EXECUTION AGREEMENT
This Agreement is made this 1st day of January, 1999, by and between W & D
Securities, Inc. ("W & D"), a California corporation, and ITG Inc. ("ITG"), a
Delaware corporation.
WHEREAS, ITG has entered into an agreement with W & D (the "Omnibus
Clearing Agreement") to clear and settle transactions which are executed by
W & D on the New York Stock Exchange ("NYSE") on behalf of customers of ITG; and
WHEREAS, ITG desires to avail itself of certain services offered by W & D
with respect to executions effected on the NYSE and other regional exchanges;
and
WHEREAS, W & D desires to provide to ITG the services described below
subject to the terms and conditions of this Agreement;
NOW, THEREFORE, for and in consideration of the promises and mutual
agreements set forth herein, W & D and ITG agree as follows:
1. SERVICES PROVIDED BY W & D WITH RESPECT TO ITG'S TRADE ENTRY AND EXECUTION
a. W & D's Operations Department shall be responsible for trade execution
and trade entry on the books and records of Xxxxxxxxx & Company, Inc. for all
trades executed by W & D as agent for ITG on the NYSE, on any other regional
stock exchange, and in the over-the-counter market. W & D's Operations
Department will also be responsible pursuant to the Omnibus Clearing Agreement
for the clearance and settlement of all trades executed by W & D as agent for
ITG on the NYSE. W & D will provide daily reconciliation of orders sent by ITG
not later than 12:00 pm on T+1.
b. W & D's Operations Department shall be available for trade entry and
clearance and settlement of trades executed on the NYSE pursuant to the Omnibus
Clearing Agreement, so long as the Omnibus Clearing Agreement remains in effect.
c. W & D shall provide to ITG the full benefit of any operating systems
changes, whether automated or manual, implemented by W & D. W & D will continue
to provide the support for order handling, systems and account set-up that it
currently provides to ITG.
d. W & D shall negotiate, pay and account within 15 days of month end all
specialist and $2 broker bills.
2. CONFIDENTIALITY
a. W & D will exercise reasonable care to prevent access to information
regarding ITG or ITG's customers by unauthorized persons and will keep
confidential any information it has concerning the business of ITG.
Notwithstanding the foregoing, W & D shall be held harmless
for complying with any request for information or documents by the Securities
and Exchange Commission or other regulatory or self-regulatory authority or
any court order or other legal process which W & D believes to be valid and
effective.
b. ITG will keep confidential any information it may acquire regarding
W & D and its business. Notwithstanding the foregoing, ITG shall be held
harmless for complying with any request for information or documents by the
Securities and Exchange Commission or other regulatory authority or any court
order or other legal process which ITG believes to be valid and effective.
3. INDEMNIFICATION
ITG will indemnify, protect and hold harmless W & D, its officers and
employees, and each person, if any, controlling W & D, from and against all
manner of claims, demands, proceedings, suits or actions (whether in law or in
equity) and liabilities, losses, expenses and costs (including attorneys' fees)
in the event (i) ITG fails to properly exercise its obligations as set forth
herein, or (ii) any customer of or regulator for ITG institutes a claim, suit,
action, arbitration or other proceeding against W & D for any reason, PROVIDED,
HOWEVER, that W & D shall not be entitled to indemnification in any such manner
if W & D is found to have acted with gross negligence in the performance of its
services under this Agreement.
4. REPRESENTATIONS AND WARRANTIES
a. ITG represents and warrants as follows:
(1) ITG is and during the term of this Agreement will remain a member
in good standing of the National Association of Securities Dealers, Inc.;
(2) ITG is and during the term of this Agreement will remain duly
registered or licensed and in good standing as a broker-dealer under all
applicable federal and state securities laws;
(3) ITG has all requisite authority, whether arising under applicable
federal or state laws and rules and regulations of any securities exchange or
securities association to which it is subject, to enter into this Agreement and
to retain the services of W & D in accordance with the terms hereof; and
(4) ITG is now and during the term of this Agreement will remain in
compliance with the capital and financial reporting requirements of every
securities exchange and/or securities association of which it is a member, the
Securities and Exchange Commission, and every state in which it is licensed as a
broker-dealer.
