CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION, PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406 UNDER THE SECURITIES ACT OF 1933, AS
AMENDED.
Exhibit 10.11
CONSULTING SERVICES AGREEMENT
THIS AGREEMENT, together with the applicable Schedule(s) attached hereto, as
such may be amended from time to time by agreement of the parties,
(collectively, the "Agreement") is made and entered into as of this 14th day of
October, 1998 by and between Predictive Systems, Inc. ("Independent Contractor")
a corporation formed under the laws of Delaware and Pershing
Division of Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation ("Pershing"), a
Delaware Corporation, with offices at Xxx Xxxxxxxx Xxxxx, Xxxxxx Xxxx, Xxx
Xxxxxx 00000.
1. AGREEMENT. Independent Contractor hereby agrees to perform for Pershing, and
Pershing hereby agrees to compensate Independent Contractor for, the consulting
and other services described in this Agreement and any Schedule(s) attached
hereto (the "Services"), as such Services may be further defined, expanded or
modified by Pershing's authorized personnel, all on the terms and subject to the
conditions more fully set forth below.
Nothing herein shall be deemed to constitute a partnership or a joint venture
between the parties hereto.
For purposes of this Agreement, "Assigned Person(s)" shall mean Independent
Contractor's officers, directors, employees, consultants, agents and
subcontractors performing Services hereunder.
2. STANDARD OF PERFORMANCE.
(a) GENERAL. Independent Contractor warrants and agrees to perform the
Services diligently and with the care and judgment of an experienced
professional. Independent Contractor agrees to use diligent and determined
efforts timely to complete all Services in conformity with any specifications
and standards as may be furnished to Independent Contractor or otherwise
identified by Pershing in connection therewith.
(b) REPORTS. At Pershing's request, Independent Contractor agrees to
promptly furnish to Pershing a written report summarizing the status of work
being performed hereunder.
(c) SUPERVISION. Independent Contractor agrees to diligently supervise
Assigned Person(s). Subject thereto, Independent Contractor and Assigned
Person(s) agree to perform the Services under the direction of such Pershing
personnel or other Pershing independent contractors as Pershing may designate.
Except with Pershing's knowledge and express written consent, Assigned Person(s)
agree(s) to avoid any involvement or activity which may create an appearance of
impropriety or conflict. Such involvement or activity may include engaging in
any undertaking or employment, having any significant financial or other
interest (e.g., ownership of more than 1% by Assigned Person or immediate family
member), or accepting any payment, any of which actually or potentially may
compromise Assigned Person(s)' professional judgment or objectivity, or
interfere with or prevent them from serving Pershing's best interests.
3. STAFFING.
(a) GENERAL. Independent Contractor warrants that all Assigned Persons
shall have been or shall be willing to be subject to a background check
(including but not limited to a check of criminal record, work experience and
education) prior to beginning work at Pershing. For the purposes of the
foregoing, a criminal record or information indicating that the Assigned Person
may have falsified information provided to Pershing or the Independent
Contractor in the engagement process or otherwise is in all events to be
considered information about which Independent Contractor must promptly notify
Pershing. If such background check is performed by Pershing, Independent
Contractor agrees that Pershing has the right, [****].
(b) QUALIFICATIONS. Independent Contractor agrees that Pershing may
require any [****].
(c) NOTICE OF UNFITNESS. If Independent Contractor becomes aware that
any Assigned Person lacks the skills, knowledge and/or experience necessary to
perform the Services or which may affect his/her acceptability to Pershing,
Independent Contractor agrees promptly to notify Pershing in writing of such
information.
(d) REQUIRED DISCLOSURE. Independent Contractor agrees to disclose to
Pershing the identity of any Assigned Person (or prospective Assigned Person)
who is an employee, significant shareholder or principal of any corporation or
legal entity other than Independent Contractor.
(e) CONTROLLED SUBSTANCES. Independent Contractor acknowledges that
Pershing has the following rule with respect to controlled substances:
Possessing, using, purchasing, distributing, selling or having controlled
substances in your system without medical authorization during the work day, on
Pershing's premises, or while conducting Pershing business is inconsistent with
Pershing's business interest and will be grounds for disciplinary action up to
and including immediate termination. Independent Contractor agrees that Assigned
Persons shall be subject to Pershing's rules concerning controlled substances
and testing by Independent Contractor at Pershing's request for the presence of
controlled substances. A confirmed positive result of testing of any Assigned
Person, or the refusal by any to submit to testing, will, among other things,
result in such individual being deemed unsuitable by Pershing. Any such
individual will immediately be barred from Pershing's premises, and Pershing
reserves all rights it may have at law or in equity.
