EXHIBIT 10.40C
Pages where confidential treatment has
been requested are stamped "Confidential
Treatment Requested and the Redacted Material
has been separately filed with the Commission,"
and places where information has been redacted
have been marked with (***).
FIRST AMENDMENT
TO
AMENDED AND RESTATED SERVICES AGREEMENT
BETWEEN
CSG SYSTEMS, INC.
AND
FIRST DATA TECHNOLOGIES, INC.
THIS FIRST AMENDMENT (the "First Amendment") is executed this 8th day
of July, 1998, and is made by and between CSG Systems, Inc., a Delaware
corporation ("CSG") and First Data Technologies, Inc., a Delaware corporation
("FDT").
RECITALS
A. The Parties entered into a certain Amended and Restated Services
Agreement dated December 31, 1996 (the "Services Agreement").
B. CSG desires to increase its CPU MIPS utilization in 1998 in excess
of (***) percent ((***)%).
C. CSG desires FDT to provide CSG with Additional Services to enable
CSG to increase its CPU MIPS utilization in 1998 in excess of (***) percent
((***)%).
D. The Services Agreement requires that in the event of such an
increase, that the Parties amend the Services Agreement.
NOW THEREFORE, in consideration of the premises and the mutual
covenants, conditions and agreements hereinafter expressed, the Parties hereto
agree as follows:
1. If the terms and conditions set forth in this First Amendment
shall be in conflict with the Services Agreement, the terms and conditions of
this First Amendment shall control. Any terms in initial capitalized letters or
all capitalized letters used as a defined term but not defined in this First
Amendment, shall have the meaning set forth in the Services Agreement. Except as
amended by this First Amendment, the terms and conditions set forth in the
Services
"Confidential Treatment Requested
and the Redacted Material has been
separately filed with the Commission."
Agreement shall continue in full force and effect according to their terms.
2. The assumptions listed in Note 1 of Schedule 1.27 are deleted and
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replaced with the following:
1. Assumptions. All pricing assumes the volumes, numbers, dollar amounts and
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levels (as applicable) of each of the FDT Services and Performance Criteria
as of the Effective Date, with the following exceptions, each of which
shall be deemed to be as follows:
Base CPU MIPS: (***)
Assigned CPU MIPS as of January 1, 1997: (***)
Assigned CPU MIPS as of January 1, 1998: (***)
Modems and Controllers as of January 1, 1997: $(***) annually; $(***)
monthly
3. The fees relating to CPU MIPS set forth on page 7 of
Schedule 1.27 are deleted and replaced with the following:
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FDT Services Unit 1997 1998 1999 2000 2001 Comments
- ----------------------------------------------------------------------------------------------------
Base CPU MIPS MIP/month $(***) $(***) $(***) $(***) $(***) Notes 1,2
- ----------------------------------------------------------------------------------------------------
Assigned CPU MIPS MIP/month $(***) $(***) $(***) $(***) $(***) Notes 1,2
that Exceed the
Number of Base CPU
MIPS
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CPU Incremental MIPS MIP/month $(***) $(***) $(***) $(***) $(***) Notes 1,2
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4. In accordance with Section 2.15 and Note 2 of Schedule 1.27,
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in calendar year 1998, CSG may increase its assignment of Assigned CPU MIPS in
excess of (***) percent ((***)%). CSG shall notify FDT of any such increases at
least one hundred twenty (120) days prior to the date upon which CSG desires
such increases to be effective, it being understood that such increases shall be
effective on the first day of the month following the expiration of such notice
period. In 1998, (***) percent ((***)%) of the Assigned CPU MIPS equals (***)
((***) x (***) = (***)). In 1998 only, the monthly fee per CPU MIPS in excess
of (***) shall be $(***). In 1998 only, the monthly fee per CPU MIPS in excess
of (***) but up to and including (***) shall be $(***). In 1999 and subsequent
years, CSG shall pay the fees for CPU MIPS in accordance with Schedule 1.27,
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with the following exception: CSG shall pay the fees for the number of Assigned
CPU MIPS that exceed (***) but that are less than or equal to the total
"Confidential Treatment Requested
and the Redacted Material has been
separately filed with the Commission."
number of Assigned CPU MIPS as of January 1, 1999 at the monthly rate of $(***).
