FEDERATED DEPARTMENT STORES INC /DE/
EXHIBIT 10.2
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>3
<FILENAME>l14373aexv10w2.txt
<DESCRIPTION>EXHIBIT 10.2
<TEXT>
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                                                                    EXHIBIT 10.2

                          CREDIT CARD PROGRAM AGREEMENT

                                  BY AND AMONG

                       FEDERATED DEPARTMENT STORES, INC.,

                                    FDS BANK,

                                FACS GROUP, INC.,

                                       AND

                                 CITIBANK, N.A.

<PAGE>

                               TABLE OF CONTENTS

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ARTICLE I DEFINITIONS............................................................................................     1
         1.1      Generally......................................................................................     1
         1.2      Miscellaneous..................................................................................    16

ARTICLE II ESTABLISHMENT OF THE PROGRAM..........................................................................    17
         2.1      Credit Program.................................................................................    17
         2.2      Exclusivity....................................................................................    17
         2.3      Retail Portfolio Acquisitions..................................................................    19
         2.4      Retail Portfolio Dispositions..................................................................    21
         2.5      Partner Exclusivity............................................................................    21
         2.6      General Electric Capital Corporation / Macy's Credit Card Program..............................    22

ARTICLE III PROGRAM MANAGEMENT AND ADMINISTRATION................................................................    22
         3.1      Program Objectives.............................................................................    22
         3.2      Operating Committee............................................................................    22
         3.3      Executive Committee............................................................................    26
         3.4      Program Relationship Managers; Partner Program Team............................................    26

ARTICLE IV PROGRAM OPERATIONS....................................................................................    27
         4.1      Operation of the Program.......................................................................    27
         4.2      Certain Responsibilities of the FDS Companies..................................................    28
         4.3      Certain Responsibilities of Bank...............................................................    29
         4.4      Ownership of Accounts..........................................................................    29
         4.5      Branding of Accounts/Credit Cards/Credit Card Documentation/Solicitation Materials.............    30
         4.6      Underwriting and Risk Management...............................................................    30
         4.7      Cardholder Terms...............................................................................    32
         4.8      Value Propositions.............................................................................    32
         4.9      Participation in Reversals.....................................................................    33
         4.10     Sales Taxes....................................................................................    35

ARTICLE V MARKETING..............................................................................................    36
         5.1      Promotion of Program...........................................................................    36
         5.2      Marketing Commitment...........................................................................    36
         5.3      Communications with Cardholders................................................................    37
         5.4      Additional Marketing Support...................................................................    38
         5.5      Ancillary Products.............................................................................    38
         5.6      Marketing Plan.................................................................................    38

ARTICLE VI CARDHOLDER INFORMATION................................................................................    39
         6.1      Customer Information...........................................................................    39
         6.2      Cardholder Data................................................................................    40
         6.3      FDS Shopper Data; FDS Prospect List............................................................    43
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ARTICLE VII OPERATING STANDARDS..................................................................................    45
         7.1      Reports........................................................................................    45
         7.2      Servicing; Interim Servicing; Transition of Services at the Election of the FDS
                  Companies......................................................................................    45
         7.3      Service Level Standards........................................................................    46
         7.4      Credit Systems.................................................................................    48
         7.5      Systems Interface; Technical Support...........................................................    49

ARTICLE VIII MERCHANT SERVICES...................................................................................    50
         8.1      Transmittal and Authorization of FDS Charge Transaction Data...................................    50
         8.2      POS Terminals..................................................................................    50
         8.3      In-Store Payments..............................................................................    50
         8.4      Settlement Procedures..........................................................................    50
         8.5      Bank's Right to Charge Back....................................................................    52
         8.6      No Processing Fees.............................................................................    52

ARTICLE IX PROGRAM ECONOMICS.....................................................................................    53
         9.1      Bank's Responsibility for Program Operation....................................................    53
         9.2      Settlement Statements..........................................................................    53
         9.3      FDS Compensation...............................................................................    53
         9.4      Budgeting......................................................................................    54

ARTICLE X INTELLECTUAL PROPERTY..................................................................................    55
         10.1     The FDS Licensed Marks.........................................................................    55
         10.2     Bank Licensed Marks............................................................................    57
         10.3     Intellectual Property..........................................................................    58

ARTICLE XI REPRESENTATIONS, WARRANTIES AND COVENANTS.............................................................    59
         11.1     General Representations and Warranties of FDS..................................................    59
         11.2     General Representations and Warranties of Bank.................................................    61
         11.3     General Covenants of the FDS Companies.........................................................    62
         11.4     General Covenants of Bank......................................................................    63

ARTICLE XII ACCESS, AUDIT AND DISPUTE RESOLUTION.................................................................    64
         12.1     Access Rights..................................................................................    64
         12.2     Audit Rights...................................................................................    64
         12.3     Dispute Resolution.............................................................................    65

ARTICLE XIII CONFIDENTIALITY.....................................................................................    69
         13.1     General Confidentiality........................................................................    69
         13.2     Use and Disclosure of Confidential Information.................................................    70
         13.3     Unauthorized Use or Disclosure of Confidential Information.....................................    70
         13.4     Return or Destruction of Confidential Information..............................................    70

ARTICLE XIV EVENTS OF DEFAULT; RIGHTS AND REMEDIES...............................................................    71
         14.1     Events of Default..............................................................................    71
         14.2     Defaults by Bank...............................................................................    71
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<TABLE>
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         14.3     Defaults by the FDS Companies..................................................................    72
         14.4     Remedies for Events of Default.................................................................    73

ARTICLE XV TERM/TERMINATION......................................................................................    73
         15.1     Term...........................................................................................    73
         15.2     Termination by the FDS Companies Prior to the End of the Initial Term or Renewal
                  Term...........................................................................................    73
         15.3     Termination by Bank Prior to the End of the Initial Term or Renewal Term.......................    74
         15.4     Automatic Termination..........................................................................    74

ARTICLE XVI EFFECTS OF TERMINATION...............................................................................    74
         16.1     General Effects................................................................................    74
         16.2     The FDS Companies' Option to Purchase the Program Assets.......................................    75
         16.3     Dedicated Program Personnel....................................................................    77
         16.4     Rights of Bank if Purchase Option Not Exercised................................................    77

ARTICLE XVII INDEMNIFICATION.....................................................................................    78
         17.1     FDS Indemnification of Bank....................................................................    78
         17.2     Bank Indemnification of the FDS Companies......................................................    79
         17.3     Procedures.....................................................................................    80
         17.4     Notice and Additional Rights...................................................................    81

ARTICLE XVIII MISCELLANEOUS......................................................................................    82
         18.1     Securitization.................................................................................    82
         18.2     Assignment.....................................................................................    82
         18.3     Sale or Transfer of Accounts...................................................................    83
         18.4     Subcontracting.................................................................................    83
         18.5     Amendment......................................................................................    83
         18.6     Non-Waiver.....................................................................................    83
         18.7     Severability...................................................................................    83
         18.8     Waiver of Jury Trial and Venue.................................................................    83
         18.9     Governing Law; Compliance with Law.............................................................    84
         18.10    Specific Performance...........................................................................    84
         18.11    Captions.......................................................................................    84
         18.12    Notices........................................................................................    84
         18.13    Coordination of Consents and Approvals.........................................................    85
         18.14    Further Assurances.............................................................................    85
         18.15    No Joint Venture...............................................................................    85
         18.16    Press Releases.................................................................................    85
         18.17    No Set-Off.....................................................................................    86
         18.18    Conflict of Interest...........................................................................    86
         18.19    Third Parties..................................................................................    86
         18.20    Force Majeure..................................................................................    86
         18.21    Entire Agreement...............................................................................    86
         18.22    Binding Effect.................................................................................    87
         18.23    Counterparts/Facsimiles........................................................................    87
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         18.24    Financial Statements...........................................................................    87
         18.25    Survival.......................................................................................    87
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<PAGE>

                          CREDIT CARD PROGRAM AGREEMENT

         This Credit Card Program Agreement is made as of the 1st day of June,
2005, by and among Federated Department Stores, Inc., a Delaware corporation,
("FDS"), FDS Bank, a federally-chartered stock savings bank ("FDS Bank"), FACS
Group, Inc., an Ohio corporation ("FACS", and together with FDS and FDS Bank,
the "FDS Companies"), and Citibank, N.A., a national banking association
("Bank").

                              W I T N E S S E T H:

         WHEREAS, the FDS Companies, directly and through subsidiaries, are
engaged in, among other activities, operating retail department stores and a
Credit Card Business (as hereinafter defined);

         WHEREAS, concurrently with the execution of this Agreement, FDS, FDS
Bank and Bank are entering a purchase and sale agreement (the "Purchase
Agreement"; unless otherwise defined herein, terms defined therein being used in
this Agreement as so defined) pursuant to which Bank shall purchase the Credit
Card Business, subject to the satisfaction of certain conditions, in the
following transactions, as more fully set forth in the Purchase Agreement: (1)
at the First Closing, Bank shall purchase the FDS Accounts and certain related
assets and liabilities; (2) at the Second Closing, Bank shall purchase the
GE/Macy's Accounts and certain related assets and liabilities; and (3) at the
Third Closing, Bank shall purchase the May Accounts and certain related assets
and liabilities;

         WHEREAS, the FDS Companies have requested that Bank establish a program
pursuant to which, from and after the Effective Date of this Agreement, Bank
shall issue private label and co-branded credit cards to be serviced, marketed
and promoted in accordance with the terms hereof;

         WHEREAS, the parties hereto agree that the goodwill associated with the
FDS Licensed Marks contemplated for use hereunder are of substantial value that
is dependent upon the maintenance of high quality services and appropriate use
of the trademarks pursuant to this Agreement; and

         NOW, THEREFORE, in consideration of the terms, conditions and mutual
covenants contained herein, and for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

                                    ARTICLE I

                                   DEFINITIONS

            1.1 Generally. The following terms shall have the following meanings
when used in this Agreement:

         "AAA" means the American Arbitration Association.

<PAGE>

         "Account" means any account under which a purchase, cash advance,
convenience check or balance transfer transaction may be or has been made by or
to a Person (or any Person authorized by such Person) pursuant to a Credit Card
Agreement established pursuant to the terms of this Agreement or acquired
pursuant to the Purchase Agreement. For the avoidance of doubt, the term Account
shall include (i) the Purchased Accounts from their respective dates of purchase
pursuant to the Purchase Agreement, and (ii) all Accounts established or
reactivated from and after the Effective Date, including the Private Label
Accounts, the General Purpose Accounts and the Employee Accounts.

         "Account Documentation" means, with respect to an Account, any and all
documentation arising from that Account, including Credit Card Documentation,
checks or other forms of payment arising from that Account, notices to
Cardholders, credit bureau reports (to the extent not prohibited from transfer
by contract with the credit bureau), adverse action notices, change of terms
notices, other notices, correspondence, memoranda, documents, stubs,
instruments, certificates, agreements, magnetic tapes, disks, hard copy formats
or other computer-readable data transmissions, any microfilm, electronic or
other copy of any of the foregoing, and any other written, electronic or other
records or materials of whatever form or nature, including tangible and
intangible information, arising from any of the foregoing to the extent related
to the Program; provided that Account Documentation shall not include FDS's or
any of its Affiliates' register tapes, invoices, sales or shipping slips,
delivery or other receipts or other indicia of the sale of FDS Goods and
Services, or any reports, analyses or other documentation prepared by any of the
FDS Companies or their Affiliates for use in the retail business operated by the
FDS Companies and their Affiliates regardless of whether derived in whole or in
part from the Account Documentation; and provided, further, that notwithstanding
that certain information included in the Account Documentation might also
constitute FDS Shopper Data, nothing contained in this definition shall limit
FDS's rights in and to the FDS Shopper Data as set forth in Section 6.3.

         "Additional Marketing Commitment" means the obligation of Bank to pay
the amounts set forth in Schedule 1.1(l) for the purposes specified by the
Operating Committee.

         "Additional Premium" means the collective reference to (i) the
"Additional Premium" portion of the FDS Purchase Price, as defined on the Final
First Closing Statement, as finally determined in accordance with Section 2.3 of
the Purchase Agreement, (ii) the "Additional Premium" portion of the GE/Macy's
Purchase Price, as defined on the Final Second Closing Statement, as finally
determined in accordance with Section 3.3 of the Purchase Agreement, and (iii)
the "Additional Premium" portion of the May Purchase Price, as defined on the
Final Third Closing Statement, as finally determined in accordance with Section
4.3 of the Purchase Agreement.

         "Adjusted Fair Market Value" has the meaning set forth in Schedule
16.2(d)(i).

         "Adverse Sales Development" means, with respect to any twelve (12)
Fiscal Month period after the Benchmark Year (as defined below), (i) a decrease
of thirty-three percent (33%) or more in the aggregate sales volume in the FDS
Channels as compared to the immediately preceding twelve (12) Fiscal Month
period or (ii) aggregate sales volume in the FDS Channels is less than sixty-six
percent (66%) of the aggregate sales volume in the FDS Channels during the

                                       2
<PAGE>

Benchmark Year; provided, however, that, to the extent that Bank is servicing
Program Assets related to any Sold Chain or Sold Area Stores pursuant to any
agreement or arrangement with the purchaser thereof, the aggregate sales volume
in the FDS Channels for any period referred to above shall include the aggregate
sales volume at such Sold Chain or Sold Area Stores during the twelve (12)
Fiscal Month period ending prior to the sale of such Sold Chain or Sold Area
Store. For purposes hereof, "Benchmark Year" means the twelve (12) Fiscal Month
period beginning with the Fiscal Month in which the Third Closing Date occurs.

         "Affiliate" means, with respect to any Person, each Person that
controls, is controlled by, or is under common control with, such Person. For
purposes of this definition, "control" of a Person means the possession,
directly or indirectly, of the power to direct or cause the direction of its
management or policies, whether through the ownership of voting securities, by
contract or otherwise. Notwithstanding the foregoing, solely for purposes of
this Agreement and regardless of its characterization under Applicable Law, CEBA
Bank shall be deemed to be an Affiliate of Bank and not an Affiliate of FDS,
except as otherwise expressly provided in this Agreement and except that for
purposes of Articles VI and XIII hereof, CEBA Bank also shall be deemed to be an
Affiliate of FDS.

         "Agreement" means this Program Agreement, together with all of its
schedules and exhibits, as modified, altered, supplemented, amended and/or
restated from time to time.

         "Ancillary Products" means (i) any financial services or financial or
credit related products (other than FDS Credit Cards), including insurance
products and services, credit protection products, investment and securities
products, home equity products, wealth accumulation products, savings and
deposit products and debt suspension products and (ii) any auto, travel or other
membership clubs and similar services that are not FDS Goods and Services.

         "Applicable Law" means, to the extent applicable to the Program or any
Party hereto, all federal, state and local laws (including common law),
statutes, regulations, injunctions, written regulatory guidance, substantive
recommendations (which Bank shall request in writing if so requested by FDS),
orders, judgments, directives or determinations of any Governmental Authority or
any order or judgment of any arbitrator, as may be amended and in effect from
time to time during the Term, including (i) the Truth in Lending Act and
Regulation Z; (ii) the Equal Credit Opportunity Act and Regulation B; (iii) the
Fair Debt Collection Practices Act; (iv) the Fair Credit Reporting Act; (v) the
Gramm-Leach-Bliley Act; and (vii) the USA PATRIOT Act, and, in each case, any
implementing regulations or interpretations issued thereunder.

         "Applicable Order" means, with respect to any Person, a judgment,
injunction, writ, decree or order of any Governmental Authority, in each case
legally binding on that Person or on any material amount of its property.

         "Approved Ancillary Products" means the products listed on Schedule
1.1(a) and any additional Ancillary Products approved for offering under the
Program after the Effective Date pursuant to the terms of this Agreement.

         "Average Private Label Interest Free Receivables" means, for any twelve
(12) consecutive Fiscal Month period, the Average Private Label Receivables that
are unbilled and

                                       3
<PAGE>

subject to any active interest free payment plan or three (3) or six (6) month
deferred payment plan plus the Average Private Label Receivables that have been
billed under (i) the 12-PAY or twelve (12) months SEAT plans or (ii) other new
Account types introduced pursuant to Article III and designated for inclusion in
the calculation of Average Private Label Interest Free Receivables in connection
with such introduction.

         "Average Private Label Receivables" means, for any twelve (12)
consecutive Fiscal Month period, Average Receivables under Private Label
Accounts.

         "Average Receivables" means, (a) for any Fiscal Month, the Cardholder
Indebtedness calculated on a sum of cycles basis of reporting monthly
receivables under the Accounts, and (b) for any Fiscal Year, (i) the sum of the
amounts determined pursuant to clause (a) for each Fiscal Month in such Fiscal
Year divided by (ii) the number of Fiscal Months in such Fiscal Year.

         "Bad Debt Reserve" means the bad debt reserve maintained by Bank solely
with respect to the Accounts under the Program in an amount, from time to time,
equal to the product of (i) forty percent (40%) of the aggregate amount of
Cardholder Indebtedness multiplied by (ii) the Loss Rate multiplied by (iii)
7/12. For purposes of this definition, "Loss Rate" means, with respect to the
twelve (12) Fiscal Month period with respect to which the calculation of the Bad
Debt Reserve is being made, a percentage equal to (i) (A) the aggregate amount
of Cardholder Indebtedness that is forecasted by Bank (in a manner consistent
with its forecasts for partner Credit Card portfolios managed by Bank of a
similar size and nature) to be written-off under the Program during such twelve
(12) Fiscal Month period, calculated on a sum of cycles basis of reporting
monthly receivables under the Accounts, minus (B) the aggregate amount
forecasted by Bank (in a manner consistent with its forecasts for partner Credit
Card portfolios managed by Bank of a similar size and nature) to be recovered
with respect to previously written-off Cardholder Indebtedness during such
twelve (12) Fiscal Month period (including recovery of sales taxes paid on
written-off Cardholder Indebtedness), divided by (ii) the aggregate amount of
the average amount of Cardholder Indebtedness under the Program forecasted for
each Fiscal Month during such twelve (12) Fiscal Month period (in each case,
calculated on a sum of cycles basis of reporting monthly receivables under the
Accounts for each Fiscal Month).

         "Bank" has the meaning set forth in the preamble hereof; provided that
Bank shall mean CEBA Bank with respect to Bank's rights and obligations
hereunder following the assignment of this Agreement to CEBA Bank pursuant to
Section 18.2.

         "Bank Licensed Marks" means the trademarks, tradenames, service marks,
logos and other proprietary designations of Bank listed on Schedule 1.1(b) and
licensed to the FDS Companies under Section 10.2 hereof.

         "Bank Manager" has the meaning set forth in Section 3.4(a) hereof.

         "Bank Parent" means Citigroup, Inc.

         "Bank Systems" means Systems owned, leased or licensed by and operated
by or on behalf of Bank or any of its controlled Affiliates; provided that a
System shall not be a Bank System if access or permission to use such System
must be granted by FDS or any of its Affiliates in order for Bank or any of its
Affiliates to use such System hereunder.

                                       4
<PAGE>

         "Bankruptcy Code" means Title 11 of the United States Code, as amended,
or any other applicable state or federal bankruptcy, insolvency, moratorium or
other similar law and all laws relating thereto.

         "Billing Cycle" means the interval of time between regular periodic
Billing Dates for an Account.

         "Billing Date" means, for any Account, the last day of a Billing Cycle
as of when the Account is billed.

         "Billing Statement" means a summary of Account credit and debit
transactions for a Billing Cycle including a descriptive statement covering
purchases, charges, past due account information and Loyalty Program
information.

         "Budget" means the semi-annual or annual (as the case may be) budget
for the Program, in substantially the form attached hereto as Schedule 9.4(a) or
such other form as may be approved by the Operating Committee, which in each
case shall set forth, among other information determined by the Operating
Committee, the projected account volumes, revenues, expenses, write-offs, and
funding needs and obligations for the Program for the period covered and an
explanation of how such needs will be met.

         "Business Day" means any day, other than a Saturday, Sunday or legal
holiday, on which both FDS and Bank are open for business at their respective
U.S. headquarters.

         "Business Plan" means a three-year business plan for the Program, in
substantially the form agreed upon by the Parties on or prior to the Effective
Date or such other form as may be approved by the Operating Committee, which
shall in each case describe strategies for Program growth and shall include
detailed financial statements, a schedule of all major assumptions underlying
such financial statements, a description of all capital expenditures and Systems
improvements projected for the period, the projected funding needs of the
Program for such period, and an explanation of how those needs will be met.

         "Card Association" means Visa International Inc. and Visa U.S.A. Inc.
or any successor thereto and, to the extent that, any time following the
Effective Date, FDS Bank approves the issuance pursuant hereto of Co-Branded
Credit Cards bearing the mark of any other card association or card network
(e.g., MasterCard, American Express or Discover), such other card association or
card network.

         "Cardholder" means any Person who has been issued an FDS Credit Card
and includes authorized user(s).

         "Card Association Contract" has the meaning set forth in Section 9.3(c)
hereof.

         "Cardholder Data" means (i) the Cardholder List and (ii) all other
personally identifiable information about a Cardholder (A) received by or on
behalf of Bank (including by the FDS Servicer in its capacity as such) in
connection with the Cardholder's application for use of an FDS Credit Card or
Account or (B) otherwise obtained by or on behalf of Bank (including information
obtained by the FDS Servicer in its capacity as such and information contained
in

                                       5
<PAGE>

the Master File conveyed to Bank pursuant to the Purchase Agreement) for
inclusion in its database of Cardholder information (including information about
a Cardholder purchased by Bank), including all transaction and experience
information collected by or on behalf of Bank (including by the FDS Servicer in
its capacity as such) with regard to each purchase charged by a Cardholder using
his or her FDS Credit Card (including FDS Charge Transaction Data with respect
to charges on Private Label Accounts and transaction and experience information
with respect to charges on General Purpose Accounts).

         "Cardholder Indebtedness" means all amounts charged and owing to Bank
by Cardholders with respect to Accounts (including principal balances from
outstanding charges, charges for Approved Ancillary Products, balance transfers,
convenience checks, cash advances, finance charges, NSF fees, late charges,
pay-by-phone fees and any other fees and charges), whether or not billed, less
the amount of any credit balances owing by Bank to Cardholders, including in
respect of any payments and any credits associated with returns of goods and/or
services and other credits and adjustments, whether or not billed.

         "Cardholder List" means any list (whether in hardcopy, magnetic tape,
electronic or other form) that identifies Cardholders, including any such
listing that sets forth the names, addresses, email addresses (as available),
telephone numbers or social security numbers of any or all Cardholders.

         "Change of Control" means, with respect to any Person (the "subject
Person"), (i) a Person or group becomes the "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934 (except that a
Person or group shall be deemed to own all securities it has the right to
acquire)), directly or indirectly, of more than fifty percent (50%) of the total
voting power of the subject Person, (ii) such subject Person merges,
consolidates, acquires, is acquired by, or otherwise combines with any other
Person in a transaction in which the subject Person is not the surviving entity
or which constitutes a "merger of equals", it being understood that a subject
Person shall not be considered the "surviving entity" of a transaction if either
(A) the members of the Board of Directors of the subject Person immediately
prior to the transaction constitute less than a majority of the members of the
Board of Directors of the ultimate parent entity of the entity surviving or
resulting from the transaction or (B) securities of the subject Person that are
outstanding immediately prior to the transaction (or securities into which such
securities are converted in the transaction) represent less than fifty percent
(50%) of the total voting power of the ultimate parent entity of the entity
surviving or resulting from the transaction, or (iii) the subject Person sells
all or substantially all of its assets to a Person that is not an Affiliate of
the subject Person.

         "Co-Branded Credit Card" means a Credit Card, including the Credit
Cards listed on Schedule 1.1(c) as "Co-Branded Credit Cards," that (i) bears an
FDS Licensed Mark and a trademark, tradename, service mark, logo or other
proprietary designation of a Card Association and (ii) is linked to a General
Purpose Account and (except in the case of SAV Visa Accounts or as otherwise
agreed by the Parties) a Private Label Account.

         "Confidential Information" has the meaning set forth in Section 13.1(a)
hereof.

         "Conversion Costs" has the meaning set forth in Section 16.2(d)(iii)
hereof.

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<PAGE>

         "CPI" means the Consumer Price Index for All Urban Consumers (CPI-U)
for the U.S. City Average for All Items, as published by the United States
Department of Labor Bureau of Labor Statistics, or any successor organization.

         "Credit Card" means a credit card pursuant to which the cardholder or
authorized user may purchase goods and services, obtain cash advances or
convenience checks, and transfer balances through open-end revolving credit,
commonly known as a credit or charge card; provided that the term does not
include: (i) any gift card; (ii) any debit card, smart card, stored value card,
electronic or digital cash card or any other card that does not provide the
holder thereof with the ability to obtain credit other than through an overdraft
line or similar feature; (iii) any secured card, including any card secured by a
lien on real or other property or by a deposit (but excluding any credit card
issued in respect of an Employee Account, which shall be deemed a Credit Card
for purposes of this Agreement); (iv) any card issued to the holder of a
securities brokerage account that allows the holder to obtain credit through a
margin account; or (v) any credit or charge card designated as a corporate
credit or charge card.

          "Credit Card Agreement" means the Credit Card agreement between Bank
(including as an assignee of FDS Bank, GE Bank or May Bank (as defined in the
Purchase Agreement)) and a Cardholder (and any replacement of such agreement),
governing the use of an Account, together with any amendments, modifications or
supplements that now or hereafter may be made to such Credit Card Agreement (and
any replacement of such agreement).

         "Credit Card Application" means the credit application that must be
completed and submitted in order to establish an Account (including any such
application submitted at the POS, by phone or via the Internet).

         "Credit Card Business" means the Business, as that term is defined in
the Purchase Agreement.

         "Credit Card Documentation" means, with respect to the Accounts, all
Credit Card Applications; Credit Card Agreements; FDS Credit Cards;
documentation containing the terms and conditions of any Loyalty Programs mailed
or sent to Cardholders; and Billing Statements, in each case relating to such
Accounts.

         "Disclosing Party" has the meaning set forth in Section 13.1(d) hereof.

         "Early Age Collection" has the meaning set forth in Section 4.2(a)(iv)
hereof.

         "Effective Date" means the First Cut-Off Time (as defined in the
Purchase Agreement).

         "Employee Accounts" means the Prepaid Employee Accounts and Private
Label Accounts designated (including by designation in the master file) by an
FDS Company as Accounts that are eligible for any employee discount or otherwise
designated by an FDS Company as "Employee Accounts" from time to time.

         "Equity Holder" means the FDS entity that is the owner of the preferred
equity interests of CEBA Bank that are issued pursuant to the Purchase
Agreement.

                                       7
<PAGE>

         "Estimated Remittance" has the meaning set forth in Section 8.4(c)
hereof.

         "Event of Default" means the occurrence of any one of the events listed
in Section 14.1 hereof.

         "Exchange Act" means the Securities and Exchange Act of 1934 and the
rules and regulations promulgated thereunder.

         "Executive Committee" has the meaning set forth in Section 3.3 hereof.

         "FACS" has the meaning set forth in the preamble hereof.

         "Fair Market Value" has the meaning set forth in Schedule 16.2(e).

         "FDIC" means the Federal Deposit Insurance Corporation.

         "FDS" has the meaning set forth in the preamble hereof.

         "FDS Accounts" has the meaning set forth in the Purchase Agreement.

         "FDS Bank" has the meaning set forth in the preamble hereof.

         "FDS Bank Designees" has the meaning set forth in Section 3.2(c)
hereof.

         "FDS Channels" means (i) all retail establishments owned or operated by
FDS or its Affiliates (including Licensee departments therein), (ii) all
websites owned or operated by FDS or its Affiliates or their Licensees, and
(iii) all mail order, catalog and other direct access media that are owned or
operated by FDS or its Affiliates or their Licensees.

         "FDS Charge Transaction Data" means the transaction information (in the
form of electronic information) with regard to a charge on an Account with
respect to each purchase of FDS Goods and Services or Approved Ancillary
Products by a Cardholder on credit and each return of FDS Goods and Services or
Approved Ancillary Products for credit.

         "FDS Companies" has the meaning set forth in the preamble hereof.

         "FDS Credit Card" means a Co-Branded Credit Card, a Private Label
Credit Card or a Credit Card linked to a Prepaid Employee Account.

         "FDS Debit Cards" has the meaning set forth in Section 2.2(d) hereof.

         "FDS Event of Default" means the occurrence of any one of the events
listed in Section 14.3 hereof or an Event of Default where an FDS Company is the
defaulting Party.

         "FDS Goods and Services" means the products and services sold, charged
or offered by or through FDS Channels, including for personal, household, or
business purposes, and including accessories, delivery services, protection
agreements, gift cards, shipping and handling, and work or labor to be performed
for the benefit of customers of the FDS Channels.

                                       8
<PAGE>

         "FDS Licensed Marks" means the trademarks, tradenames, service marks,
logos and other proprietary designations of the FDS Companies listed on Schedule
1.1(e) and licensed to Bank by the FDS Companies under Section 10.1 hereof.

         "FDS Manager" has the meaning set forth in Section 3.4(a) hereof.

         "FDS Marketing Commitment" means the obligation of Bank to pay the
amounts set forth in Schedule 1.1(l) for marketing purposes as set forth in, and
in accordance with, Section 5.2(b).

         "FDS Matters" has the meaning set forth in Section 3.2(f) hereof.

         "FDS Profit Share" has the meaning set forth in Schedule 1.1(i).

         "FDS Prospect List" has the meaning set forth in Section 6.3(b) hereof.

         "FDS Revenue Share" means the sum of the Net Credit Sale Share (as set
forth on Schedule 9.3(a)) plus the New Account Payments (as set forth on
Schedule 9.3(a)).

         "FDS Servicer" means FDS Bank or such of its Affiliates, including
FACS, responsible for performing the servicing functions referred to in Section
7.2(a).

         "FDS Servicing Charge" means, for any Fiscal Month, the amount
calculated as set forth in Schedule 1.1(g).

         "FDS Shopper" means any Person who makes purchases of FDS Goods and
Services.

         "FDS Shopper Data" means all personally identifiable information
regarding an FDS Shopper that is obtained by (or on behalf of) FDS or any of its
Affiliates at any time (including prior to the date hereof), including
personally identifiable information obtained in connection with such FDS Shopper
making a purchase of FDS Goods and Services.

         "FDS Systems" means Systems owned, leased or licensed by and operated
by or on behalf of FDS or its Affiliates; provided that a System shall not be an
FDS System if access or permission to use such System must be granted by Bank or
any of its Affiliates in order for FDS or any of its Affiliates to use such
System hereunder.

         "FDS Transaction" means any purchase, exchange or return of FDS Goods
and Services by a Cardholder using an FDS Credit Card.