(f) REPLACEMENT PROCEDURE. If the replacement of any Assigned Person
is necessary for any reason, Independent Contractor agrees to submit the
names and qualifications of replacement candidates for Xxxxxxxx Xxxxxxxx'x
approval within [****] following the date on which Independent Contractor (i)
becomes aware of such Assigned Person's prospective unavailability or (ii) if
applicable, receives a notice from Pershing demanding such replacement. Any
replacement Assigned Person agrees to participate in such orientation as
Pershing shall determine appropriate. Pershing shall have no obligation to
compensate
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
2
Independent Contractor hereunder for any activities (including Services)
performed by a replacement Assigned Person during such orientation period.
Independent Contractor agrees to use its best efforts to minimize any delay or
disruption to Pershing resulting from the replacement or removal of any Assigned
Person.
4. INDEPENDENT CONTRACTOR STATUS. It is the express intention of the parties
that neither Independent Contractor nor any Assigned Person is an employee,
agent (except as set out herein) or partner of Pershing. Nothing in this
Agreement shall be interpreted as creating the relationship of employer and
employee between the Independent Contractor or Assigned Person and Pershing.
Independent Contractor agrees to be solely responsible for the payment of
compensation to Assigned Person(s). Assigned Person(s) shall not be entitled to
participate in or directly receive benefits pursuant to the provisions of any
Pershing employee benefit plans or policies. Pershing shall not be responsible
for payment of workers' compensation, disability benefits, unemployment
insurance or for withholding income taxes or social security payments for any
Assigned Person. Independent Contractor agrees to be solely responsible for, and
agrees to duly perform, all such payment and withholding obligations as may be
required by law.
5. PERSHING FACILITIES AND EQUIPMENT.
(a) EQUIPMENT. Subject to Pershing's prior written approval, it may
become necessary for Assigned Persons to utilize Pershing equipment (including
software) away from Pershing's premises for Pershing's business purposes. In
such event, Independent Contractor and the Assigned Person(s) hereby agree to
the following:
(i) each agrees to exercise at least reasonable care in the use of
the equipment;
(ii) upon the termination of the engagement with Pershing, or at
such earlier time as Pershing shall demand, the Assigned
Person(s) shall surrender the equipment to Pershing in as good
order and condition as the same now is in, reasonable wear and
tear resulting from the proper use thereof alone excepted;
(iii) not to surrender possession of the equipment or permit the use
of the equipment by anyone other than the Assigned Person
without the prior written consent of Pershing;
(iv) to reimburse Pershing should Pershing incur any charge by
reason of Independent Contractor's use of the equipment for
any purpose other than the business of Pershing. Pershing may
deduct the amount of such charge from any amounts due to
Independent Contractor from Pershing by reason of this
Agreement or, if no such amounts are due Independent
Contractor, Pershing may xxxx Independent Contractor
accordingly;
(v) not to install software on the equipment unless it has been
duly licensed to Pershing. As a matter of Pershing policy,
each Assigned Person is required to respect any and all
copyrights, patents, trade secrets and
3
trademarks of any other entity. Each Assigned Person shall be
a custodian of third party propriety information that may have
been lawfully provided to Pershing. Accordingly, third party
software may not be used for personal benefit or disclosed to
other parties (or used for any purposes beyond the scope of
the license to Pershing). Copies should not be made for any
reason, unless permitted by the license agreement. Moreover,
the Assigned Person may not make reference to (i.e., copy) the
work of third parties in the development of software systems
for Pershing. Assigned Persons who make, acquire or use
unauthorized copies of computer software will have their work
orders terminated without limiting Pershing's other rights it
may have at law or in equity.
Unauthorized or otherwise personal information should not be installed,
created, sorted or transmitted using the equipment. Pershing will treat
any personal information or files that are stored, processed, or
transmitted using the equipment as Pershing's property and may copy,
access and disclose any such information or files in accordance with
its business needs and polices. This includes, without limitation, the
right to conduct a software audit of the equipment loaned to Assigned
Person, at any off-site location, including his/her residence.
(b) FACILITIES. Pershing agrees to provide Independent Contractor with
such access to office space and related information processing and
telecommunications systems, storage media and other systems, equipment and
facilities ("Facilities") as Independent Contractor may reasonably require to
perform its obligations hereunder.
