SYSTEMS AND MARKETING AGREEMENT
This Systems and Marketing Agreement ("Agreement") is entered into as of
September 30, 1999("Effective Date") between Option One Mortgage Corporation dba
H&R Block Mortgage, a California corporation having an address at S Ada, Irvine,
California 92618 ("HRBM") and E-LOAN, Inc., a California corporation having an
office at 0000 Xxxxxx Xxxx, Xxxxxx, Xxxxxxxxxx 00000 ("E-LOAN") (collectively,
the "Parties")
WHEREAS, HRBM is engaged in providing mortgage services that include
processing, origination, and funding mortgage leans secured by residential
properties located in the United States; and
WHEREAS, E-LOAN is engaged in marketing mortgage services via the Internet
including attracting visitors to E-LOAN's website, providing visitors with a
variety of mortgage options, and displaying a variety of competitive loan
products available on the market;
WHEREAS, HRBM and E-LOAN wish to develop a systems communication and
marketing program("Program") to facilitate and market HRBM's loan products to
visitors of E-LOAN's website;
NOW, THEREFORE, in consideration of their mutual promises, the Parties
hereby agree as follows:
I. The Program
(a) E-LOAN shall market HRBM's various mortgage programs and products
to Internet users. The Program shall include a comprehensive
marketing plan designed, executed, and paid for by E-LOAN, to
attract visitors to E-LOAN's website ("Customers") for the purpose
of obtaining mortgage loans from HRBM and other mortgage
companies. All customers meeting the HRBM mortgage loan
guidelines, as set forth in Exhibit A, will be noted and the
on-line preliminary application will be transferred to HRBM for
further processing.
(b) Although E-LOAN shall market HRBM to its Customers as required by
the Program: (i) E-LOAN shall not be required to, and shall not,
endorse HRBM, in any communications under the Program that are
targeted to Customers;(ii) E-LOAN shall not be required to
recommend HRBM as a mortgage provider and (iii) E-LOAN shall not
be required to, and shall not as part of the Program, provide
advice, counseling or assistance to Customers in connection with
any particular HRBM mortgage loan, for which they have applied.
E-Loan shall not hold itself out as a partner, joint venturer, or
similar business affiliate of HRBM.
2. Compensation.
(a) HRBM shall pay E-Loan a one-time, non-refundable fee for the creation,
construction, installation, and testing of the software, hardware, and
other system enhancements necessary for communications between E-Loan
and HRBM systems and for enabling the credit calculations on
information submitted by the Customers (the "Set-Up Fee") The amount
of the Set-Up Fee shall be [*] and shall be due upon execution of this
Agreement by both Parties and payable no more than twenty (20) days
thereafter.
(b) HRBM shall pay E-Loan a marketing fee of [*] per month (the "Monthly
Marketing Fee") for the marketing activities provided under this
Agreement in connection with the Program. Each Monthly Marketing Fee
shall be paid on or before the twentieth (20th) day following the end
of each month. To illustrate, the Monthly Marketing Fee due for
October marketing shall be due on or before November 20,1999. The
Parties each acknowledge and agree that the Monthly Marketing Fee
reflects the reasonable and fair market value of the goods and
services to be provided by E-LOAN under the Program, without regard to
the value or volume of mortgage loans that may be attributable to the
Program.
3. Term and Termination.
(a) The term of this Agreement shall be for a period of six (6) months
commencing on its Effective Date unless earlier terminated in
accordance with the provisions of this Section 3.
(b) Notwithstanding anything to the contrary in this Agreement, either
party may terminate this Agreement at any time, in the following
situations ("Events of Default"):
(1) Material breach or this Agreement by the other party which
remains uncured after thirty (30) days' written notice
thereof;
(2) A party makes a general assignment for the benefit of
creditors, or files a voluntary petition in bankruptcy or
for reorganization or arrangement under the bankruptcy
laws, or a petition in bankruptcy is filed against a party
and is not dismissed within sixty (60) days after filing,
or a receiver or trustee is appointed for all or any part
of the property or assets of a party.