         "FedCustomer" means the retail marketing database used by FDS and its
Affiliates.

         "Federal Funds Rate" means the offered rate as reported in The Wall
Street Journal in the "Money Rates" section for reserves traded among commercial
banks for overnight use in amounts of one million dollars ($1,000,000) or more
or, if no such rate is published for a day, the rate published for the preceding
Business Day, calculated on a daily basis based on a 365 day year.

                                       9
<PAGE>

         "Finance Charge Reversal Percentage" means, with respect to any Fiscal
Quarter, an amount, expressed as a percentage, equal to (i) the aggregate amount
of all finance charges that had been assessed on the Accounts and then reversed
by FDS or its Subsidiaries (other than System generated refunds of provisional
finance charges assessed prior to on time payment in full of amounts due by a
Cardholder) during the twelve (12) Fiscal Month period ended at the end of such
Fiscal Quarter calculated on a sum of cycles basis of reporting monthly
receivables under the Accounts, divided by (ii) the aggregate amount of all
finance charges assessed on the Accounts during the twelve (12) Fiscal Month
period ended at the end of such Fiscal Quarter calculated on a sum of cycles
basis of reporting monthly receivables under the Accounts.

         "Fiscal Month" means each four (4) or five (5) week period designated
as such in the calendar published by the National Retail Federation for
retailers on a Fiscal Year-reporting basis; provided, that the Fiscal Month in
which the Effective Date occurs shall be deemed to begin on the Effective Date.

         "Fiscal Quarter" means each three (3) Fiscal Month period set forth in
the calendar published by the National Retail Federation for retailers on a
Fiscal Year-reporting basis; provided that the Fiscal Quarter in which the
Effective Date occurs shall be deemed to begin on the Effective Date.

         "Fiscal Year" means the fiscal year set forth in the calendar published
by the National Retail Federation setting forth the fiscal year for retailers on
a 52/53 week fiscal year ending on the Saturday closest to January 31; provided
that the Fiscal Year in which the Effective Date occurs shall be deemed to begin
on the Effective Date.

         "Force Majeure Event" has the meaning set forth in Section 18.20
hereof.

         "Funding Costs" has meaning set forth on Schedule 1.1(m).

         "Future Subcontractors" has the meaning set forth in Section 6.2(h)(i)
hereof.

         "GE Bank" means GE Capital Consumer Card Co., an Ohio banking
corporation.

         "GE/Macy's Account" has the meaning set forth in the GE/Macy's Program
Agreement.

         "GE/Macy's Program Agreement" means the Amended and Restated Credit
Card Program Agreement, dated as of June 4, 1996, by and among GE Bank, FDS and
the other parties thereto, as amended, restated or otherwise modified from time
to time.

         "GE/Macy's Receivables" has the meaning set forth in the GE/Macy's
Program Agreement.

         "General Purpose Account" means an Account linked to any Co-Branded
Credit Card and usable solely for the purpose of financing (i) purchases (and
all fees and charges relating thereto) of goods and services through sellers or
channels other than the FDS Channels and (ii) purchases (and all fees and
charges relating thereto) of FDS Goods and Services through any FDS Channel that
does not honor the Private Label Account linked to such Co-Branded Credit

                                       10
<PAGE>

Card (e.g., purchase of FDS Goods and Services at a Macy's store using a
Bloomingdale's branded FDS Credit Card).

         "Governmental Authority" means any federal, state or local domestic,
foreign or supranational governmental, regulatory or self-regulatory authority,
agency, court, tribunal, commission or other governmental, regulatory or
self-regulatory entity.

         "Gross Receivables" means amounts owing (net of credit balances) from
cardholders with respect to accounts in a Credit Card portfolio (including
outstanding loans, cash advances and other extensions of credit; billed or
unbilled finance charges and late charges; and any other billed or unbilled
fees, charges and interest assessed on such accounts).

         "Guidelines" has the meaning set forth in Section 6.1(b) hereof.

         "High Collar" has the meaning set forth on Schedule 1.1(f) hereto.

         "Indemnified Party" has the meaning set forth in Section 17.3(b)
hereof.

         "Indemnifying Party" has the meaning set forth in Section 17.3(b)
hereof.

         "Initial Term" has the meaning set forth in Section 15.1 hereof.

         "Inserts" has the meaning set forth in Section 5.3(a) hereof.

         "In-Store Payment" means any payment on an Account made in a retail
store owned or operated by FDS or any of its Subsidiaries by a Cardholder or a
person acting on behalf of a Cardholder.

          "Intellectual Property" means, on a worldwide basis, all intellectual
property, including (i) rights associated with works of authorship, including
copyrights, moral rights and mask-works; (ii) trademarks, service marks,
internet domain names and other source indicators and the goodwill associated
therewith; (iii) trade secret rights; (iv) patents, designs, algorithms and
other industrial property rights; (v) other intellectual and industrial property
rights of every kind and nature, however designated, whether arising by
operation of law, contract, license or otherwise; and (vi) applications,
registrations, renewals, extensions, continuations, divisions or reissues
thereof now or hereafter in force (including any rights in any of the
foregoing).

         "Interchange Fees" means the interchange fees or interchange
reimbursement fees paid or payable to Bank by the Card Association with respect
to the Accounts, in Bank's capacity as a Credit Card issuer, and in connection
with Cardholder usage of the Accounts.

         "Interim Services" means the services set forth in Schedule 1.1(n).

         "Joint IP" has the meaning set forth in Section 10.3(b) hereof.

         "Knowledge" means, with respect to any of the FDS Companies or Bank,
the actual knowledge of the executive officers of the organization who have
managerial responsibility for the Program, after reasonable inquiry.

                                       11
<PAGE>

         "Late Fee Reversal Percentage" means, with respect to any Fiscal
Quarter, an amount equal to (i) the aggregate amount of all late fees that had
been assessed on the Accounts and then reversed by FDS or its Subsidiaries
during the twelve (12) Fiscal Month period ended at the end of such Fiscal
Quarter calculated on a sum of cycles basis of reporting monthly receivables
under the Accounts, divided by (ii) the aggregate amount of all late fees
assessed on the Accounts during the twelve (12) Fiscal Month period ended at the
end of such Fiscal Quarter calculated on a sum of cycles basis of reporting
monthly receivables under the Accounts.

         "Legally Required Communications" means any communications with
Cardholders (including any communications relating to customer service, account
management and collections) that are required by Applicable Law.

         "LIBOR" means the London Interbank Offered Rates.

         "Licensee" means any Person authorized by FDS or any of its
Subsidiaries to operate in and sell FDS Goods and Services from the FDS Channels
under the FDS Licensed Marks, solely with respect to such Person's or any of its
Subsidiaries' operation in and sale of FDS Goods and Services from the FDS
Channels or under the FDS Licensed Marks.

         "Low Collar" has the meaning set forth on Schedule 1.1(f) hereto.

         "Loyalty Programs" has the meaning set forth in Section 4.8(a) hereof.

         "Manager" has the meaning set forth in Section 3.4(a) hereof.

         "Marketing Plan" has the meaning set forth in Section 5.6(a) hereof.

         "May Co." means The May Department Stores Company, a Delaware
corporation.

         "May Merger" means the merger of May Co. with and into Milan
Acquisition Corp., a Subsidiary of FDS, pursuant to the Agreement and Plan of
Merger, dated as of February 27, 2005, by and among FDS, Milan Acquisition Corp.
and May Co., as amended or otherwise modified from time to time.

         "Merchant Discount" means a discount rate generally applied against
settlements due to merchants for transactions with respect to the use of a
Credit Card, which includes the Interchange Fees as well as any other
transaction fees.

         "Monthly Settlement Sheet" has the meaning set forth in Section 9.2(a)
hereof.

         "MSA" means a metropolitan statistical area as defined by the U.S.
Office of Management and Budget and announced in an OMB Bulletin.

         "Net Credit Sales" means, for any Fiscal Year or Fiscal Month, an
amount equal to (i) gross credit sales on Accounts (including gift card sales,
sales tax, delivery charges, Licensee sales and any other amount included in the
full amount charged by Cardholders) during such Fiscal Year or Fiscal Month,
minus (ii) the sum of credits for returned goods and cancelled

                                       12
<PAGE>

services and other credits (such as concessions, discounts and adjustments) on
Accounts during such Fiscal Year or Fiscal Month.

         "Net FDS Write-offs" means, with respect to Accounts that have been
written-off in a Fiscal Month as losses on a sum of cycles basis of reporting
monthly receivables under the Accounts in accordance with the credit and
collection policies contained in the Risk Management Policies, (a) amounts
charged to the written-off Accounts, identified by Account, relating to the sale
of FDS Goods and Services, including sales and use tax but excluding finance
charges and late charges, minus (b) the portion of any recoveries received
during such Fiscal Month on previously written-off Accounts attributable to the
sale of FDS Goods and Services, including sales and use taxes but excluding
finance charges and late charges.

         "New Account Payments" has the meaning set forth in Schedule 9.3(a)
hereof.

         "New Bank Mark" has the meaning set forth in Section 10.2(b) hereof.

         "New FDS Mark" has the meaning set forth in Section 10.1(b) hereof.

         "Nominated Purchaser" has the meaning set forth in Section 16.2(a)
hereof.

         "Operating Committee" has the meaning set forth in Section 3.2(a)
hereof.

         "Operating Procedures" means the operating procedures for the Program
in effect from time to time in accordance with Section 4.1(b) hereof.

         "Parties" means the collective reference to the FDS Companies and Bank;
and unless the context otherwise requires, "Party" means either the collective
reference to the FDS Companies, on the one hand, or Bank, on the other hand.

         "Partner Designees" has the meaning set forth in Section 3.2(c) hereof.

         "Partner Event of Default" means the occurrence of any one of the
events listed in Section 14.2 hereof or an Event of Default where a Bank is the
defaulting Party.

         "Partner Matters" has the meaning set forth in Section 3.2(g) hereof.

         "Partner Servicing Charge" means the amount calculated as set forth on
Schedule 1.1(g).

         "Person" or "person" means any individual, corporation, business trust,
partnership, association, limited liability company or similar organization, or
any Governmental Authority.

         "POS" means point of sale.

         "Premium" means the collective reference to (i) the "Premium" portion
of the FDS Purchase Price, as defined on the Final First Closing Statement, as
finally determined in accordance with Section 2.3 of the Purchase Agreement,
(ii) the "Premium" portion of the GE/Macy's Purchase Price, as defined on the
Final Second Closing Statement, as finally determined in accordance with Section
3.3 of the Purchase Agreement, and (iii) the "Premium"

                                       13
<PAGE>

portion of the May Purchase Price, as defined on the Final Third Closing
Statement, as finally determined in accordance with Section 4.3 of the Purchase
Agreement.

         "Prepaid Employee Account" means a payment product issued to an
employee of FDS or any of its Subsidiaries that may be used for the purchases of
FDS Goods and Services and otherwise has the same functionality and features as
a Private Label Account, except that the terms of such Account shall require the
applicable employee to prepay the amount that can be utilized for purchases
pursuant to that Account, and is designated by an FDS Company as an Account that
is eligible for an employee discount.

         "Pre-Tax Profit" has the meaning set forth in Schedule 1.1(i).

         "Previously Disclosed" means a disclosure in writing setting forth an
exception to the representations and warranties of FDS or Bank, as applicable,
in each case as set forth in the corresponding Schedule to this Agreement, which
Schedules are being delivered by FDS and Bank concurrently with the execution
and delivery of this Agreement by the Parties.

         "Primary Initial Program Terms" means (a) the credit offerings and
cardholder terms described in Section 4.7 and Schedule 4.7, (b) the Value
Propositions described in Section 4.8 and Schedules 4.8(a) and 4.8(b), (c) the
Risk Management Policies set forth in Schedules 4.6(b), 4.6(c)(i) and
4.6(c)(ii), and (d) the SLAs set forth in Schedule 7.3.

         "Private Label Accounts" means the (i) Accounts linked to Private Label
Credit Cards and (ii) Accounts linked to Co-Branded Credit Cards solely for the
purpose of financing the purchase of FDS Goods and Services (and all fees and
charges relating thereto) through any FDS Channel (except any such FDS Channel
that has not provided for cross-acceptance of such Credit Card from another FDS
Channel, the marks of which are linked to such Co-Branded Credit Card).

         "Private Label Credit Card" means a Credit Card that bears an FDS
Licensed Mark and may be used solely to finance purchases of FDS Goods and
Services through any FDS Channel associated with the FDS Licensed Marks
appearing on the face of such Credit Card, including the Credit Cards listed on
Schedule 1.1(c) as "Private Label Credit Cards". Each Private Label Credit Card
is linked to solely a Private Label Account (and not a General Purpose Account).

         "Program" means the Private Label Credit Card and Co-Branded Credit
Card program established pursuant to this Agreement.

         "Program Assets" means the Accounts, Account Documentation, Cardholder
List, Cardholder Data, Solicitation Materials and all Cardholder Indebtedness
(whether held by Bank or a third party).

         "Program Expenses" has the meaning set forth in Schedule 1.1(i).

         "Program Objectives" has the meaning set forth in Section 3.1 hereof.

         "Program Privacy Policy" means the privacy policy and associated
disclosures to be provided by Bank to Cardholders in connection with the
Program, as set forth in Section 6.2(a)

                                       14
<PAGE>

and as modified from time to time in accordance with such Section, provided,
however, that the Program Privacy Policy shall be deemed not to include the
portion of the notice set forth in Schedule 6.2(b) entitled "Citigroup Privacy
Promise to Consumers".

         "Program Purchase Date" has the meaning set forth in Section 16.2(c)
hereof.

         "Purchase Agreement" has the meaning set forth in the recitals hereof.

         "Purchased Accounts" means the collective reference to (i) the FDS
Accounts from and after the occurrence of the First Closing, (ii) the GE/Macy's
Accounts from and after the occurrence of the Second Closing and (iii) the May
Accounts from and after the occurrence of the Third Closing.

         "Quarterly Settlement Sheet" has the meaning set forth in Section
9.2(b) hereof.

         "Receiving Party" has the meaning set forth in Section 13.1(d) hereof.

         "Retail Merchants" has the meaning set forth in Section 8.1 hereof.

         "Renewal Term" has the meaning set forth in Section 15.1 hereof.

         "Right of First Offer" has the meaning set forth in Schedule 2.2.

         "Risk Management Policies" means the underwriting and risk management
policies, procedures and practices applicable to the Program, consistent with
this Agreement, including policies, procedures and practices for credit and
Account openings, transaction authorization, fraud, collections, credit line
assignment, increases and decreases, over-limit decisions, Account closures,
payment crediting and charge-offs.

         "Sales Tax Refunds" means refunds, rebates, credits or deductions of
sales and use tax by any taxing authority in respect of an Account, and all
allowable interest relating thereto.

         "Second Look Program" has the meaning set forth in Section 2.2(c)
hereof.

         "Services Transition Date" has the meaning set forth in Section 7.2(d)
hereof.

         "Significant Portfolio" has the meaning set forth in Section 2.3(b)(i)
hereof.

         "SLA" means each individual performance standard set forth on Schedule
7.3.

         "Small Portfolio" has the meaning set forth in Section 2.3(a) hereof.

         "Sold Area Stores" has the meaning set forth in Section 2.4 hereof.

         "Sold Chain" has the meaning set forth in Section 2.4 hereof.

         "Solicitation Materials" means works of authorship, documentation,
materials, artwork, copy, brochures, applications, any other written or recorded
materials and any advertisements in any format or media (including television,
internet and radio), used to promote or identify the

                                       15
<PAGE>
Program to Cardholders and potential Cardholders, including direct mail
solicitation materials and coupons.

      "Special Condition" has the meaning set forth in Section 11.4(g) hereof.

      "SPIFs" has the meaning set forth in Section 5.2(a)(v) hereof.

      "Subsidiary" when used with respect to any Person, means another Person,
where an amount of the voting securities, or other voting ownership or voting
partnership interests of the second Person sufficient to elect at least a
majority of its board of directors or similar governing body (or if there are
not such voting interests, fifty percent (50%) or more of the equity interest of
which) is owned directly or indirectly by the first Person or by another
Subsidiary of the first Person.

      "Systems" means software, databases, computers, systems and networks.

      "Systems Transition Date" has the meaning set forth in Section 7.4(a)
hereof.

      "Term" means the Initial Term and each Renewal Term.

      "Termination Period" means the period beginning on the earlier of the date
of expiration of this Agreement or the date of any notice of termination
pursuant to Article XV and ending on either (i) the date the Program Assets are
purchased pursuant to Section 16.2, if FDS or a Nominated Purchaser purchases
the Program Assets, or (ii) the date that either (A) the FDS Companies deliver
written notice to Bank of their election not to purchase the Program Assets or
(B) the right of the FDS Companies to purchase the Program Assets expires in
accordance with the terms of this Agreement.

      "Total Servicing Transfer" has the meaning set forth in Section 7.2(c)
hereof.

      "Trademark Style Guide" means any rules governing the manner of usage of
trademarks, tradenames, service marks, logos and other proprietary designations.

      "Transition Plan" means the transition plan agreed upon by the Parties on
or before the Effective Date as to the actions the Parties shall take to
initiate the Program in accordance with this Agreement and which shall be
attached hereto as Schedule 1.1(j).

      "Unamortized Premium" has the meaning set forth in Schedule 1.1(k).

      "Unapproved Matter" has the meaning set forth in Section 3.2(e)(ii)(B)
hereof.

      "Value Propositions" means the value propositions described in Section 4.8
and any other card-related promotional or rewards programs as may be established
by the Operating Committee from time to time.

      "Year-End Settlement Sheet" has the meaning set forth in Section 9.2(c)
hereof.

            1.2 Miscellaneous. As used herein: (a) all references to the plural
number shall

                                       16
<PAGE>

include the singular number (and vice versa); (b) all references to "herein,"
"hereunder," "hereof" or like words shall refer to this Agreement as a whole and
not to any particular section, subsection or clause contained in this Agreement;
(c) all references to "include," "includes" or "including" shall be deemed to be
followed by the words "without limitation"; (d) unless specified as Business
Days, all references to days or months shall be deemed references to calendar
days or months; and (e) all references to "$" or "dollars" shall be deemed
references to United States dollars.

                                   ARTICLE II

                          ESTABLISHMENT OF THE PROGRAM

            2.1 Credit Program. Beginning as of the Effective Date, Bank shall
offer and issue the FDS Credit Cards, and shall issue (or arrange to be issued
by an Affiliate or another third party acceptable to FDS or currently offering
such products on Bank's behalf) the Approved Ancillary Products. Bank shall
promptly open a new Account and issue a new Private Label Credit Card or
Co-Branded Credit Card with respect to each Credit Card Application approved in
accordance with the Risk Management Policies. In addition, in the case of any
employee of FDS or any of its Subsidiaries who applies for an FDS Credit Card
but is not approved for a Private Label Account in accordance with the Risk
Management Policies, Bank shall arrange for an Affiliate to offer, or cause to
be offered, and Bank shall issue, or arrange for the issuance by an Affiliate
of, a Prepaid Employee Account. To the extent approved in accordance with the
terms of this Agreement, in addition to the FDS Credit Cards and Approved
Ancillary Products, the Program shall include such other Ancillary Products and
other payment products as shall be incorporated in the Program in the future.

            2.2 Exclusivity.

      (a) General. Except as otherwise provided in this Section 2.2 and in
Section 2.3, during the Term, each of the FDS Companies, on behalf of itself and
its Affiliates, agrees that it shall not, by itself or in conjunction with or
pursuant to agreements with others, directly or indirectly: (i) issue, offer or
market in the United States a Credit Card, whether or not bearing an FDS
Licensed Mark or any other mark comprised, in whole or in part, of the name of
any FDS retail entity, other than through the Program; (ii) expressly authorize
any third party to issue, offer or market in the United States a revolving
credit or installment loan product bearing an FDS Licensed Mark or any other
mark comprised, in whole or in part, of the name of any FDS retail entity, other
than through the Program; or (iii) sell, rent or otherwise make available, or
allow others to sell, rent or otherwise make available, any FDS Shopper Data or
other Cardholder information for marketing, issuance or offering of any
revolving credit or installment loan product bearing an FDS Licensed Mark or any
other mark comprised, in whole or in part, of the name of any FDS retail entity.

      (b) GE/Macy's and May Credit Cards. Notwithstanding Section 2.2(a), (i)
FDS and its Affiliates shall have the right to continue to exercise their rights
and perform their obligations pursuant to the GE/Macy's Program Agreement until
the termination thereof; provided that FDS shall not permit the term of such
agreement to be extended or renewed and (ii) following the May Merger and prior
to the Third Closing Date, FDS and its Affiliates shall be entitled to offer

                                       17
<PAGE>

the May Accounts and operate the May Business (as defined in the Purchase
Agreement) as contemplated by the Purchase Agreement.

      (c) Second-Look Credit Card Program. Notwithstanding Section 2.2(a), FDS
and its Affiliates shall have the right at any time during the Term to establish
a program (a "Second Look Program") for issuing Credit Cards, including Private
Label Credit Cards and Co-Branded Credit Cards, using the FDS Licensed Marks, to
customers whose Credit Card Applications have been declined by Bank (and
customers who were granted credit under the Program, but for whom the credit
granted is not sufficient to accommodate the purchase of any FDS Goods and
Services). Upon the request of any FDS Company, Partner shall forward to the FDS
Companies or a provider of secondary financing the Credit Card Applications with
respect to such customers and shall take such other actions as are reasonably
requested by the FDS Companies in order to facilitate the issuance of Credit
Cards to such customers pursuant to any Second Look Program.

      (d) Debit Cards. In the event that FDS or any of its Affiliates desires to
issue or market a debit card that bears the brand of the relevant card
association and one or more FDS Licensed Marks ("FDS Debit Cards"), FDS shall
first provide notice to Bank of such desire. Bank shall have thirty (30) days
from the receipt of such notice to make a proposal (or to cause one of its
Affiliates to make a proposal) with respect to such issuance. If Bank or one of
its Affiliates elects to make such a proposal during such time period, FDS shall
negotiate in good faith with Bank or such Affiliate to arrive at an agreement
providing for the offering, on mutually satisfactory terms, of a debit card
product featuring functionality and terms mutually agreeable to FDS and Bank. In
the event that FDS and Bank (or Bank's Affiliate) fail to reach agreement on the
principal terms thereof within thirty (30) days from the date of Bank's initial
proposal to FDS, FDS shall be free to issue FDS Debit Cards or enter into an
arrangement with any third party to issue FDS Debit Cards; provided that FDS
shall not enter into any such third party arrangement having contractual terms,
product features and functionality that are in the aggregate materially less
favorable to FDS than the terms, features and functionality offered to FDS by
Bank or its Affiliate.

      (e) Retail Portfolio Acquisition. Notwithstanding Section 2.2(a), Bank's
sole rights with respect to Credit Card portfolios acquired by FDS or its
Affiliates during the Term are set forth in Section 2.3 hereof. The limitations,
restrictions and procedures set forth in Section 2.2(d) shall not apply to debit
card portfolios acquired by FDS or its Affiliates, and Bank shall have no rights
with respect to any such acquired portfolios.

      (f) Payment Plans. Without the prior written consent of Bank, none of FDS
or its Affiliates shall offer the payment plans set forth on Schedule 4.8(b)(i)
to their retail customers except (i) through the Program, (ii) through a
second-look Credit Card program established in compliance with Section 2.2(c) or
(iii) to the extent that, without the consent of FDS, such payment plans are no
longer offered through the Program.

      (g) Other Products. Notwithstanding the prohibitions set forth in this
Section 2.2, FDS and its Affiliates shall be free to do any of the following at
any time:

                  (i) issue, offer or market any payment products not expressly
covered in this Section 2.2 (e.g., FDS and its Affiliates shall not be
restricted from issuing, accepting or

                                       18
<PAGE>

otherwise taking action with respect to (A) gift cards, pre-paid cards or stored
value cards, whether or not bearing an FDS Licensed Mark, or (B) debit cards
(whether or not bearing an FDS Licensed Mark) other than to the extent set forth
above with respect to FDS Debit Cards);

                  (ii) participate in rewards programs and promotions by card
associations or for cards not branded with any of the FDS Licensed Marks (e.g.,
American Express Membership Rewards);

                  (iii) offer its customers a loyalty program of any type
(whether or not using an FDS Licensed Mark); provided that (a) no such program
shall (1) promote the generation of Credit Card accounts in the United States
other than the Accounts or (2) be marketed more prominently in any retail stores
operated by FDS and Subsidiaries than the Loyalty Programs offered under the
Program; and (b) the Loyalty Programs offered under the Program shall be the
primary loyalty programs of FDS and its Subsidiaries (as applicable); and

                  (iv) accept any type of Credit Card, debit card or other
payment product for purchases of FDS Goods and Services.

            2.3 Retail Portfolio Acquisitions.

      (a) Small Acquired Portfolios. If FDS or any of its Affiliates acquires
(including by merger, consolidation or other business combination) a retail
department store business that directly or through an Affiliate or unaffiliated
third party issues a Credit Card in the United States and the portfolio of such
Credit Cards has Gross Receivables, as of the month-end preceding the date of
acquisition, of less than five hundred million dollars ($500,000,000) (a "Small
Portfolio"), unless it is prohibited from doing so by contractual prohibitions
applicable to the acquired business or by Applicable Law, FDS or such Affiliate
shall sell, and Bank shall purchase, such Small Portfolio in accordance with the
terms and procedures set forth in Schedule 2.3(a); provided, however, that
Bank's obligation to purchase the Small Portfolio shall be subject only to
receipt of applicable regulatory approvals and the execution by FDS of the
transaction agreement referred to in Section 2.3(c).

      (b) Significant Acquired Portfolios.

                  (i) If FDS or any of its Affiliates acquires (including by
merger, consolidation or other business combination) a retail department store
business that directly or through an Affiliate or unaffiliated third party
issues a Credit Card in the United States and the portfolio of such Credit Cards
has Gross Receivables, as of the month-end preceding the date of acquisition, of
five hundred million dollars ($500,000,000) or more (a "Significant Portfolio"),
FDS may elect to (A) keep such Significant Portfolio (or if the portfolio is
then subject to an agreement with a third party issuer, retain such portfolio
with such third party issuer), or (B) subject to Bank's Right of First Offer,
transfer such Significant Portfolio to a third party.

                  (ii) If FDS elects to keep such Significant Portfolio (or if
the portfolio is then subject to an agreement with a third party issuer, retain
such portfolio with such third party issuer), FDS shall have the right to
operate (itself or through arrangements with a third party) the Credit Card
business associated with such Significant Portfolio. If FDS does not sell the
Significant Portfolio to Bank and this Agreement remains in effect, the
restrictions of Section 2.2

                                       19
<PAGE>

shall not apply to the Credit Card business associated with such Significant
Portfolio, including any growth thereof.

      (c) In the event of a sale of a Small Portfolio to Bank or if FDS accepts
an offer from Bank to purchase a Significant Portfolio, (i) the Parties shall
promptly negotiate in good faith and execute a purchase agreement for such
portfolio, which shall contain terms and conditions substantially similar to the
Purchase Agreement to the extent applicable (and such other terms and conditions
as may be mutually satisfactory to the Parties), and (ii) FDS shall arrange for
the Parties to have reasonable access to information regarding such portfolio to
enable the Parties to perform customary due diligence for purposes of
determining the purchase price for such portfolio. The Parties shall not
unreasonably withhold or delay execution of such purchase agreement or any other
documents necessary to effectuate such sale. The Parties shall use reasonable
efforts to ensure that the closing under such purchase agreement occurs as
promptly as reasonably practicable following the execution of such purchase
agreement.

      (d) Third Party Programs. Notwithstanding the foregoing provisions of this
Section 2.3, if the Credit Cards offered by the acquired retail department store
business are issued by a third party pursuant to a program agreement or other
contractual arrangement between such third party and such acquired retail
business, the FDS Companies shall not be required to terminate such agreement or
arrangement in order to offer such portfolio to Bank. Following completion of
such acquisition, FDS and its Affiliates shall be entitled to continue to comply
with such agreements or arrangements and to renew such agreements or
arrangements upon their expiration. Without limiting their rights and
obligations hereunder, Bank shall cooperate with the FDS Companies in an effort
to ensure that the operation of the Program and the acquired program can both
continue without disruption to the customer base of FDS and its Affiliates;
provided, however, that any cross-acceptance of Credit Cards between the Program
and any such other third party program or arrangement shall be made only on a
reciprocal basis.

      (e) Bank Programs. Notwithstanding the foregoing provisions of this
Section 2.3, if the Credit Cards offered by the acquired retail department store
business are owned by Bank or any of its Affiliates, upon request of FDS, FDS
and Bank shall negotiate in good faith in order to enter into an agreement
containing mutually satisfactory terms pursuant to which the acquired Credit
Card portfolio would be integrated into the Program by converting the acquired
Credit Card accounts into Accounts subject to this Agreement; provided, however,
that if the Parties, after having used good faith to do so, cannot reach a
mutually satisfactory agreement for the integration of such acquired Credit Card
portfolio into the Program, then the Program and the acquired Credit Card
portfolio shall continue to be operated in accordance with the then-existing
respective terms applicable to each, and Bank shall not be deemed in breach of
the provisions of Section 2.5 in respect of the continued operation of such
acquired Credit Card portfolio.

      (f) Conversion of Purchased Accounts. If Bank or any of its Affiliates
acquires any Credit Card portfolio pursuant to this Section 2.3, unless
otherwise provided in this Section 2.3, the Parties shall integrate such Credit
Card portfolio with the Program and convert all acquired Credit Card accounts to
Accounts established under the Program, which converted Accounts shall be
subject to the same terms and conditions as the Accounts and to this Agreement,
and shall participate in the Program, as if they were originated under this
Agreement. Bank shall cover all costs and expenses related to conversions
pursuant to this Section 2.3(f) (which costs

                                       20
<PAGE>

and expenses shall be Program Expenses), including replacement of Credit Cards,
notices to Cardholders and complying with other requirements of Applicable Law.

      (g) No Other Obligations. Except as set forth in this Section 2.3, neither
Party nor any of their respective Affiliates shall (i) have any obligation to
include in the Program any Credit Card portfolios acquired in connection with
any merger, consolidation, acquisition or other transaction or otherwise cause
them to be transferred to Bank or (ii) have any obligation to include any debit
card program so acquired in the Program or otherwise transfer any such program
to Bank. Except to the extent included in the Program, an acquired portfolio may
be operated free of the exclusivity restrictions set forth in this Agreement.