b. W & D represents and warrants as follows:
(1) W & D is and during the term of this Agreement will remain a
member in good standing of the National Association of Securities Dealers, Inc.
and the NYSE;
(2) W & D is and during the term of this Agreement will remain duly
registered or licensed and in good standing as a broker-dealer under all
applicable federal and state securities laws;
(3) W & D has all requisite authority, whether arising under
applicable federal or state laws and rules and regulations of any securities
exchange or securities association to which it is subject, to enter into this
Agreement and to retain the services of W & D in accordance with the terms
hereof; and
(4) W & D is now and during the term of this Agreement will remain in
compliance with the capital and financial reporting requirements of every
securities exchange and/or securities association of which it is a member, the
Securities and Exchange Commission, and every state in which it is licensed as a
broker-dealer.
5. COMPENSATION
During the term of this Agreement, W & D shall be compensated by ITG based
on the schedule that appears on Exhibit A hereto. The parties may amend said
schedule from time to time in writing and such amendment shall not affect any
other term of this Agreement.
6. TERM AND TERMINATION
a. The term of this Agreement shall be a period of eighteen months from
the date hereof, and shall renew automatically for successive one (1) year terms
unless terminated earlier in accordance with Section 6(b), 6(c), or 6(d).
b. This Agreement may be terminated by either party without cause upon
written notice delivered in person or by registered mail to the other party at
least 180 days prior to the effective date of termination, PROVIDED, HOWEVER,
that the first date on which such notice of termination may be given by either
party hereto is January 1, 2000.
c. This Agreement may be terminated immediately by either party if any
representations or warranties cease to be true or if any duties,
responsibilities or obligations are not duly performed during the term of this
Agreement. Notwithstanding the foregoing, should any party choose not to
exercise its right to terminate this Agreement when such a right is first
available, such action shall not be deemed a waiver of such right if available
on a subsequent occasion and the non-terminating party's legal and/or equitable
remedies for any breach(es) of this Agreement will remain in full force and
effect.
d. This Agreement shall terminate automatically on the effective date of
termination of the Fully-Disclosed Clearing Agreement between ITG and Xxxxxxxxx
& Company, Inc. without any further action by either party hereto.
e. The Core Glue System Software License Agreement between ITG and W & D
shall terminate automatically on the effective date of termination of this
Agreement.
f. Upon any termination of this Agreement for any reason whatsoever, the
Supplemental Account Agreement between ITG and Xxxxxxxxx & Company, Inc.
relating to ITG's use of Optimark services shall terminate automatically without
any further action by either party hereto.
7. NOTICE
For the purpose of delivery of any notice hereunder, W & D's address shall
be:
W & D Securities, Inc.
Harborside Financial Xxxxxx
Xxxxx XXX, Xxxxx 000
Xxxxxx Xxxx, XX 00000
Attention: President
and ITG's address shall be:
ITG Inc.
000 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: President
8. MISCELLANEOUS
a. W & D agrees that it will use ITG Glue for the routing of orders
placed by ITG; however, W & D shall have the right to adopt or use new or
different routing technology for orders, including those placed by ITG, if W & D
determines that the new technology is superior to ITG Glue.
b. This Agreement shall be governed by the State of New York, without
giving effect to principles of conflicts of laws.
c. W & D shall provide to ITG on within 45 days of the end of W & D's
first three fiscal quarters and 90 days of the end of W & D's fiscal year, W &
D's balance sheet and a consolidating income statement. Such financial
information shall be prepared in accordance with Exhibit B hereto.
d. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors, assigns, and transferees. No
assignment or amendment shall be valid unless the other party consents to such
assignment or amendment in writing. Neither this Agreement nor the performance
of services by W & D hereunder shall be construed to create a joint venture,
partnership or agency relationship of any type between ITG and W & D.
IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to
be executed by their duly authorized officers as of the day and year set forth
above.
W & D SECURITIES, INC. ITG INC.
By: /s/ Xxxxxx Xxxxx By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
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Xxxxxx Xxxxx Xxxxxxx X. Xxxxxxx, Xx.
President President