5. A new Section C is added to Note 2 of Schedule 1.27 to read as
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follows:
C. Additional Examples.
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(1) As of January 1, 1998, the number of Assigned CPU MIPS equals
(***). On March 12, 1998, CSG notifies FDT to increase its
assignment of Assigned CPU MIPS to (***). FDT shall implement
such increase on August 1, 1998. The monthly CPU MIPS charge for
August, 1998 shall be calculated as follows:
((***) x $(***)) + (((***) - (***) x ($(***))) + (((***) - (***))
x $(***)))
$(***) + $(***) + $(***) = $(***)
(2) As of January 1, 1999 and January 1, 2000, the number of Assigned
CPU MIPS equals (***). On October 19, 1999, CSG notifies FDT to
increase its assignment of Assigned CPU MIPS to (***). FDT shall
implement such increase on March 1, 2000. The monthly CPU MIPS
charge for March, 2000 shall be calculated as follows:
((***) x $(***)) + (((***) - (***)) x $(***))) + (((***) - (***))
x $(***))) + (((***) - (***)) x $(***)))
$(***) + $(***) + (***) + $(***) = $(***)
(3) As of January 1, 1999 and January 1, 2000, the number of Assigned
CPU MIPS equals (***). On October 14, 1999, CSG notifies FDT to
decrease its assignment of Assigned CPU MIPS to (***). FDT shall
implement such decrease on March 1, 2000. The monthly CPU MIPS
charge for March, 2000 shall be calculated as follows:
((***) x $(***)) + (((***) - (***)) x $(***))) + (((***) - (***))
x $(***)))
$(***) + $(***) + $(***) = $(***)
6. In example "a" to Note 2(A)(2) of Schedule 1.27, the two
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appearances of the term "(***) MIPS" shall each be replaced with the phrase
"(***) CPU MIPS".
7. In the second paragraph of Note 2(B)(2) of Schedule 1.27, the
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phrase "Assigned CPU MIPS Charge" shall be replaced with the phrase "Base CPU
MIPS Charge".
8. In the first paragraph of Note 2(B)(3) of Schedule 1.27, the
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phrase "CPU Base MIPS" shall be replaced with the phrase "CPU MIPS".
"Confidential Treatment Requested
and the Redacted Material has been
separately filed with the Commission."
9. In the first paragraph of Note 2(B)(3) of Schedule 1.27, the
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term "MIPS" shall be replaced with the term "CPU MIPS".
10. In the second paragraph of Note 2(B)(3) of Schedule 1.27, the
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term "MIPS" shall be replaced with the term "CPU MIPS".
11. In the first paragraph of Note 2(B)(4) of Schedule 1.27, the
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phrase "CPU Base MIPS" shall be replaced with the phrase "CPU MIPS".
12. In the second paragraph of Note 2(B)(4) of Schedule 1.27, the
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phrase "Assigned CPU MIPS Charge" shall be replaced with the phrase "Base CPU
MIPS Charge".
13. In Note 4 of Schedule 1.27, each appearance of the phrase "CPU
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Base MIPS" shall be replaced with the phrase "CPU MIPS".
14. The multiprocessor computer platform to be installed in 1998
initially will be physically partitioned into two (2) systems. CSG shall be
responsible for paying for only the CPU MIPS assigned to it. Upon CSG's
request, FDT will add capacity or additional engines to either system. CSG
shall notify FDT of any such request at least one hundred twenty (120) days
prior to the date upon which CSG desires such additional capacity or engines to
be effective, it being understood that such additions shall be effective on the
first day of the month following the expiration of such notice period, provided
the Parties can reach agreement pursuant to the procedures set forth in Section
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2.15. If FDT adds additional engines to either system or an agreement is
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reached to repartition, then FDT will establish a new CPU MIPS rating for the
systems.
15. Note 11 of Schedule 1.27 is deleted and replaced with the
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following:
11. FICHE
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A. Increases.