Upon termination of this Agreement, as provided herein or pursuant
to Paragraph 19; (i) HREM shall continue to process, in due course
any mortgage loan applications submitted by any Customer prior to
the date of termination, and (ii) HRBM's obligation to pay any
then due Monthly Marketing Fee will be prorated as of such date,
and (iii) the provisions of Section 5 of this Agreement shall
survive.
4. Relationship
The relationship between HRBM and E-LOAN shall be that of independent
contractors and neither party shall be or represent itself td be an
agent, employee, partner or joint venturer of the other, nor shall either
party have or represent itself to have any power or authority to act for,
bind or commit the other.
5. Representations and Warranties.
(a) HRBM's Authority/Legal Actions. HRBM is a corporation duly
organized, validly existing and in good standing under the laws
of the State of California with full corporate power and
authority to transact the business contemplated by this Agreement
and it possesses all requisite authority, power, license. permits
and franchises to conduct its business as presently conducted.
Its execution, delivery and compliance with its obligations under
the terms of this Agreement are not prohibited or restricted by
any government agency. There is no claim. action. suit,
proceeding or investigation pending or, to the best of HRBM's
knowledge, threatened against it or against any of its principal
officers, directors or key employees, which, either in any one
instance or in the aggregate. may result in an adverse change in
the business, operations, financial condition, properties or
assets of HRBM, or in any impairment of the right or ability of
HREM to carry on its business substantially as now conducted
through its existing management group, or in any material
liability on the part of HRBM, or which would draw into question
the validity of this Agreement.
(b) E-LOAN's Authority/Legal Actions. E-LOAN is a corporation duly
organized, validly existing and in good standing under the laws
of the State or Delaware with full corporate power and authority
to transact any and all business contemplated by this Agreement
and it possesses all requisite authority. power, license, permits
and franchises to conduct its business as presently conducted.
Its execution, delivery and compliance with its obligations under
the terms of this Agreement are not prohibited or restricted by
any government agency. There is no claim, action, suit.
proceeding or investigation pending or, to the best of E-LOAN's
knowledge, threatened against it or against any of its principal
officers, directors or key employees which, either in any one
instance or in the aggregate, may result in an adverse change in
the business, operations, original condition, properties or
assets of E-LOAN, or in any impairment of the right or ability of
E-LOAN to carry on its business substantially as now conducted
through its existing management group, or in any material
liability on the part of E-LOAN, or which would draw into
question the validity of this Agreement. The information and
content on the E-LOAN website (other than information supplied by
HRBM )and the E-LOAN Marks (as defined below) licensed hereunder,
do not and will not infringe on the patent, copyright, trademark.
trade name or other proprietary right of any third party.
(c) E-LOAN's Compliance. E-LOAN's website structure, format,
information, and content, as built and as used by E-LOAN shall be
in full compliance with all applicable federal and state laws and
this Agreement. E-LOAN has obtained, or will have obtained in
connection with the transactions contemplated by this Agreement,
all necessary federal and state approvals in connection with
operation and ownership or its website and the content thereof
and will make the necessary changes to its website to reflect
this Agreement and insure accurate representation. The Privacy
notices and Privacy Policies of E-LOAN's website shall be
consistent with the Federal Trade Commission's procedure or
rules, and comply with acceptable trade practices.
6. Execution/Conflict with Existing Laws or Contracts.
The parties have taken all necessary action to authorize their respective
execution, delivery and performance of this Agreement The execution and
delivery of this Agreement and the performance of the obligations of the
respective parties hereunder will not (I) conflict with or violate the
Certificate or Incorporation or By-laws of either party or any provision of
any law or regulation or any decree, demand or order to which either pad is
subject or (ii) conflict with or result in a breach of or constitute a
default (or an event which, with notice or lapse of time, or both, would
constitute a default) under any or the terms, conditions or provisions of
any agreement or instrument to which either party is a party or by which it
is bound, or any order or decree applicable to either party, or result in
the creation or imposition of any lien on any of their assets or property.