Pershing's facilities are to be used by Assigned Person(s) solely for the
conduct of Pershing's business and performance of the services and for no other
purpose. Independent Contractor and Assigned Person(s) hereby acknowledge(s) and
agree(s) that Pershing may treat as Pershing's property and may, without
restriction or prior notice, copy, access, modify, destroy or disclose in
accordance with its business needs and policies, any information or files,
whether or not of a personal nature or unrelated to the Services, that any
Assigned Person(s) may create, copy, store, process, receive or transmit using
Pershing's facilities.
Pershing shall have the right, in its discretion, at any time and for any
business purposes, to exclude or eject, either temporarily or permanently, any
Assigned Person(s) from its premises.
(c) WORK POLICY. Except as otherwise specified by Pershing, Independent
Contractor and Assigned Person(s) agree to observe the working hours, rules and
holiday schedule of Pershing while working on Pershing's premises. Adherence to
such working hours, rules and holiday schedules shall not constitute
justification for failure to timely complete any Services, nor shall adherence
to Pershing's rules and schedule create an employment relationship between
Pershing and Independent Contractor or Assigned Person(s). Assigned Person(s)
shall not be entitled to receive any benefits or payments which Pershing may
provide to its employees.
(d) SECURITY. Independent Contractor agrees to observe and comply with
(and agrees to cause Assigned Person(s) to observe and comply with) all
policies, measures, procedures and regulations governing the workplace that
Pershing may establish from time to time, including
4
without limitation those relating to security, safety, health and decorum.
Without limitation on the foregoing, if Pershing maintains a log book or other
means of tracking entry and exit at its premises where Services are performed,
Assigned Person(s) shall diligently record the date and time of his/her arrival
at and departure from the premises, and any other information that Pershing may
reasonably request. Upon request at any time by Pershing security personnel,
Assigned Person(s) shall display any identification cards furnished by Pershing
or otherwise establish their identity to the satisfaction of such security
personnel.
(e) COMPUTER CENTER. Independent Contractor agrees not to break, bypass
or circumvent. Or attempt to break, bypass or circumvent, any security system of
Pershing or obtain, or attempt to obtain, access to any program or data other
than that which Independent Contractor owns, is developing or testing pursuant
hereto or to which it has expressly been granted access by Pershing in writing.
In the event that Independent Contractor obtains access to any such program or
data, it shall promptly notify Pershing of such access and shall cooperate as
requested by Pershing in any investigation thereof or prosecution resulting
therefrom. Independent Contractor shall not, in any manner whatsoever, use such
program or data, or disclose such program or data to any third party.
Independent Contractor agrees to establish appropriate procedures to limit
access to Pershing facilities by Assigned Persons to those having a need for
such access in connection with the Services and in accordance with the
limitations set forth herein and for the protection of Pershing Confidential
Information (as defined in Section 8 herein). Independent Contractor agrees to
cause Assigned Person(s) to comply with these procedures.
6. TERMINATION.
(a) GENERAL. Either party may terminate this Agreement at any time
and for any reason upon thirty (30) days' advance written notice to the
other, setting forth the effective date of such termination.
If either party fails to discharge a material obligation or to remedy a
material default under this Agreement, the other party may give written
notice specifying the material obligation or material default and indicating
an intent to terminate this Agreement if the material obligation is not
discharged or the material default is not corrected. The party receiving such
notice shall have fourteen (14) days from the date of receipt of such notice
to discharge such material obligation or cure such material default. If the
material obligation is not discharged or the material default is not
corrected by the end of such fourteen (14) day period, the other party may
terminate this Agreement, effective immediately upon written notice to the
defaulting party given at any time after the end of such period, provided
that the material obligation has not been discharged or the material default
is continuing on the date of such notice. Notwithstanding the foregoing,
Pershing may request any Assigned Person to leave its premises immediately in
the event of any perceived risk during the fourteen (14) day period, without
responsibility for payment beyond the actual time worked.
(b) ORDERLY TERMINATION. In the event this Agreement is terminated for
any reason, including, without limitation, default by either party, and
notwithstanding any claim by Independent Contractor for amounts unpaid and in
dispute by Pershing, Independent Contractor
5
agrees to provide such information, cooperation and assistance to Pershing or
its designee, as Pershing may reasonably request to assure the orderly
termination of this Agreement and the orderly transfer to Pershing or its
designee of materials relating to, and responsibility for providing, the
Services or services related thereto. Notwithstanding any other provision
hereof, Independent Contractor's obligations to Pershing under this Agreement
shall not terminate until completion of the orderly transfer contemplated by
this section (notwithstanding the fact that Independent Contractor's other
obligations may survive longer as provided by this Agreement).
