Item 1.01. Entry into Material Definitive Agreement
2021 Deposit Servicing Agreement Amendment
Reference is made to Item 1.01 of the Current Report on Form 8-K of BM
Technologies, Inc. (the "Company") dated January 4, 2021 and filed with the
Securities and Exchange Commission ("SEC") on January 8, 2021 (the "January 2021
Form 8-K") describing that certain Deposit Processing Servicing Agreement (the
"2021 Deposit Servicing Agreement") between the Company and Customers Bank, a
bank chartered under the laws of the Commonwealth of Pennsylvania ("Customers
Bank"), which provides that Customers Bank will establish and maintain deposit
accounts and other banking services in connection with customized products and
services offered by the Company, and the Company would provide certain other
related services in connection with the accounts. The initial term of that
agreement was through December 31, 2022. The 2021 Deposit Servicing Agreement
was filed as Exhibit 10.3 to the January 2021 Form 8-K and is incorporated
herein by this reference.
Reference also is made to Item 1.01 of the Company's Current Report on Form 8-K
dated November 8, 2022 and filed with the SEC on November 8, 2022 (the "November
2022 Form 8-K") describing Amendment No. 1 to the 2021 Deposit Servicing
Agreement ("DSA Amendment No. 1"), which, among other things, extended the
termination date of the 2021 Deposit Servicing Agreement for six months from
December 31, 2022. DSA Amendment No. 1 was filed as Exhibit 10.1 to the November
2022 Form 8-K and is incorporated herein by this reference.
On March 22, 2023, the Company and Customers Bank entered into Amendment No. 2
to the 2021 Deposit Servicing Agreement ("DSA Amendment No. 2"). DSA Amendment
No. 2, among other things, extends the termination date of the 2021 Deposit
Servicing Agreement until the earlier of: (i) the transfer of the Company's
serviced deposits to a Durbin Exempt (as such term is defined in the 2021
Deposit Servicing Agreement) sponsor bank; or (ii) June 30, 2024; and revises
the fee structure of the 2021 Deposit Servicing Agreement. The other terms of
the 2021 Deposit Servicing Agreement, as amended by DSA Amendment No. 1, remain
in effect through the new termination date.
The foregoing summary of DSA Amendment No. 2 does not purport to be complete and
is qualified in its entirety by reference to DSA Amendment No. 2, a copy of
which will be filed with the SEC as an exhibit not later than with the filing of
the Company's Quarterly Report on Form 10-Q for the quarter ended March 31,
2023.
Effective March 31, 2023, the 2021 Deposit Servicing Agreement will be amended
as described below as a result of the Company and Customers Bank having entered
into that certain Deposit Processing Services Agreement date March 22, 2023 (the
"2023 CB Deposit Servicing Agreement"), which is further described below.
2023 CB Deposit Servicing Agreement
On March 22, 2023, the Company and Customers Bank entered into the 2023 CB
Deposit Servicing Agreement, under which, effective March 31, 2023, the Company
will perform, on behalf of Customers Bank, Customer Bank's services, duties, and
obligations under the Private Label Banking Program Agreement, dated February
24, 2017 (as amended, the "PLBPA"), by and between Customers Bank and T-Mobile
USA, Inc. ("TMO") that are not required by Applicable Law (as defined in the
2023 CB Deposit Servicing Agreement) to be provided by an FDIC insured financial
institution.
The obligations of the Company and Customers Bank under the 2023 CB Deposit
Servicing Agreement are similar those under the 2021 Deposit Servicing
Agreement; provided, however, that: (i) as of March 31, 2023, the 2023 CB
Deposit Servicing Agreement and not the 2021 Servicing Agreement shall govern
the terms, conditions, roles, responsibilities, duties, and obligations of the
Company and Customers Bank with respect to the PLBPA and the Depositor Accounts
(as defined in the 2023 CB Deposit Servicing Agreement); (ii) the 2021 Deposit
Servicing Agreement is amended to the extent necessary or advisable to effect
the same, including, without limitation, such that "Depositor" under the 2021
Deposit Servicing Agreement shall not include any TMO Customer (as defined in
the PLBPA); and (iii) there is a different fee structure under the 2023 CB
Deposit Servicing Agreement from that set forth in the 2021 Deposit Servicing
Agreement.