7. Confidential Information
Each party recognizes that during the term of this Agreement, its
directors, officers, employees and authorized representatives such as
attorneys and accountants, may obtain knowledge or trade secrets, customer
lists, membership lists and other confidential information or the other
party which is valuable, proprietary, special or unique to the continued
business of that party, which information is initially delivered in written
form including electronic form or is summarized and delivered in writing
within thirty (30) days after initial delivery in non-written form, and
which writing is marked "Confidential" or in a similar nature to indicate
its nonpublic and proprietary nature ("Confidential information. However,
Confidential Information does not include information that is or (i)
becomes available to the general public other than through a breach by the
recipient party, (ii) already known to the recipient party as or the time
of communication to the recipient party, (iii) developed by the recipient
party independently or and without reference to information communicated by
the other party, or (iv) rightfully received by the recipient party from a
third party which third party is not under a legal duty of confidentiality
with respect to such information. Accordingly, each party as a recipient of
the other's Confidential Information agrees to hold the Confidential
Information of the communicating party and the terms and conditions of this
Agreement in confidence and to use diligent efforts to ensure that the
communicating party's Confidential Information the terms hereof are held in
confidence by it officers, directors, employees, representatives and others
over whom it exercises control Upon discovering any unauthorized disclosure
of the communicating party's Confidential Information or the terms or this
Agreement, the recipient will use diligent efforts to recover such
information and to prevent its further disclosure to additional third
parties. In addition, the recipient party will promptly notify the
communicating party in writing of any such unauthorized disclosure of the
communicating party's Confidential Information. The parties' obligations
under this paragraph will survive for a period or three (3) years following
the expiration or earlier termination of this Agreement.
8. Hold Harmless.
(a) HRBM agrees to indemnify, defend and hold E-LOAN harmless from
and against any and all claims, suits, actions, liability,
losses, expenses or damages which may hereafter arise, which
E-LOAN, its affiliates, directors, officers, agents or employees
may sustain due to or arising out of any misrepresentation,
negligent ad or omission by HRBM, its affiliates, officers.
agents, representatives or employees or out of any act by HRBM,
its affiliates, officers, agents, representatives or employees in
violation of this Agreement or in violation of any applicable law
or regulation. Provided, however, the above indemnification shall
not provide coverage for (a) any claim, suit or action, liability
or loss, expense or damage that resulted from E-LOAN'S negligent
act or omission to a breach by E-LOAN of any of its
representations, warranties or obligations under this Agreement,
or (b) the amount by which any cost, fee, expense or loss
associated with any of the foregoing were increased as a result
of an act or omission on the part of E-LOAN. As a condition of
the foregoing indemnity obligation, E-LOAN agrees to give HRBM
reasonably prompt notice of any third party claim.
(b) E-LOAN agrees to indemnify, defend and hold HRBM harmless from
and against any and all claims, suits, actions, liability,
losses, expenses or damages which may hereafter arise, which
HRBM, its affiliates, directors, officers, agents or employees
may sustain due to or arising out of any misrepresentation,
negligent act or omission by E-LOAN, its affiliates, officers,
agents, representatives or employees or out of any act by E-LOAN,
its affiliates, officers, agents, representatives or employees in
violation of this Agreement or in violation of any applicable law
or regulation. Provided, however, the above indemnification shall
not provide coverage for (a) any claim, suit or action, liability
or loss, expense or damage that resulted from a negligent act or
omission of HRBM or that is attributable to a breach by HRBM of
any of its representations, warranties or obligations pursuant to
this Agreement, or(b) the amount by which any cost, fee, expense
or loss associated with any of the foregoing were increased as a
result of an act or omission on the part of HRBM. As a condition
of the foregoing indemnity obligation, HRBM agrees to give E-LOAN
reasonably prompt notice of any third party claim.