            2.4 Retail Portfolio Dispositions.

      (a) In the event that FDS or any of its Affiliates arranges for the sale
of (a) any existing chain or other group of separately identifiable stores,
including through the sale of a division or subsidiary of FDS (a "Sold Chain"),
or (b) all stores or other retail establishments within an MSA ("Sold Area
Stores"), Bank shall negotiate in good faith with FDS in connection with such
disposition to the extent the purchaser of any Sold Chain or Sold Area Stores
expresses an interest in the Program Assets primarily related thereto. If, as a
result of a disposition referred to in the preceding sentence, FDS ceases to own
any stores in a particular MSA, then, in the event that neither FDS nor the
purchaser of the Sold Chain or Sold Area Stores purchases the Program Assets
primarily related thereto, the provisions of clause (a) of Section 16.4 hereof
shall apply in respect of any Account (a) that at the time of such disposition
has been or thereafter becomes purchase-inactive for at least twelve (12)
consecutive Billing Cycles and (b) for which seventy-five percent (75%) of the
purchase activity in the twelve (12) Billing Cycles preceding the period of
inactivity was at a store or stores disposed of. Notwithstanding the foregoing,
any replacement or substitute Credit Card issued to the holders of such Accounts
shall be a non-partner Credit Card (i.e. a Credit Card that is issued by Bank or
its Affiliates other than pursuant to a program, joint-marketing or similar
agreement with a third party). Notwithstanding the foregoing, Bank shall not
sell any of the foregoing Accounts without the prior written consent of FDS
(which consent shall not be unreasonably withheld).

      (b) In the event that FDS or any of its Affiliates arranges for the sale
of stores, divisions or subsidiaries pursuant to a settlement with or other
written commitment to a Governmental Authority in connection with such
Governmental Authority's review of the May Merger, FDS shall have the right to
cause the disposition of the portion of the Program Assets related to such
disposition to a third party purchaser for a purchase price equal to (i) the
Cardholder Indebtedness of the Program Assets disposed of plus (ii) the product
of (A) the Premium plus the Additional Premium paid in respect of all Purchased
Accounts times (B) (1) Cardholder Indebtedness of the Program Assets disposed of
divided by (2) total Cardholder Indebtedness.

            2.5 Partner Exclusivity. During the Term, neither Bank nor any of
its Affiliates shall enter into any agreement with any of the retailers listed
on Schedule 2.5 or any of their respective Affiliates providing for issuance,
offering or marketing in the United States of a Credit Card bearing a corporate
name, brand or trademark used by any of such retailers in connection with the
operation of their retail businesses in the United States.

                                       21
<PAGE>

            2.6 General Electric Capital Corporation / Macy's Credit Card
Program. Prior to the Second Closing, Bank shall work together with the FDS
Companies to (i) ensure that the Program and the program under the GE/Macy's
Program Agreement shall continue to coexist in substantially the same manner as
prior to the Effective Date and (ii) avoid, to the extent possible (consistent
with this Agreement), any conflicts that may arise between the operations of the
Program and those of the program under the GE/Macy's Program Agreement. Prior to
the consummation of the Second Closing (and the termination or expiration of the
GE/Macy's Program Agreement), Bank shall have no right to any amounts received
by FDS pursuant to the GE/Macy's Program Agreement or to any amounts generated
by GE/Macy's Accounts or GE/Macy's Receivables. Bank shall not be liable
hereunder for any act or omission to act to the extent that such act or omission
was properly taken by Bank in order to satisfy its respective obligations under
this Section 2.6 without gross negligence or willful misconduct (and no such act
or omission shall constitute an Event of Default hereunder).

                                  ARTICLE III

                      PROGRAM MANAGEMENT AND ADMINISTRATION

            3.1 Program Objectives. In performing their responsibilities with
respect to the management and administration of the Program, each Party shall be
guided by the following Program objectives (the "Program Objectives"):

      (a)   to drive retail sales and profitability of the FDS Companies and
            their Affiliates;

      (b)   to provide high-quality service consistent with the preservation and
            enhancement of the FDS brands;

      (c)   to differentiate the FDS Companies and their Affiliates from their
            competitors in terms of customer value, convenience and service;

      (d)   to provide a Program tailored to the unique characteristics of the
            retail customers of the FDS Companies and their Affiliates; and

      (e)   to retain existing Cardholders and generate new Accounts and FDS
            Credit Card usage to drive the FDS Companies' and their Affiliates'
            retail sales and increase Program revenues and profitability.

            3.2 Operating Committee.

      (a) Establishment of the Operating Committee. FDS Bank, on behalf of the
FDS Companies, and Bank hereby establish a committee (the "Operating Committee")
to oversee and review the conduct of the Program pursuant to this Agreement and
to perform any other action that, pursuant to any express provision of this
Agreement, requires its action.

      (b) Subcommittees of the Operating Committee. The Operating Committee may
designate additional committees (which may include persons who are not members
of the Operating Committee) with responsibility for overseeing and administering
specified aspects of the Program (e.g., marketing, underwriting and risk
management); provided, however, that

                                       22
<PAGE>

approval of any matter expressly required by this Agreement to be approved by
the Operating Committee shall not be delegated to any subcommittee or other
body.

      (c) Composition of the Operating Committee. The Operating Committee shall
consist of six (6) members, of whom three (3) members shall be nominated by FDS
Bank (the "FDS Bank Designees") and three (3) members shall be nominated by Bank
(the "Partner Designees"). The initial FDS Bank Designees and Partner Designees
shall be determined prior to the First Closing. FDS shall at all times have as
one of its designees the FDS Manager (as defined in Section 3.4(a)) and Bank
shall at all times have as one of its designees Bank Manager (as defined in
Section 3.4(a)). Bank and FDS Bank may each substitute its designees to the
Operating Committee from time to time, provided that each Party shall provide
the other Party with as much prior notice of any such substitution as is
reasonably practicable under the circumstances.

      (d) Functions of the Operating Committee. Subject to Sections 3.2(e),
3.2(f) and 3.2(g), the Operating Committee shall:

                  (i)   approve the semi-annual and annual Budget and the
                        Business Plan, including the assumptions and performance
                        targets reflected therein;

                  (ii)  review monthly, quarterly and annual Program performance
                        relative to the Budget and the Business Plan and Program
                        Objectives;

                  (iii) oversee Program marketing activities, including:

                        (A)   review and approval of the Marketing Plan; and

                        (B)   allocation of the Additional Marketing Commitment;

                  (iv)  review collection strategies and collection metrics;

                  (v)   monitor activities of competitive programs and identify
                        implications of market trends;

                  (vi)  approve (which approval will not be unreasonably
                        withheld) the use of any third party (e.g.,
                        subcontractor or outsourced service provider), other
                        than any Affiliate or Licensee of FDS or Bank, as the
                        case may be, to perform any obligation to be performed
                        by Bank or the FDS Companies under the Program to the
                        extent such obligation involves customer contact
                        (whether in person, by telephone or in writing) prior to
                        ninety (90) days' delinquency (as set forth on, and in
                        accordance with, Schedule 4.2(a)(iv)), in each case,
                        except to the extent subcontracted or outsourced as of
                        the Effective Date;

                  (vii) evaluate and approve changes to the Primary Initial
                        Program Terms, including the evaluation and approval of
                        any of the following:

                                       23
<PAGE>

                        (A)   offering of new Credit Card or other payment
                              products or Ancillary Products;

                        (B)   changes in Cardholder terms, including any of the
                              terms set forth on Schedule 4.7;

                        (C)   changes to the Risk Management Policies (which
                              shall be  submitted to the Operating Committee
                              together with the expected pro forma effects of
                              such changes on the Program);

                        (D)   changes to the Operating Procedures;

                        (E)   changes to the SLAs applicable to the Program;

                        (F)   changes to existing Value Propositions, or
                              approval of additional Value Propositions to be
                              supported by the Program;

                  (viii) approve the design of Credit Card Documentation, the
                         design of FDS Credit Cards and any changes thereto;

                  (ix)   review customer service, collections and other
                         servicing performance and reporting aspects of the
                         Program against SLAs and other requirements of this
                         Agreement;

                  (x)    approve any capital expenditures (or group of related
                         capital expenditures) that would constitute Program
                         Expenses in excess of one hundred thousand dollars
                         ($100,000) in any Fiscal Year;

                  (xi)   carry out such other tasks as are assigned to it by
                         this Agreement or jointly by the Parties;

                  (xii)  approve any modifications to the Transition Plan;

                  (xiii) approve changes to the Program Privacy Policy or the
                         notice set forth in Schedule 6.2(b); and

                  (xiv)  evaluate and approve new Credit Card products,
                         Ancillary Products or other products and services
                         proposed to be offered to Cardholders.

      (e) Proceedings of the Operating Committee.

                  (i) Meetings and Procedural Matters. The Operating Committee
shall meet (in person or telephonically) not less frequently than monthly. In
addition, any member of the Operating Committee may call a special meeting by
delivery of at least five (5) Business Days' prior notice to all of the other
members of the Operating Committee, which notice shall specify the purpose for
such meeting. Except to the extent expressly provided in this Agreement, the
Operating Committee (and any subcommittee formed by it) shall determine the
frequency, place

                                       24
<PAGE>

and agenda for its meetings, the manner in which meetings shall be called and
all procedural matters relating to the conduct of meetings and the approval of
matters thereat.

                  (ii) Actions.

                        (A) Each of FDS and Bank shall be entitled to one vote
                  in respect of all matters to be approved by the Operating
                  Committee (or any applicable subcommittees). Any one of the
                  representatives of FDS and of Bank on the Operating Committee
                  (or any subcommittee) may cast the vote allocated to FDS or
                  Bank, as the case may be, in the manner determined by such
                  representatives. Any matter requiring the approval of the
                  Operating Committee (or any subcommittee) shall require the
                  affirmative approval of both FDS and Bank.

                        (B) If the Operating Committee shall fail to agree on
                  any matter of significance to the Program, including any
                  unresolved subcommittee matter to which the Operating
                  Committee has attempted in good faith to resolve (an
                  "Unapproved Matter"), then such Unapproved Matter shall be
                  referred to the Executive Committee (as defined in Section
                  3.3) for further consideration. Any such resolution by the
                  Executive Committee shall be deemed to be the action and
                  approval of the Operating Committee for purposes of this
                  Agreement. If a majority of the Executive Committee members
                  constituting the full Executive Committee (including any
                  vacancies) shall fail to resolve the Unapproved Matter within
                  ten (10) Business Days after such matter has been referred to
                  the Executive Committee, then such Unapproved Matter shall be
                  referred to the President of Citi Cards and the Vice Chairman
                  or other senior executive of FDS responsible for FDS's credit
                  program, who shall in good faith attempt to resolve the
                  matter. Any such resolution by such senior officers shall be
                  deemed to be the action and approval of the Operating
                  Committee for purposes of this Agreement. If, after ten (10)
                  Business Days, the Unapproved Matter remains unresolved by
                  such senior officers of FDS Bank and Bank, the failure to
                  agree shall constitute a deadlock. In the event of a deadlock,
                  the final decision shall rest with FDS Bank in the case of FDS
                  Matters and with Bank in the case of Partner Matters, each of
                  whom shall exercise their discretion reasonably and in good
                  faith. If a deadlock should occur with respect to a matter
                  that is neither an FDS Matter nor a Partner Matter, the matter
                  shall be deemed rejected by the Operating Committee.

                        (C) No changes to the Primary Initial Program Terms
                  shall be made before the first anniversary of the Effective
                  Date without the approval of the Operating Committee (it being
                  understood that "approval" shall not include any decision made
                  pursuant to the penultimate sentence of Section
                  3.2(e)(ii)(B)); provided, however, that (i) if a Party
                  concludes that a change is required by Applicable Law or is
                  commensurate and proportionate to any negative changes in
                  through the door populations or individual segment performance
                  (as evidenced and measured by validated scores or generally
                  accepted, data driven credit risk metrics), and (ii) if such
                  Party would have final decision making authority with respect
                  to such change (pursuant to Section 3.2(f) or (g)), then,
                  after satisfying all procedures provided in this Article III
                  with respect to the consideration and

                                       25
<PAGE>

                  approval of the matter by the Operating Committee, such Party
                  may make the change without regard to this clause (C).

                        (D) Without limiting the provisions of this Article III,
                  during the first year following the Effective Date, the
                  Operating Committee will consider the matters set forth on
                  Schedule 3.2(e)(ii)(D).

      (f) FDS Matters. In accordance with and subject to this Section 3.2, FDS
Bank shall have the ultimate decision making authority with respect to the
matters set forth on Schedule 3.2(f) (the "FDS Matters").

      (g) Partner Matters. In accordance with and subject to this Section 3.2,
Bank shall have the ultimate decision making authority with respect to the
matters set forth on Schedule 3.2(g) (the "Partner Matters").

            3.3 Executive Committee. The strategic direction of the Program
shall be subject to the review of an executive committee (the "Executive
Committee"). The Executive Committee shall be responsible for (i) periodically
reviewing the Program; (ii) setting and reviewing strategy for the Program;
(iii) overseeing competitive positioning of Program information systems support
and strategy; (iv) reviewing fundamental changes in the operation of the
Program; and (v) all other matters that the Parties agree should be reviewed by
the Executive Committee. The Executive Committee shall consist of four (4)
members, with two (2) members appointed by each of FDS and Bank and reasonably
acceptable to each other. Each Party shall have the right to remove or replace
its appointees for any reason and at any time, and to fill any vacancy with
respect to its appointees. The initial appointees to the Executive Committee of
each Party shall be determined prior to the Effective Date. The Executive
Committee shall meet (in person or by telephone or video conference) quarterly
or at such other intervals and at places as may be decided by the members of the
Executive Committee; provided, that either FDS Bank or Bank may call a meeting
of the Executive Committee by delivery of at least thirty (30) Business Days'
prior written notice to the other Party (which written notice may be waived by
written agreement of all members of the Executive Committee) containing the
purpose, time and place of the meeting. The members of the Executive Committee
shall appoint an acting chairman and adopt such other rules for the conduct of
meetings as are agreed upon from time to time. The Executive Committee shall be
subject, mutatis mutandis, to the same voting and records provisions of the
Operating Committee set forth in Section 3.2 above.

            3.4 Program Relationship Managers; Partner Program Team.

      (a) Bank and the FDS Companies shall each appoint one Program relationship
manager (each, a "Manager"; the appointee of the FDS Companies, the "FDS
Manager"; and the appointee of Bank, the "Bank Manager"). The FDS Manager and
the Bank Manager shall be the leaders of their respective teams and they and
their teams shall conduct their responsibilities in accordance with the terms of
this Agreement. The FDS Companies and Bank shall endeavor to provide stability
and continuity in the Manager positions and Bank's other Program personnel.

      (b) The initial FDS Manager shall be determined prior to the Effective
Date.

                                       26
<PAGE>

      (c) The initial Bank Manager and the member of Bank's senior management to
whom the Bank Manager reports shall be determined prior to the Effective Date.
The Bank Manager's performance-based compensation shall be based upon the
Program Objectives and other specific annual targets and objectives, including
Program profitability targets. Prior to appointing a new Bank Manager, Bank will
(i) provide FDS an opportunity to meet the proposed candidate, (ii) consult with
FDS and permit FDS an opportunity to provide input and express its views as to
the proposed candidate and (iii) give due consideration to FDS's input and views
as to the appointment of the new Manager. With respect to future Bank Manager
candidates, Bank shall seek to propose candidates with substantial
Program-relevant experience, including (i) substantial Credit Card industry
experience and/or (ii) experience with the department store industry, and/or
comparable customer demographics and/or loyalty programs.

      (d) Prior to appointing a new Manager, the FDS Companies will (i) provide
Bank an opportunity to meet the proposed candidate, (ii) consult with Bank and
permit Bank an opportunity to provide input and express its views as to the
proposed candidate and (iii) give due consideration to Bank's input and views as
to the appointment of the new Manager.

      (e) Bank shall maintain a Program team having expertise and experience
commensurate with a Credit Card program of the size and nature of the Program.
Neither the Bank Manager nor any senior member of Bank's Program team that is or
was a leader of Bank's risk management, finance, decision management or
marketing Program groups shall be reassigned to any program operated by Bank or
any of its Affiliates pursuant to any agreement or arrangement with any retailer
listed on Schedule 2.5 within twelve (12) months of the date that such person
last worked on the Program.

                                   ARTICLE IV

                               PROGRAM OPERATIONS

            4.1 Operation of the Program.

      (a) Each of the Parties hereto shall perform its obligations under this
Agreement (i) in compliance with the terms and conditions of this Agreement
(including any policies, procedures and practices adopted pursuant to this
Agreement), (ii) in good faith, and (iii) in a manner consistent with the
Program Objectives and any annual targets and objectives set by the Operating
Committee from time to time.

      (b) The initial Operating Procedures applicable to various aspects of the
operation of the Program are attached hereto as Schedule 4.1(b). Changes to such
Operating Procedures shall only be made with the approval of the Operating
Committee.

      (c) Except as expressly provided otherwise in this Agreement, Bank shall
use commercially reasonable efforts to ensure that the personnel and other
resources (including Systems and other technology resources) devoted by Bank to
the Program shall be appropriate for a program of the size and nature
contemplated by this Agreement.

                                       27
<PAGE>

            4.2 Certain Responsibilities of the FDS Companies.

      (a) In addition to its other obligations set forth elsewhere in this
Agreement, FDS Bank agrees that during the Term it shall, in its capacity as FDS
Servicer (either itself or through the Affiliate(s) to which it subcontracts the
relevant functions), take the following actions all in accordance with the Risk
Management Policies and the Operating Procedures:

                  (i) as provided in Sections 7.2 and 7.3, maintain a System to
process Credit Card Applications, service the Accounts and effect customer
service;

                  (ii) as provided in Sections 7.2 and 7.3, maintain call
centers to respond to inquiries from Cardholders and to deal with billing
related claims and adjustments (including by making finance charge and late fee
reversals and rebates), establish new Accounts or Account types, authorize
transactions, and assign, increase and decrease credit lines;

                  (iii) as provided in Sections 7.2 and 7.3, provide Account
monitoring services, including identifying delinquencies, implementing
collection efforts, implementing credit-line adjustments, over limit
authorizations and Account deactivation or cancellation;

                  (iv) as provided in Sections 7.2 and 7.3, handle early stage
collection and recovery efforts in respect of Accounts delinquent no more than
ninety (90) days as set forth on, and in accordance with, Schedule 4.2(a)(iv)
("Early Age Collection");

                  (v) deliver Monthly Settlement Sheets, Quarterly Settlement
Sheets and Year-End Settlement Sheets in accordance with this Agreement,
including, in each case the calculation of Pre-tax Profit and the other amounts
and estimates set forth on Schedule 1.1(i) for the applicable period; and

                  (vi) until the Services Transition Date, perform the Interim
Services.

      (b) In addition to their other obligations set forth elsewhere in this
Agreement, the FDS Companies agree that during the Term they shall:

                  (i) solicit new Accounts through in-store instant credit
procedures (in accordance with this Agreement) and display of Solicitation
Materials (or Credit Card Applications) in the FDS Channels pursuant to the
Marketing Plan;

                  (ii) implement and administer the Marketing Plan in accordance
with this Agreement;

                  (iii) pay sales associate compensation relating to the
solicitation of new Accounts;

                  (iv) receive In-Store Payments, subject to reimbursement to
Bank and reimbursement from Bank for the processing of such payments as provided
in this Agreement;

                  (v) deliver to Bank accounting data feeds, including data
relating to Cardholder Indebtedness, finance charges billed and charge-offs, and
other financial and

                                       28
<PAGE>

statistical information as may be reasonably requested by Bank for financial
reporting and securitization purposes and in connection with the exercise and
performance of its rights and obligations under this Agreement, such data feeds
and other information to be delivered electronically and in a form to be
mutually agreed; and

                  (vi) implement the Transition Plan in a timely manner.

            4.3 Certain Responsibilities of Bank.

      (a) In addition to the other obligations set forth elsewhere in this
Agreement, Bank agrees that during the Term it shall:

                  (i) subject to Article III and Section 4.6, establish and
implement all Risk Management Policies;

                  (ii) fund all Program Expenses as provided in this Agreement;

                  (iii) use Bank's and Bank's Affiliates' data and data
resources to support the Program and increase sales of FDS Goods and Services as
provided in Section 5.4(a);

                  (iv) following the applicable Services Transition Date, in
accordance with Sections 7.2 and 7.3, process remittances from Cardholders;

                  (v) following the applicable Services Transition Date, in
accordance with Sections 7.2 and 7.3, prepare, process and mail Credit Card
Documentation, Inserts, privacy policy notices, change in terms notices and
other communications to Cardholders, and provide the FDS Companies with adequate
supplies of Credit Card Applications;

                  (vi) fund all Cardholder Indebtedness on the Accounts;

                  (vii) extend credit on newly originated and existing Accounts
and offer the Value Propositions with respect to those Accounts as are provided
for pursuant to this Agreement;

                  (viii) comply with the terms of the Credit Card Agreements,
the Program Privacy Policies and all Cardholder opt-ins and opt-outs;

                  (ix) following the applicable Services Transition Date, in
accordance with Sections 7.2 and 7.3, handle collection and recovery efforts in
respect of Accounts other than Early Age Collection efforts;

                  (x) maintain the mainframe credit system and the call center
client service systems, in each case to the extent FDS's Systems are not used;
and

                  (xi) implement the Transition Plan in a timely manner.

            4.4 Ownership of Accounts.

                                       29
<PAGE>

      (a) Except to the extent of the FDS Companies' ownership of the FDS
Licensed Marks and the options to purchase Program Assets under Sections 2.4 and
16.2, CEBA Bank shall be the sole and exclusive owner of all Accounts (including
the Purchased Accounts), Cardholder Indebtedness and Account Documentation. All
purchases by Cardholders that are charged on the Accounts and the Cardholder
Indebtedness shall create a relationship of debtor and creditor between the
Cardholders and Bank, respectively. None of the FDS Companies or their
Affiliates shall be considered a creditor with respect to any Account or the
Gross Receivables arising thereunder.

      (b) Except as expressly provided herein (including Section 9.3), Bank
shall be entitled to (i) receive all payments made by Cardholders on Accounts,
(ii) retain for its account all Cardholder Indebtedness and all other fees and
income authorized by the Credit Card Agreements and collected with respect to
the Accounts and Cardholder Indebtedness, and (iii) retain for its account all
income from selling Approved Ancillary Products.

            4.5 Branding of Accounts/Credit Cards/Credit Card
      Documentation/Solicitation Materials.

      (a) The Credit Card Documentation, the FDS Credit Cards and the
Solicitation Materials shall be in the design and format proposed by the FDS
Companies and approved by the Operating Committee; provided that, to the extent
subject to Bank's final authority, Bank shall be responsible for ensuring that
the Credit Card Documentation, the FDS Credit Cards and the Solicitation
Materials comply with Applicable Law and for ensuring that the FDS Credit Cards
and the Solicitation Materials comply with the Credit Card Documentation. Unless
otherwise agreed by the Parties, Billing Statements with respect to Co-Branded
Credit Cards shall be designed to separately reflect in two (2) separate Billing
Statements (i) information with respect to the associated Private Label Account
and (ii) information with respect to the associated General Purpose Account.

      (b) Bank shall bear the costs and expenses of development and delivery of
the Credit Card Documentation, FDS Credit Cards and Solicitation Materials,
which shall be Program Expenses.

      (c) The applicable FDS Licensed Marks shall appear prominently on (i) the
face of the FDS Credit Cards issued or renewed after the Effective Date, (ii)
the Credit Card Documentation created after the Effective Date and (iii) the
Solicitation Materials created after the Effective Date. Unless otherwise agreed
by the Operating Committee, the FDS Credit Cards, the Credit Card Documentation
and the Solicitation Materials shall not bear Bank Licensed Marks; provided,
however, that Bank's name shall appear (i) on the back of the FDS Credit Cards
issued or renewed after the Effective Date, (ii) on the Credit Card
Documentation created after the Effective Date and (iii) on the Solicitation
Materials created after the Effective Date, in each case to identify Bank as the
credit provider under the Program, together with any other disclosures required
by Applicable Law.

            4.6 Underwriting and Risk Management.

                                       30
<PAGE>

      (a) Subject to Section 2.1 with respect to Prepaid Employee Accounts, Bank
shall accept or reject any Credit Card Application based solely upon application
of the then-current Risk Management Policies. Upon satisfaction of the
applicable credit criteria set forth in the Risk Management Policies, Bank shall
promptly establish a Private Label Credit Account and/or a General Purpose
Account, as applicable. The Credit Card types to be associated with such
Accounts shall be established in accordance with the terms of the Loyalty
Programs and the Risk Management Policies. Bank shall have the right, power and
privilege to review periodically the creditworthiness of Cardholders to
determine the range of credit limits to be made available to individual
Cardholders and whether or not to suspend or terminate credit privileges of such
Cardholders; provided, however, that Bank shall only decrease credit limits or
suspend or terminate credit privileges on an individual Account basis consistent
with the then current Risk Management Policies and in a manner consistent with
Article III and this Section 4.6.

      (b) The initial Risk Management Policies to be in effect as of the
Effective Date are attached hereto as Schedule 4.6(b). Each Party may propose
modifications of any aspect of the Risk Management Policies, which modifications
shall be made only in accordance with Article III.

      (c) The Program shall be operated throughout the Term to achieve the
targets set forth in Schedule 4.6(c)(ii). In the case of any inconsistency
between the terms of Schedule 4.6(c)(i) and (ii), the terms of Schedule
4.6(c)(ii) shall control. If the targets set forth in Schedule 4.6(c)(ii) are
not achieved with respect to any measurement period set forth on Schedule
4.6(c)(ii) with respect to the applicable target, the actions set forth on
Schedule 4.6(c)(iii) shall apply.

      (d) In the event of a change in (i) the applicable through-the-door
population or individual segment performance (as measured by validated scores or
generally accepted, data driven credit risk metrics), (ii) industry wide
performance expectations or (iii) Applicable Law, the Operating Committee shall
consider and approve any changes to Schedules 4.6(c)(i) and 4.6(c)(ii) and shall
preserve the targets or alternative targets, as appropriately and mutually
agreed, and remedies set forth in such schedules, but after taking into account
the relevant change referred to in clause (i), (ii) or (iii).

      (e) Within fifteen (15) days after the end of each Fiscal Month, Bank
shall report to FDS Bank, in a mutually agreed upon format, the applicable
metrics with respect to each of the targets set forth on Schedule 4.6(c)(ii)
during such Fiscal Month (it being understood that the measurement period to
determine any penalties associated with such targets under Schedule 4.6(c)(ii)
may exceed one Fiscal Month). During the period in which Interim Services are
being provided, reporting will be prepared by FDS Bank and the Parties agree to
use FDS Bank generated reporting for review of the applicable metrics with
respect to each of the targets set forth on Schedule 4.6(c)(ii) until such time
as Bank has the necessary access to such data.

      (f) To the extent that the changes implemented as referenced in Schedule
11.1(g) result in substandard performance, such changes, with Operating
Committee approval, will be reversed upon demonstration of such substandard
performance. Additionally, upon such reversal, the applicable targets in
Schedule 4.6(c)(ii) shall be revised as appropriate.

                                       31
<PAGE>

      (g) Bank shall use commercially reasonable efforts to perform all
necessary security functions to minimize fraud in the Program due to lost,
stolen or counterfeit cards and fraudulent applications. Each of the FDS
Companies agrees to use commercially reasonable efforts to cooperate with Bank
in such functions.

            4.7 Cardholder Terms.

      (a) The terms and conditions of all Purchased Accounts and of all new
Accounts originated on and after the Effective Date shall be the terms and
conditions applicable to the Account type immediately prior to the Effective
Date, including the terms and conditions set forth on Schedule 4.7; provided,
however, that changes to the terms and conditions of the Accounts may be made
only in accordance with Article III.

      (b) Except as otherwise agreed by FDS, the card association for all
Co-Branded Credit Cards shall be Visa International Inc. and Visa U.S.A. Inc. or
any successor thereto. Except as otherwise approved by the Operating Committee,
Bank (or CEBA Bank to the extent that Bank has assigned this Agreement to CEBA
Bank pursuant to Section 18.2) shall be, at all times during the Term, a
Participating Member in the VISA Partnership Program, or any successor thereto.

      (c) Unless otherwise agreed by the Parties, (i) the account numbers, BINs
and expiration date of all FDS Accounts shall remain the same after the
Effective Date, (ii) the account numbers, BINs and expiration date of all
GE/Macy's Accounts shall remain the same after the Second Closing Date, and
(iii) the account numbers, BINs and expiration date of all May Accounts shall
remain the same after the Third Closing Date

            4.8 Value Propositions.

      (a) Loyalty Programs. All elements of the Star Rewards and Insider Loyalty
Programs, as set forth on Schedule 4.8(a) (the "Loyalty Programs"), shall remain
in effect and shall be honored by the Parties unless modified by approval of the
Operating Committee. Bank shall be responsible for funding all aspects of the
Loyalty Programs, as more fully set forth in Schedule 4.8(a), except that FDS
shall be responsible for funding the portion of Redeemed Rewards set forth in
Schedule 4.8(a).

      (b) Payment Plans. Bank shall offer and support the payment plans set
forth on Schedule 4.8(b)(i) and, subject to the limitations set forth in this
Section 4.8(b), the cost of maintaining such payment plans shall be borne by
Bank. Within ten (10) calendar days after the end of each Fiscal Quarter, the
FDS Servicer (or following the Systems Transition Date, Bank) shall provide to
the other Parties a report setting forth, for such preceding twelve (12) Fiscal
Month period ended at the end of such Fiscal Quarter: (i) Average Private Label
Receivables and (ii) Average Private Label Interest Free Receivables. If the
dollar amount of Average Private Label Interest Free Receivables as a percentage
of Average Private Label Receivables for such preceding twelve (12) Fiscal Month
period ended at the end of such Fiscal Quarter exceeds the percentage threshold
set forth in Schedule 4.8(b)(ii), FDS shall make the applicable cash payment to
Bank as set forth in Schedule 4.8(b)(ii) for the actual number of days in such
Fiscal Quarter calculated on the basis of a 360-day year, which cash payment
shall be excluded from

                                       32
<PAGE>

the calculation of Pre-Tax Profit. If the dollar amount of Average Private
Label Interest Free Receivables as a percentage of Average Private Label
Receivables for the preceding twelve (12) Fiscal Month period ended at the end
of such Fiscal Quarter is less than the percentage threshold set forth in
Schedule 4.8(b)(ii), Bank shall make the applicable cash payment to FDS as set
forth in Schedule 4.8(b)(ii) for the actual number of days in such Fiscal
Quarter, calculated on the basis of a 360-day year, which cash payment shall be
excluded from the calculation of Pre-Tax Profit. The Parties shall negotiate in
good faith to adjust the foregoing provisions of this Section 4.8(b) to
appropriately reflect the impact of the addition of the May Accounts to the
Program as set forth in Schedule 4.8(b)(ii). No such negotiations shall be
deemed to constitute an attempt to renegotiate the May Purchase Price under the
Purchase Agreement or otherwise affect the Parties' rights thereunder.