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The initial term of the 2023 CB Deposit Servicing Agreement continues until
February 24, 2025, and will automatically renew for additional one year terms
unless either party gives written notice of nonrenewal at least 180 days prior
to the expiration of the then-current term. The 2023 CB Deposit Servicing
Agreement may be terminated early by either party upon material breach, upon
notice of an uncured objection from a regulatory authority, or by the Company
upon 120 days' written notice upon the satisfaction of certain conditions. As
compensation, Customers Bank will retain any and all revenue generated from the
funds held in the deposit accounts, and Customers Bank will pay the Company
monthly servicing fees set forth in the 2023 CB Deposit Servicing Agreement. In
addition, the Company will have the right to retain all revenue generated by or
from the Depositor Accounts (as defined in the 2023 CB Deposit Servicing
Agreement), including, but not limited to, fees and all other miscellaneous
revenues. The Company also shall retain all fees (including without limitation
interchange fees), and charges generated by its ATMs and from its payment
processing services. The Company acknowledges and agrees that it will be solely
liable for any and all fees, expenses, costs, reimbursements, and other amounts
that are or may become due and payable under the PLBPA, including, without
limitation, any Durbin-Exempt Interchange (as defined in the 2023 CB Deposit
Servicing Agreement) fees payable to TMO under the PLBPA. Customers Bank may set
off any and all PLBPA Amounts against any compensation payable to the Company
under the 2023 CB Deposit Servicing Agreement.
The foregoing description of the 2023 CB Deposit Servicing Agreement does not
purport to be complete and is qualified in its entirety by the terms and
conditions of the 2023 CB Deposit Servicing Agreement, a copy of which will be
filed with the SEC as an exhibit not later than with the filing of the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2023.
2023 FCB Deposit Servicing Agreement
On March 16, 2023, the Company entered into that certain Deposit Servicing
Agreement (the "2023 FCB Deposit Servicing Agreement") with First Carolina Bank,
a North Carolina chartered, non-member community bank ("FCB"), which provides
that FCB will establish and maintain deposit accounts and other banking services
in connection with customized products and services offered by the Company to
its higher education clients, and the Company would provide certain other
related services in connection with the accounts.
Under the 2023 FCB Deposit Servicing Agreement, the Company is required to
reimburse FCB its direct costs to operate the Depositor Program (as defined in
the 2023 FCB Deposit Servicing Agreement) including: any fees charged by the
Federal Reserve Bank, ACH, wire, and other processing and transmission fees,
data processing (FIS) expenses (including Depositor Program implementation
fees), Network assessment fees (net of any rebates or incentives), check
processing fees, ATM fees, and any other fees arising from the flow of funds to
and from FCB related to Depositor Accounts; provided that the Company will shall
not be responsible for audit and regulatory fees with respect to the Depositor
Program or for Federal Reserve Bank or Network fees related to Depositor
Accounts.
The initial term of the 2023 FCB Deposit Servicing Agreement is for four years
from March 16, 2023 and will automatically renew for additional two year terms
unless either party gives written notice of nonrenewal at least 120 days prior
to the expiration of the then-current term. The 2023 FCB Deposit Servicing
Agreement may be terminated early by either party upon material breach, by
either party upon notice that the continuation of the Depositor Program violates
Applicable Law or Network Rules (as defined in the 2023 FCB Deposit Servicing
Agreement); by FCB if a regulatory authority determined that the performance of
its obligations under the 2023 FCB Deposit Servicing Agreement was not
consistent with safe and sound banking practices; by either party upon the other
party commencing or being subject to certain bankruptcy proceedings; by the
Company should it experience a Change in Control on or after March 16, 2026; and
by either party should the required regulatory approvals not be obtained on or
before July 15, 2023.
The foregoing description of the 2023 FCB Deposit Servicing Agreement does not
purport to be complete and is qualified in its entirety by the terms and
conditions of the 2023 FCB Deposit Servicing Agreement, a copy of which will be
filed with the SEC as an exhibit not later than with the filing of the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2023.
Item 7.01. Regulation FD Information.
On March 22, 2023, the Company issued the press release that is furnished as
Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by
reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. See Exhibit Index set forth below for a list of the exhibits
filed or furnished with this Current Report on Form 8-K.
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