9. Notices
All notices required Of permitted by this Agreement shall be in writing and
shall be given by certified mail, return receipt requested or by reputable
overnight courier with package tracing capability and sent to the address
at the read of this Agreement or such other address that a party specified
in writing in accordance with this paragraph.
10. Disclaimer Concerning Tax Effects
Neither party to this Agreement makes any representation or warranty to the
other regarding the effect that this Agreement and the consummation of the
transactions contemplated hereby may have upon the foreign, federal, state
or local tax liability of the other.
11. Disclaimer of Warranties
Neither E-LOAN nor HRBM guarantees continuous or uninterrupted display or
distribution of any links contemplated hereunder. or continuous or
uninterrupted operation of their respective websites. In the event of
interruption of display or distribution of E-LOAN's or HRBM's links or the
parties' websites (or any portion there to the parties' sole obligation to
each other shall be to restore service as soon as practical. In no event
will either party be liable for consequential, punitive. special or
indirect damages in connection with this Agreement or the obligations
contemplated hereby even if they are advised of the possibility of such
damages. Notwithstanding the foregoing. or any other provision in this
Agreement, should operation be interrupted for eight or more hours
throughout a day (an "Interrupted flay") for five consecutive calendar days
or longer, the Monthly Marketing Fee shall be reduced by that amount equal
to $2,500 per clay for each Interrupted Day.
12. Capitalized Terms. Capitalized terms used herein shall have the meanings set
forth herein.
13. Amendment
The terms and conditions of this Agreement may not be modified or amended
other than by a writing signed by both parties.
14. Trademark License
Neither party may use the other parties trademarks, service marks, trade
names, logos, or other commercial or product designation(collectively
"Marks") for any purpose whatsoever without the prior written consent of
the other party.
15. Assignment/Binding Nature
Neither party may assign, voluntarily, by operation of law, or otherwise,
any rights, or delegate any duties under this Agreement to any party that
is not an affiliate of itself as of the Effective Date, without the other
party's prior written consent, except that either party may assign this
Agreement or any of its rights or obligations arising hereunder to the
surviving entity in a merger, acquisition, reorganization or consolidation
in which it participates, or to a purchaser of substantially all of its
assets; providing that the assigning party will give reasonable written
notice to the non-assigning party in advance of such merger, acquisition or
other assignment and that the surviving entity is not a competitor to the
non-assigning party. Subject to the foregoing, this Agreement shall be
binding upon and shall inure to the benefit of the successors and assigns
of the Parties.
16. Entire Agreement
This Agreement and any Exhibits attached hereto constitute the entire
Agreement between the Parties and supersede all oral and written
negotiations of the Parties with respect to the subject matter hereof.
17. Governing Law
This agreement shall be subject to and construed under the laws of the
Stale of California. without reference to conflicts of law provisions
thereof
18. Severability
If any provision of this Agreement should be invalid, illegal or in
conflict with any applicable state or federal law or regulation, such law
or regulation shall control, to the extent or such conflict, without
affecting the remaining provisions or this Agreement. This Agreement shall
be deemed to be severable and. if any provision is determined to be void or
unenforceable, then that provision will be deemed severed and the remainder
or the Agreement will remain in effect. Without limiting the foregoing, if
either party is advised by counsel or a regulatory body having jurisdiction
over the party's activities that any provision of this Agreement violates
any applicable federal or state law or regulation, then the parties agree
cooperate to comply with such advice by modifying or terminating this
Agreement (in whole or in part).
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed the
day and year first above written.
E-LOAN, Inc. Option One Mortgage Corporation,
dba H & R Block Mortgage
By: /s/Xxxxxx X. Xxxxxxx By: /s/ Xxx Xxxxx
-------------------- -----------------------------
Xxxxxx X. Xxxxxxx Xxx Xxxxx
President & COO SVP
Exhibit A
HRBM Loan Program Guidelines
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