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(1) During each calendar year during the Term, CSG may increase its
volume of Fiche FDT Services in any calendar month by no more
than (***) percent ((***)%) based on the average monthly volume
of Fiche FDT Services during the prior calendar year. CSG shall
notify FDT of such increases at least sixty (60) days prior to
the date upon which CSG desires such increase to be effective, it
being understood that such increases shall be effective on the
first day of the month following the expiration of such notice
period.
(2) Except as set forth in Note 11(A)(3) of this Schedule 1.27,
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during each calendar year during the Term, requests by CSG to
increase its volume of Fiche FDT Services in any calendar month
in excess of twenty (***) ((***)%), based on the average monthly
volume of Fiche FDT Services
"Confidential Treatment Requested
and the Redacted Material has been
separately filed with the Commission."
during the prior calendar year, shall be addressed as an
Additional Service. CSG shall notify FDT of such increases at
least sixty (60) days prior to the date upon which CSG desires
such increase to be effective, it being understood that such
increases shall be effective on the first day of the month
following the expiration of such notice period, provided the
Parties can reach agreement pursuant to the procedures set forth
in Section 2.15.
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(3) Notwithstanding Note 11(A)(2) of this Schedule 1.27 or Section
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2.15, during calendar year 1998, CSG may increase its volume of
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Fiche FDT Services in any calendar month by more than (***)
percent ((***)%) based on the average monthly volume of Fiche FDT
Services during calendar year 1997 ((***)). CSG shall notify FDT
of such increases at least sixty (60) days prior to the date upon
which CSG desires such increase to be effective, it being
understood that such increases shall be effective on the first
day of the month following the expiration of such notice period.
Increases in CSG's Fiche FDT Services under this Note 11(A)(3)
shall not be addressed as an Additional Service.
B. Decreases.
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(1) Except as set forth in Note 11(B)(2) of this Schedule 1.27,
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during each calendar year during the Term, CSG may decrease the
volume of Fiche FDT Services in any calendar month by no more
than (***) percent ((***)%), based on the average volume of Fiche
FDT Services during the prior calendar year. CSG shall notify
FDT of any such decreases at least sixty (60) days prior to the
date upon which CSG desires such decreases to be effective, it
being understood that such decreases shall be effective on the
first day of the month following the expiration of such notice
period.
(2) Notwithstanding Note 11(B)(1) of Schedule 1.27, during any
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calendar year during the Term, CSG may decrease the volume of
Fiche FDT Services in any calendar month by more than (***)
percent ((***)%), based on the average volume of Fiche FDT
Services during the prior calendar year, provided that CSG shall
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pay to FDT, in addition to the fees associated with the actual
Fiche FDT Services, the following additional payment (if any):
(((***) x volume of Fiche FDT Services during the prior calendar
year) - (actual volume of Fiche FDT Services during such calendar
year)) x (Applicable Fiche FDT Services Charges x (***))
"Confidential Treatment Requested
and the Redacted Material has been
separately filed with the Commission."
FDT shall invoice CSG on the tenth (10th) day of January of the
following calendar year for any amount owed for the foregoing
additional payment. Each such invoice shall be due and payable
within fourteen (14) days following receipt.
CSG shall notify FDT of any such decreases at least sixty days
prior to the date upon which CSG desires such decreases to be
effective, it being understood that such decreases shall be
effective on the first day of the month following the expiration
of such notice period.
(3) If CSG notifies FDT to decrease the volume of Fiche FDT Services,
and CSG subsequently fails to be in a position whereby FDT could
implement such decrease (either in whole or in part) without
disrupting CSG's business, in addition to any of the charges set
forth in Schedule 1.27, CSG shall pay to FDT, as applicable: (a)
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if FDT has Fiche FDT Services capacity available, the costs (as
set forth herein) associated with CSG's use of Fiche FDT Services
in excess of the Fiche FDT Services level that CSG instructed FDT
to decrease CSG's volume to, and (b) FDT's costs of maintaining
or implementing CSG's volume of Fiche FDT Services in excess of
the level of Fiche FDT Services that CSG instructed FDT to
decrease CSG's volume to.
