party hereto except that nothing herein shall relieve either party from liability for any breach of this Agreement prior to such termination.

  

  

  Section 6.2  Survival of Representations and Warranties. The respective representations and warranties of the Company and the Investor made herein or in any
      certificates delivered in connection with the Closing shall survive the Closing without limitation.

  

  

  Section 6.3  Amendment.  No amendment of any provision of this Agreement will be effective unless made in writing and signed by an officer or a duly
      authorized representative of each of the Company and the Investor.  No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any
      other or further exercise of any other right, power or privilege.  The rights and remedies herein provided shall be cumulative of any rights or remedies provided by law.

  

  

  Section 6.4  Waiver of Conditions.  The conditions to each party’s obligation to consummate the Exchange are for the sole benefit of such party and may be
      waived by such party in whole or in part to the extent permitted by applicable law.  No waiver will be effective unless it is in a writing signed by a duly authorized officer of the waiving party that makes express reference to the provision or
      provisions subject to such waiver.  No waiver of any provision, or any portion

  
    

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  of any provision, of this Agreement will constitute a waiver of any other part of the provision or any other provision of this Agreement.

  

  

  Section 6.5  Governing Law; Submission to Jurisdiction.  This enforcement of this Agreement and any claim, controversy or dispute arising under this
      Agreement shall be enforced, governed and construed in all respects (whether in contract or in tort) in accordance with the laws of the State of Delaware, without giving effect to its choice of laws principles.  To the fullest extent permitted by
      applicable law, each of the parties hereto (a) irrevocably agrees to submit to the exclusive jurisdiction and venue of the Delaware Court of Chancery for any and all civil actions, suits or proceedings arising out of this Agreement or the Exchange
      contemplated hereby and (b) unconditionally waives trial by jury in any civil legal action or proceeding arising out of this Agreement or the Exchange contemplated hereby.  Each of the parties hereto consents to and agrees that service of process,
      summons, notice or document delivered to a party to this Agreement may be served upon (i) the Company at the address and in the manner set forth for notices to the Company in Section 6.6 and (ii) the Investor at the address and in the manner set
      forth for notices to the Company in Section 6.6, but otherwise in accordance with applicable law.

  

  

  Section 6.6  Notices.  Any notice, request, instruction or other document to be given hereunder by any party to the other will be in writing and will be
      deemed to have been duly given (a) on the date of transmission, if transmitted electronically or by facsimile (provided the sender receives
      confirmation of receipt), or (b) on the Business Day following the date of mailing if delivered by a U.S. nationally recognized overnight courier service with next day delivery specified.  All notices hereunder shall be delivered as set forth below
      or pursuant to such other instructions as may be designated in writing by the party to receive such notice.

  

  

  If to the Company:

  

  

  Alliance Data Systems Corporation

  7500 Dallas Parkway, Suite 700

  Plano, Texas 75024

  Attention:  Joseph L. Motes III, Senior VP, General Counsel & Secretary

  E-mail:  GeneralCounsel@alliancedata.com

  

  

  With a copy to:

  

  

  Latham & Watkins LLP

  811 Main Street, Suite 3700

  Houston, Texas 77002

   Attention: Michael Dillard

  Luke Bergstrom

  Chad Rolston

  E-mail: 
        michael.dillard@lw.com; luke.bergstrom@lw.com; chad.rolston@lw.com

  

  

  
    

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  If to the Investor:

  

  

  ValueAct Holdings, L.P.

  One Letterman Drive, Building D, Fourth Floor

  San Francisco, California 94129

  Attention:  Jason B. Breeding, General Counsel

  E-mail:  jbreeding@valueact.com

  

  

  With a copy to:

  

  

  Cadwalader, Wickersham & Taft LLP

  200 Liberty Street

  New York, New York 10281

  Attention:   Stephen Fraidin

  E-mail:  stephen.fraidin@cwt.com

  

  

  Section 6.7  Assignment.  Neither this Agreement nor any right, remedy, obligation nor liability arising hereunder or by reason hereof shall be assignable by
      any party hereto without the prior written consent of each other party, and any attempt to assign any right, remedy, obligation or liability hereunder without such consent shall be void, except an assignment, in the case of a Business Combination
      where such party is not the surviving entity, or a sale of substantially all of its assets, to the entity which is the survivor of such Business Combination or the purchaser in such sale.

  

  

  Section 6.8  Severability.  If any provision of this Agreement, or the application thereof to any person or circumstance, is determined by a court of
      competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof, or the application of such provision to persons or circumstances other than those as to which it has been held invalid or unenforceable, will remain in full
      force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party.  Upon such
      determination, the parties shall negotiate in good faith in an effort to agree upon a suitable and equitable substitute provision to effect the original intent of the parties.