(c) RETURN OF MATERIALS. Upon termination, Independent Contractor and
Assigned Person(s) are obligated to return to Pershing all copies of such
materials, documentation. programs, drawings, specifications and work product in
its possession or stored in any computer system and to purge all such computer
systems of such copies once copies of same are provided to Pershing. In
addition, Independent Contractor and its Assigned Person(s) are obligated to
immediately return any security identification pass provided by Pershing.
7. INDEMNITY AND INSURANCE.
(a) GENERAL INDEMNITY. Independent Contractor agrees to defend,
indemnify and hold harmless Pershing and its affiliates and their respective
partners, directors, principal, agents, employees, and officers (collectively,
"Pershing Indemnitees") from any loss, damage, liability, cost or expense
resulting or caused by (i) any negligent act or omission or willful misconduct
of Independent Contractor or any Assigned Person; (ii) any breach or default by
Independent Contractor in the performance of this Agreement; (iii) claims for
personal injury or property damage arising out of Independent Contractor's
performance of the Services; or (iv) any claim by an employee or subcontractor
of Independent Contractor against Independent Contractor and/or Pershing
Indemnitees.
(b) INSURANCE REQUIREMENT. Without limiting the scope of the foregoing
indemnification, Independent Contractor agrees to provide to Pershing, within
ten (10) days after the date hereof, a certificate of insurance endorsing
Pershing as an additional named insured to Independent Contractor's insurance,
evidencing the following insurance coverage in the following minimum amounts:
Workers' Compensation Statutory limits
General Liability $1,000,000 per Occurrence
Automobile Liability $1,000,000 per Occurrence
Errors and Omissions $1,000,000
The certificate of insurance referred to above shall also state that each
insurance policy is in full force and effect, that the premiums in respect
thereof have been paid in full, and that such policy may not be canceled or
materially changed unless Pershing shall receive thirty (30) days advance
written notice in the event of such cancellation of or material change in the
policy. For so long as Independent Contractor is performing Services hereunder,
at least thirty (30) days before the expiration of any such insurance policy,
Independent Contractor agrees to deliver to Pershing certificates of insurance
attesting to the renewal of such insurance. Receipt by Pershing of any
certificate of insurance which does not conform to the requirements of this
section shall not
6
relieve Independent Contractor of its obligation to provide insurance conforming
to the requirements hereof.
(c) ADVERSE TAX INDEMNITY. In the event that the Internal Revenue
Service, any state or local government agency or any other applicable taxing
authority determines that any Assigned Person is an employee of Pershing for
the purpose of any tax liability (including, without limitation, liabilities
relating to employee withholdings and payroll taxes), Independent Contractor
agrees to reimburse Pershing upon demand for, and shall otherwise defend,
indemnify and hold harmless Pershing from and against, all losses, claims,
damages, liabilities, costs and expenses (including but not limited to taxes,
fees, imposts, penalties, interest, and reasonable attorneys' and
accountants' fees), as incurred and on an after tax basis, based on or
arising from or in connection with any such determination.
(d) SURVIVAL. The indemnification provisions in this Agreement shall
remain operative and in full force and effect, regardless of the termination of
this Agreement, and shall survive any such termination.
8. DEFINITION OF CONFIDENTIAL INFORMATION. Information disclosed by Pershing,
including but not limited to, information learned by the Independent Contractor
and Assigned Persons from Pershing's employees, agents or through inspection or
discussion of Pershing's property, that relates to Pershing's or a customer's
methods, trade secrets, programs, operations, customers, products, services,
designs, business plans, business opportunities, finances, research,
development, know-how, personnel or third-party confidential information and the
terms and conditions of this Agreement, will be considered and referred to
collectively in this Agreement as "Confidential Information." Confidential
Information, however, does not include information that: (i) is now or
subsequently becomes generally available to the public through no fault or
breach on the part of the Independent Contractor or Assigned Person; (ii) the
Independent Contractor or Assigned Person can demonstrate to have had rightfully
in its possession prior to exposure to it; (iii) is independently developed by
the Independent Contractor or Assigned Person without the use of any
Confidential Information; or (iv) the Independent Contractor or Assigned Person
rightfully obtains from a third party who has the right to transfer or disclose
it.