C. Examples.
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(1) The monthly average of Fiche FDT Services during calendar
year 1997 is (***). On March 12, 1998, CSG notifies FDT
that its average monthly volume of Fiche FDT Services will
increase to (***). FDT shall implement such increase on
June 1, 1998. On June 24, 1998, CSG notifies FDT that its
average monthly volume of Fiche FDT Services shall increase
to (***). Note 11(A)(2) of Schedule 1.27 is inapplicable.
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FDT shall implement such increase on September 1, 1998.
(2) The monthly average of Fiche FDT Services during calendar
year 1998 is (***). On March 12, 1999, CSG notifies FDT
that its average monthly volume of Fiche FDT Services will
increase to (***). FDT shall implement such increase on
June 1, 1999. On June 24, 1999, CSG notifies FDT that its
average monthly volume of Fiche FDT Services shall increase
to (***). Note
"Confidential Treatment Requested
and the Redacted Material has been
separately filed with the Commission."
11(A)(3) of Schedule 1.27 is inapplicable. The parties shall
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proceed under Section 2.15 to determine whether FDT would
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provide CSG such additional Fiche FDT Services as an
Additional Service.
(3) The monthly average of Fiche FDT Services during calendar
year 1997 is (***). On March 12, 1998, CSG notifies FDT
that its average monthly volume of Fiche FDT Services will
decrease to (***). FDT shall implement such decrease on
June 1, 1998. On June 24, 1998, CSG notifies FDT that its
average monthly volume of Fiche FDT Services shall decrease
to (***). FDT shall implement such increase on September 1,
1998.
(4) The monthly average of Fiche FDT Services during calendar
year 1998 is (***). On March 12, 1999, CSG notifies FDT
that its average monthly volume of Fiche FDT Services will
decrease to (***). FDT shall implement such decrease on
June 1, 1999. Throughout calendar year 1999, the actual
volume of Fiche FDT Services is (***), which consisted of
(***) masters and (***) duplicates. On January 10, 2000,
CSG shall not pay to FDT any additional payment pursuant to
Note 11(b)(2) of this Schedule 1.27 since the value is
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negative as set forth below:
(((***) x (***)) - ((***))) x ((***) x (***))
((***) - (***)) x (***) = N/A
(5) The monthly average of Fiche FDT Services during calendar
year 1998 is (***). On March 12, 1999, CSG notifies FDT
that its average monthly volume of Fiche FDT Services will
decrease to (***). FDT shall implement such decrease on
June 1, 1999.
Throughout calendar year 1999, the actual volume of Fiche
FDT Services is (***), which consisted of (***) masters and
(***) duplicates. On January 10, 2000, CSG shall pay to FDT
the following additional payment:
(((***) x (***)) - (***)) x (((***)/(***)) x (***)))
((***) - (***)) x ((***) x (***))
(***) x (***) = $(***)
"Confidential Treatment Requested
and the Redacted Material has been
separately filed with the Commission."
16. The fees relating to Tape Upgrade set forth on page 7 of
Schedule 1.27 are deleted and replaced with the following:
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FDT Services Unit 1997 1998 1999 2000 2001 Comments
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Tape Upgrade monthly $(***) $(***) $(***) $(***) $(***) Notes 1, 4, 12
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17. The following additional note shall be added to the end of
Schedule 1.27:
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12. TAPE UPGRADE. Notwithstanding Note 4 of this Schedule 1.27, effective
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March 8, 1998, the monthly fee for Tape Upgrade shall be $(***). The increase in
price reflects the provision by FDT as an Additional Service of sixteen (16)
Timberlines for an additional $(***) per month, it being understood that if CSG
terminates this Agreement for its convenience pursuant to Section 11.4, CSG
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shall pay to FDT in addition to the Termination for Convenience Fee, the
additional fees incurred by FDT associated with FDT obtaining such additional
sixteen (16) Timberlines.
THIS FIRST AMENDMENT is executed as of the date and year first shown above.
CSG SYSTEMS, INC. ("CSG") FIRST DATA
TECHNOLOGIES, INC. ("FDT")
By: /s/ John Johnson By: /s/ Guy Battista
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Title: V.P. Operations Title: Senior V.P./ CIO
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Name: John Johnson Name: Guy Battista
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