      (c) Cardholder Discounts. The FDS Companies may provide discounts to
Cardholders from time to time; provided the cost of such discounts are borne by
the FDS Companies either through POS markdowns or in accordance with the
procedures set forth in Section 8.4.

      (d) Changes to Value Propositions. The terms and conditions of the Value
Propositions set forth in this Section 4.8, and the Parties' related
responsibilities in respect thereof, may be modified solely with the approval of
the Operating Committee in accordance with Article III.

      (e) Value Proposition Support. Except to the extent performed as part of
the services provided by the FDS Servicer prior to the Systems Transition Date,
Bank shall be responsible for accounting and servicing of all rewards under the
Value Propositions associated with the Program (including with respect to
Loyalty Programs, in accordance with the eligibility criteria for each Loyalty
Program), such as printing certificates on monthly Billing Statements and
rewards summaries. All Value Proposition testing existing as of the Effective
Date shall be supported by the Program. Bank shall continue to honor any accrued
benefits to customers accrued prior to the Effective Date in connection with
such Value Propositions (subject to the reimbursement and other financial
obligations of the FDS Companies set forth above in this Section 4.8).

            4.9 Participation in Reversals.

      (a) Reporting of Reversals. Each Quarterly Settlement Statement shall set
forth a calculation of the applicable Finance Charge Reversal Percentage and
Late Fee Reversal Percentage for the preceding Fiscal Quarter and such other
calculations as are necessary to calculate the payment in respect thereof to be
made by the Parties pursuant to this Section 4.9. All amounts payable pursuant
to this Section 4.9 (i) shall be netted against each other so that only a single
payment shall be made pursuant to this Section 4.9 and (ii) shall be excluded
from the calculation of Pre-Tax Profit.

      (b) Finance Charge Reversals.

                  (i) Private Label Accounts. If the Finance Charge Reversal
Percentage solely with respect to the Private Label Accounts reflected in the
Quarterly Settlement Statement with

                                       33
<PAGE>

respect to the preceding Fiscal Quarter is greater than the applicable High
Collar, the FDS Companies shall pay Bank an amount equal to (A) the Finance
Charge Reversal Percentage solely with respect to the Private Label Accounts
minus the applicable High Collar, multiplied by (B) the aggregate amount of all
finance charges assessed on the Private Label Accounts during such preceding
Fiscal Quarter. If the Finance Charge Reversal Percentage solely with respect to
the Private Label Accounts for such Fiscal Quarter is less than the applicable
Low Collar, Bank shall pay the FDS Companies an amount equal to (A) the
applicable Low Collar minus the Finance Charge Reversal Percentage solely with
respect to the Private Label Accounts, multiplied by (B) the aggregate amount of
all finance charges assessed on the Private Label Accounts during such preceding
Fiscal Quarter calculated on a sum of cycles basis of reporting monthly
receivables under the Private Label Accounts.

                  (ii) General Purpose Accounts. If the Finance Charge Reversal
Percentage solely with respect to the General Purpose Accounts reflected in the
Quarterly Settlement Statement with respect to the preceding Fiscal Quarter is
greater than the applicable High Collar, the FDS Companies shall pay Bank an
amount equal to (A) the Finance Charge Reversal Percentage solely with respect
to the General Purpose Accounts minus the applicable High Collar, multiplied by
(B) the aggregate amount of all finance charges assessed on the General Purpose
Accounts during such preceding Fiscal Quarter. If the Finance Charge Reversal
Percentage solely with respect to the General Purpose Accounts for such Fiscal
Quarter is less than the applicable Low Collar, Bank shall pay the FDS Companies
an amount equal to (A) the applicable Low Collar minus the Finance Charge
Reversal Percentage solely with respect to the General Purpose Accounts,
multiplied by (B) the aggregate amount of all finance charges assessed on the
General Purpose Accounts during such preceding Fiscal Quarter calculated on a
sum of cycles basis of reporting monthly receivables under the General Purpose
Accounts.

      (c) Late Fee Reversals.

                  (i) Private Label Accounts. If the Late Fee Reversal
Percentage solely with respect to the Private Label Accounts reflected in the
Quarterly Settlement Sheet with respect to the preceding Fiscal Quarter is
greater than the applicable High Collar, the FDS Companies shall pay Bank an
amount equal to (A) the Late Fee Reversal Percentage solely with respect to the
Private Label Accounts minus the applicable High Collar, multiplied by (B) the
aggregate amount of all late fees assessed on the Private Label Accounts during
such preceding Fiscal Quarter. If the Late Fee Reversal Percentage solely with
respect to the Private Label Accounts for such Fiscal Quarter is less than the
applicable Low Collar, Bank shall pay the FDS Companies an amount equal to (A)
the applicable Low Collar minus the Late Fee Reversal Percentage solely with
respect to the Private Label Accounts, multiplied by (B) the aggregate amount of
all late fees assessed on the Private Label Accounts during such preceding
Fiscal Quarter calculated on a sum of cycles basis of reporting monthly
receivables under the Private Label Accounts.

                  (ii) General Purpose Accounts. If the Late Fee Reversal
Percentage solely with respect to the General Purpose Accounts reflected in the
Quarterly Settlement Sheet with respect to the preceding Fiscal Quarter is
greater than the applicable High Collar, the FDS Companies shall pay Bank an
amount equal to (A) the Late Fee Reversal Percentage solely with respect to the
General Purpose Accounts minus the applicable High Collar, multiplied by (B) the

                                       34
<PAGE>

aggregate amount of all late fees assessed on the General Purpose Accounts
during such preceding Fiscal Quarter. If the Late Fee Reversal Percentage solely
with respect to the General Purpose Accounts for such Fiscal Quarter is less
than the applicable Low Collar, Bank shall pay the FDS Companies an amount equal
to (A) the applicable Low Collar minus the Late Fee Reversal Percentage solely
with respect to the General Purpose Accounts, multiplied by (B) the aggregate
amount of all late fees assessed on the General Purpose Accounts during such
preceding Fiscal Quarter calculated on a sum of cycles basis of reporting
monthly receivables under the General Purpose Accounts.

      (d) Adjustments. Prior to the Third Closing Date, the Parties shall
negotiate in good faith to adjust Sections 4.9(b) and (c) (including the High
Collars and the Low Collars) to appropriately reflect the impact of the addition
of the May Accounts to the Program. No such negotiations shall be deemed to
constitute an attempt to renegotiate the May Purchase Price under the Purchase
Agreement or otherwise affect the Parties rights thereunder.

            4.10 Sales Taxes. FDS and its Subsidiaries shall remit when due any
sales taxes relating to the sale of FDS Goods and Services that have been
charged to an Account. Unless the FDS Servicer has access to such information in
connection with its services hereunder, Bank shall provide the FDS Companies on
a monthly basis (based upon Fiscal Months) with a detailed description of all
Net FDS Write-offs and shall sign such forms and provide any such other
information as requested by FDS to enable FDS and its Subsidiaries to recover
any Sales Tax Refunds. Except as expressly provided in this Section 4.10, Bank
acknowledges and agrees that it shall not, directly or indirectly, seek to claim
or recover any amount by way of a Sales Tax Refund. Bank agrees that, to the
extent the laws of any jurisdiction would permit Bank or any of its Affiliates
to elect or designate the party entitled to receive Sales Tax Refunds, Bank
shall, and shall cause its Affiliates to, take all steps necessary to enable and
permit FDS or any of its appropriate Affiliates to elect to receive the Sales
Tax Refunds. Further, Bank agrees that, to the extent the Applicable Law of any
jurisdiction would permit Bank or any of its Affiliates, but not the FDS
Companies or any of their Affiliates, to receive Sales Tax Refunds, Bank shall,
and shall cause its Affiliates to, take all steps necessary to receive the Sales
Tax Refunds, except to the extent that taking any such steps would reasonably be
likely to create any tax obligation or liability of Bank or its Affiliates.
Whenever Bank or any of its Affiliates are applying for Sales Tax Refunds in
accordance with the preceding sentence, (a) Bank shall promptly notify FDS of
the application for Sales Tax Refunds, and (b) FDS and its Subsidiaries shall
provide such information reasonably requested by Bank to enable Bank, or any of
its Affiliates, to recover any such Sales Tax Refunds. FDS shall pay to Bank an
amount equal to Sales Tax Refunds received by FDS and its Subsidiaries, net of
an amount equal to the FDS Companies' reasonable out-of-pocket costs incurred in
connection with obtaining such Sales Tax Refunds (it being understood that if
the reasonable out-of-pocket costs incurred by the FDS Companies or any of their
Affiliates to obtain such Sales Tax Refunds exceeds the amount of Sales Tax
Refunds actually obtained, then any such excess amounts shall be treated as
Program Expenses). All Sales Tax Refunds received by Bank or any of its
Affiliates shall be treated as income of the Program. In the event FDS or any of
its Subsidiaries is audited or assessed by a taxing authority, and as a result
any Sales Tax Refunds, or any interest or penalties with respect thereto, is
repaid to such taxing authority, Bank shall repay such amount to FDS, and such
amount shall be treated as a reduction of Program income in the next Monthly
Settlement Sheet for the Program. Bank and its Affiliates also shall fully
cooperate in any such audit or assessment.

                                       35
<PAGE>

                                    ARTICLE V

                                    MARKETING

            5.1 Promotion of Program. In accordance with the Marketing Plan,
Bank and the FDS Companies shall cooperate with each other and actively support
and promote the Program to both existing and potential Cardholders.

            5.2 Marketing Commitment.

      (a) The FDS Marketing Commitment shall be used by FDS and its Affiliates
in accordance with the Marketing Plan for any of the following marketing
purposes:

                  (i)   new Credit Card Applications;

                  (ii)  POS brochures;

                  (iii) new Account membership kits;

                  (iv)  the allocated costs incurred by the FDS Servicer for its
                        use of FedCustomer;

                  (v)   FDS division incentive programs (other than special
                        promotion incentive funds ("SPIFs") paid to sales
                        associates, which shall be paid from amounts reimbursed
                        pursuant to Schedule 9.3(a));

                  (vi)  solicitations to Private Label Credit Card Cardholders
                        offering Co-Branded Credit Cards;

                  (vii) Inserts, to the extent designed to stimulate usage of
                        FDS Credit Cards;

                  (viii) loyalty program testing; and

                  (ix)  other marketing activities of the type performed by FACS
                        prior to the Effective Date.

      (b) Each Monthly Settlement Sheet shall set forth an accounting of the
costs incurred, if any, by FDS and its Affiliates in the prior Fiscal Month
which may be paid out of the FDS Marketing Commitment and Bank shall (i)
reimburse the FDS Companies from the FDS Marketing Commitment for such amounts
as provided in Section 9.3 (or, in the event Bank or any other third party
conducts any of the above-referenced activities or provides any of the
above-referenced services at the request of FDS Bank, upon request of FDS Bank
shall retain or pay to the applicable third party the amounts payable in respect
of such activities or products) and (ii) reduce the amount remaining in the FDS
Marketing Commitment by the amount so reimbursed, retained or paid. To the
extent that the expenditures of the FDS Marketing Commitment by FDS and its
Affiliates in any Fiscal Year exceed the amount in the FDS Marketing Commitment,
the FDS Companies shall be entitled to reimbursement from the FDS Marketing
Commitment for the following Fiscal Year of such expenditures to the extent they
do

                                       36
<PAGE>

not exceed (in the aggregate) ten percent (10%) of the Marketing Commitment for
the following Fiscal Year (without Operating Committee approval). Any amount in
the FDS Marketing Commitment for a given Fiscal Year that is not spent in that
Fiscal Year, at the direction of the Operating Committee, either (i) shall
remain available for use during the Term; or (ii) if the Operating Committee
determines that such amount shall not be used for the Program, shall be included
as income in the calculation of Pre-Tax Profit in the next Year-End Settlement
Sheet prepared following such determination.

      (c) The Additional Marketing Commitment shall be used as set forth in the
Marketing Plan and as otherwise directed by the Operating Committee from time to
time. The FDS Companies and Bank shall each provide to the other for inclusion
in the Monthly Settlement Sheet, an accounting of such Party's and its
Affiliates' use of the Additional Marketing Commitment in the prior Fiscal
Month, and Bank shall reimburse the FDS Companies for such amounts used by FDS
and its Affiliates, and shall reduce the amount remaining in the Additional
Marketing Commitment by the amounts used by Bank and its Affiliates. Any amount
in the Additional Marketing Commitment for a given Fiscal Year that is not spent
in that Fiscal Year, at the direction of the Operating Committee, either (i)
shall remain available for use during the Term or (ii) if the Operating
Committee determines that such amount shall not be used for the Program, shall
be included as income in the calculation of Pre-Tax Profit in the next Year-End
Settlement Sheet prepared following such determination.

      (d) Except as otherwise provided in Section 5.2(b), any proposed
expenditure in excess of the remaining FDS Marketing Commitment for any Fiscal
Year or in excess of the Additional Marketing Commitment for any Fiscal Year
shall require the prior approval of the Operating Committee (which at the time
of granting any such approval shall approve the treatment of such excess
expenditures).

      (e) For the avoidance of doubt, neither the FDS Marketing Commitment nor
(except as otherwise expressly provided in Section 5.4) the Additional Marketing
Commitment shall be used to fund the activities described in Section 5.4 or any
other marketing initiatives approved by the Operating Committee pursuant to a
Marketing Plan that allocates such costs to Bank.

            5.3 Communications with Cardholders.

      (a) FDS Inserts. FDS and its Affiliates shall have the exclusive right to
communicate with Cardholders, except for any Legally Required Communication,
through use of inserts, fillers and bangtails (which shall be included on all
billing envelopes) (collectively, "Inserts"), including Inserts selectively
targeted for particular classes of Cardholders, in any and all Billing
Statements (including electronic Billing Statements) and envelopes, subject to
production requirements contained in the Operating Procedures and Applicable
Law. Except as otherwise provided in the Marketing Plan, and except for Inserts
required by Applicable Law (which shall be paid for by Bank and shall be deemed
Program Expenses, except to the extent otherwise provided in Section 11.4(g)),
the FDS Companies shall be responsible for the content of, and the cost of
preparing and printing, any such Inserts (provided that in the case of
"bangtails" such costs shall be limited to the direct costs (without any
overhead allocation) incurred by Bank in producing such bangtails). Subject to
Section 11.4(g), if the insertion of Inserts in particular Billing Statements
would increase the postage costs for such Billing Statements, the FDS

                                       37
<PAGE>

Companies agree to either pay for the incremental postage cost or prioritize the
use of Inserts to avoid postage cost over-runs. The FDS Companies shall retain
all revenues they receive from all Inserts (other than any Inserts promoting the
FDS Credit Cards or Approved Ancillary Products that the FDS Companies may
permit to be produced and distributed in accordance with the Marketing Plan).

      (b) Billing Statement Messages. FDS and its Affiliates shall have the
exclusive right to use Billing Statement (including electronic Billing
Statement) messages and Billing Statement envelope (or electronic mail) messages
in each Billing Cycle to communicate with Cardholders, subject to production
requirements contained in the Operating Procedures and Applicable Law. Such
messages shall be included at no cost to the FDS Companies. Notwithstanding the
foregoing, subject to Section 11.4(g), any message required by Applicable Law
shall take precedence over FDS's and its Affiliates' messages.

            5.4 Additional Marketing Support.

      (a) Upon the reasonable request of FDS from time to time, Bank shall
perform or cause the performance of the marketing functions set forth on
Schedule 5.4(a) at no cost or expense to the FDS Companies (and the cost and
expense of performing such functions shall not constitute Program Expenses);
provided, however, that, notwithstanding the foregoing, the FDS Companies shall
be responsible for all out-of-pocket third party costs and expenses relating to
the production of marketing materials and mailing services (which costs and
expenses the FDS Companies may fund from amounts in the Additional Marketing
Commitment).

      (b) Following the Effective Date, upon FDS's request, Bank shall retain a
mutually agreed upon third party to conduct surveys of Cardholder perception and
satisfaction on a regular, periodic basis consistent with the practices of the
FDS Companies prior to the Effective Date but in no event less frequently than
annually (it being understood that the costs associated with the preparation of
such surveys shall be treated as paid from the Additional Marketing Commitment).
Such surveys shall be in a form and employ methodologies developed in
consultation with the FDS Companies and shall provide for a level of information
that is at a minimum substantially similar to the information gathered by the
FDS Companies prior to the Effective Date. Bank shall make available to the FDS
Companies the results of such surveys as well as all associated work papers
promptly following completion thereof.

            5.5 Ancillary Products. Except for the Approved Ancillary Products
and the FDS Credit Cards, Bank and its Affiliates shall not offer (except as
directed by the FDS Companies) any goods or services (including any Ancillary
Products) to Cardholders or through the Program. Bank may from time to time
propose to the Operating Committee that Bank be permitted to solicit through
mailings, Billing Statements, Inserts, telemarketing or otherwise, any or all
Cardholders for a specific Ancillary Product. If the Operating Committee agrees
to permit such solicitations, such solicitations shall be permitted on the terms
set by the Operating Committee and the Parties shall be compensated as set forth
in Article IX hereof.

            5.6 Marketing Plan.

                                       38
<PAGE>

      (a) On an annual basis, the FDS Companies shall develop, in consultation
with Bank, a marketing plan for the Program that outlines the objectives,
strategies and general tactics for marketing the Program for the applicable
Fiscal Year (the "Marketing Plan"). In addition, each Marketing Plan shall (i)
include a budget and indicate the anticipated source of funds for each budgeted
item and (ii) outline marketing responsibilities of the Parties. The initial
Marketing Plan to be in effect as of the Effective Date and until January 28,
2006 is attached hereto as Schedule 5.6.

      (b) FDS shall submit the Marketing Plan for each Fiscal Year to the
Operating Committee at least thirty (30) days prior to beginning of the Fiscal
Year to which such Marketing Plan relates. FDS shall have the right to change an
approved Marketing Plan in its sole discretion; provided that any material
modification to an approved Marketing Plan shall require the approval of the
Operating Committee.

                                   ARTICLE VI

                             CARDHOLDER INFORMATION

            6.1 Customer Information.

      (a) All sharing, use and disclosure of Cardholder Data and FDS Shopper
Data under this Agreement shall be subject to the provisions of this Article VI.
The Parties acknowledge that the same or similar information may be contained in
the Cardholder Data, the FDS Shopper Data, and other data and that each such
pool of data shall therefore be considered separate information subject to the
specific provisions applicable to that data hereunder.

      (b) Each Party to the extent it possesses Cardholder Data, and Bank to the
extent it possesses FDS Shopper Data, shall maintain an information security
program that is designed to meet the objectives of the Interagency Guidelines
Establishing Information Security Standards as issued by the Office of the
Comptroller of the Currency in the OCC Bulletin, OCC 2005-13 (12 C.F.R Section
30) and by the Office of Thrift Supervision (12 C.F.R. Section 570, Appendix B)
(collectively, the "Guidelines"), including, at a minimum, maintenance of an
information security program that is designed to: (i) ensure the security and
confidentiality of the Cardholder Data and the FDS Shopper Data; (ii) protect
against any anticipated threats or hazards to the security or integrity of the
Cardholder Data and the FDS Shopper Data; (iii) protect against unauthorized
access to or modification, destruction, disclosure or use of the Cardholder Data
and the FDS Shopper Data; and (iv) ensure the proper disposal of Cardholder Data
and FDS Shopper Data. Additionally, such security measures shall meet current
industry standards and shall be at least as protective as those used by each
Party to protect its other confidential customer information. Each Party shall
use the same degree of care in protecting the Cardholder Data and the FDS
Shopper Data against unauthorized disclosure as it accords to its own
confidential customer information, but in no event less than a reasonable
standard of care. In particular, Bank shall treat FDS Shopper Data as if it were
"customer information" for purposes of the regulations above. In the event a
Party becomes aware of any unauthorized use, modification, destruction or
disclosure of, or access to, Cardholder Data, such Party shall immediately
notify the other Party and shall cooperate with the other Party, as they deem
necessary or as required by Applicable Law, (x) to assess the nature and scope
of such incident, (y) to contain and control such incident to prevent further

                                       39
<PAGE>

unauthorized access to or use of Cardholder Data, and (z) to provide prompt
notice to affected Cardholders. In the event Bank becomes aware of any
unauthorized use, modification, destruction or disclosure of, or access to, FDS
Shopper Data, Bank shall immediately notify the FDS Companies and shall
cooperate with them, as they deem necessary or as required by Applicable Law,
(x) to assess the nature and scope of such incident, (y) to contain and control
such incident to prevent further unauthorized access to or use of FDS Shopper
Data, and (z) to provide prompt notice to affected FDS Shoppers. The cost and
expenses of any such notice shall be borne solely by the Party that experienced
the unauthorized use, modification, destruction or disclosure of, or access to,
Cardholder Data or FDS Shopper Data and such costs and expenses shall not be
Program Expenses.

      (c) The Parties agree that for all purposes of Applicable Law relevant to
the sharing, use and disclosure of Cardholder Data and FDS Shopper Data pursuant
to this Article VI, FDS and its Subsidiaries shall each be considered
"affiliates" of CEBA Bank as such term is used in the Gramm-Leach-Bliley Act,
the Fair Credit Reporting Act, any similar provision of state law and any
implementing regulations adopted thereunder (it being understood that nothing in
this Agreement shall constitute FDS and its Subsidiaries, on the one hand, and
Citibank, N.A., on the other hand, Affiliates of each other for such purposes).

            6.2 Cardholder Data.

      (a) As among the Parties hereto, the Cardholder Data shall be the property
of and exclusively owned by CEBA Bank.

      (b) The privacy notice provided to Cardholders pursuant to the
Gramm-Leach-Bliley Act constituting part of the Program Privacy Policy shall be
in the form attached hereto as Schedule 6.2(b). Any changes to such privacy
notice or to the Program Privacy Policy described therein shall be made only in
accordance with Article III.

      (c) Bank shall not use, or permit to be used, the Cardholder Data, except
as provided in this Section 6.2. Bank may use the Cardholder Data in compliance
with Applicable Law and the Program Privacy Policy solely (i) for purposes of
soliciting, marketing or servicing (in each case, solely as directed by the FDS
Companies or the Operating Committee) customers listed in the Cardholder Data
for FDS Credit Cards, Approved Ancillary Products, and any other products and
services approved by the Operating Committee, (ii) as otherwise necessary to
carry out its obligations or exercise its rights hereunder (including its rights
to use such information as contemplated by Section 16.4), or (iii) as required
by Applicable Law. Bank has no rights to use the Cardholder Data for marketing
purposes except as expressly provided herein.

      (d) Bank shall not disclose, or permit to be disclosed, the Cardholder
Data, except as provided in this Section 6.2. Bank shall not, directly or
indirectly, sell or otherwise transfer any right in or to the Cardholder Data
other than to FDS or any of its Affiliates or to a Nominated Purchaser pursuant
to Section 16.2. Bank may disclose the Cardholder Data in compliance with
Applicable Law and the Program Privacy Policy solely:

                  (i) to its authorized subcontractors in connection with a
permitted use of such Cardholder Data under this Section 6.2, provided that each
such authorized subcontractor agrees

                                       40
<PAGE>

in writing to maintain all such Cardholder Data as strictly confidential in
perpetuity and not to use or disclose such information to any Person other than
Bank or an FDS Company, except as required by Applicable Law or any Governmental
Authority (after giving Bank and the FDS Companies prior notice and an
opportunity to defend against such disclosure); provided, further, that each
such authorized subcontractor maintains, and agrees in writing to maintain, an
information security program that is designed to meet the objectives of the
Guidelines, including, at a minimum, maintenance of an information security
program that is designed to: (w) ensure the security and confidentiality of the
Cardholder Data; (x) protect against any anticipated threats or hazards to the
security or integrity of the Cardholder Data; (y) protect against unauthorized
access to or modification, destruction, disclosure or use of the Cardholder
Data; and (z) ensure the proper disposal of Cardholder Data; and provided,
further, that each such authorized subcontractor agrees to notify promptly Bank
and the FDS Companies of any unauthorized disclosure, use, or disposal of, or
access to, Cardholder Data and to cooperate with Bank and the FDS Companies in
any investigation thereof and remedial action with respect thereto;

                  (ii) to its Affiliates, and its and such Affiliates'
employees, attorneys and accountants with a need to know such Cardholder Data in
connection with a permitted use of such Cardholder Data under this Section 6.2;
provided that (A) any such Person is bound by terms substantially similar to
this Section 6.2 as a condition of employment or of access to Cardholder Data or
by professional obligations imposing comparable terms; and (B) Bank shall be
responsible for the compliance by each such Person with the terms of this
Section 6.2; or

                  (iii) to any Governmental Authority with authority over Bank
(A) in connection with an examination of Bank; or (B) pursuant to a specific
requirement to provide such Cardholder Data by such Governmental Authority or
pursuant to compulsory legal process; provided that Bank seeks the full
protection of confidential treatment for any disclosed Cardholder Data to the
extent available under Applicable Law governing such disclosure, and with
respect to clause (B), to the extent permitted by Applicable Law, Bank (1)
provides at least ten (10) Business Days' prior notice of such proposed
disclosure to FDS if reasonably possible under the circumstances, and (2) seeks
to redact the Cardholder Data to the fullest extent possible under Applicable
Law governing such disclosure; or

                  (iv) to any consumer reporting agency in accordance with the
federal Fair Credit Reporting Act.

      (e) Subject to Applicable Law and the Program Privacy Policy, Bank shall
transmit to the FDS Companies on a real-time basis throughout each day by a
secure data feed into FDS Systems designated by FDS from time to time, in
formats agreed to by the Parties in advance from time to time:

                  (i) for any customer who has applied for an FDS Credit Card,
regardless of the marketing channel of such application: (A) the customer's
name, address, email address, telephone number, social security number and all
other information supplied on the application or prescreened response submitted
by the customer; (B) an indication of whether or not the customer has been
approved for an FDS Credit Card; and (C) if the customer has been approved for
an FDS Credit Card, the FDS Credit Card issued (or to be issued) to such
customer (i.e., specify the type of FDS Credit Card and the FDS Licensed Mark to
be used on such FDS Credit Card);

                                       41
<PAGE>

                  (ii) for each Cardholder, joint-Cardholder and authorized
buyer, (A) such person's name, address, email address, telephone number, social
security number and Account number; (B) any reported change to any of the
foregoing information; (C) transaction and experience data; and (D) any such
other Cardholder Data as the FDS Companies may reasonably request;

                  (iii) the Cardholder's name and account number for any Account
that is delinquent;

                  (iv) the Cardholder's name and account number for any Account
that has been closed; and

                  (v) the Cardholder Data for all categories of information
available on the FDS Companies' credit Systems as of the date hereof.

      (f) Subject to Applicable Law and the Program Privacy Policy, Bank shall
transmit by a secure data feed into FedCustomer (or other FDS Systems designated
by FDS from time to time), in a format agreed to by the Parties, on an as billed
basis, all information contained in the Billing Statements and all other
Cardholder Data for all categories of information available on FedCustomer as of
the date hereof (including, for each Cardholder, joint-Cardholder and authorized
buyer, name, address, email address, telephone number, information as to
creditworthiness and changes to any of the foregoing information).

      (g) Bank shall reasonably cooperate with the FDS Companies to provide FDS
and its Affiliates with the maximum ability permissible under Applicable Law and
the Program Privacy Policy to receive, use and disclose the Cardholder Data,
including, as reasonably necessary or appropriate, through use of consents,
opt-in provisions or opt-out provisions, in each case as directed by the FDS
Companies. Without limiting the foregoing, FDS and each of its Affiliates may
receive, use and disclose the Cardholder Data in compliance with Applicable Law
and the Program Privacy Policy (i) for purposes of promoting the Program or
promoting FDS Goods and Services, (ii) as otherwise necessary to carry out its
obligations under this Agreement, and (iii) as otherwise permitted by Applicable
Law.

      (h) The FDS Companies may use the Cardholder Data in compliance with
Applicable Law and the Program Privacy Policy. Each of the FDS Companies may
disclose the Cardholder Data in compliance with Applicable Law and the Program
Privacy Policy solely:

                  (i) to its existing subcontractors as of the Effective Date
and to authorized subcontractors that enter into agreements with an FDS Company
after the Effective Date ("Future Subcontractors") in connection with a
permitted use of such Cardholder Data under this Section 6.2, provided that each
such Future Subcontractor agrees in writing to maintain all such Cardholder Data
as strictly confidential in perpetuity and not to use or disclose such
information to any Person other than an FDS Company or Bank, except as required
by Applicable Law or any Governmental Authority (after giving the FDS Companies
prior notice and an opportunity to defend against such disclosure); provided,
further, that each such Future Subcontractor maintains, and agrees in writing to
maintain, an information security program that is designed to

                                       42
<PAGE>

meet the objectives of the Guidelines, including, at a minimum, maintenance of
an information security program that is designed to: (w) ensure the security and
confidentiality of the Cardholder Data; (x) protect against any anticipated
threats or hazards to the security or integrity of the Cardholder Data; (y)
protect against unauthorized access to or modification, destruction, disclosure
or use of the Cardholder Data; and (z) ensure the proper disposal of Cardholder
Data; and provided, further, that each such Future Subcontractor agrees to
notify promptly Bank and the FDS Companies of any unauthorized disclosure, use,
or disposal of, or access to, Cardholder Data and to cooperate with Bank and the
FDS Companies in any investigation thereof and remedial action with respect
thereto;

                  (ii) to its Affiliates, and its and such Affiliates'
employees, attorneys and accountants with a need to know such Cardholder Data in
connection with a permitted use of such Cardholder Data under this Section 6.2;
provided that (A) any such Person is bound by terms substantially similar to
this Section 6.2 as a condition of employment or of access to Cardholder Data or
by professional obligations imposing comparable terms; and (B) the FDS Companies
shall be responsible for the compliance by each such Person with the terms of
this Section 6.2; or

                  (iii) to any Governmental Authority with authority over such
FDS Company (A) in connection with an examination of such FDS Company; or (B)
pursuant to a specific requirement to provide such Cardholder Data by such
Governmental Authority or pursuant to compulsory legal process; provided that
such FDS Company seeks the full protection of confidential treatment for any
disclosed Cardholder Data to the extent available under Applicable Law governing
such disclosure, and with respect to clause (B), to the extent permitted by
Applicable Law, such FDS Company (1) provides at least ten (10) Business Days'
prior notice of such proposed disclosure to Bank if reasonably possible under
the circumstances, and (2) seeks to redact the Cardholder Data to the fullest
extent possible under Applicable Law governing such disclosure.