  

  

  Section 6.9  No Third-Party Beneficiaries.  Nothing contained in this Agreement, expressed or implied, is intended to confer upon any person or entity other
      than the Company and the Investor any benefit, right or remedies.

  

  

  Section 6.10  Press Releases.  The Company and the Investor shall consult with each other before issuing any press release with respect to this Agreement or
      the transactions contemplated hereby and no party shall issue any press release without the prior consent of the other party hereto (which consent shall not be unreasonably withheld).

  

  

  Section 6.11  Entire Agreement.  This Agreement (including the Schedules hereto) constitutes the entire agreement, and supersedes all other prior agreements,
      understandings, representations and warranties, both written and oral, between the parties, with respect to the subject matter hereof.

  

  

  Section 6.12  Counterparts.  This Agreement may be executed in any number of separate counterparts, each of which will be deemed an original instrument, and
      all such counterparts will together constitute the same agreement.  Executed signature pages to this

  
    

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  Agreement may be delivered by facsimile or electronic scan in PDF format and will be sufficient to bind the party or parties.

  

  

  Section 6.13  Specific Performance.  The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not
      performed in accordance with their specific terms.  It is accordingly agreed that the parties shall be entitled (without the necessity of posting a bond) to specific performance of the terms hereof, this being in addition to any other remedies to
      which they are entitled at law or equity.

  

  

  Section 6.14  Expenses.  Except as otherwise expressly provided in this Agreement, all costs and expenses incurred in connection with this Agreement will be
      borne and paid by the party incurring the expense.

  

  

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  IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective
      authorized officers as of the day and year first above written.

  

  

  

  

  ALLIANCE DATA SYSTEMS CORPORATION

  

  

  By:  /s/ Charles L.
          Horn

  Name:  Charles L. Horn

  Title:  Executive Vice President, Chief

             Financial Officer

  

  

  

  

  

  

  VALUEACT HOLDINGS, L.P.

  

  

  By:  /s/ Christopher
          Allen

  Name:  Christopher Allen

  Title:  Chief Financial
        Officer

  

  

  

  

  

  

  

  

  
    
      

      

    

    
      

    
      

      

    

  

  

  

  Schedule A

  

  

  	
          Investor

        	
          Shares of Common Stock to Be Exchanged

        	
          Exchange Shares to Be Delivered

        
	
          ValueAct Holdings, L.P.

        	
          1,500,000

        	
          150,000

        

  

  

  

  

  

  

  

  

  
    
      

      

    

    
      

    
      

      

    

  

  

  

  Schedule B

  

  

  

  

  	
          Class of Capital Stock

        	
          Shares Authorized

        	
          Shares Outstanding

        
	
          Common Stock, par value 

          $0.01 per share

        	
          200,000,000

        	
          113,233,264 (including 

          60,852,178 treasury 

          shares)

        
	
          Preferred Stock, par value 

          $0.01 per share

        	
          19,880,000

        	
          0EX-4.2

 Exhibit 4.2 

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE
THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. 
 UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 

 BLACKROCK, INC. 

3.250% Note due 2029 
  

			
	 No.
	  	CUSIP No. 09247X AP6
	 	  	ISIN: US09247XAP69
		
	 	  	$500,000,000

 BlackRock, Inc., a corporation duly organized and existing under the laws of Delaware (herein called the
“Company,” which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co., or registered assigns, the principal sum of FIVE HUNDRED MILLION DOLLARS
($500,000,000) on April 30, 2029, and to pay interest thereon from April 29, 2019 or the most recent Interest Payment Date to which interest has been paid or provided for, on April 30 and October 30 in each year, beginning on
October 30, 2019, at the rate of 3.250% per annum. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Security (or one or
more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the April 15 or October 15 (whether or not a Business Day), as the case may be, next preceding such Interest
Payment Date. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture. 
 Payment of the principal of (and premium, if any) and any such interest on this
Security will be made at the office or agency of the Company maintained for that purpose in New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register. 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place. 
 Unless the certificate of authentication hereof has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed. 

Dated: April 29, 2019 
  

			
	BLACKROCK, INC.
		
	 By:
	 	  

	 Name:
	 	
	 Title:
	 	

 This is one of the Securities of the series designated therein referred to in the within mentioned
Indenture. 
  

			
	 The Bank of New York Mellon,

As Trustee

		
	 By:
	 	  

		 	Authorized Signatory
	
	 Dated:

 BLACKROCK, INC. 

