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JOINT SERVICES AGREEMENT
among
CANTOR XXXXXXXXXX, X.X.,
CANTOR XXXXXXXXXX SECURITIES,
CANTOR XXXXXXXXXX & CO.,
CANTOR XXXXXXXXXX PARTNERS,
CANTOR XXXXXXXXXX INTERNATIONAL,
CANTOR XXXXXXXXXX GILTS,
eSPEED, INC.,
eSPEED SECURITIES, INC.,
eSPEED GOVERNMENT SECURITIES, INC.,
eSPEED MARKETS, INC.
and
eSPEED SECURITIES INTERNATIONAL LIMITED
Dated as of December __, 1999
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JOINT SERVICES AGREEMENT
This JOINT SERVICES AGREEMENT is made and entered into as of December
__, 1999, among Cantor Xxxxxxxxxx, X.X., a Delaware limited partnership
("CFLP"), Cantor Xxxxxxxxxx International, an English unlimited liability
company ("CF International"), Cantor Xxxxxxxxxx Gilts, an English unlimited
liability company ("CF Gilts"), Cantor Xxxxxxxxxx Securities, a New York general
partnership ("CFS"), Cantor Xxxxxxxxxx & Co., a New York general partnership
("CF&Co"), and Cantor Xxxxxxxxxx Partners, a New York general partnership ("CFP"
and, together with CFLP, CF International, CF Gilts, CFS and CF&Co., the
"Executing Cantor Parties" and, together with the other Executing Cantor Parties
and each subsidiary of CFLP that becomes a party to this Agreement, the "Cantor
Parties"), on the one hand, and eSpeed, Inc., a Delaware corporation ("eSpeed"),
eSpeed Securities, Inc., a Delaware corporation and a wholly-owned subsidiary of
eSpeed ("eSpeed Securities"), eSpeed Government Securities, Inc., a Delaware
corporation and a wholly-owned subsidiary of eSpeed ("eSpeed GS"), eSpeed
Securities International, Limited, a U.K. private limited company and a
wholly-owned subsidiary of eSpeed ("eSpeed International"), and eSpeed Markets,
Inc., a Delaware corporation and a wholly-owned subsidiary of eSpeed ("eSpeed
Markets" and, together with eSpeed, eSpeed Securities, eSpeed GS and eSpeed
International, the "Executing eSpeed Parties" and, together with the other
Executing eSpeed Parties and each subsidiary of eSpeed that becomes a party to
this Agreement, the "eSpeed Parties"), on the other hand. All capitalized terms
used in this Agreement and not otherwise defined shall have the meanings
ascribed to such terms in Section 1 of this Agreement. Each subsidiary of CFLP
and eSpeed will automatically become a party to this Agreement, unless it
becomes a party to a substantially identical separate agreement.
W I T N E S S E T H:
--------------------
WHEREAS, the Executing Cantor Parties are engaged in, among other
things, the business of creating, developing and operating Marketplaces in and
through which buyers and sellers of fixed-income securities, futures contracts,
commodities and other Financial Products may effect transactions in those
Financial Products;
WHEREAS, certain of the Marketplaces operated by the Executing Cantor
Parties are Electronic Marketplaces;
WHEREAS, pursuant to an Assignment and Assumption Agreement of even
date herewith, certain of the Executing Cantor Parties are contributing to
eSpeed their Electronic Trading Systems assets;
WHEREAS, from and after the Closing, the eSpeed Parties and the Cantor
Parties wish to collaborate in providing brokerage services to customers through
the existing Electronic Marketplaces, and in creating and developing Electronic
Marketplaces for new Financial Products and other Products; and
WHEREAS, from and after the Closing, the eSpeed Parties wish to provide
Ancillary IT Services to the Cantor Parties in consideration for the fees herein
provided;
NOW, THEREFORE, in consideration of the premises contained herein, it
is agreed as follows:
1. Defined Terms. For purposes of this Agreement, the following terms
have the meanings specified or referred to in this Section 1:
"Ancillary IT Services" means technology support services,
including, but not limited to, (i) systems administration, (ii) internal network
support, (iii) support and procurement for desktops of end-user equipment, (iv)
operations and disaster recovery services, (v) voice and data communications,
(vi) support and development of systems for Clearance, Settlement and
Fulfillment Services, (vii) systems support for Cantor Party brokers and (viii)
electronic applications systems and network support and development for
Unrelated Dealer Businesses.