      (i) With respect to the sharing, use and disclosure of the Cardholder Data
following the termination of this Agreement:

                  (i) the rights and obligations of the Parties under this
Section 6.2 shall continue through any Termination Period;

                  (ii) if FDS exercises its rights under Section 16.2, Bank
shall transfer its right, title and interest in the Cardholder Data to FDS or
its Nominated Purchaser as part of such transaction, and Bank's right to use and
disclose the Cardholder Data shall terminate upon the termination of the
Termination Period; and

                  (iii) if FDS provides notice that it shall not exercise its
rights under Section 16.2, FDS and its Affiliates' right to use and disclose the
Cardholder Data hereunder shall terminate upon the termination of the
Termination Period.

            6.3   FDS Shopper Data; FDS Prospect List.

      (a) Bank acknowledges that the FDS Companies gather information about
purchasers of FDS Goods and Services and that FDS and its Affiliates have rights
to use and disclose such

                                       43
<PAGE>

information independent of whether such information also constitutes Cardholder
Data. FDS acknowledges that Bank gathers information independent of the Program
and that Bank and its Affiliates shall not be subject to any limitations in
respect of their right to use and disclose such information notwithstanding that
such information may be the same as any information included in the Cardholder
Data or the FDS Shopper Data. Bank shall reasonably cooperate in the maintenance
of the FDS Shopper Data and other data, including by incorporating in the Credit
Card Application and Credit Card Agreement provisions mutually agreed to by the
Parties pursuant to which applicants and Cardholders shall agree that they are
providing their identifying information (including name, address, telephone
number, email address and social security number) and all updates thereto to
both Bank and FDS and its Affiliates. To the extent any Bank is the direct
recipient of such data, it shall provide such data to the FDS Companies in such
format and at such times as shall be agreed upon by the Operating Committee. As
between the FDS Companies and Bank, all the FDS Shopper Data shall be owned
exclusively by the FDS Companies. Bank acknowledges and agrees that it has no
proprietary interest in the FDS Shopper Data.

      (b) Subject to compliance with Applicable Law, FDS's privacy policies, the
Marketing Plan and such criteria (including format) as may be mutually agreed to
from time to time, the FDS Companies shall make available to Bank, free of
charge, a list of customers of FDS and its Subsidiaries who the FDS Companies
have determined are available to be solicited for Accounts under the Program
(the "FDS Prospect List"). As between the FDS Companies and Bank, the FDS
Prospect List shall be owned exclusively by the FDS Companies. Bank acknowledges
it has no proprietary interest in the FDS Prospect List.

      (c) Bank shall not use, or permit to be used, directly or indirectly, the
FDS Shopper Data, except to transfer such data to the FDS Companies to the
extent received by Bank. Bank shall not use, or permit to be used, the FDS
Prospect List except as provided in this Section 6.3(c). Bank may use the FDS
Prospect List in compliance with Applicable Law solely for purposes of
soliciting customers listed in the FDS Prospect List for Accounts or as required
by Applicable Law.

      (d) Bank shall not disclose, or permit to be disclosed, the FDS Shopper
Data or the FDS Prospect List, except as provided in this Section 6.3. Bank
shall not, directly or indirectly, sell or otherwise transfer any right in or to
the FDS Shopper Data or the FDS Prospect List (all such rights belonging
exclusively to the FDS Companies). Bank may disclose the FDS Shopper Data and
the FDS Prospect List in compliance with Applicable Law solely:

                  (i) to its authorized subcontractors in connection with a
permitted use of such FDS Shopper Data or FDS Prospect List under this Section
6.3, provided that each such authorized subcontractor agrees in writing to
maintain all such FDS Shopper Data or FDS Prospect List as strictly confidential
in perpetuity and not to use or disclose such information to any Person other
than a Bank or an FDS Company, except as required by Applicable Law or any
Governmental Authority (after giving Bank and the FDS Companies prior notice and
an opportunity to defend against such disclosure); provided, further, that each
such authorized subcontractor maintains, and agrees in writing to maintain, an
information security program that is designed to meet the objectives of the
Guidelines, including, at a minimum, maintenance of an information security
program that is designed to: (w) ensure the security and confidentiality of

                                       44
<PAGE>

the FDS Shopper Data and FDS Prospect List; (x) protect against any anticipated
threats or hazards to the security or integrity of the FDS Shopper Data and FDS
Prospect List; (y) protect against unauthorized access to or modification,
destruction, disclosure or use of the FDS Shopper Data and FDS Prospect List;
and (z) ensure the proper disposal of FDS Shopper Data and FDS Prospect List;
and provided, further, that each such authorized subcontractor agrees to notify
promptly Bank and the FDS Companies of any unauthorized disclosure, use, or
disposal of, or access to, FDS Shopper Data or FDS Prospect List and to
cooperate with Bank and the FDS Companies in any investigation thereof and
remedial action with respect thereto;

                  (ii) to its Affiliates, and its and such Affiliates'
employees, attorneys and accountants, with a need to know the FDS Shopper Data
or FDS Prospect List in connection with a permitted use of the FDS Shopper Data
or FDS Prospect List under this Section 6.3; provided that (A) any such Person
is bound by terms substantially similar to this Section 6.3 as a condition of
employment, of access to the FDS Shopper Data or FDS Prospect List or by
professional obligations imposing comparable terms; and (B) Bank shall be
responsible for the compliance by each such Person with the terms of this
Section 6.3; or

                  (iii) to any Governmental Authority with authority over such
Bank (A) in connection with an examination of such Bank; or (B) pursuant to a
specific requirement to provide the FDS Shopper Data or FDS Prospect List by
such Governmental Authority or pursuant to compulsory legal process; provided
that Bank seeks the full protection of confidential treatment for any disclosed
FDS Shopper Data or FDS Prospect List, as the case may be, to the extent
available under Applicable Law governing such disclosure, and with respect to
clause (B), to the extent permitted by Applicable Law, Bank (1) provides at
least ten (10) Business Days' prior notice of such proposed disclosure to FDS if
reasonably possible under the circumstances, and (2) seeks to redact the FDS
Shopper Data or FDS Prospect List to the fullest extent possible under
Applicable Law governing such disclosure.

      (e) Upon the termination of this Agreement, Bank's right to use and
disclose the FDS Shopper Data and FDS Prospect List shall terminate. Promptly
following such termination, Bank shall return or destroy all the FDS Shopper
Data and FDS Prospect Lists and shall certify such return or destruction to the
FDS Companies upon request.

                                   ARTICLE VII

                               OPERATING STANDARDS

            7.1 Reports. Each of Bank and the FDS Servicer shall provide to the
Operating Committee and the other Party such reports as are mutually agreed to
by the Parties from time to time and on the time schedule for delivery of such
reports as shall be agreed by the Parties prior to the Effective Date. Unless
otherwise required by FDS, all such reports shall be prepared on a Fiscal-Year
reporting basis; provided, however, that the FDS Companies shall cooperate with
Bank to provide such supplemental reporting as is reasonably necessary to
accommodate Bank's calendar-basis reporting needs.

            7.2 Servicing; Interim Servicing; Transition of Services at the
Election of the FDS Companies.

                                       45
<PAGE>

      (a) The FDS Companies shall perform the applicable servicing functions
referenced in Section 4.2 in accordance with the terms and conditions of this
Agreement, including the SLAs set forth in Schedule 7.3 (as such standards may
be amended from time to time by the Operating Committee). Bank shall perform the
applicable servicing functions referenced in Section 4.3 in accordance with the
terms and conditions of this Agreement, including the SLAs established with
respect thereto in accordance with Section 7.3 hereof (as such standards may be
amended from time to time by the Operating Committee). Without limiting the
foregoing, each of the FDS Companies and Bank shall service the Accounts in
compliance with Applicable Law and with no less care and diligence than the
degree of care and diligence employed by the FDS Companies prior to the
Effective Date.

      (b) Commencing on the Effective Date and ending on such date or dates as
the Parties shall mutually agree to transfer one or more of the Interim Services
to Bank, the FDS Companies shall perform the Interim Services in accordance with
the foregoing requirements and the requirements of Section 7.3. At any time
after the Effective Date, Bank may, upon mutual agreement of the Parties,
commence performing any or all of the Interim Services in accordance with an
appropriate and agreed upon transition plan.

      (c) At any time following the first anniversary of the Effective Date,
upon not less than ninety (90) days' prior written notice by FDS (or one hundred
eighty (180) days' prior written notice if the Systems Transition Date has not
yet occurred at the time of such notice), the FDS Companies shall be entitled to
elect to transfer substantially all of the services then being performed by the
FDS Companies pursuant to Section 4.2(a) to Bank (any such transfer, a "Total
Servicing Transfer") if the Parties have substantially completed reasonable
joint transition planning prior to the giving of such notice (or an additional
ninety (90) days notice if the Parties have not substantially completed such
planning; provided that the Parties shall cooperate to complete such planning
within such ninety (90) day period). Following such Total Servicing Transfer,
Bank shall be obligated to provide all such services in accordance with the
terms of this Agreement and the FDS Companies shall thereafter be relieved of
all obligations under this Article VII. Notwithstanding the foregoing, Bank
shall not be obligated to undertake a Total Servicing Transfer until the System
Transition Date has occurred. Upon any such Total Servicing Transfer, the
payments made pursuant to Article IX shall be adjusted as set forth therein to
take account of such Total Servicing Transfer.

      (d) Without limiting the foregoing provisions of this Section 7.2, upon
mutual agreement of the Parties from time to time following the Effective Date,
the Parties may agree to transfer services on an individual basis at such times
and upon such terms as the Parties may agree (such transition time, with respect
to each individual Interim Service, the "Services Transition Date").

            7.3 Service Level Standards.

      (a) Within fifteen (15) days after the end of each Fiscal Month, the FDS
Companies shall report to Bank, in a mutually agreed upon format, the FDS
Companies' performance under each of the SLAs set forth on Schedule 7.3 during
such Fiscal Month (it being understood that the measurement period to determine
compliance with any SLA may exceed one Fiscal Month).

                                       46
<PAGE>

      (b) The FDS Companies shall comply with SLAs set forth in Schedule 7.3;
provided that that such SLAs shall be amended from time to time to establish new
SLAs and modify existing SLAs, in each case, as deemed appropriate by and with
the approval of the Operating Committee for any reason, including (i) completion
of the System conversion described in Section 7.4(a); (ii) changes in the
Program; (iii) changes in industry-wide performance expectations with respect to
any SLA; and (iv) change in Applicable Law.

      (c) Without limiting the foregoing, prior to transitioning any service to
Bank in accordance with the terms of this Agreement, whether pursuant to (i) an
election by the FDS Companies, (ii) the cessation of any interim service being
performed by the FDS Companies pursuant to Section 7.2(b) or (iii) a termination
of any service upon an SLA breach permitting such termination of service as set
forth in Schedule 7.3, the Operating Committee shall establish SLAs to be
performed by Bank with respect to such transferred service, which new SLAs shall
be deemed automatically applicable to Bank with respect to Bank's performance of
such transferred services and which new SLAs shall provide for at least the
minimum SLA standards provided for in Schedule 7.3 with respect to such service
and/or such other higher SLA standards as are appropriate to reflect the service
levels provided by Bank to other partner portfolios of a size, nature and
customer base similar to the Program and consistent with current industry
practices. Upon the transition of any service to Bank for which an SLA is
applicable, Bank shall be obligated to deliver to the FDS Companies the reports
described in Section 7.3 with respect to such SLAs within fifteen (15) days
after the end of each Fiscal Month (and FDS's obligation to deliver such reports
with respect to such services shall terminate).

      (d) Notwithstanding anything to the contrary contained in Schedule 7.3,
once a service is transferred to Bank pursuant to the terms of this Agreement,
thereafter, the FDS Companies shall no longer be obligated to perform such
services and shall not be obligated to assume responsibilities for such services
for any reasons. Accordingly, upon the occurrence of any SLA failure by Bank
that would have otherwise resulted in a requirement to transfer services to Bank
had the FDS Companies been the Party providing such services, then, (i) the FDS
Companies shall have the option to transition the service subject to the SLA
failure from Bank back to the FDS Companies or an alternate service provider in
accordance with Schedule 7.3 or (ii) if they elect not to transition such
services, such SLA failure shall be deemed an Event of Default by Bank pursuant
to Section 14.2(f) and FDS shall be entitled to exercise its termination rights
pursuant to Section 15.2 in respect of such Event of Default.

      (e) Each Party providing services hereunder shall maintain in effect
during the Term a disaster recovery and business continuity plan that complies
with Applicable Law and that is designed to ensure that Systems availability is
consistent with the standards specified in Schedule 7.3. Each Party shall be
prepared to and have the ability to implement such plan if necessary. Each Party
shall provide the other with access to review such plan upon request. Each Party
shall test its plan annually and shall promptly implement such plan upon the
occurrence of a disaster or business interruption.

      (f) Bank shall be excused from its failure to meet any applicable SLAs to
the extent that such failure results from the FDS Systems or any acts or
omissions of the FDS Companies. The FDS Companies shall be excused from their
failure to meet any applicable SLAs to the extent that any such failure results
from Bank's Systems or any acts or omissions of Bank.

                                       47
<PAGE>

            7.4 Credit Systems.

      (a) Subject to clause (b) of this Section 7.4, the master file of Accounts
and all other Cardholder Data and other Program credit data shall remain on the
FDS Systems for a minimum of one year after the Effective Date. Bank and the FDS
Companies shall work together (including through a subcommittee of the Operating
Committee formed for this purpose) to develop a mutually agreeable Systems
conversion plan designed to convert such data to Bank Systems. Subject to the
satisfaction of each of the requirements set forth in Section 7.4(b), at such
time, if any, when both FDS and Bank are satisfied with the terms of such
conversion plan and have concluded that such conversion will further the Program
Objectives and provide cost efficiencies and features and functionality superior
to those available on the FDS Systems without an unacceptable level of Program
disruption, such conversion shall be implemented (the date of any such
conversion the "Systems Transition Date"). Bank shall bear its costs and
expenses associated with the Systems conversion and such expenses shall not
constitute Program Expenses. Until the Systems Transition Date, FDS shall, in a
manner consistent with FDS's historical practice (taking into account the
magnitude and type of each of the following matters): (i) make modifications and
changes to FDS Systems as necessary to comply with Applicable Law, the Risk
Management Policies and/or the Operating Procedures, following appropriate
consultation with Bank with respect to changes thereto; (ii) ensure that the
features and functionality available on the FDS Systems as of the Effective Date
are maintained in a manner consistent with historical levels, and (iii) ensure
that the technology associated with the FDS Systems (including hardware
platforms, operations systems and software licenses) is sufficient to support
the operation of the Program as contemplated by the terms of this Agreement.

      (b) The Parties acknowledge and agree that no Systems conversion shall
occur pursuant to Section 7.4(a) in absence of satisfaction of each of the
following requirements:

                  (i) Bank shall ensure that all features and functionality
available on the FDS Systems prior to the Systems Transition Date (including
data gathering, interface capabilities with the FDS Companies' other Systems,
Loyalty Program support and core systems/customer service functionality) are
available on Bank Systems as of the Systems Transition Date to the extent the
FDS Systems are to be converted to Bank Systems;

                  (ii) all existing credit data feeds used by FDS or any of its
Affiliates in connection with the Credit Card Business, FedCustomer or otherwise
prior to the Effective Date shall have been replicated on Bank Systems prior to
the Systems Transition Date;

                  (iii) Bank shall provide and Bank Systems shall support the
Internet services set forth on Schedule 7.4(b);

                  (iv) without limiting the foregoing, Bank Systems shall
interface with the FDS Systems that are not converted to Bank Systems in a
manner reasonably acceptable to FDS;

                  (v) Bank shall have a disaster recovery and business
continuity plan applicable to the Bank Systems as set forth in Section 7.3(d)
and Bank shall be prepared to and have the ability to implement such plan if
necessary; and

                                       48
<PAGE>

                  (vi) Bank shall have identified and implemented all hardware
and other Systems changes necessary to ensure that Bank Systems will be
compatible with those FDS Systems that will interface with Bank Systems,
including the POS Systems of FDS and its Affiliates.

      (c) The FDS Companies shall have the right to perform testing to assure
that Bank Systems have the features and functionality described in clauses
(b)(i)-(vi) and any other features and functionality promised by Bank.

      (d) Neither Party shall make any change to any of its Systems that would
render them incompatible in any way with the other Party's or its Affiliates'
Systems or require the other Party or its Affiliates (or the Retail Merchants)
to make any change to any of their Systems (including any POS terminals) or
reduce or restrict interfacing or System feeds, in any such case without the
prior approval of the Operating Committee. Neither Party will make any change to
its Systems with respect to the Program without prior notification to the
Operating Committee if such change would reasonably be expected to materially
impact the Program or the operation of any of the other Party's Systems, except
to the extent such change is necessary in connection with the exercise by FDS or
Bank of an FDS Matter or a Partner Matter, as applicable; provided further,
that, without the prior approval of the Operating Committee, neither Party shall
make any change to its Systems with respect to the Program during October,
November or December. Bank shall cooperate to ensure that System changes are
scheduled with due regard to FDS's retail sales calendar and in a manner
designed to minimize disruption to peak sales periods.

      (e) Prior to the Systems Transition Date, the Operating Committee shall
agree on such modifications to the terms of this Agreement relating to the
allocation of reporting obligations, settlement and chargeback procedures and
other Systems-dependent obligations and procedures as are necessary to
accurately reflect the transition of relevant services, capabilities and data
access of the respective Parties following the System Transition Date.

            7.5 Systems Interface; Technical Support.

      (a) Required Interfaces. The FDS Companies and Bank shall identify, prior
to the Effective Date, the Systems interfaces required to be sustained between
the FDS Companies and Bank. The FDS Companies and Bank shall maintain such
interfaces and cooperate in good faith with each other in connection with any
modifications to such interfaces as may be requested by either Party from time
to time. Each of the FDS Companies and Bank agrees to maintain at its own
expense its respective Systems interfaces so that the operation of the Systems
as a whole is at all times no less functional than prior to the Effective Date.

      (b) Additional Interfaces; Interface Modifications. All requests for new
interfaces, modifications to existing interfaces and terminations of existing
interfaces shall be presented to the Operating Committee for approval. Upon
approval, the Parties shall work in good faith to establish the requested
interfaces or modify or terminate the existing interfaces, as applicable, on a
timely basis. Except as otherwise provided herein (including in Section 7.4),
all costs and expenses with respect to any new interface or interface
modification or termination shall be borne by the requesting Party unless
otherwise determined by the Operating Committee.

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<PAGE>

      (c) Secure Protocols. The Parties shall use secure protocols for the
transmission of data from Bank and its Affiliates, on the one hand, to FDS and
its Affiliates, on the other hand, and vice versa.

                                  ARTICLE VIII

                                MERCHANT SERVICES

            8.1 Transmittal and Authorization of FDS Charge Transaction Data.
FDS shall, and shall cause its Subsidiaries and Licensees (such Subsidiaries and
Licensees, together with FDS, the "Retail Merchants") to, accept the FDS Credit
Cards for FDS Transactions. The Retail Merchants shall transmit FDS Charge
Transaction Data for authorization of FDS Transactions as provided in the
Operating Procedures. The FDS Transactions shall be authorized or declined on a
real time basis as provided in the Operating Procedures, including transactions
involving split-tender (i.e., a portion of the total transaction amount is
billed to an FDS Credit Card and the remainder is paid through one or more other
forms of payment), transactions over the phone, on-line or hand keyed, as
applicable, or down-payments on FDS Goods and Services for later delivery. If
any Retail Merchant is unable to obtain authorizations for FDS Transactions for
any reason, such Retail Merchant may complete such FDS Transactions without
receipt of further authorization as provided in the Operating Procedures.

            8.2 POS Terminals. The Retail Merchants shall maintain POS terminals
capable of processing FDS Credit Card and Account transactions as handled as of
the Effective Date. To the extent that the Retail Merchants are required to make
changes to any POS terminal (including hardware and software) in order to
process FDS Transactions and transmit FDS Charge Transaction Data under this
Agreement as a result of any System conversion contemplated by Section 7.4 or
any other change or modification to any Bank System or a new Bank System
approved by the Operating Committee, each Party shall pay its respective costs
and expenses associated with such changes.

            8.3 In-Store Payments. The Retail Merchants may accept In-Store
Payments from Cardholders on their Accounts in accordance with the Operating
Procedures. The Retail Merchants shall, as necessary, provide proper
endorsements on such items. Bank hereby grants to each of the FDS Companies and
the Retail Merchants a limited power of attorney (coupled with an interest) to
sign and endorse Bank's name upon any form of payment that may have been issued
in Bank's name in respect of any Account. The FDS Companies and Bank shall
jointly develop procedures in the Operating Procedures with respect to the
manner in which such In-Store Payments shall be processed (it being understood
that such procedures shall provide for immediate credit toward the applicable
open-to-buy limits of the respective Account upon receipt of an In-Store
Payment). The FDS Companies, on behalf of the Retail Merchants, shall notify
Bank upon receipt of In-Store Payments and Bank shall include the FDS Charge
Transaction Data related to such In-Store Payments in the net settlement in
respect of the day immediately following such receipt on the same basis as other
FDS Charge Transaction Data. The Retail Merchants shall issue receipts for such
payments in compliance with Applicable Law.

            8.4 Settlement Procedures.

                                       50
<PAGE>

      (a) The Retail Merchants shall transmit FDS Charge Transaction Data
(including FDS Charge Transaction Data arising in connection with sales by
Licensees) to Bank in accordance with the Operating Procedures on each day that
the Retail Merchant is open for business. If FDS Charge Transaction Data is
received by Bank's processing center before 11:00 A.M. (Eastern time) on any
Business Day on which Bank is open for business, Bank shall process the FDS
Charge Transaction Data and initiate a wire transfer of the payment in respect
thereof before 1:00 P.M. (Eastern time) on the same Business Day.

      (b) Bank shall remit to FDS, for itself and the Retail Merchants, an
amount equal to the total amount of charges identified in all FDS Charge
Transaction Data not yet paid in accordance with Section 8.4(a) less the sum of
(i) the total amount of any credits included in such FDS Charge Transaction
Data, plus (ii) the total amount of In-Store Payments (if any), plus (iii) any
amounts charged back to such Retail Merchants pursuant to Section 8.5. The total
amount of charges reflected in the FDS Charge Transaction Data shall include the
amount of all Cardholder and employee discount(s) such that upon daily
settlement of such FDS Charge Transaction Data in accordance with Section
8.4(c), Bank shall pay FDS the price of the FDS Goods and Services without
giving effect to such discount(s). FDS shall reimburse Bank for the amount of
such discounts on a monthly basis as set forth in Section 8.4(d).

      (c) If any FDS Charge Transaction Data is not received by Bank's
processing center before 11:00 A.M. (Eastern time) on any Business Day on which
such processing center is open for business as a result of any circumstance
other than a willful failure of the Retail Merchant to send such data (e.g.,
Systems failure or communication outage), which circumstance the Retail Merchant
shall use reasonable efforts to remedy, Bank shall initiate a wire transfer
(each such transfer, an "Estimated Remittance") by 3:00 P.M. (Eastern time) on
the same Business Day of Bank's good faith estimate of the amount that should be
transferred to FDS for itself and the Retail Merchants in accordance with
Section 8.4(a) as if such failure had not occurred. Bank's good faith estimate
shall be based on FDS's then most recent projections of Net Credit Sales and
shall take into account, among other things, holidays and seasonal and other
sales fluctuations. The Estimated Remittance shall be deducted from any
remittance in respect of applicable FDS Charge Transaction Data when transmitted
and processed pursuant to this Section 8.4 (and to the extent necessary
thereafter to fully reconcile such Estimated Remittance, other FDS Charge
Transaction Data).

      (d) Not more than five (5) days after the end of each Fiscal Month, the
FDS Servicer shall deliver or cause to be delivered to Bank a report for such
preceding Fiscal Month of all discount(s) reflected in the FDS Charge
Transaction Data and paid for by Bank in such preceding Fiscal Month (and, in
the case of FDS Charge Transaction Data for a credit to an Account, all
reversals of discounts reflected in the credits included in such FDS Charge
Transaction Data). The net amount of discounts paid by Bank with respect to such
discounts during such Fiscal Month, as reflected on such report (after deducting
any discounts reversed in respect of FDS Goods and Services for which a credit
was issued), shall be paid by the FDS Companies to Bank within three (3)
Business Days of such report.

      (e) FDS shall be responsible for allocating remittances under this Section
8.4 among all the Retail Merchants as appropriate and Bank shall have no
responsibility or liability in

                                       51
<PAGE>

connection therewith (it being agreed that Bank has no obligation to make
remittances to, any person other than FDS).

            8.5 Bank's Right to Charge Back.

      (a) Right to Charge Back. Bank shall have the right to charge back to FDS
the Cardholder Indebtedness (including Cardholder Indebtedness incurred prior to
the Effective Date with respect to Purchased Accounts) reflected in FDS Charge
Transaction Data only to the extent such charge back is expressly permitted in
clauses (i) through (iv) below.

                  (i) Merchandise Adjustments. If a Cardholder requests an
adjustment based on the quality or delivery of FDS Goods and Services, the
Cardholder request for adjustment shall be promptly communicated to FACS on
behalf of the relevant Retail Merchant. FACS shall honor the customer service
policies and determinations of the Retail Merchant. Amounts shall only be
charged back to the extent FACS authorizes the applicable charge back of
Cardholder Indebtedness.

                  (ii) Fraudulent Charges. If a charge arose from fraud of any
employee or agent of a Retail Merchant, the amount of any Cardholder
Indebtedness with respect to such charge may be charged back to FDS, on behalf
of the relevant Retail Merchant.

                  (iii) Certain Transactions. Any transactions in the FDS
Channels with respect to which appropriate authorizations were not obtained in
accordance with the Operating Procedures may be charged back to FDS.

                  (iv) Cardholder Fraud. Any transactions that arose in any FDS
Channel from fraud in respect of a Private Label Account may be charged back to
FDS.

      (b) Exercise of Chargeback. If Bank exercises its right of chargeback,
Bank may set off all amounts charged back against any sums due to the FDS
Companies under this Agreement, or Bank may demand payment from FDS for the full
amount of such chargeback. In the event of a chargeback pursuant to this Article
VIII, upon payment in full of the related amount by FDS, Bank shall immediately
assign to FDS or the relevant Retail Merchant, without any representation,
warranty or recourse, all right to payments of amounts charged back in
connection with such Cardholder charge. Bank shall cooperate fully in any effort
by the FDS Companies to collect the chargeback amount, including by executing
and delivering any document necessary or useful to such collection efforts.

      (c) General Purpose Account Fraud. All fraud losses in respect of General
Purpose Accounts shall be at Bank's expense (and shall be deemed Program
Expenses).

            8.6   No Processing Fees.

      (a) None of FDS, its Affiliates or the Retail Merchants shall charge any
Credit Card surcharge, application, processing or other Program related fee to
Cardholders.

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<PAGE>

      (b) None of FDS, its Affiliates or the Retail Merchants shall be required
to pay any Merchant Discount on any FDS Transaction. Bank shall process FDS
Transactions such that the Retail Merchants do not incur any merchant
acquirer/processor or similar fees.

                                   ARTICLE IX

                                PROGRAM ECONOMICS

            9.1 Bank's Responsibility for Program Operation. Except as otherwise
expressly specified in this Agreement, Bank shall be responsible for the costs
of operating the Program. Except as expressly contemplated by the Budget
approved by the Operating Committee or as otherwise expressly provided for in
this Agreement, Bank shall not incur costs that would be deemed Program Expenses
unless otherwise approved by the Operating Committee.

            9.2 Settlement Statements.

      (a) Within thirty (30) days after the end of each Fiscal Month other than
the last Fiscal Month of each Fiscal Quarter, FDS Bank shall deliver to Bank a
statement including all information set forth on Schedule 9.2(a). Each such
statement shall be known as a "Monthly Settlement Sheet." (b) Within thirty (30)
days after the end of each Fiscal Quarter other than the last Fiscal Quarter of
each Fiscal Year, FDS Bank shall deliver to Bank a statement including all
information set forth on Schedule 9.2(b). Each such statement shall be known as
a "Quarterly Settlement Sheet."

      (c) Within thirty (30) days after the end of each Fiscal Year, FDS Bank
shall deliver to Bank a statement including all information set forth on
Schedule 9.2(c). Each such statement shall be known as a "Year-End Settlement
Sheet".

            9.3 FDS Compensation.

      (a) Payments. Not later than 10 A.M. (Eastern time) on the fifth (5th)
Business Day after the receipt of each Monthly Settlement Sheet, Quarterly
Settlement Sheet or Year-End Settlement Sheet, as applicable, Bank shall pay to
FDS Bank the amounts determined in accordance with Schedule 9.3(a). Such amounts
shall be paid to FDS Bank regardless of whether any amounts are disputed by
Bank. Each Party may invoke the dispute resolution procedures set forth herein
in connection with any dispute relating to any payment of the amounts set forth
in the applicable settlement sheet.

      (b) Form of Payment. All payments pursuant to this Section 9.3 shall be
made by wire transfer of immediately available funds to an account designated in
writing by FDS Bank unless otherwise agreed upon by the Parties in writing.

      (c) Card Association Compensation. FDS Bank shall be entitled to all
amounts (other than Interchange Fees) paid to Bank by the Card Association
pursuant to the Visa-Branded Federated Department Stores Co-Branded Card Program
Agreement, dated as of October 22, 2002, between FDS Bank and the Card
Association (as amended, renewed or otherwise

                                       53
<PAGE>

modified, the "Card Association Contract"). Bank shall use its commercially
reasonable efforts to ensure that the Card Association Contract remains in full
force and effect in accordance with its terms following the Effective Date, and
Bank shall not agree to any early termination of the Card Association Contract
or to any amendment or modification thereof that would reduce the amount payable
to FDS Bank pursuant thereto and this Section 9.3(c). Bank shall use its
commercially reasonable efforts to cause the Card Association Contract to be
extended, renewed or replaced by the Card Association at the end of its term
with a replacement contract having economic terms that are (i) the most
favorable economic terms reasonably available to Bank and (ii) no less favorable
than the terms in effect under the Card Association Contract on the date hereof.
Any contract resulting from any such extension, renewal or replacement shall
also be deemed the Card Association Contract and shall be subject to all of the
terms of this Section 9.3(c). All amounts payable pursuant to this Section
9.3(c) shall be payable as set forth in Section 9.3(a). The Parties acknowledge
and agree that (i) in exercising its commercially reasonable efforts hereunder,
Bank shall not be obligated to pay any fee or other amount to the Card
Association or to any other Person unless FDS Bank agrees to reimburse the Bank
for the full amount thereof in connection therewith and (ii) Bank shall not
agree to pay any such fee or other amount unless FDS Bank shall have consented
thereto in writing.