All Confidential Information, and any Derivative thereof, whether created by the
Independent Contractor, Assigned Person or Pershing, remains the property of
Pershing and no license or other right to Confidential Information is granted or
implied hereby. For purposes of this Agreement, "Derivatives" shall mean: (i)
for copyrightable or copyrighted material, any translation, abridgment, revision
or other form in which an existing work may be recast, transformed or adapted;
(ii) for patentable or patented material, any improvement thereon; and (iii) for
material which is protected by trade secret, any new material derived from such
existing trade secret material, including any new material which may be
protected by copyright, patent and/or trade secret.
9. NON-DISTRIBUTION/NON-DISCLOSURE OF CONFIDENTIAL INFORMATION. The Independent
Contractor further covenants and agrees that it: (i) will neither copy,
disclose, publish or distribute Confidential Information to anyone other than
those to whom such disclosure is authorized or necessary for performance of this
Agreement; (ii) will take reasonable
7
precautions to prevent any unauthorized use, disclosure, publication or
dissemination of Confidential Information; (iii) will not, during the
contractual relationship with Pershing, nor at any time thereafter, directly or
indirectly disclose to others and/or use for its own benefit or for the benefit
of others, Confidential Information, including, but not limited to: trade
secrets, customer lists, employee and prospective employee information,
proprietary software products, any financial information pertaining to
Pershing's business or that of any of its clients, consultants, licensees or
affiliates, acquired by it during the period of its employment, except to the
extent necessary in the ordinary course of performing its duties with respect to
Pershing; (iv) upon termination of its contract with Pershing, the Independent
Contractor will return Confidential Information, and any copies or compilations
thereof and certify to Pershing that it no longer has any rights to such
materials or information, and it covenants that the original and all copies of
such materials and information have been returned to Pershing. In the event of a
breach or threatened breach by the Independent Contractor of the provisions of
this paragraph, Pershing shall be entitled, in addition to all other remedies
available, to an injunction restraining the Independent Contractor from
disclosing any such information or knowledge.
10. PERMITTED DISCLOSURE. The Independent Contractor only may disclose
Confidential Information if required by a judicial or governmental request,
requirement, order or subpoena, and provided that the Independent Contractor
gives Pershing notice of such request, requirement, order or subpoena within
[****] of receipt by Independent Contractor.
11. WARRANTIES. Independent Contractor represents and warrants that: (a) it has
full and unrestricted right to disclose any information, knowledge or data
disclosed by it to Pershing in the performance of this Agreement; (b) it is free
to undertake the Services provided for in this Agreement, and there is no
conflict of interest between Independent Contractor's performance of this
Agreement and any existing obligation Independent Contractor has to other
parties; (c) performance of this Agreement will not violate any non-compete or
non-disclosure provision (or any substantially similar provision) of any
contract or agreement previously entered into by Independent Contractor; and (d)
will not disclose to Pershing or attempt to induce Pershing to use any
Confidential Information or material to which Pershing is not entitled.
12. WORK FOR HIRE. The Independent Contractor will immediately disclose to
Pershing any and all improvements and inventions that it makes solely, or
jointly or commonly with others during the term of its contractual relationship
with Pershing, with respect to:
(a) methods, processes or apparati relating to the services
performed by Pershing; and/or
(b) any character of services sold or used by Pershing.
13. ASSIGNMENT OF RIGHT, TITLE AND INTEREST. The Independent Contractor agrees
to immediately assign, transfer and convey to Pershing its entire right, title
and interest in and to any and all such inventions, as specified herein, and in
and to any and all applications for letters patent that may be filed on such
inventions and in and to all letters patent that may be issued upon such
applications.
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
8
14. NECESSARY STEPS/PROCEDURES FOR ASSIGNMENT. The Independent Contractor agrees
to immediately:
(a) sign any and all instruments necessary for the filing and
processing of any applications for letters patent of the
United States, or of any foreign country, that Pershing may
desire to file upon such inventions as are specified herein;
(b) sign all instruments necessary for reviving or renewing any of
such applications as may become necessary or desirable; and
(c) sign all instruments necessary to the filing and processing of
any continued applications, or reissue applications, that may
subsequently appear to be necessary or desirable to render
such inventions as are mentioned herein effective and of full
force for the purposes of Pershing.