3.250% Note due 2029 
 This
Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”), issued and to be issued in one or more series under an Indenture, dated as of September 17, 2007 (herein called the
“Indenture,” which term shall have the meaning assigned to it in such instrument), between the Company and The Bank of New York Mellon, as Trustee (herein called the “Trustee,” which term includes any successor trustee under the
Indenture), and reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is one of the series designated on the face hereof, initially limited in aggregate principal amount to $1,000,000,000. The Company may, from time to time, without the consent
of the holders of the Securities of this series, issue additional Securities under the Indenture having the same ranking and the same interest rate, maturity and other terms as this series of Securities. Any additional Securities having such similar
terms, together with any outstanding Securities of this series, will constitute a single series of Securities under the Indenture if either such additional Securities are part of the same “issue” within the meaning of U.S. Treasury
Regulation Sections 1.1275-1(f) or 1.1275-2(k), or such additional Securities are not issued with more than a de minimis amount of original issue discount for
U.S. federal income tax purposes, unless such additional securities are issued under a separate CUSIP. 
 The Securities of this series will
be redeemable as a whole or in part, at the Company’s option at any time, prior to January 30, 2029 (three (3) months prior to maturity) at a redemption price equal to the greater of (i) the principal amount of such Securities to
be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest thereon (exclusive of interest accrued to the date of redemption) discounted to the redemption date on a semiannual basis (assuming
a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 15 basis points, plus in each case accrued interest thereon to the date of redemption. 

The Securities may be redeemed on or after January 30, 2029 (three (3) months prior to maturity) in whole or in part at any time, at
the Company’s option, at 100% of the principal amount of the Securities. In the case of any such redemption, the Company will also pay accrued and unpaid interest thereon, if any, to the redemption date. 

“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semiannual equivalent yield to
maturity or interpolated (on a day count basis) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

 “Comparable Treasury Issue” means the United States Treasury security or securities selected by an Independent
Investment Banker as having an actual or interpolated maturity comparable to the remaining term of the Securities of this series to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of a comparable maturity to the remaining term of such Securities. 
 “Independent
Investment Banker” means one of the Reference Treasury Dealers appointed by the Company. 
 “Comparable Treasury
Price” means, with respect to any redemption date, (1) the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (2) if
the Company obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations. 
 “Reference
Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Company, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the Company by such Reference Treasury Dealer at 3:30 p.m. New York time on the third business day preceding such redemption date. 

“Reference Treasury Dealer” means (i) Citigroup Global Markets Inc., Barclays Capital Inc. and Morgan Stanley &
Co. LLC or any of their affiliates that are primary U.S. Government securities dealers in the City of New York, and their respective successors; provided that if the foregoing or any of their affiliates shall cease to be a primary U.S.
Government securities dealer in The City of New York (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury Dealer; and (ii) one other Primary Treasury Dealer selected by the Company. 

Notice of any redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each holder of Securities of
this series. 

 Unless the Company defaults in payment of the redemption price, on and after the redemption
date interest will cease to accrue on the Securities of this series or portions thereof called for redemption. 
 In the event of redemption
of this Security in part only, a new Security or Securities of this series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof. 

The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Security or certain restrictive covenants and
Events of Default with respect to this Security, in each case upon compliance with certain conditions set forth in the Indenture. 
 If an
Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture. 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations
of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of at least a majority in aggregate principal amount of the
Securities at the time Outstanding of each series to be affected. The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Security. 
 As provided in and subject to the provisions of the Indenture, the Holder of this Security shall not
have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given the Trustee written notice of a continuing
Event of Default with respect to the Securities of this series, the Holders of not less than 25% in principal amount of the Securities of this series at the time Outstanding shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee and offered the Trustee reasonable indemnity satisfactory to the Trustee, and the Trustee shall not have received from the Holders of a majority in principal amount of Securities of this series at the time
Outstanding a direction inconsistent with such request, and shall have failed to institute any such proceeding, for 60 days after receipt of such notice, request and offer of indemnity. The foregoing shall not apply to any suit instituted by the
Holder of this Security for the enforcement of any payment of principal hereof or any premium or interest hereon on or after the respective due dates expressed herein. 

No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any premium and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed. 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the
Security Register, upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of and any premium and interest on this Security are payable, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series and of like
tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. 

The Securities of this series are issuable only in registered form without coupons in denominations of $2,000 and integral multiples of $1,000
in excess thereof. As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same. 
 No service charge shall be made for any such registration of
transfer or exchange, but the Company or the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 

Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture. 

This Security shall be governed by and construed in accordance with the law of the State of New York.

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