            9.4 Budgeting.

      (a) The Budget for the Fiscal Year ending January 28, 2006 is attached
hereto as Schedule 9.4(a). At least ninety (90) days before the beginning of
each subsequent Fiscal Year, the Managers will jointly submit a proposed annual
Budget for such Fiscal Year to the Operating Committee. Each Budget shall be
based on reasonable estimates of each line item therein based upon the Business
Plan, the Marketing Plan and other information regarding actual historical and
estimated future expenses of the Program and the Parties. Each Party shall
promptly provide information reasonably requested by the Operating Committee in
connection with the review and approval of any Budget.

      (b) The Operating Committee shall review the proposed Budget and approve
the annual Budget in accordance with Section 3.2. The Operating Committee shall
also review the Budget at least semi-annually and may elect to approve
modifications to the forecasts contained in the Budget (and/or approve a
semi-annual Budget) from time to time.

      (c) Within thirty (30) days after the end of each Fiscal Year, the FDS
Servicer shall provide a report to Bank indicating the actual income and
expenses of the Program compared to the applicable Budget. Unless otherwise
approved by the Operating Committee, to the extent any actual expenses incurred
in the prior Fiscal Year in respect of any expense category (including all line
items in such expense category) set forth in Schedule 9.4(c) exceed one hundred
ten percent (110%) of the amount budgeted therefor in the approved Budget for
such Fiscal Year, the following shall apply:

                  (i) with respect to each expense category where such an excess
exists, if such expense category is an expense category with respect to which
the FDS Companies are responsible (as set forth in Schedule 9.4(c)) and are
entitled to payment or reimbursement in accordance with this Agreement
disregarding this Section 9.4(c), the FDS Companies shall make a payment to Bank
in an amount equal to the excess, if any, of (A) the aggregate of all monthly

                                       54
<PAGE>

amounts paid or reimbursed to the FDS Companies in respect of such expense
category for the relevant Fiscal Year over (B) the amount to which the FDS
Companies would have been entitled had the actual amount of the expenses in such
expense category not exceeded the amount budgeted therefor; and

                  (ii) annual Pre-Tax Profit shall be recalculated by the FDS
Servicer; provided that for purposes of such recalculation, for each expense
category as to which there is an excess of the type referred to in the first
paragraph of this Section 9.4(c), the budgeted amount for such expense category
shall be substituted for the amount that would have been recorded for such
expense category based on actual results. Bank shall pay to the FDS Companies an
amount equal to the excess, if any, of (A) the FDS Profit Share to which the FDS
Companies would have been entitled for such Fiscal Year had the actual Pre-Tax
Profit for such Fiscal Year been equal to the Pre-Tax Profit as recalculated in
accordance with this Section 9.4(c)(ii) over (B) the aggregate amount actually
paid to the FDS Companies in respect of the FDS Profit Share for all months in
such Fiscal Year.

      (d) All amounts payable pursuant to Section 9.4(c) shall be reflected in
the Year-End Settlement Sheet and paid to the Party(ies) entitled thereto in
connection with the settlement of the amounts reflected therein.

                                    ARTICLE X

                              INTELLECTUAL PROPERTY

            10.1  The FDS Licensed Marks.

      (a) Grant of License to Use the FDS Licensed Marks. Subject to the terms
and conditions of this Agreement, FDS hereby grants to Bank a non-exclusive,
royalty-free, non-transferable right and license to use the FDS Licensed Marks
(i) with respect to the Program in the United States in connection with the
creation, establishment, marketing and administration of, and the provision of
services related to, the Program and (ii) in connection with any sale permitted
by this Agreement of the Accounts and Cardholder Indebtedness to third parties
for liquidation. All use of the FDS Licensed Marks shall be in accordance with
this Agreement and any Trademark Style Guide delivered by FDS to Bank from time
to time (which FDS shall so deliver). All uses of the FDS Licensed Marks shall
require the prior written approval of FDS. To the extent Bank delegates any of
its rights or obligations hereunder to any authorized Affiliate and/or
authorized third party in accordance with the terms and conditions of this
Agreement, Bank may sublicense its rights in the FDS Licensed Marks hereunder to
such authorized Person; provided that such Person shall agree to comply with all
of the terms and conditions of the use of the FDS Licensed Marks hereunder and
Bank shall remain liable for such Person's failure to so comply. Except as
expressly set forth in this Section 10.1, the rights granted pursuant to this
Section 10.1 are solely for use of Bank and may not be sublicensed without the
prior written approval of FDS.

      (b) New FDS Marks. If FDS or any of its Subsidiaries adopts a trademark,
service mark or other source indicator that is a successor to an FDS Licensed
Mark or that FDS has otherwise elected to use in connection with the Program but
which is not listed on Schedule

                                       55
<PAGE>

1.1(e) hereto (a "New FDS Mark"), Bank may request that FDS add such New FDS
Mark to Schedule 1.1(e) hereto and license its use hereunder; FDS shall not
unreasonably fail to do so (for the avoidance of doubt and without limitation,
it is reasonable for FDS to withhold consent if the New FDS Mark is not a
successor to an FDS Licensed Mark or is not used in connection with its retail
operations), and upon FDS's written approval of the addition of such New FDS
Mark, such New FDS Mark shall be deemed added to Schedule 1.1(e). In the event
that FDS does not license any New FDS Mark to Bank, such New FDS Mark shall be
deemed to be an FDS Licensed Mark solely for purposes of Section 2.2.

      (c) Termination of License. Except to the extent otherwise provided in
Section 16.4, the license granted in this Section 10.1 shall terminate upon the
termination or expiration of this Agreement or, if the purchase option under
Section 16.2 is exercised, the Program Purchase Date. Upon termination of the
license granted in this Section 10.1, all rights in the FDS Licensed Marks
granted hereunder shall revert to FDS and Bank shall (and shall cause its
authorized Affiliates, authorized third parties and permitted sublicensees to):
(i) discontinue all use of the FDS Licensed Marks, or any of them, and any
colorable imitation thereof; and (ii) destroy all unused FDS Credit Cards,
Credit Card Applications, Account Documentation, Solicitation Materials,
periodic statements, materials, displays, advertising and sales literature and
any other items bearing any of the FDS Licensed Marks; provided that if the
purchase option under Section 16.2 is exercised, at FDS's election, such items
shall constitute Program Assets and will be transferred and delivered to FDS or
its Nominated Purchaser pursuant to Section 16.2.

      (d) Ownership of the FDS Licensed Marks. Bank acknowledges that (i) the
FDS Licensed Marks, all rights therein, and the goodwill associated therewith,
are, and shall remain, the exclusive property of FDS and its Affiliates, (ii) it
shall take no action which shall adversely affect the exclusive ownership of FDS
and its Affiliates in the FDS Licensed Marks, or the goodwill associated with
the FDS Licensed Marks (it being understood that the collection of Accounts,
adverse action letters, and changes in terms of Accounts as required by
Applicable Law do not adversely affect goodwill, if done in accordance with the
terms of this Agreement), and (iii) any and all goodwill arising from use of the
FDS Licensed Marks by Bank shall inure to the benefit of FDS. Nothing herein
shall give Bank any proprietary interest in or to the FDS Licensed Marks, except
the right to use the FDS Licensed Marks in accordance with this Agreement, and
Bank shall not contest FDS's title in and to the FDS Licensed Marks. FDS shall
prosecute and maintain the FDS Licensed Marks at FDS's cost and expense and in
its sole discretion.

      (e) Infringement by Third Parties. Bank shall use reasonable efforts to
notify FDS, in writing, promptly upon acquiring Knowledge of any infringing use
of any of the FDS Licensed Marks by any third party. If any of the FDS Licensed
Marks is infringed, FDS alone has the right, in its sole discretion, to take
whatever action it deems necessary to prevent such infringing use; provided,
however, that if FDS fails to take reasonable steps to prevent infringement of
the FDS Licensed Marks by any department store retailer and such infringement
has an adverse effect upon the Program or the rights of Bank hereunder, Bank may
request that FDS take action necessary to alleviate such adverse impact. Bank
shall reasonably cooperate with and assist FDS, at FDS's expense, in the
prosecution of those actions that FDS determines, in its sole discretion, are
necessary or desirable to prevent the infringing use of any of the FDS Licensed
Marks.

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<PAGE>

            10.2 Bank Licensed Marks.

      (a) Grant of License to Use Bank Licensed Marks. Subject to the terms and
conditions of this Agreement, Bank hereby grants to the FDS Companies a
non-exclusive, royalty-free, non-transferable right and license to use Bank
Licensed Marks in the United States in connection with the creation,
establishment, marketing and administration of, and the provision of services
related to, the Program. All use of Bank Licensed Marks shall be in accordance
with this Agreement and any Trademark Style Guide delivered by Bank to FDS from
time to time (which Bank shall so deliver). All uses of Bank Licensed Marks
shall require the prior written approval of Bank. To the extent the FDS
Companies delegate any of their rights or obligations hereunder to any
authorized Affiliate and/or authorized third party in accordance with the terms
and conditions of this Agreement, the FDS Companies may sublicense their rights
in Bank Licensed Marks hereunder to such authorized Person; provided that such
Person shall agree to comply with all of the terms and conditions of the use of
Bank Licensed Marks hereunder and the FDS Companies shall remain liable for such
Person's failure to so comply. Except as expressly set forth in this Section
10.2, the rights granted pursuant to this Section 10.2 are solely for use of the
FDS Companies and may not be sublicensed without the prior written approval of
Bank.

      (b) New Bank Marks. If Bank adopts a trademark, service mark or other
source indicator for use in connection with its Credit Card business or any
related businesses that is not listed on Schedule 1.1(b) hereto (for purposes of
this Section 10.2, a "New Bank Mark"), FDS may request that Bank add such New
Bank Mark to Schedule 1.1(b) hereto and license its use hereunder; and if the
Operating Committee (which shall decide on behalf of Bank) so agrees, such New
Bank Mark shall be deemed added to Schedule 1.1(b) (provided that
notwithstanding any agreement of the Operating Committee, any New Bank Mark that
is a successor to a Bank Licensed Mark shall be deemed to be licensed as a Bank
Licensed Mark hereunder and added to Schedule 1.1(b)).

      (c) Termination of License. The license granted in this Section 10.2 shall
terminate upon the termination or expiration of this Agreement or, if the
purchase option under Section 16.2 is exercised, six (6) months after the
Program Purchase Date. Upon the termination of the license granted in this
Section 10.2, all rights in Bank Licensed Marks granted hereunder shall revert
to Bank and the FDS Companies shall (and shall cause their authorized
Affiliates, authorized third parties and permitted sublicensees to): (i)
discontinue all use of Bank Licensed Marks, or any of them, and any colorable
imitation thereof; and (ii) destroy all unused FDS Credit Cards, Credit Card
Applications, Account Documentation, Solicitation Materials, periodic
statements, materials, displays, advertising and sales literature and any other
items, in each case, bearing any of Bank Licensed Marks.

      (d) Ownership of Bank Licensed Marks. Each of the FDS Companies
acknowledges that (i) Bank Licensed Marks, all rights therein, and the goodwill
associated therewith, are, and shall remain, the exclusive property of Bank,
(ii) it shall take no action which shall adversely affect Bank's exclusive
ownership of Bank Licensed Marks or the goodwill associated with Bank Licensed
Marks, and (iii) any and all goodwill arising from use of Bank Licensed Marks by
the FDS Companies shall inure to the benefit of Bank. Nothing herein shall give
the FDS Companies any proprietary interest in or to Bank Licensed Marks, except
the right to use Bank

                                       57
<PAGE>

Licensed Marks in accordance with this Agreement, and the FDS Companies shall
not contest Bank's title in and to Bank Licensed Marks. Bank shall prosecute and
maintain the Bank Licensed Marks at Bank's cost and expense and in its sole
discretion.

      (e) Infringement by Third Parties. Each of the FDS Companies shall use
reasonable efforts to notify Bank, in writing, promptly upon acquiring Knowledge
of any infringing use of any Bank Licensed Marks by any third party. If any Bank
Licensed Mark is infringed, Bank alone has the right, in its sole discretion, to
take whatever action it deems necessary to prevent such infringing use;
provided, however, that if Bank fails to take reasonable steps to prevent
infringement of any Bank Licensed Marks by any credit provider and such
infringement has an adverse effect upon the Program or the rights of the FDS
Companies hereunder, the FDS Companies may request that Bank take action
necessary to alleviate such adverse impact. The FDS Companies shall reasonably
cooperate with and assist Bank, at Bank's expense, in the prosecution of those
actions that Bank determines, in its sole discretion, are necessary or desirable
to prevent the infringing use of any Bank Licensed Marks.

            10.3  Intellectual Property.

      (a) Each Party shall continue to own all of its Intellectual Property that
existed as of the Effective Date. Each Party also shall own all right, title and
interest in the Intellectual Property it develops or creates independently of
the other Party during the Term.

      (b) Except to the extent the Parties enter into a separate agreement (or
addendum to this Agreement) with respect to the development, creation, use and
their respective rights in any Joint IP, each Party shall have the right to use,
license and otherwise exploit Joint IP without any restriction or obligation to
account to the other Party; provided, however, that no such Joint IP shall be
used by Bank in connection with any Credit Card or other credit program or other
arrangement with any retailer (including any retailer listed on Schedule 2.5)
without the prior written consent of FDS. "Joint IP" means any Intellectual
Property developed or created in connection with the Program that is deemed to
be jointly owned by Bank, on the one hand, and any of the FDS Companies, on the
other hand, pursuant to this Section 10.3. Patents and patentable inventions
shall be deemed to be owned jointly, as between the Parties only if the
respective personnel of each Party are deemed co-inventors under the patent law.
Software and other works of authorship and associated copyrights shall be deemed
to be jointly owned only if the Parties are deemed co-authors or co-owners of
such software or other work of authorship under the copyright law or otherwise.
Any other Intellectual Property developed by a substantially equal investment of
time, human, intellectual and financial resources by each Party during the Term
of this Agreement shall be owned jointly by the Parties; provided that any such
Intellectual Property constituting a trademark, service mark or other source
indicator, shall be owned exclusively by FDS and may become a "New FDS Mark"
pursuant to Section 10.1(b) (for the avoidance of doubt, Bank shall own all
right, title and interest in any trademark, service mark or other source
indicator it develops or creates independently of the FDS Companies during the
Term). To the extent that a work created by one Party is based on or
incorporates Intellectual Property of the other Party, but the Parties are not
joint owners as set forth above, then one Party shall be the sole owner of the
Intellectual Property in the underlying work and the other Party shall be the
sole owner of the Intellectual Property in the new work. By way of example and
not of limitation, a Party shall not be a joint owner of any Intellectual
Property in any marketing

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<PAGE>

materials to the extent its contribution thereto consists solely of review,
approval or modification of such materials to ensure compliance with Applicable
Law or Credit Card Documentation.

      (c) During and after the Term of this Agreement, each Party shall use,
license or otherwise exploit (or permit others to do so) any Joint IP solely at
its own risk. Each Party hereby disclaims all representations and warranties,
either express or implied, including any warranties of title, non-infringement,
validity, value, reliability, merchantability or fitness for a particular
purpose, with respect to any Joint IP and its use, licensing or exploitation by
the other Party. The term "Program Assets" includes all of Bank's right, title
and interest in and to any Joint IP used by Bank solely in connection with the
Program (but not any liabilities arising out of or relating to Bank's use of
such Joint IP). Any information or data provided by or on behalf of one Party to
the other Party remains, as between the Parties, the sole property of the
providing Party, and if applicable, shall be considered "Confidential
Information" under Article XIII. Ownership of Cardholder Data, FDS Shopper Data
and FDS Prospect List shall not be governed by this Section 10.3(b). The
provisions of Section 10.3 shall survive any expiration or termination of this
Agreement.

                                   ARTICLE XI

                    REPRESENTATIONS, WARRANTIES AND COVENANTS

            11.1 General Representations and Warranties of FDS. Except as
Previously Disclosed, FDS makes the following representations and warranties to
Bank as of the date hereof and as of the Effective Date:

      (a) Corporate Existence. Each FDS Company: (i) is a corporation (or, in
the case of FDS Bank, a federally chartered stock savings bank) duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization; (ii) is duly licensed or qualified to do business and is in good
standing as a foreign entity in all jurisdictions in which the conduct of its
business or the activities in which it is engaged makes such licensing or
qualification necessary, except to the extent that its non-compliance would not
reasonably be expected to have, individually or in the aggregate, a material
adverse effect on the FDS Companies' ability to perform their obligations
hereunder; and (iii) has all necessary licenses, permits, consents or approvals
from or by, and has made all necessary filings and registrations with, all
governmental authorities having jurisdiction, to the extent required for the
ownership, lease or conduct and operation of its business, except to the extent
that the failure to obtain such licenses, permits, consents or approvals or to
make such filings or registrations would not reasonably be expected to have,
individually or in the aggregate, a material adverse effect on the Program.

      (b) Capacity; Authorization; Validity. Each FDS Company has all necessary
corporate or similar power and authority to (i) execute and enter into this
Agreement and (ii) perform the obligations required of such FDS Company
hereunder and the other documents, instruments and agreements relating to the
Program and this Agreement executed by such FDS Company pursuant hereto. The
execution and delivery by the FDS Companies of this Agreement and all documents,
instruments and agreements executed and delivered by the FDS Companies pursuant
hereto, and the consummation by the FDS Companies of the transactions specified
herein, have been duly and validly authorized and approved by all necessary
corporate

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<PAGE>

or similar actions of the FDS Companies. This Agreement (i) has been duly
executed and delivered by the FDS Companies, (ii) constitutes the valid and
legally binding obligation of the FDS Companies, and (iii) is enforceable in
accordance with its terms (subject to applicable bankruptcy, insolvency,
reorganization, receivership or other laws affecting the rights of creditors
generally and by general equity principles including those respecting the
availability of specific performance).

      (c) Conflicts; Defaults; Etc. The execution, delivery and performance of
this Agreement by each of the FDS Companies, compliance by each of them with the
terms hereof, and consummation by each of them of the transactions specified
herein will not (i) conflict with, violate, result in the breach of, constitute
an event which would, or with the lapse of time or action by a third party or
both would, result in a default under, or accelerate the performance required
by, the terms of any contract, instrument or agreement to which FDS or any of
its Subsidiaries is a party or by which they are bound, or to which any of the
assets of FDS or any of its Subsidiaries are subject; (ii) conflict with or
violate the articles of incorporation or by-laws, or any other equivalent
organizational document(s), of the FDS Companies; (iii) breach or violate any
Applicable Law, Applicable Order or the by-laws or other membership or operating
rules of the Card Association, in each case, applicable to the FDS Companies;
(iv) require the consent or approval of any other party to any contract,
instrument or commitment to which any FDS Company is a party or by which it is
bound; or (v) require any filing with, notice to, consent or approval of, or any
other action to be taken with respect to, any Governmental Authority, except, in
the cases of clauses (i), (iv) and (v), for such conflicts, breaches, defaults,
violations or failures to obtain such consents or approvals or make or obtain
such filings, notices, consents and approvals as would not reasonably be
expected to have, individually or in the aggregate, a material adverse effect
upon the Program and, except in the case of clause (iii), for any immaterial
breach or violation of any such Applicable Law, Applicable Order, by-law or
rules.

      (d) No Litigation. No action, claim, litigation, proceeding, arbitration
or investigation is pending or, to the Knowledge of FDS, threatened against FDS
or any of its Subsidiaries, at law, in equity or otherwise, by or before any
Governmental Authority, to which FDS or any of its Subsidiaries is a party,
which would reasonably be expected to have, individually or in the aggregate, a
material adverse effect on the Program.

      (e) The FDS Licensed Marks. FDS has the right, power and authority to
grant the rights to use the FDS Licensed Marks expressly granted herein.

      (f) Internal Controls Over Financial Reporting. FDS has implemented with
respect to the Credit Card Business, "disclosure controls and procedures" and
"internal control over financial reporting" (as defined in Rules 13a-15 and
15d-15 of the Exchange Act) reasonably designed to ensure that all information
(both financial and non-financial) required to be disclosed by FDS with respect
to the Credit Card Business in the reports that FDS files or submits under the
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the rules and forms of the SEC and that all such
information is accumulated and communicated to FDS's management as appropriate
to allow timely decisions regarding required disclosure and to make the
certifications of the Chief Executive Officer and Chief Financial Officer of FDS
required under the Exchange Act with respect to such reports.

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<PAGE>

      (g) Operating Procedures and Risk Management Policies. Except as set forth
on Schedule 11.1(g), the initial Operating Procedures set forth in Schedule
4.1(b) and the initial Risk Management Policies set forth in Schedule 4.6(b)
represent the operating procedures and risk management policies under which the
FDS Companies have operated the Credit Card Business from January 1, 2005 until
the date hereof. Except as set forth on Schedule 11.1(g), the FDS Companies have
not made any material changes to such operating and risk management policies
since January 1, 2005. The FDS Companies have achieved or exceeded the risk
management targets specified in Schedule 4.6(c)(ii) in either the First Quarter
of Fiscal Year 2005 or as otherwise specified in Schedule 4.6(c)(ii). The FDS
Companies have achieved or exceeded the SLAs specified in Schedule 4.1(b) with
respect to the services to be performed by Bank pursuant to Sections 4.3(a)(v)
and (ix) since July 31, 2004.

            11.2 General Representations and Warranties of Bank. Except as
Previously Disclosed, Bank hereby makes the following representations and
warranties to the FDS Companies as of the date hereof and as of the Effective
Date:

      (a) Corporate Existence. Bank (i) is duly organized, validly existing and
in good standing under the federal laws of the United States and (ii) is duly
licensed or qualified to do business and is in good standing as a foreign entity
in all jurisdictions in which the conduct of the its business or the activities
in which it is engaged, or proposes to engage pursuant to this Agreement, makes
such licensing or qualification necessary, except to the extent that its
non-compliance would not reasonably be expected to have, individually or in the
aggregate, a material adverse effect upon the Program. Bank has all necessary
licenses, permits, consents or approvals from or by, and has made all necessary
filings and registrations with, all governmental authorities having
jurisdiction, to the extent required for the ownership, lease or conduct and
operation of its business and the Credit Card Business pursuant to this
Agreement, except to the extent that the failure to obtain such licenses,
permits, consents or approvals or to make such filings or registrations would
not reasonably be expected to have, individually or in the aggregate, a material
adverse effect upon the Program.

      (b) Capacity; Authorization; Validity. Bank has all necessary corporate or
similar power and authority to (i) execute and enter into this Agreement and
(ii) perform the obligations required of it hereunder and the other documents,
instruments and agreements relating to the Program and this Agreement executed
by Bank pursuant hereto. The execution and delivery by Bank of this Agreement
and all documents, instruments and agreements executed and delivered by Bank
pursuant hereto, and the consummation by Bank of the transactions specified
herein, has been duly and validly authorized and approved by all necessary
corporate or similar actions of Bank. This Agreement (i) has been duly executed
and delivered by Bank, (ii) constitutes the valid and legally binding obligation
of Bank and (iii) is enforceable in accordance with its terms (subject to
applicable bankruptcy, insolvency, reorganization, receivership or other laws
affecting the rights of creditors generally and by general equity principles
including those respecting the availability of specific performance).

      (c) Conflicts; Defaults; Etc. The execution, delivery and performance of
this Agreement by Bank, compliance by it with the terms hereof, and consummation
by it of the transactions specified herein will not (i) conflict with, violate,
result in the breach of, constitute an event which would, or with the lapse of
time or action by a third party or both would, result in

                                       61
<PAGE>

a default under, or accelerate the performance required by, the terms of any
contract, instrument or agreement to which Bank is a party or by which it is
bound, or to which any of the assets of Bank is subject; (ii) conflict with or
violate the articles of incorporation or by-laws, or any other equivalent
organizational document(s), of Bank; (iii) breach or violate any Applicable Law,
Applicable Order or the by-laws or other membership or operating rules of the
Card Association, in each case, applicable to Bank; (iv) require the consent or
approval of any other party to any contract, instrument or commitment to which
any Bank is a party or by which it is bound; or (v) require any filing with,
notice to, consent or approval of, or any other action to be taken with respect
to, any Governmental Authority, except, in the cases of clauses (i), (iv) and
(v), for such conflicts, breaches, defaults, violations or failures to obtain
such consents or approvals or make or obtain such filings, notices, consents and
approvals as would not reasonably be expected to have, individually or in the
aggregate, a material adverse effect upon the Program, and except, in the case
of clause (iii), for any immaterial breach or violation of any such Applicable
Law, Applicable Order, by-laws or rules.

      (d) No Litigation. No action, claim, litigation, proceeding, arbitration
or investigation is pending or, to the Knowledge of Bank, threatened against
Bank or any of its Affiliates, at law, in equity or otherwise, by or before any
Governmental Authority, to which Bank or any of its Affiliates is a party, which
would reasonably be expected to, individually or in the aggregate, have a
material adverse effect on the Program.

      (e) Bank Licensed Marks. Bank or one or more of its Affiliates owns the
Bank Licensed Marks and Bank has the right, power and authority to grant the
rights to use Bank Licensed Marks expressly granted herein.

      (f) FDIC Insurance. Bank's deposit accounts are insured by the FDIC to the
fullest extent permitted by Applicable Law, and to Bank's Knowledge, no
proceeding is contemplated to revoke such insurance.

      (g) Card Associations. Bank is a member in good standing of the Card
Association and has full authority under the by-laws and other membership and
operating rules of the Card Association to issue the Co-Branded Credit Cards and
otherwise perform its obligations under this Agreement.

            11.3 General Covenants of the FDS Companies.

      (a) Litigation. Each of the FDS Companies promptly shall notify Bank in
writing if it receives written notice of any litigation that, if adversely
determined, would reasonably be expected to have a material adverse effect on
the Program, the Accounts in the aggregate or the FDS Companies' ability to
perform their obligations hereunder.

      (b) Reports and Notices. Each of the FDS Companies shall provide Bank with
a facsimile notice specifying the nature of any FDS Event of Default, or any
event which, with the giving of notice or passage of time or both, would
constitute an FDS Event of Default, or any development or other information
which is likely to have a material adverse effect on the Program, the Accounts,
Cardholder Indebtedness or the FDS Companies' ability to perform their
obligations pursuant to this Agreement. Notices pursuant to this Section 11.3(b)
relating to the

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<PAGE>

FDS Events of Default shall be provided within two (2) Business Days after any
of the FDS Companies has Knowledge of the existence of such default. Notices
relating to all other events or developments described in this Section 11.3(b)
shall be provided (i) promptly after any of the FDS Companies has Knowledge of
the existence of such event or development if such event or development has
already occurred, and (ii) with respect to events or developments that have yet
to occur, as early as reasonably practicable under the circumstances. Any notice
provided under this section shall be confirmed in writing to Bank within five
(5) Business Days after the transmission of the initial notice.

      (c) Applicable Law/Operating Procedures. The FDS Companies shall at all
times during the Term comply in all material respects with Applicable Law
affecting their obligations under this Agreement and the Operating Procedures.

      (d) Disputes with Cardholders. The FDS Companies shall reasonably
cooperate with Bank in a timely manner (but in no event less promptly than
required by Applicable Law) to resolve all disputes with Cardholders.

      (e) Books and Records. Prior to the Systems Transition Date, the FDS
Companies shall keep adequate records and books of account with respect to the
Accounts and Cardholder Indebtedness in which proper entries, reflecting all of
the FDS Companies' transactions relating to the Program are made in accordance
with the terms of this Agreement. The FDS Companies shall keep adequate records
and books of account with respect to their activities relating to the Program,
in which proper entries reflecting all of the FDS Companies' transactions are
made in accordance with the terms of this Agreement. All of the records, files
and books of account of the FDS Companies relating to the Program shall be in
all material respects complete and correct and shall be maintained in accordance
with good business practice and Applicable Law.

            11.4 General Covenants of Bank.

      (a) Litigation. Bank promptly shall notify FDS in writing if it receives
written notice of any litigation that, if adversely determined, would reasonably
be expected to have a material adverse effect on the Program, the Accounts in
the aggregate or Bank's ability to perform its obligations hereunder.

      (b) Reports and Notices. Bank shall provide FDS with a facsimile notice
specifying the nature of any Bank Event of Default, or any event which, with the
giving of notice or passage of time or both, would constitute a Bank Event of
Default, or any development or other information which is likely to have a
material adverse effect on the Program, the Accounts or Bank's ability to
perform its obligations pursuant to this Agreement. Notice pursuant to this
Section 11.4(b) relating to Bank Events of Default shall be provided within two
(2) Business Days after Bank has Knowledge of the existence of such default.
Notices relating to all other events or developments described in this Section
11.4(b) shall be provided (i) promptly after Bank obtains Knowledge of the
existence of such event or development if such event or development has already
occurred, and (ii) with respect to events or developments that have yet to
occur, as early as reasonably practicable under the circumstances. Any notice
produced under this section shall be confirmed in writing to the FDS Companies
within five (5) Business Days after transmission of the initial notice.

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<PAGE>

      (c) Applicable Law/Operating Procedures. Bank shall at all times during
the Term comply in all material respects with Applicable Law affecting its
obligations under this Agreement and the Operating Procedures. Bank shall at all
times during the Term maintain its federal bank charter.

      (d) Books and Records. Bank shall keep adequate records and books of
account with respect to the Accounts and Cardholder Indebtedness in which proper
entries, reflecting all of Bank's financial transactions relating to the
Program, are made in accordance with the terms of this Agreement. Bank shall
keep adequate records and books of account with respect to their activities
relating to the Program, in which proper entries reflecting all of Bank's
financial transactions are made in accordance with the terms of this Agreement.
All of Bank's records, files and books of account relating to the Program shall
be in all material respects complete and correct and shall be maintained in
accordance with good business practice and Applicable Law.

      (e) FDIC Insurance. Bank's deposit accounts shall be insured by the FDIC
to the fullest extent permitted by Applicable Law throughout the Term. (f) Card
Association. Bank and, from and after the Effective Date, any assignee thereof
shall be members in good standing of the Card Association throughout the Term.

      (g) Special Conditions. In the event that any Special Condition applicable
to Bank or any of its Affiliates results in any of such Parties being required
to incur costs to ensure that the Program remains in compliance with Applicable
Law, such incremental costs shall be paid for or reimbursed by Bank and shall
not be deemed to be Program Expenses or otherwise reduce Pre-tax Profit.
"Special Condition" means any Applicable Order or any other requirement of
Applicable Law affecting the operation of the Program by Bank and its
Affiliates, other than any such Applicable Order or requirement of general
application that similarly affects other Credit Card Banks that are national
banks or federally-chartered savings associations.