15. HIRING. Independent Contractor agrees that it will not directly or
indirectly hire, solicit or otherwise contract for services with any Pershing
employees or other Pershing contractors or their employees, agents, consultants
or subcontractors during the term of this Agreement and for a period of one (1)
year following the termination thereof. The Pershing Division of Xxxxxxxxx,
Xxxxxx & Xxxxxxxx Securities Corporation agrees that it will not knowingly
solicit for employment without prior written consent any predictive employee,
consultant or subcontractor during the term of this Agreement and for a period
of one (1) year following the termination thereof.
16. LIMITATION OF LIABILITY. INDEPENDENT CONTRACTOR AGREES THAT NO PERSHING
INDEMNITEES SHALL BE LIABLE FOR ANY LOST PROFITS OR SPECIAL, INDIRECT,
INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING UNDER THIS AGREEMENT FOR ANY CAUSE
WHATSOEVER, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, TORT OR
STRICT LIABILITY, AND WHETHER OR NOT ANY PERSHING INDEMNITEE HAD BEEN ADVISED OF
OR COULD HAVE FORESEEN THE POSSIBILITY OF SUCH DAMAGES. NO PERSHING INDEMNITEE
SHALL BE LIABLE FOR ANY LOSS, COST, EXPENSE, CLAIM, INJURY OR DAMAGE TO
INDEPENDENT CONTRACTOR OR ITS PROPERTY OR PERSONNEL EXCEPT LOSSES, COSTS,
EXPENSES, CLAIMS, INJURIES OR DAMAGES CAUSED BY THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF A PERSHING INDEMNITEE.
Neither party to this Agreement shall be liable to the other for consequential,
incidental or indirect damages, including lost profits arising from default in
the performance of its respective obligations under, or otherwise in connection
with, this Agreement. This limitation applies regardless of the form of action,
whether in contract or tort. However, the provisions of this Section shall not
apply to Independent Contractor's obligation to indemnify any indemnified party.
17. FORCE MAJEURE. In no event shall either party be liable to the other for any
delay or failure to perform hereunder, which delay or failure to perform is due
to causes beyond the control of said party, including but not limited to, acts
of God, acts of the public enemy, acts of the United States of America, or any
state, territory or political division of the United States of
9
America, or of the District of Columbia, fires, floods, epidemics, quarantine
restrictions, strikes or any other labor disputes and freight embargoes. In
every case the delay or failure to perform must be beyond the control and
without the fault or negligence of the party claiming excusable delay, and the
party claiming excusable delay must promptly notify the other party of such
delay. Performance times under this Agreement shall be considered extended for a
period of time equivalent to the time lost because of any delay which is
excusable under this Section; provided, however, that if any such delay
continues for a period of more than five (5) business days, the party not
claiming excusable delay shall have the option of terminating this Agreement
upon notice to the party claiming excusable delay.
18. ASSIGNMENT. This Agreement shall inure to the benefit of, and be binding
upon, the respective successors and assigns, if any, of the parties hereto.
Neither party shall assign its rights under this Agreement without the prior
written consent of the other party, such consent not to be unreasonably
withheld.
19. NON-USE OF PERSHING NAME. Independent Contractor agrees that it will not, in
the course of performance of this Agreement, or thereafter, use Pershing's name
in any advertising or promotional media without the prior written consent of
Pershing.
20. COMPLIANCE WITH LAWS. Independent Contractor warrants that no laws,
regulations or ordinances of the United States, or any state or government
authority or agency, have been violated, including the Fair Labor Standard Act,
as amended, in the performance of the Services hereunder, and agrees to
indemnify and hold Pershing harmless from any and all claims arising out of
breach by Independent Contractor of its obligations hereunder. Independent
Contractor agrees to, at its own expense, comply with all other laws, rules and
regulations and assume all liabilities or obligations imposed by such laws,
rules and regulations with respect to Independent Contractor's performance.
21. REMEDIES. Independent Contractor acknowledges that any failure to perform
its obligations under this Agreement shall cause Pershing irreparable injury not
compensable by money damages, for which Pershing will not have an adequate
remedy at law. Accordingly, if Pershing institutes an action or proceeding to
enforce the provisions of this Agreement, Pershing shall be entitled, without
the posting of any bond or security, to such injunctive or other equitable from
a court of competent jurisdiction as may be necessary or appropriate to require
Independent Contractor to perform such obligations. The foregoing shall be in
addition to, and without prejudice to, such rights as Pershing may have, subject
to the express provisions of this Agreement, at law or in equity.