                                   ARTICLE XII

                      ACCESS, AUDIT AND DISPUTE RESOLUTION

            12.1 Access Rights. Each Party shall permit the other Party and its
representatives and regulators to visit its facilities related to the Program
during normal business hours with reasonable advance notice and at times and in
a manner that does not unreasonably disrupt its normal business operations. Each
Party shall also permit the other Party and its representatives and regulators
to review (during normal business hours) and obtain copies of the books and
records relating to the Program; provided that neither Party shall be required
to provide access to records to the extent that (a) such access is prohibited by
Applicable Law, (b) such records are legally privileged, (c) such records relate
to other customers of, or credit programs operated by, Bank (or its Affiliates)
or the FDS Companies, or (d) such access would unreasonably disrupt its normal
business operations.

            12.2 Audit Rights. Either Party may, from time to time during the
Term, at its sole cost and expense and upon ten (10) days' prior notice to the
other Party, conduct an audit of (i) the financial and operational records that
are under the control and/or direction of the other Party

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<PAGE>

and relate to the Program or can be reasonably segregated; and/or (ii) the
operations of the other Party to ensure such Party's compliance with its
obligations under this Agreement; provided, however, that any such audit shall
only be permitted at times and in a manner that does not unreasonably interfere
with the other Party's normal business operations, including that any such audit
shall be conducted during normal business hours in accordance with generally
accepted auditing standards and the auditing Party shall employ such reasonable
procedures and methods as necessary and appropriate in the circumstances,
minimizing interference with the audited Party's normal business operations. The
audited Party shall use reasonable efforts to facilitate the auditing Party's
review, including making reasonably available such personnel of the audited
Party, its Affiliates and its service providers to assist the auditing Party,
its representatives and its regulators as reasonably requested. The audited
Party shall deliver any document or instrument necessary for the audited Party
to obtain such records from any Person maintaining records for the audited Party
and shall maintain records pursuant to its regular record retention policies.
For purposes of this provision, to the extent reasonably practicable, the
audited Party also shall be required to provide records relating to the Program
held by Persons performing services in connection with the Program at the
auditing Party's request. Notwithstanding the generality of the foregoing, the
audited Party shall not be required to provide access to records to the extent
that (a) such access is prohibited by Applicable Law, (b) such records are
legally privileged, or (c) such records relate to other customers of, or credit
programs operated by, the audited Party.

            12.3 Dispute Resolution. Any dispute among the Parties arising out
of or relating to this Agreement, including with respect to the interpretation
of any provision of this Agreement and with respect to the performance by Bank
or the FDS Companies hereunder shall be resolved as provided in this Section
12.3; provided, however, that this provision shall not limit either Party's
right to seek any provisional or other remedy, including, without limitation,
specific performance or injunctive relief from any court of competent
jurisdiction, as may be necessary, in the aggrieved Party's sole discretion, to
protect its rights under this Agreement. This Section 12.3 does not apply to
disputes among the Operating Committee members with respect to decisions
expressly allocated to the Operating Committee pursuant to this Agreement (other
than matters submitted to the Operating Committee pursuant to the dispute
resolution procedure referred to in Section 12.3(a)(i)(B)). Such disputes shall
be resolved in accordance with Section 3.2.

      (a) Informal Dispute Resolution.

                  (i) Prior to the initiation of formal dispute resolution
procedures, the Parties shall first attempt to resolve their dispute informally,
as follows:

                        (A) Operating Committee. Upon the written request of
                  either Party containing a short statement as to the nature of
                  the dispute and the requesting Party's position with respect
                  thereto, the Operating Committee shall meet for the purpose of
                  negotiating in good faith to seek resolution of such dispute.

                        (B) Executive Committee. If, after a period of five (5)
                  Business Days, the Operating Committee is unable to resolve
                  the dispute to the satisfaction of the FDS Companies and Bank,
                  the dispute shall be brought before the Executive

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<PAGE>

                  Committee, the members of which shall in good faith seek
                  resolution of such dispute.

                        (C) Appointment of Representatives. If, after a period
                  of five (5) Business Days, the Executive Committee is unable
                  to resolve the dispute to the satisfaction of both the FDS
                  Companies and Bank, such unresolved matter shall be referred
                  to the President of Citi Cards and the President of FDS's
                  retail business, whose task it will be to meet for the purpose
                  of negotiating in good faith to seek resolution of the
                  dispute.

      With respect to clauses (A), (B) and (C) above, the location, format,
      frequency, duration and conclusion of these discussions shall be left to
      the discretion of the Operating Committee, Executive Committee and
      representatives, respectively. With respect to clause (C) above, upon
      agreement, the representatives may utilize other alternative dispute
      resolution procedures such as mediation to assist in the negotiations.

      With respect to clauses (A), (B) and (C) above, discussions, documents and
      correspondence exchanged among the representatives, or submitted to the
      Operating Committee or the Executive Committee for purposes of these
      negotiations, shall be treated as confidential information developed for
      purposes of settlement, exempt from discovery and production, which shall
      not be admissible in the arbitration described below or in any lawsuit
      without the concurrence of the Parties. Documents identified in or
      provided with such communications, which were not prepared for the
      purposes of the negotiations, are not so exempted and may, if otherwise
      admissible, be admitted in evidence in the arbitration or lawsuit.

                  (ii) Formal proceedings for the resolution of the dispute
pursuant to Section 12.3(b) shall not be commenced until the earlier of:

                        (A) either of the designated representatives concludes
                  in good faith that amicable resolution through continued
                  negotiation of the dispute does not appear likely and so
                  states in a notice to the other designated representative or
                  in a joint declaration signed by each of them; or

                        (B) twenty (20) Business Days after the appointment of
                  designated representatives pursuant to Section 12.3(a)(i)(C)
                  above (it being understood that this period shall be deemed to
                  run notwithstanding any claim that the process described in
                  this Section 12.3 was not followed or completed).

                  (iii) This Section 12.3 shall not be construed to prevent a
Party from instituting, and a Party is authorized to institute, formal
proceedings earlier than provided in clause (ii) above, to avoid the expiration
of any applicable limitations period, to preserve a superior position with
respect to other creditors, or as provided in Section 12.3(c).

      (b) Arbitration. If the Parties are unable to resolve a dispute as
provided in Section 12.3(a), then the Parties may agree that such dispute be
submitted to mandatory and binding arbitration. Where the Parties have agreed to
arbitrate a specific matter after it has arisen, the following conditions will
apply:

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<PAGE>

                  (i) Agreement to Arbitrate. Provided the Parties specifically
agree (in their sole discretion) in writing signed by their authorized
representatives specifically referencing this Section 12.3(b) to submit to
arbitration for the dispute described in such writing, such dispute, claim or
controversy relating in any way to this Agreement shall be settled by
arbitration in accordance with the Commercial Arbitration Rules of the AAA. No
damages excluded by or in excess of any damage limitations set forth in this
Agreement shall be awarded. The arbitrator is prohibited from awarding punitive
damages. If such arbitration is agreed to, notwithstanding the then current
specified Commercial Arbitration Rules of the AAA, the terms of this Agreement,
including the terms set forth in this Section 12.3(b), shall supersede any AAA
rule in conflict herewith. In addition, the arbitrator, in deciding all matters
and in fashioning an appropriate remedy or relief, shall be bound to apply the
substantive laws of the State of Delaware. In no event may any demand for
arbitration be made on any date on or after which the institution of legal or
equitable proceedings based on the applicable dispute would be barred by the
applicable statute of limitations or by any provision of this Agreement.

                  (ii) Selection of Arbitrator. The Disputing Party shall notify
the AAA and the other Party in writing and shall request that the AAA furnish a
list of five (5) possible arbitrators who shall have substantial experience in
the substantive area of the dispute. Each Party shall have fifteen (15) days to
reject two (2) of the proposed arbitrators. If only one individual has not been
so rejected, he or she shall serve as arbitrator; if two or more individuals
have not been so rejected, unless the Parties have agreed on one of such
individuals to be the arbitrator, the AAA shall select the arbitrator from those
individuals.

                  (iii) Conduct of Arbitration. Discovery shall be controlled by
the arbitrator and shall be permitted to the extent deemed by the Parties and
the arbitrator to be reasonable in the circumstances. Examples of the types of
discovery that may be permitted include:

                        (A) interrogatories,

                        (B) demands to produce documents,

                        (C) requests for admission, and

                        (D) depositions of a reasonable number of knowledgeable
                  fact witnesses.

The arbitration hearing shall be commenced within sixty (60) days of the demand
for arbitration. The arbitrator shall control the scheduling so as to process
the matter expeditiously. The Parties may submit written briefs. The times
specified in this Section may be extended upon mutual agreement of the Parties
or by the arbitrator upon a showing of good cause.

                  (iv) Replacement of Arbitrator. Should the arbitrator refuse
or be unable to proceed with arbitration proceedings as called for by this
Section 12.3(b), such arbitrator shall be replaced by an arbitrator selected by
mutual agreement of the Parties or, failing such agreement, by the AAA from the
other four (4) arbitrators originally proposed by the AAA and not rejected by
the Parties, if any, or if there are no remaining proposed arbitrators who have
not been rejected, by repeating the process of selection described in Section
12.3(b)(ii) above. If an

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<PAGE>

arbitrator is replaced pursuant to this Section 12.3(b)(iv), then a rehearing
shall take place in accordance with the provisions of this Section 12.3(b).

                  (v) Findings and Conclusions. The arbitrator rendering
judgment upon disputes between the Parties as provided in this Section 12.3(b)
shall, after reaching judgment and award, prepare and distribute to the Parties
within thirty (30) days after the close of hearings, or as soon thereafter as is
practicable in the circumstances, a writing describing the findings of fact and
conclusions of law relevant to such judgment and award and containing an opinion
setting forth the reasons for the giving or denial of any award. The award of
the arbitrator shall be final and binding on the Parties, and judgment thereon
may be entered in any court of competent jurisdiction.

                  (vi) Place of Arbitration Hearings. The arbitration shall be
held at a mutually agreed upon location or a neutral location determined by the
arbitrator if the Parties do not agree.

                  (vii) Fees. Each Party shall bear its own costs of these
procedures. A Party seeking discovery shall reimburse the responding Party the
costs of production of documents (to include search time and reproduction
costs). The Parties shall equally split the fees of the arbitration cost, the
court reporter's transcript, and the arbitrator.

                  (viii) Confidentiality. The Parties, their representatives and
participants and the arbitrator shall hold the existence, content and result of
the arbitration in confidence, except to the limited extent necessary to enforce
a final settlement agreement or to obtain or enforce a judgment on an
arbitration decision and award.

      (c) Litigation.

                  (i) Immediate Injunctive Relief. If a Party makes a good faith
determination that a breach of the terms of this Agreement by the other Party is
such that a temporary restraining order or other injunctive relief is the only
appropriate and adequate remedy, such Party shall be authorized to seek
immediate injunctive relief without regard to Section 12.3(a) or 12.3(b). If a
Party files a pleading with a court seeking immediate injunctive relief and such
pleading is challenged by the other Party and the injunctive relief sought is
not awarded in substantial part, the Party filing such pleading shall pay all of
the costs and attorneys' fees of the Party successfully challenging the
pleading.

                  (ii) Litigation in Lieu of Arbitration. So long as no
arbitration proceeding has been commenced by one Party and accepted by the other
Party as provided in Section 12.3(b)(i), after the dispute resolution procedures
set forth in Section 12.3(a) or either of the events set forth in Section
12.3(a)(ii) has occurred, either Party shall be authorized to initiate
litigation in order to resolve the dispute.

      (d) Continued Performance. Subject to Articles XV and XVI, each Party
agrees to continue performing its obligations under this Agreement while any
dispute is being resolved except to the extent the issue in dispute precludes
performance (it being understood and agreed by the Parties that a dispute over
payment shall not be deemed to preclude performance).



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                                  ARTICLE XIII

                                 CONFIDENTIALITY

            13.1 General Confidentiality.

      (a) For purposes of this Agreement, "Confidential Information" means any
of the following: (i) information that is provided by or on behalf of the FDS
Companies, on the one hand, or Bank, on the other hand, to the other Party or
its agents in connection with the Program (including information provided prior
to the date hereof or the Effective Date); (ii) information about the FDS
Companies or Bank or their Affiliates, or their respective businesses or
employees, that is otherwise obtained by the other Party in connection with the
Program, in each case including: (A) information concerning marketing plans,
objectives and financial results; (B) information regarding business systems,
methods, processes, financing data, programs, products and Value Proposition
terms and features and tests thereof; (C) information unrelated to the Program
obtained by the FDS Companies or Bank in connection with this Agreement,
including by accessing or being present at the business location of the other
Party; and (D) proprietary technical information, including source codes; (iii)
the terms and conditions of this Agreement; and (iv) the Marketing Plan. The
provisions of this Article XIII governing Confidential Information shall not
govern Cardholder Data, FDS Shopper Data or FDS Prospect List, which shall be
governed by the provisions of Article VI.

      (b) The restrictions on disclosure of Confidential Information under this
Article XIII shall not apply to information received or obtained by the FDS
Companies or Bank, as the case may be, that: (i) is or becomes generally
available to the public other than as a result of disclosure in breach of this
Agreement or any other confidentiality obligations; (ii) is lawfully received on
a non-confidential basis from a third party authorized to disclose such
information without restriction and without breach of this Agreement; (iii) is
contained in, or is capable of being discovered through examination of, publicly
available records or products; (iv) is required to be disclosed by Applicable
Law (but only to the extent of such required disclosure); provided that the
Party subject to such Applicable Law shall use reasonable efforts to avoid such
disclosure and notify the other Party of any such use or requirement prior to
disclosure of any Confidential Information obtained from the other Party in
order to afford such other Party an opportunity to seek a protective order to
prevent or limit disclosure of the Confidential Information to third parties;
provided, further, that such information shall be disclosed only to the extent
required by such Applicable Law and shall otherwise remain Confidential
Information; or (v) is developed by the FDS Companies or Bank, as the case may
be, without the use of any proprietary, non-public information provided by the
other Party under this Agreement. Nothing herein shall be construed to permit
the Receiving Party (as defined below) to disclose to any third party any
Confidential Information that the Receiving Party is required to keep
confidential under Applicable Law.

      (c) The terms and conditions of this Agreement, the Business Plan, the
Marketing Plan and the Budget shall each be the Confidential Information of the
FDS Companies and Bank, and each of the Parties to this Agreement shall be
deemed to be a Receiving Party of each of them.

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<PAGE>

      (d) If the FDS Companies, on the one hand, or Bank, on the other hand,
receive Confidential Information of the other Party ("Receiving Party"), the
Receiving Party shall do the following with respect to the Confidential
Information of the other Party ("Disclosing Party"): (i) keep the Confidential
Information of the Disclosing Party secure and confidential; (ii) treat all
Confidential Information of the Disclosing Party with the same degree of care as
it accords its own Confidential Information, but in no event less than a
reasonable degree of care; and (iii) implement and maintain commercially
reasonable physical, electronic, administrative and procedural security
measures, including commercially reasonable authentication, access controls,
virus protection and intrusion detection practices and procedures.

      (e) Upon reasonable request, the FDS Companies and Bank shall have the
right to review the other Party's information security standards and shall
notify the other Party prior to materially modifying such procedures.

            13.2 Use and Disclosure of Confidential Information.

      (a) Each Receiving Party shall use and disclose the Confidential
Information of the Disclosing Party only for the purpose of performing its
obligations or enforcing its rights with respect to the Program or as otherwise
expressly permitted by this Agreement, and shall not accumulate in any way or
make use of such Confidential Information for any other purpose.

      (b) Each Receiving Party shall: (i) limit access to the Disclosing Party's
Confidential Information to those employees, authorized agents, vendors,
consultants, service providers, accountants, advisors and subcontractors who
have a reasonable need to access such Confidential Information in connection
with the Program, the sale of Program Assets or other assets of FDS and its
Affiliates or the establishment of a new Credit Card or other program or
arrangement for an FDS Company, in each case in accordance with the terms of
this Agreement, and (ii) ensure that any Person with access to the Disclosing
Party's Confidential Information agrees to be bound by confidentiality
provisions consistent with the provisions of this Article XIII.

            13.3 Unauthorized Use or Disclosure of Confidential Information.
Each Receiving Party agrees that any unauthorized use or disclosure of
Confidential Information of the Disclosing Party might cause immediate and
irreparable harm to the Disclosing Party for which money damages might not
constitute an adequate remedy. In that event, the Receiving Party agrees that
injunctive relief may be warranted in addition to any other remedies the
Disclosing Party may have. In addition, the Receiving Party agrees promptly to
advise the Disclosing Party by telephone and in writing via facsimile of any
security breach that may have compromised any Confidential Information or of any
unauthorized misappropriation, disclosure or use by any Person of the
Confidential Information of the Disclosing Party which may come to its
attention, and to take all steps at its own expense reasonably requested by the
Disclosing Party to limit, stop or otherwise remedy such breach,
misappropriation, disclosure or use.

            13.4 Return or Destruction of Confidential Information. Upon the
termination or expiration of this Agreement, the Receiving Party shall comply
with the Disclosing Party's reasonable instructions regarding the disposition of
the Disclosing Party's Confidential Information, which may include return of any
and all the Disclosing Party's Confidential Information (including any
electronic or paper copies, reproductions, extracts or summaries

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thereof); provided, however, that the Receiving Party in possession of tangible
property containing the Disclosing Party's Confidential Information may retain
one archived copy of such material, subject to the terms of this Agreement,
which may be used solely for regulatory purposes and may not be used for any
other purpose. Such compliance shall be certified in writing, including a
statement that no copies of Confidential Information have been kept, except as
necessary for regulatory purposes.

                                   ARTICLE XIV

                     EVENTS OF DEFAULT; RIGHTS AND REMEDIES

            14.1 Events of Default. The occurrence of any one or more of the
following events (regardless of the reason therefor) shall constitute an Event
of Default by a Party hereunder:

      (a) Such Party shall fail to make a payment of any material amount due and
payable pursuant to this Agreement (other than the settlement of amounts due in
respect of FDS Charge Transaction Data) and such failure shall remain
un-remedied for a period of five (5) Business Days after the non-defaulting
Party shall have given written notice thereof.

      (b) Such Party shall fail to perform, satisfy or comply with any
obligation, condition, covenant or other provision contained in this Agreement
(other than failure to comply with any SLAs), and such failure shall remain
unremedied for a period of thirty (30) days after the other Party shall have
given written notice thereof specifying the nature of such failure in reasonable
detail; provided that such failure shall not constitute an Event of Default if
either (i) the defaulting Party shall have initiated and diligently pursued a
cure within such time and such cure is completed within sixty (60) days from the
date of written notice regarding such failure or (ii) such failure has not had
and would not reasonably be expected to have, a material adverse effect on the
licensed marks of the non-defaulting Party, and has not had, and would not
reasonably be expected to have, a material adverse impact on the Program or the
non-defaulting Party.

      (c) Any representation or warranty by such Party contained in this
Agreement shall not be true and correct in any respect as of the date when made,
and the Party making such representation or warranty shall fail to cure the
event giving rise to such breach within thirty (30) days after the other Party
shall have given written notice thereof specifying the nature of such breach in
reasonable detail; provided that such breach shall not constitute an Event of
Default if either (i) the defaulting Party shall have initiated and diligently
pursued a cure within such time and such cure is completed within sixty (60)
days from the date of written notice regarding such breach or (ii) such breach
has not had, and would not reasonably be expected to have, a material adverse
effect on the licensed marks of the non-defaulting Party, and has not had, and
would not reasonably be expected to have, a material adverse impact on the
Program or the non-defaulting Party.

            14.2 Defaults by Bank. The occurrence of any one or more of the
following events (regardless of the reason therefor) shall constitute an Event
of Default by Bank hereunder:

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<PAGE>

      (a) Bank fails to settle FDS Charge Transaction Data and make payment in
full therefor within twenty-four (24) hours of the time that such settlement
payment is due pursuant to Section 8.4.

      (b) CEBA Bank or Citibank, N.A. shall no longer be solvent or shall fail
generally to pay its debts as they become due or there shall be a substantial
cessation of the regular course of business of CEBA Bank or Citibank, N.A..

      (c) The FDIC or any other regulatory authority having jurisdiction over
CEBA Bank or Citibank, N.A. shall order the appointment of a custodian,
receiver, liquidator, assignee, trustee or sequestrator (or similar official) of
such entity or of any substantial part of its properties, or order the
winding-up or liquidation of the affairs of such entity, and such order shall
not be vacated, discharged, stayed or bonded within sixty (60) days from the
date of entry thereof.

      (d) CEBA Bank or Citibank, N.A. shall (i) consent to the institution of
proceedings specified in paragraph (c) above or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee or
sequestrator (or similar official) of such entity or of any substantial part of
its properties, or (ii) take corporate or similar action in furtherance of any
such action.

      (e) During the Term, Bank Parent's senior unsecured debt rating falls to
or below BBB+ according to Standard and Poor's rating system or to or below Baa1
according to Moody's Investors' Service rating system, or any such debt rating
is withdrawn.

      (f) Bank shall fail to meet one or more SLAs expressly giving rise to the
right to terminate hereunder.

            14.3 Defaults by the FDS Companies. The occurrence of any one or
more of the following events (regardless of the reason therefor) shall
constitute an Event of Default by the FDS Companies hereunder:

      (a) FDS or the Equity Holder shall no longer be solvent or shall fail
generally to pay its debts as they become due or there shall be a substantial
cessation of FDS's regular course of business.

      (b) A petition under the U.S. Bankruptcy Code or similar law shall be
filed against FDS and not be dismissed within ninety (90) days.

      (c) A decree or order by a court having jurisdiction (i) for relief in
respect of FDS pursuant to Bankruptcy Code or any other applicable bankruptcy or
other similar law, (ii) for appointment of a custodian, receiver, liquidator,
assignee, trustee or sequestrator (or similar official) of FDS or of any
substantial part of its properties, or (iii) ordering the winding-up or
liquidation of the affairs of FDS shall, in any such case be entered, and shall
not be vacated, discharged, stayed or bonded within ninety (90) days from the
date of entry thereof.

      (d) FDS shall (i) file a petition seeking relief pursuant to the
Bankruptcy Code or any other applicable bankruptcy or other similar law, (ii)
consent to the institution of proceedings

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<PAGE>

pursuant thereto or to the filing of any such petition or to the appointment of
or taking possession by a custodian, receiver, liquidator, assignee, trustee or
sequestrator (or similar official) of FDS or any substantial part of its
properties, or (iii) take corporate or similar action in furtherance of any such
action.

            14.4 Remedies for Events of Default. In addition to any other rights
or remedies available to the Parties at law or in equity, upon the occurrence of
an Event of Default pursuant to Section 14.1, 14.2 or 14.3, the non-defaulting
Party shall be entitled to collect from the defaulting Party any amount
indisputably in default plus interest based on the Federal Funds Rate.

                                   ARTICLE XV

                                TERM/TERMINATION

            15.1 Term. This Agreement shall continue in full force and effect
for ten (10) years from the last to occur of the Second Closing Date or the
Third Closing Date (the "Initial Term"). The Agreement shall renew automatically
without further action of the Parties for a single three (3) year term (the
"Renewal Term"), unless Bank provides written notice of termination at least one
(1) year prior to the expiration of the Initial Term or an FDS Company provides
written notice of termination at least six (6) months prior to the expiration of
the Initial Term.

            15.2 Termination by the FDS Companies Prior to the End of the
Initial Term or Renewal Term. FDS, on behalf of the FDS Companies, may terminate
this Agreement prior to the end of the Initial Term or the Renewal Term, upon
written notice given not more than ninety (90) days after becoming aware of the
occurrence of the relevant event set forth below, in the event of any of the
following:

      (a) after the occurrence of a Partner Event of Default;

      (b) upon thirty (30) days' prior written notice if (i) there is a Change
of Control of Bank Parent or (ii) one or more Persons that is not an Affiliate
of Bank on the date of this Agreement acquires a direct or indirect controlling
interest in Bank or any other Person conducting a substantial part of the Credit
Card business conducted within the corporate group of Bank Parent or such
corporate group otherwise disposes of or terminates a substantial part of such
Credit Card business;

      (c) upon thirty (30) days' prior written notice if there is a Change of
Control of FDS if the other Party to such Change of Control transaction issues,
offers or otherwise provides (either itself or through Affiliates) or is party
to any contractual arrangement with any other Person to issue, offer or
otherwise provide, any Credit Card in the United States;

      (d) upon thirty (30) days' prior written notice if there is a change in
Applicable Law and (i) such change would limit or otherwise restrict in any
material respect the level of access and use by FDS and its Affiliates of the
Cardholder Data as contemplated by this Agreement and (ii) the restrictions
under Applicable Law on the level of access to or use of Cardholder Data by

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<PAGE>

FDS and its Affiliates after giving effect to such change would be materially
lessened if FDS and its Affiliates operated the Program themselves and/or with a
Person other than Bank; provided, however, that prior to delivering a notice of
termination pursuant to this Section 15.2(d), FDS shall engage in good faith
negotiations with Bank to modify the Program in a way that would preserve at
least the same level of access and use of such data for the benefit of FDS and
its Affiliates following the relevant change in Applicable Law as was
permissible prior to the date of this Agreement, such negotiations not to
terminate (in the absence of an agreement between the Parties on any
modification) earlier than thirty (30) days after the earlier of (i) the date on
which one of the Parties delivers a notice to the other that the relevant change
in Applicable Law is likely to occur or (ii) the date on which the relevant
change in Applicable Law takes effect; or

      (e) upon termination of the Purchase Agreement by FDS pursuant to Section
10.2 or 10.3.

            15.3 Termination by Bank Prior to the End of the Initial Term or
Renewal Term. Bank may terminate this Agreement prior to the end of the Initial
Term or the Renewal Term, upon written notice given not more than ninety (90)
days after becoming aware of the occurrence of the relevant event set forth
below, in the event of any of the following:

      (a) after the occurrence of an FDS Event of Default;

      (b) upon six months prior written notice following an Adverse Sales
Development; or

      (c) upon six months prior written notice following the consummation of a
Change of Control of FDS if both (A) the other Party to such Change of Control
issues, offers or otherwise provides (either itself or through Affiliates) or is
party to any contractual arrangement with any other Person to issue, offer or
otherwise provide, any Credit Card in the United States and (B) the Credit Card
business of such other Party or such other contractual arrangement would have a
material adverse effect on the Program.

            15.4 Automatic Termination. Upon termination of the Purchase
Agreement without the occurrence of the First Closing, this Agreement shall
automatically terminate and shall be null and void.

                                   ARTICLE XVI

                             EFFECTS OF TERMINATION

            16.1 General Effects.

      (a) All solicitations, marketing and advertising of the Program, other
than acceptance of applications through the FDS Channels in the ordinary course
of business consistent with past practice, shall cease upon the expiration or
termination of this Agreement, except as the Parties may otherwise mutually
agree; provided that the Parties shall continue to operate the Program in
accordance with the terms of this Agreement and service the Accounts in good
faith and in the ordinary course of their respective businesses, subject to the
terms of this Agreement, until the provisions of Sections 16.2 and 16.3 are
satisfied. The Parties shall cooperate to ensure the orderly wind-down or
transfer of the Program.

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<PAGE>

      (b) Upon the satisfaction of the provisions of Section 16.2 and 16.3, all
obligations of the Parties under this Agreement shall cease, except that the
provisions specified in Section 18.25 shall survive.

            16.2 The FDS Companies' Option to Purchase the Program Assets.

      (a) If this Agreement expires or is terminated by either Party for
whatever reason, FDS has the option to purchase, or arrange the purchase by a
third party nominated by FDS (a "Nominated Purchaser"), of the Program Assets
from Bank.

      (b) The purchase option given by Section 16.2(a) is exercisable by FDS or
the Nominated Purchaser serving notice on Bank no later than sixty (60) days
after the receipt of the information with respect to the Program Assets required
to be delivered by Bank pursuant to Section 16.2(e).

      (c) If such purchase option is exercised, FDS or the Nominated Purchaser
must complete the purchase of the Program Assets within one hundred eighty (180)
days after the notice has been given pursuant to Section 16.2(b); provided,
however, that such time period shall be extended as necessary to obtain required
regulatory approvals, rating agency consents, and to complete any interim or
transition servicing obligation agreed to by FDS and Bank. The date of such
completion shall be the "Program Purchase Date."

      (d) In the event that FDS or the Nominated Purchaser exercises the
purchase right, the purchase price shall be as follows:

                  (i) if the purchase right arises upon the expiration of the
Initial Term or any Renewal Term, then such purchase price for the Program
Assets shall be the Adjusted Fair Market Value of the Program Assets;

                  (ii) if the purchase right arises as a result of a termination
of this Agreement pursuant to Section 15.2(a), then such purchase price for the
Program Assets shall be the lower of (A) Fair Market Value of the Program Assets
(which may be less than the amount of Cardholder Indebtedness) and (B) the
amount of Cardholder Indebtedness at the time of the purchase excluding
written-off Cardholder Indebtedness (in accordance with the write-off policies
then applicable to the Program);

                  (iii) if the purchase right arises as a result of a
termination of this Agreement pursuant to Section 15.2(b) or 15.3(b), then such
purchase price for the Program Assets shall be an amount equal to the sum of (A)
the Fair Market Value of the Program Assets (which, for purposes of this clause
(iii), shall not be less than Cardholder Indebtedness excluding written-off
Cardholder Indebtedness (in accordance with the write-off policies then
applicable to the Program)) plus (B) if the termination occurs prior to the
third anniversary of the date hereof and after the System Transition Date, an
amount equal to the aggregate amount of all out-of-pocket costs and expenses
incurred by Bank in connection with the conversion of the Program to the Bank
Systems pursuant to Section 7.4 (the "Conversion Costs");

                  (iv) if the purchase right arises as a result of a termination
of this Agreement pursuant to Section 15.2(c) or 15.3(a), then such purchase
price for the Program Assets shall be

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an amount equal to the sum of (A) the Fair Market Value of the Program Assets
(which, for purposes of this clause (iv) shall not be less than Cardholder
Indebtedness excluding written-off Cardholder Indebtedness (in accordance with
the write-off policies then applicable to the Program)), plus (B) from and after
the Third Closing Date, the amount set forth in Schedule 16.2(d)(iv), plus (C)
if the termination occurs prior to the third anniversary of the date hereof and
after the Systems Transition Date, an amount equal to the Conversion Costs;
provided that in no event shall the sum of the amounts set forth in clauses (A)
and (B) be less than the sum of Cardholder Indebtedness at the time of the
purchase excluding written-off Cardholder Indebtedness (in accordance with the
write-off policies then applicable to the Program)) plus the Unamortized
Premium;

                  (v) if the purchase right arises as a result of a termination
of this Agreement pursuant to Section 15.2(d), then such purchase price for the
Program Assets shall be an amount equal to the sum of (A) the Fair Market Value
of the Program Assets (which, for purposes of this clause (v), shall not be less
than Cardholder Indebtedness excluding written-off Cardholder Indebtedness (in
accordance with the write-off policies then applicable to the Program)) plus (B)
if the termination occurs prior to the third anniversary of the date hereof and
after the Systems Transition Date, an amount equal to the Conversion Costs;
provided that in no event shall the amount set forth in clause (A) be less than
the sum of Cardholder Indebtedness at the time of the purchase excluding
written-off Cardholder Indebtedness (in accordance with the write-off policies
then applicable to the Program)) plus the Unamortized Premium;

                  (vi) if the purchase right arises as a result of a termination
of this Agreement pursuant to Section 15.2(e), then such purchase price shall be
equal to the sum of (A) Cardholder Indebtedness at the time of purchase
excluding written-off Cardholder Indebtedness (in accordance with the write-off
policies then applicable to the Program) plus (B) any Premium and Additional
Premium paid prior to such date plus (C) the excess, if any, of (i) the interest
on such Premium and Additional Premium at a rate equal to the Federal Funds Rate
over (ii) the aggregate amount of Pre-Tax Profit (but reduced by the FDS Profit
Share) generated pursuant to this Agreement during the period from the Effective
Date to the date of such purchase, plus (D) the cost (which may be a negative
amount) of unwinding the funding strategy Bank has implemented at the request of
FDS and its Affiliates, unless FDS elects to assume such funding arrangement;
and

                  (vii) if the purchase right arises as a result of a
termination of this Agreement pursuant to Section 15.3(c), then such purchase
price shall be equal to the sum of (A) Cardholder Indebtedness at the time of
purchase excluding written-off Cardholder Indebtedness (in accordance with the
write-off policies then applicable to the Program) plus (B) the Unamortized
Premium.