Without limiting Pershing's rights in any way, the maximum liability which
Pershing may incur to Independent Contractor for damages of any kind (whether
direct or otherwise), [****]. Independent Contractor's exclusive remedy for
any claim arising out of, connected with, relating to, or resulting from this
Agreement and the obligations under this Agreement are limited to a claim for
the damages set out in this section. This limitation shall apply regardless
of whether the Independent Contractor brings a claim in
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
10
contract, equity or tort (including but not limited to claims for negligence and
willful misconduct).
All remedies available to either party for breach of this Agreement are
cumulative and may be exercised concurrently or separately, and the exercise of
any one remedy shall not be deemed an election of such remedy to the exclusion
of other remedies.
22. INVOICES, FINANCIAL RECORDS AND AUDIT CAPABILITY. Independent Contractor
agrees to xxxx Xxxxxxxx by monthly invoice as of the last calendar day of the
month addressed to:
Xx. Xxxxxx Xxxxxxxx
Pershing
00 Xxxxxxxx Xxxx
Xxxxxxx Xxxx, XX 00000
and agrees to maintain full and detailed records of all items billed to Pershing
under this Agreement. Pershing reserves the right to audit and copy, during
regular business hours, the records pertaining to the scope of this Agreement,
including the records maintained at Independent Contractor's office which may
provide Pershing with evidence that reveals any excessive charges against
Pershing or noncompliance with the terms and conditions herein, for a
[****] period after the termination of this Agreement. If such
audit reveals any excessive charges against Pershing, such excessive charges
shall be refunded to Pershing immediately upon written notification by Pershing
to Independent Contractor, notwithstanding that Pershing may have previously
paid such excessive charges for accepted services. Independent Contractor shall
be given thirty (30) days to refute or approve the findings of any such audit.
Moreover, Independent Contractor agrees to maintain full and detailed records of
all sales tax charged to Pershing and paid to the Government by Independent
Contractor. Pershing reserves the right to copy and audit these tax records
during regular business hours, including any records maintained at Independent
Contractor's office pertaining to sales tax billed to Pershing, for a period of
[****] after the termination of this Agreement.
23. SEVERABILITY. In the event any one or more of the provisions of this
Agreement shall, for any reason, be held to be invalid, illegal or
unenforceable, the remaining provisions of this Agreement shall be unimpaired
and shall continue in full force and effect, and the invalid, illegal or
unenforceable provision shall be replaced by a mutually acceptable provision,
which, being valid, legal and enforceable, comes closest to the intention of the
parties underlying the invalid, illegal or unenforceable provision.
24. WAIVER. The failure of either party to insist upon the performance of any
terms or conditions of this Agreement or to exercise any right or privilege
conferred in this Agreement or the waiver of enforcing penalties resulting from
any breach of any terms and conditions of this Agreement, shall not be construed
as waiving any such terms, conditions, rights or privileges, but the same shall
continue and remain in full force and effect as if no such forbearance or waiver
had occurred.
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.
11
25. AMENDMENT. Any supplement, amendment or modification of this Agreement shall
be binding upon the parties if it has been made in writing and signed by
authorized representatives of both parties.
26. GOVERNING LAW. This Agreement, and any amendments thereto, shall be governed
by the laws of the State of New York without giving effect to those provisions
governing conflicts of law. By entering into this Agreement Independent
Contractor consents to personal jurisdiction in the courts of the State of New
York.
27. ARBITRATION. The parties agree and acknowledge that any dispute, controversy
or claim, whether statutory or common law, arising out of this Agreement or the
business relationship between Independent Contractor and Pershing, or the
termination of that relationship, included but not limited to, any claims
alleging breach of contract, or any violation of any provision of this Agreement
shall be submitted and finally settled by arbitration in accordance with the
rules of the National Association of Securities Dealers, Inc. ("NASD").
Arbitration must be commenced by service upon the other party of a written
demand for arbitration or a written notice of intention to arbitrate.
- ARBITRATION IS FINAL AND BINDING ON THE PARTIES.
- THE PARTIES ARE WAIVING THEIR RIGHT TO SEEK REMEDIES IN COURT,
INCLUDING THE RIGHT TO JURY TRIAL.
- PRE-ARBITRATION DISCOVERY IS GENERALLY MORE LIMITED THAN AND
DIFFERENT FROM COURT PROCEEDINGS.
- THE ARBITRATORS' AWARD IS NOT REQUIRED TO INCLUDE FACTUAL
FINDINGS OR LEGAL REASONING AND ANY PARTY'S RIGHT TO APPEAL OR
TO SEEK MODIFICATION OF RULINGS BY THE ARBITRATORS IS STRICTLY
LIMITED.
- THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF
ARBITRATORS WHO WERE OR ARE AFFILIATED WITH THE SECURITIES
INDUSTRY.
Any court of competent jurisdiction may enter a judgment upon the arbitration
award. Any claims for injunctive relief provided for in Section 21 of this
Agreement are not subject to arbitration. The mutual promises by the parties to
arbitrate differences and the considerations set forth on the Schedule(s)
attached to this Agreement, constitute consideration for this agreement to
arbitrate.
The Arbitrator's authority to award damages is limited to the damages set out in
Section 21 of this Agreement. The decision of the Arbitrator will be final and
binding on the parties.
Either party may bring an action in any court of competent jurisdiction to
compel arbitration under this Agreement, to enforce an arbitration award, or to
vacate an arbitration award. The standards for confirmation or vacation of the
award shall be those of the law of the State of New York
NO PERSON SHALL BRING A PUTATIVE OR CERTIFIED CLASS ACTION TO ARBITRATION, NOR
SEEK TO ENFORCE ANY PRE-DISPUTE ARBITRATION
12
AGREEMENT AGAINST ANY PERSON WHO HAS INITIATED IN COURT A PUTATIVE CLASS ACTION;
WHO IS A MEMBER OF A PUTATIVE CLASS WHO HAS NOT OPTED OUT OF THE CLASS WITH
RESPECT TO ANY CLAIMS ENCOMPASSED BY THE PUTATIVE CLASS ACTION UNTIL: (i) THE
CLASS CERTIFICATION IS DENIED; (ii) THE CLASS IS DECERTIFIED; OR (iii) THE
CUSTOMER IS EXCLUDED FROM THE CLASS BY THE COURT. SUCH FORBEARANCE TO ENFORCE AN
AGREEMENT TO ARBITRATE SHALL NOT CONSTITUTE A WAIVER OF ANY RIGHTS UNDER THIS
AGREEMENT EXCEPT TO THE EXTENT STATED HEREIN.
28. HEADINGS. The headings in this Agreement are for purposes of reference only
and shall not limit or affect any of the terms hereof.
29. NOTICES. Any notice or other communication hereunder shall be in writing and
shall be deemed to have been given, when delivered personally; or received by
certified or registered mail, return receipt requested, postage prepaid, at the
respective addresses for the parties as set forth below, or at such other
address as the intended recipient may specify in a written notice pursuant to
this paragraph.
IF TO PERSHING:
---------------
Pershing Division of Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation
00 Xxxxxxxx Xxxx
Xxxxxxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxx
IF TO INDEPENDENT CONTRACTOR:
-----------------------------
Predictive Systems
00X Xxxxxxxx Xxxx
Xxxxxxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxx
30. AFFILIATES. The rights, protections and privileges of Pershing under this
Agreement shall inure to the benefit of each affiliate controlling, controlled
by or under common control with Pershing, and each such affiliate or subsidiary
shall be entitled to exercise such rights, benefits, protections and privileges
as if such affiliate or subsidiary were Pershing hereunder.
31. NO THIRD PARTY BENEFICIARIES. Except as provided in Section 30 above, no
third party is intended, or shall be deemed to be, a beneficiary of any
provision of this Agreement.
32. COUNTERPARTS. This Agreement may be executed in counterparts each of which
shall be deemed an original and all of which together shall constitute one
instrument.
33. ENTIRE AGREEMENT. The provisions, terms and conditions of this Agreement
represent the entire agreement between the parties and supersede any prior
written or oral communications, discussions or understandings not incorporated
herein. In the event inconsistencies exist between this Agreement and any prior
written agreement or understanding, the terms of this Agreement shall prevail.
13
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and do
each hereby warrant and represent that their respective signatory whose
signature appears below has been, and is on the date of this Agreement, duly
authorized by all necessary and appropriate corporate action to execute this
Agreement.
This Agreement contains a pre-dispute arbitration clause in paragraph 27
beginning on page 12. Independent Contractor acknowledges receiving a copy of
this Agreement.
10/14/98 PERSHING DIVISION OF XXXXXXXXX,
---------------------- LUFKIN & XXXXXXXX SECURITIES
(Date) CORPORATION
By: /s/ Xxxxxxx X. Xxxxx By: /s/ [illegible]
-------------------------------- ----------------------------
14