Notwithstanding anything to the contrary contained in this Agreement, in the
event of a purchase of Program Assets following a termination of this Agreement
upon expiration of the Initial Term or Renewal Term, the purchase price payable
for any Cardholder Indebtedness that was outstanding at the time of the First
Closing Date, Second Closing Date or Third Closing Date, shall be the Fair
Market Value of such Cardholder Indebtedness (without regard to the proviso
contained in the definition thereof).

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      (e) The Parties shall use commercially reasonable efforts to minimize
transaction costs and Bank shall provide FDS and the Nominated Purchaser and
their respective representatives reasonable access to the records and accounts
relating to the Program Assets for the purpose of conducting due diligence
investigations to determine whether they wish to purchase the Program Assets and
shall provide as soon as reasonably practicable (but in no event more than
fifteen (15) days) following a request therefor from FDS or its Nominated
Purchaser a master file of the Accounts (which shall include data for at least
the twelve (12) month period preceding the month in which the master file is
requested and shall be updated every thirty (30) days); provided, however, that
Bank shall be entitled to require any Nominated Purchaser to enter into
customary confidentiality arrangements before providing it with such access. The
Parties shall promptly negotiate in good faith and execute a purchase agreement
for the Program Assets to be purchased, which shall contain terms and conditions
substantially similar to those in the Purchase Agreement (if applicable) (and,
if FDS or the Nominated Purchaser elects to purchase the outstanding equity
securities of CEBA Bank that are not owned by FDS or any of its Affiliates,
terms and conditions customary for the sale of such an entity controlled by a
third party). The Parties shall cooperate with one another in connection with
the conversion of the Program Assets to the Systems of the FDS Companies or the
Nominated Purchaser and Bank shall provide reasonable assistance to the FDS
Companies or the Nominated Purchaser in connection with the conversion of the
Program Assets, including the provision of interim services in accordance with
the provisions of this Agreement until such conversion occurs. The Parties shall
not unreasonably withhold or delay execution of such purchase agreement or any
other documents necessary to effectuate such sale. The Parties shall use
reasonable efforts to ensure that the Program Purchase Date occurs as promptly
as reasonably practicable following the execution of such purchase agreement.

            16.3 Dedicated Program Personnel. Upon termination or expiration of
the Program for any reason and until the date that is ninety (90) days after
Bank ceases to provide any services hereunder, FDS shall have the right to offer
employment to employees and independent contractors of Bank and any of Bank's
Affiliates that perform all or substantially all of their work for Bank or its
Affiliates in connection with the Program. Bank shall cooperate with the FDS
Companies in offering employment to such employees and independent contractors
and transitioning such persons to the FDS Companies, including, subject to
Applicable Law, providing reasonably requested information regarding such
persons to the FDS Companies.

            16.4 Rights of Bank if Purchase Option Not Exercised. If this
Agreement expires or is terminated and FDS gives written notice that it shall
not exercise its option referred to in Section 16.2 or otherwise fails to
exercise its option within the time period specified in Section 16.2, the FDS
Companies shall have no further rights whatsoever in the Program Assets. In such
event, the following provisions shall apply:

      (a) Bank shall have the right at its sole discretion on or after the
expiration or termination of this Agreement to:

                  (i) issue to Cardholders a replacement or substitute Credit
Card (which card must not bear any FDS Licensed Marks or any other trademarks or
source indicators confusingly similar thereto) with such characteristics as Bank
considers appropriate and with the cost of card re-design and re-issue being
borne by Bank; provided that the replacement or substitute Credit

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<PAGE>

Card shall not be issued in cooperation with any business referred to in
Schedule 2.5 in any MSA within which the FDS Companies are still operating
stores; provided, further, that the FDS Companies shall be permitted to add an
enclosure to the last two (2) Billing Statements (with respect to each of the
Private Label Accounts and the General Purpose Accounts) to the effect that the
Program has been terminated;

                  (ii) subject to Applicable Law, notify Cardholders that Bank
shall cease providing credit under the Accounts and require repayment of all
amounts outstanding on all Accounts until all associated receivables have been
repaid;

                  (iii) sell the Accounts and associated receivables to a third
party purchaser, other than a competitor of FDS and its Affiliates (which shall
include those companies listed on Schedule 2.5), selected by Bank at a price
agreed between Bank and the purchaser; or

                  (iv) any combination of (i), (ii) and (iii).

      (b) If this Agreement expires or is terminated and FDS gives written
notice that it shall not exercise its option referred to in Section 16.2 or
otherwise fails to exercise its option within the time period specified in
Section 16.2, the FDS Companies shall provide reasonable assistance in
connection with the conversion of any Program Assets resident on FDS Systems to
Bank Systems, including provision of interim services in accordance with the
provisions of this Agreement until such conversion occurs, which shall not be
later than one hundred eighty (180) days after FDS gives written notice that it
shall not exercise its option referred to in Section 16.2 or after the time
period for FDS to exercise such option shall have expired. The Parties shall
bear their respective costs and expenses of any such conversion and the
transitioning of services performed by the FDS Companies to Bank.

      (c) Within sixty (60) days after FDS gives written notice that it shall
not exercise its option referred to in Section 16.2 or after the time period for
FDS to exercise such option shall have expired, Bank shall no longer use any of
the FDS Licensed Marks (or any other trademarks or source indicators confusingly
similar thereto) and must rebrand the FDS Credit Cards; provided that Bank may
use the FDS Licensed Marks to communicate with Cardholders in connection with
the billing and collection of Accounts and as otherwise required by Applicable
Law for up to one hundred eighty (180) days after such written notice or
expiration.

                                  ARTICLE XVII

                                 INDEMNIFICATION

            17.1 FDS Indemnification of Bank. From and after the Effective Date,
FDS shall indemnify and hold harmless Bank, its Affiliates, and its respective
officers, directors and employees from and against and in respect of any and all
losses, liabilities, damages (direct and indirect), costs and expenses of
whatever nature, including reasonable attorneys' fees and expenses, which are
caused or incurred by, result from, arise out of or relate to:

      (a) any FDS Company's negligence or recklessness or willful misconduct
(including acts and omissions) in performing its obligations under this
Agreement;

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<PAGE>

      (b) any breach by an FDS Company of any of the terms, covenants,
representations, warranties or other provisions contained in this Agreement;
provided that a breach of any SLA set forth in Schedule 7.3 shall be subject to
the remedies set forth in such Schedule;

      (c) any actions or omissions of Bank taken or not taken at an FDS
Company's written request or direction pursuant to this Agreement except where
Bank would have been otherwise required to take such action (or refrain from
acting) absent the request or direction of the FDS Companies;

      (d) dishonest or fraudulent acts by an FDS Company, or any of its
Affiliates, agents or employees, in connection with the Program (except to the
extent charged back pursuant to Section 8.5);

      (e) the sale of any FDS Goods and Services in an FDS Channel or any
failure by the FDS Companies or their Affiliates to satisfy any of their
obligations to third parties with respect to the sale by them to such third
parties of FDS Goods and Services;

      (f) any Solicitation Materials (i) distributed by an FDS Company and not
approved by the Operating Committee or (ii) provided by Bank;

      (g) any claim, suit or proceeding by any Governmental Authority or other
third party arising out of the failure of FDS or any of its Affiliates to comply
with Applicable Law in connection with the Program or the Operating Procedures,
unless such failure was the result of any action taken or not taken by FDS or
such Affiliate at the written request or direction of Bank or any of its
Affiliates;

      (h) the FDS Companies' Inserts or Billing Statement messages; and

      (i) allegations by a third party that the use of the FDS Licensed Marks or
the FDS Systems constitutes infringement, misappropriation, dilution or other
violation of any Intellectual Property right of such third party.

            17.2 Bank Indemnification of the FDS Companies. From and after the
Effective Date, Bank shall indemnify and hold harmless the FDS Companies, their
Affiliates and their respective officers, directors and employees from and
against and in respect of any and all losses, liabilities, damages, costs and
expenses of whatever nature, including reasonable attorneys' fees and expenses,
which are caused or incurred by, result from, arise out of or relate to:

      (a) Bank's negligence or recklessness or willful misconduct (including
acts and omissions) in performing its obligations under this Agreement;

      (b) any breach by Bank or any of its Affiliates, employees or agents of
any of the terms, covenants, representations, warranties or other provisions
contained in this Agreement or any Credit Card Agreement; provided that a breach
of any SLA set forth in Schedule 7.3 shall be subject to the remedies set forth
in such Schedule;

      (c) any actions or omissions by any of the FDS Companies taken or not
taken at the written request or direction of Bank or any of its Affiliates
pursuant to this Agreement, except

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<PAGE>

where the FDS Companies would have been otherwise required to take such action
(or refrain from acting) absent such request or direction;

      (d) dishonest or fraudulent acts by Bank, or any of its Affiliates, agents
or employees, in connection with the Program;

      (e) any failure by Bank or its Affiliates to satisfy any of their
obligations to Cardholders with respect to the Program pursuant to the terms of
the applicable Credit Card Agreements;

      (f) any Account Documentation and Solicitation Materials approved by the
Operating Committee and used by any of the FDS Companies in that form that fails
to comply with Applicable Law;

      (g) any claim, suit or proceeding by any third party (i) arising out of
the failure of Bank or any of its Affiliates to comply with Applicable Law in
connection with the Program unless such failure was the result of any action
taken or not taken by Bank or such Affiliate at the specific written request or
direction of the FDS Companies or (ii) to the extent arising out of the
"Citigroup Privacy Promise for Consumers";

      (h) Bank's Inserts or Billing Statement messages;

      (i) allegations by a third party that the use of the Bank Licensed Marks
or the Bank Systems constitutes infringement, misappropriation, dilution or
other violation of any Intellectual Property right of such third party; and

      (j) any capital or guarantee obligations of FDS Bank or its Affiliates
with respect to the CEBA Bank required by law under Section 38 of the Federal
Deposit Insurance Act.

            17.3 Procedures.

      (a) An Indemnified Party (as defined in Section 17.3(b)) shall promptly
give the Indemnifying Party (as defined in Section 17.3(b) notice of any matter
(other than any third party claim, suit or action) upon determining that such
matter has or may give rise to any right of indemnification pursuant to Article
XVII hereof; provided that the failure by the Indemnified Party to give prompt
notice of any such matter shall not limit the liability of the Indemnifying
Party hereunder, except that this provision shall not be deemed to limit the
Indemnifying Party's rights to recover from the Indemnified Party to the extent
of any loss, cost or expense which it can establish resulted directly from such
failure to give prompt notice.

      (b) In case any third party claim is made, or any third party suit or
action is commenced, against a Party (the "Indemnified Party"), the Indemnified
Party shall promptly give the other Party (the "Indemnifying Party") notice
thereof upon making a determination that such third party claim, suit or action
may give rise to a right of indemnification under Article XVII hereof and the
Indemnifying Party shall be entitled to participate in the defense thereof and,
with prior written notice to the Indemnified Party given not later than twenty
(20) days after the delivery of the applicable notice from the Indemnified
Party, to assume, at the Indemnifying

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Party's expense, the defense thereof, with counsel reasonably satisfactory to
such Indemnified Party. After notice from the Indemnifying Party to such
Indemnified Party of its election so to assume the defense thereof, the
Indemnifying Party shall not be liable to such Indemnified Party under this
Section for any attorneys' fees or other expenses subsequently incurred by such
Indemnified Party in connection with the defense thereof, other than reasonable
costs of investigation.

      (c) The Indemnified Party shall have the right to employ its own counsel
if the Indemnifying Party elects to assume such defense, but the fees and
expenses of such counsel shall be at the Indemnified Party's expense, unless (i)
the employment of such counsel has been authorized in writing by the
Indemnifying Party, (ii) the Indemnifying Party has not employed counsel to take
charge of the defense within twenty (20) days after delivery of the applicable
notice or, having elected to assume such defense, thereafter ceases its defense
of such action, or (iii) the Indemnified Party has reasonably concluded that
there may be defenses available to it which are different from or additional to
those available to the Indemnifying Party (in which case the Indemnifying Party
shall not have the right to direct the defense of such action on behalf of the
Indemnified Party), in any of which events the attorneys' fees and expenses of
counsel to the Indemnified Party shall be borne by the Indemnifying Party.

      (d) The Indemnifying Party shall promptly notify the Indemnified Party if
the Indemnifying Party desires not to assume, or participate in the defense of,
any such third party claim, suit or action.

      (e) The Indemnified Party or Indemnifying Party may at any time notify the
other of its intention to settle or compromise any third party claim, suit or
action against the Indemnified Party in respect of which payments may be sought
by the Indemnified Party hereunder, and (i) the Indemnifying Party may settle or
compromise any such claim, suit or action solely for the payment of money
damages for which the Indemnified Party will be fully indemnified hereunder, but
shall not agree to any other settlement or compromise without the prior written
consent of the Indemnified Party, which consent shall not be unreasonably
withheld (it being agreed that any failure of an Indemnified Party to consent to
any settlement or compromise involving relief other than monetary damages shall
not be deemed to be unreasonably withheld), and (ii) the Indemnified Party may
settle or compromise any such third party claim, suit or action solely for an
amount not exceeding one thousand dollars ($1,000), but shall not settle or
compromise any other matter without the prior written consent of the
Indemnifying Party, which consent shall not be unreasonably withheld.

            17.4 Notice and Additional Rights.

      (a) If an Indemnified Party fails to give prompt notice of any third party
claim being made or any third party suit or action being commenced upon
determining that such claim, suit or action has or may give rise to any right of
indemnification pursuant to Article XVII, such failure shall not limit the
liability of the Indemnifying Party; provided, however, that this provision
shall not be deemed to limit the Indemnifying Party's rights to recover from the
Indemnified Party to the extent of any loss, cost or expense which it can
establish resulted directly from such failure to give prompt notice.

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<PAGE>

      (b) Except as otherwise provided in the Agreement (including with respect
to SLAs and risk management penalties), this Article XVII shall constitute the
Parties' exclusive remedy for any of the matters addressed herein or other claim
arising out of or relating to this Agreement; provided, however, that this
provision shall not impair the ability of any Party to obtain specific
performance or other equitable relief.

      (c) Notwithstanding anything to the contrary in this Agreement, no Party
shall be liable to the other for punitive or exemplary damages relating to or
arising out of this Agreement, or any breach thereof or any of the transactions
provided for therein, unless the Indemnified Party shall have become liable to a
third party for any such amounts.

                                  ARTICLE XVIII

                                  MISCELLANEOUS

            18.1 Securitization. Bank shall have the right to securitize or
participate the Cardholder Indebtedness and the Accounts or any part thereof, by
themselves or as part of a larger offering at any time, and, subject to Article
XIII, shall have the right, to make all disclosures and filings associated with
any such securitization or participation in accordance with Applicable Law and
required by the terms of the securitization agreements (and, in the latter case,
subject to appropriate confidentiality arrangements to the extent disclosure of
Cardholder Data is required). Bank shall not securitize or participate the
Cardholder Indebtedness in any manner that would not permit such arrangements to
be unwound or that would not allow removal or substitution of the Program Assets
in order to permit the FDS Companies to purchase the Program Assets pursuant to
Article XVI. Without limiting the foregoing, Bank will structure any
securitization or participation such that if FDS provides written notice to Bank
in accordance with the provisions of this Agreement of FDS's exercise of its
purchase option hereunder in accordance with Article XVI hereof, the
securitization or participation arrangements will not impair FDS's rights to
purchase the Accounts and the Gross Receivables arising thereunder or require
the FDS Companies to assume, directly or indirectly, any obligation under any
such securitization or participation. To the extent any of the FDS Licensed
Marks are used in any securitization documents, such marks shall not be used in
a way that adversely affects any of the FDS Companies or the FDS Licensed Marks.

            18.2 Assignment. None of the FDS Companies, on the one hand, and
Bank, on the other hand, shall assign this Agreement or any of their rights or
obligations hereunder without the prior written consent of the other Party;
provided, however, that, immediately following the First Closing, Bank shall
assign this Agreement, and all of the rights and obligations contained herein
(including licenses granted herein, notwithstanding any contrary limitation on
sub-license rights) to CEBA Bank upon written notice to FDS Bank without any FDS
Companies' consent, provided, however, that the indemnification obligations set
forth in Article XVII shall not be assigned to the CEBA Bank but shall remain
obligations of Citibank, N.A. and Citibank, N.A. shall remain directly liable
therefor (regardless of whether the Person whose actions give rise to such
indemnification obligations is "Bank", CEBA Bank, Citibank, N.A. or any other
Person); provided , further, that the assigning party shall remain obligated and
liable to the FDS Companies without diminution of such obligation or liability
(or the other party's rights or benefits) by virtue of such assignment; and
provided, further, that FDS Bank may assign this

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Agreement and all of its rights and obligations hereunder to FDS or any
Subsidiary of FDS.

            18.3 Sale or Transfer of Accounts. Except as otherwise provided in
this Agreement, including as set forth in Sections 18.1 or 18.2, Bank shall not
sell or transfer in whole or in part the Accounts.

            18.4 Subcontracting. Except as set forth in Section 3.2(d)(vi), it
is understood and agreed that, in fulfilling its obligations under this
Agreement, no Person other than a Party hereto or its Affiliates may perform
such Party's functions; provided that, to the extent any of the FDS Companies
subcontract or outsource to any third party any services to be provided
hereunder by the FDS Companies as of the date hereof, the FDS Companies and
their Affiliates may continue to subcontract or outsource such services to any
third party. Each Party hereto shall be responsible for functions performed by
such Affiliates or other Persons to the same extent the Party would be
responsible if it performed such functions itself.

            18.5 Amendment. Except as provided herein, this Agreement may not be
amended except by a written instrument signed by Bank and each of the FDS
Companies.

            18.6 Non-Waiver. No delay by a Party hereto in exercising any of its
rights hereunder, or partial or single exercise of such rights, shall operate as
a waiver of that or any other right. The exercise of one or more of a Party's
rights hereunder shall not be a waiver of, or preclude the exercise of, any
rights or remedies available to such Party under this Agreement or in law or at
equity. Any waiver by a Party shall only be made in writing and executed by a
duly authorized officer of such Party.

            18.7 Severability. In case any one or more of the provisions
contained herein shall be invalid, illegal or unenforceable in any respect under
any law, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby, and this
Agreement shall be reformed, construed and enforced as if such invalid, illegal
or unenforceable provision or portion of any provision had never been contained
herein and there had been contained herein instead such valid, legal and
enforceable provisions as would most nearly accomplish the intent and purpose of
such invalid, illegal or unenforceable provision.

            18.8 Waiver of Jury Trial and Venue.

      (a) Each Party hereby waives all right to trial by jury in any action or
proceeding to enforce or defend any rights under this Agreement.

      (b) Each Party hereby irrevocably submits to the jurisdiction of the
United States District Court for the District of Delaware or, if such federal
jurisdiction is unavailable, in the state courts of the State of Delaware over
any action arising out of this Agreement, and each Party hereby irrevocably
waives any objection which such Party may now or hereafter have to the laying of
improper venue or forum non conveniens. Each Party agrees that a judgment in any
such action or proceeding may be enforced in other jurisdictions by suit on the
judgment or in any manner provided by law. Any and all service of process and
any other notice in any such suit, action or proceeding with respect to this
Agreement shall be effective against a Party if given as provided herein.

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<PAGE>

            18.9 Governing Law; Compliance with Law.

      (a) This Agreement and all rights and obligations hereunder, including
matters of construction, validity and performance, shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
contracts made to be performed within such State and applicable federal law.

      (b) Each Party shall comply in all material respects with Applicable Law
in connection with its activities and the exercise of its rights and performance
of its obligations hereunder.

            18.10 Specific Performance. The Parties agree that money damages
would not be a sufficient remedy for any breach of Article VI, X or XIII or the
failure of a Party to perform any of its material obligations hereunder, and
that, in addition to all other remedies, each Party will be entitled to seek
specific performance and to seek injunctive or other equitable relief as a
remedy for any such breach or failure to perform its material obligations
hereunder. Each Party waives any requirements for the securing or posting of any
bond in connection with such remedy.

            18.11 Captions. Captions of the articles and sections of this
Agreement are for convenient reference only and are not intended as a summary of
such articles or sections and do not affect, limit, modify or construe the
contents thereof.

            18.12 Notices. Any notice, approval, acceptance or consent required
or permitted under this Agreement shall be in writing to the other Party and
shall be deemed to have been duly given when delivered in person or, if sent by
United States registered or certified mail, with postage prepaid, or by a
nationally recognized overnight delivery service, when received, addressed as
follows:

If to the FDS Companies:                c/o Federated Department Stores, Inc.
                                        7 West Seventh Street
                                        Cincinnati, Ohio 45202
                                        Attention: Vice Chair - Finance
                                        Facsimile: (513) 579-7462

With a copy to:                         c/o Federated Department Stores, Inc.
                                        7 West Seventh Street
                                        Cincinnati, Ohio 45202
                                        Attention: General Counsel
                                        Facsimile: (513) 579-7354

With a copy to:                         FDS Bank
                                        9111 Duke Boulevard
                                        Mason, Ohio 45040
                                        Attention: President
                                        Facsimile: (513) 573-2720

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<PAGE>

If to Bank:                             Citibank, N.A.
                                        701 E. 60th North
                                        Sioux Falls, South Dakota 57104
                                        Attention: David Zimbeck
                                        Facsimile: (605) 330-6745

With a copy to:                         Citicorp Commerce Solutions
                                        Attention: General manager
                                        Four Parkway North
                                        Deerfield, Illinois 60015
                                        Fax: (847) 579-3259

With a copy to:                         Citigroup Inc.
                                        Attention: M&A Legal
                                        425 Park Ave. 4th Floor
                                        New York, New York 10043
                                        Fax: (212) 793-6072

            18.13 Coordination of Consents and Approvals. With respect to any
consent or approval to be given by the FDS Companies, FDS may give consents or
approvals on behalf of the other FDS Company and Bank shall be entitled to rely
on any such consent or approval of FDS acting on behalf of any or all of the FDS
Companies. With respect to any consent or approval to be given by Bank, Bank may
give such consents or approvals.

            18.14 Further Assurances. The FDS Companies and Bank agree to
produce or execute such other documents or agreements as may be reasonably
necessary or desirable for the execution and implementation of this Agreement
and the consummation of the transactions specified herein and to take all such
further action as the other Party may reasonably request in order to give
evidence to the consummation of the transactions specified herein.

            18.15 No Joint Venture. Nothing contained in this Agreement
(including use of the term "Partner") shall be deemed or construed by the
Parties or any third party to create the relationship of principal and agent,
partnership, joint venture or of any association between the FDS Companies and
Bank, and no act of either Party shall be deemed to create any such
relationship. The FDS Companies and Bank each agree to such further actions as
the other may reasonably request to evidence and affirm the non-existence of any
such relationship.

            18.16 Press Releases. The FDS Companies, on the one hand, and Bank,
on the other hand, each shall obtain the prior written approval of the other
Party with regard to the substance and timing of any press release which
announces the execution of this Agreement or the transactions specified herein,
which prior approval shall not unreasonably be withheld. At all times
thereafter, the FDS Companies and Bank, prior to issuing any press releases
concerning this Agreement or the transactions specified herein, shall consult
with each other concerning the proposed substance and timing of such releases
and give due consideration to the comments of the other Party relating thereto.
The foregoing notwithstanding, it is understood that neither Party shall be
required to obtain any prior consent, but shall consult with each other to the
extent practicable, with regard to (a) filings, press releases and other
announcements as may be required

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<PAGE>

by Applicable Law or the applicable rules and regulations of any governmental
agency or stock exchange and (b) publications prepared solely by and for
employees of any of the FDS Companies or Bank, or their respective Affiliates.

            18.17 No Set-Off. The FDS Companies and Bank agree that each Party
has waived any right to set-off, combine, consolidate or otherwise appropriate
and apply (i) any assets of the other Party held by the Party or (ii) any
indebtedness or other liabilities at any time owing by the Party to the other
Party, as the case may be, against or on account of any obligations owed by the
other Party under this Agreement, except as expressly set forth herein.

            18.18 Conflict of Interest. Each Party hereto, in performing it
obligations hereunder, shall establish and maintain appropriate business
standards, procedures and controls. Each Party shall review such standards,
procedures and controls with reasonable frequency during the Term including
those related to the activities of its employees and agents in their relations
with the employees, agents and representatives of the other Party hereto and
with other third parties.

            18.19 Third Parties. There are no third-party beneficiaries to this
Agreement. Except for the Indemnified Parties with respect to indemnity claims
pursuant to Article XVII, the Parties do not intend: (i) the benefits of this
Agreement to inure to any third party; or (ii) any rights, claims or causes of
action against a Party to be created in favor of any person or entity other than
the other Party.

            18.20 Force Majeure. If performance of any service or obligation
under this Agreement is prevented, restricted, delayed or interfered with by
reason of labor disputes, strikes, acts of God, floods, lightning, severe
weather, shortages of materials, rationing, utility or communication failures,
earthquakes, war, revolution, acts of terrorism, civil commotion, acts of public
enemies, blockade, embargo or any law, order, proclamation, regulation,
ordinance, demand or requirement having legal effect of any government or any
judicial authority or representative of any such government, or any other act
whatsoever, whether similar or dissimilar to those referred to in this clause,
which are beyond the reasonable control of a Party and could not have been
prevented by reasonable precautions (each, a "Force Majeure Event"), then such
Party shall be excused from such performance to the extent of and during the
period of such Force Majeure Event. A Party excused from performance pursuant to
this Section 18.20 shall exercise all reasonable efforts to continue to perform
its obligations hereunder, including by implementing its disaster recovery and
business continuity plan as provided in Section 7.3(e), and shall thereafter
continue with reasonable due diligence and good faith to remedy its inability to
so perform except that nothing herein shall obligate either Party to settle a
strike or other labor dispute when it does not wish to do so. Notwithstanding
the foregoing, if a condition constituting a Force Majeure Event with respect to
Bank, on the one hand, or an FDS Company on the other hand, exists for more than
thirty (30) consecutive days (or five (5) consecutive days in the case of any
Force Majeure Event affecting any payment obligation hereunder), this provision
shall cease to apply and all rights and remedies of the other Party shall be
reinstated as if this provision had not applied.

            18.21 Entire Agreement. This Agreement, together with the Schedules
hereto which are expressly incorporated herein by reference, and the Purchase
Agreement, supersedes any other agreement, whether written or oral, that may
have been made or entered into by the FDS

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<PAGE>

Companies and Bank (or by any officer or employee of any such Parties) relating
to the matters specified herein, and constitutes the entire agreement by the
Parties related to the matters specified herein or therein.

            18.22 Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the Parties hereto and their respective successors and
permitted assigns. This Agreement is the product of negotiation by the Parties
having the assistance of counsel and other advisers. It is the intention of the
Parties that this Agreement not be construed more strictly with regard to one
Party than with regard to the other.

            18.23 Counterparts/Facsimiles. This Agreement may be executed in any
number of counterparts, all of which together shall constitute one and the same
instrument, but in making proof of this Agreement, it shall not be necessary to
produce or account for more than one such counterpart. Any facsimile of an
executed counterpart shall be deemed an original.

            18.24 Financial Statements. If, at any time during the Term, FDS is
no longer required to publicly file financial statements pursuant to the
Exchange Act or otherwise, FDS shall promptly deliver to Bank quarterly and
annual financial statements in form and substance similar to those required
pursuant to the Exchange Act, as reasonably requested by Bank from time to time.

            18.25 Survival. Upon the expiration or termination of this
Agreement, the Parties shall have the rights and remedies described herein. Upon
such expiration or termination, all obligations of the Parties under this
Agreement shall cease, except that the obligations of the Parties pursuant to
Section 3.4(e) (Partner Program Team), Article VI (Cardholder Information),
Section 8.5 (Bank's Right to Charge Back), Article X (Intellectual Property),
Article XII (Access, Audit and Dispute Resolution), Article XIII
(Confidentiality), Article XVI (Effects of Termination), Article XVII
(Indemnification), Section 18.8 (Waiver of Jury Trial and Venue) and 18.9
(Governing Law; Compliance with Law) shall survive the expiration or termination
of this Agreement.

                  [Remainder of Page Intentionally Left Blank]

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<PAGE>

      IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
duly executed as of the date first above written.

                               CITIBANK, N.A.

                               By: /s/ Ray Quinlan
                                   -------------------------------
                                   Name: Ray Quinlan
                                   Title: Executive Vice President

                               FEDERATED DEPARTMENT STORES, INC.

                               By: /s/ Ronald W. Tysoe
                                   -------------------------------
                                   Name: Ronald W. Tysoe
                                   Title: Vice Chair

                               FDS BANK

                               By: /s/ Teresa Huxel
                                   -------------------------------
                                   Name: Teresa Huxel
                                   Title: President and Chief Financial Officer

                               FACS GROUP, INC.

                               By: /s/ Amy Hanson
                                   -------------------------------
                                   Name: Amy Hanson
                                   Title: President
</TEXT>
</DOCUMENT>