"Cantor Exchange" means Cantor Financial Futures Exchange,
Inc. and any successor thereto or to the operations thereof.
"Cantor Services" means any one of, or any combination of,
Voice Assisted Brokerage Services, Clearance, Settlement and Fulfillment
Services and Related Services.
"Clearance, Settlement and Fulfillment Services" means all
such services as are necessary to clear, settle and fulfill, or arrange
settlement or fulfillment as a name give-up or other intermediary of, in
accordance with customary market practice and taking into account applicable
regulatory requirements, a purchase and sale of a particular Product, including,
but not limited to, collection of money; arrangement of delivery of Products;
receipt, delivery and maintenance of margin and collateral, if appropriate;
dealing with issues relating to failures to receive or deliver payments or
Products; and collection and payment of transfer or similar taxes, to the extent
applicable to such Product. Clearance, Settlement and Fulfillment Services may
include, but are not limited to, acting as a riskless principal or other
intermediary between the buyer and the seller of a Product.
"Closing" means the Closing under the Assignment and
Assumption Agreement.
"Collaborative Marketplace" means an Electronic Marketplace
that is operated by a Cantor Party and an eSpeed Party in collaboration pursuant
to Section 3 of this Agreement. All Marketplaces shall be Collaborative
Marketplaces, unless otherwise determined in accordance with this Agreement.
"Electronic Brokerage Services" means the effecting of
transactions in, and purchases and sales of, a Product on an Electronic
Marketplace in and through the operation of an Electronic Trading System.
Electronic Brokerage Services include, but are not limited to, the provision and
operation of network distribution systems, transaction processing systems and
customer interface systems, in each case that are related to the effecting of
transactions in, and purchases and sales of, a Product on an Electronic
Marketplace. Electronic Brokerage Services do not include Voice Assisted
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Brokerage Services, Clearance, Settlement and Fulfillment Services, Information
Services or Related Services.
"Electronic Marketplace" means a Marketplace on which
transactions in, and purchases and sales of, Products may be effected in whole
or in part electronically, but does not include a Marketplace that is merely
electronically assisted, such as screen assisted open outcry.
"Electronic Trading System" means, as to any Electronic
Marketplace, the hardware, software, network infrastructure and other similar
assets that are used to effect purchases and sales in that Electronic
Marketplace.
"eSpeed Marketplace" means a Marketplace (i) in which an
eSpeed Party renders Electronic Brokerage Services and (ii) that is not a
Collaborative Marketplace.
"Financial Product" means any financial asset or financial
instrument, any intangible commodity or any tangible fungible commodity,
including, but not limited to, any security, futures contract, foreign exchange
transaction, swap transaction, credit derivative, repurchase or reverse
repurchase obligation, currency or swap (as currently defined in the Federal
Bankruptcy Code of 1978) or any option or derivative on any of the foregoing.
"Information" means information relating to bids, offers or
trades, or any other information, that is input into, created by or otherwise
resides on an Electronic Trading System.
"Information Services" means the provision of Information to a
Person with respect to a Marketplace as a separate service not in connection
with transactions by such Person on such Marketplace. Information Services shall
not include the provision of Information to purchasers and sellers of a Product
incident to the provision of Electronic Brokerage Services and/or Voice Assisted
Brokerage Services to such customers.
"Marketplace" means a marketplace operated or to be operated
by the Cantor Parties and/or the eSpeed Parties in and through which buyers and
sellers of a Product may effect transactions in the Product.
"New Market Notice" means, with respect to a Marketplace, a
written notice describing with reasonable specificity the anticipated nature,
general level of volume and trading needs of that Marketplace.
"Person" means any corporation, general or limited
partnership, limited liability company, joint venture, estate, trust,
association, organization or other entity or governmental or regulatory
authority or agency.
"Product" means any tangible or intangible asset or good.
"Product or Pricing Decisions" means, as to an Electronic
Marketplace for a particular Product, (i) the definition of the Product, (ii)
the hours of operation of the Marketplace, (iii) the rules relating to trading
priority, incentives and other trading related issues and (iv) the rates and
schedules
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of commissions and other Transaction Revenues for the Marketplace, including any
variation thereof for particular customers or classes of customers.
"Related Services" includes (i) credit and risk management
services, (ii) services related to sales positioning of Products, (iii)
oversight of customer suitability and regulatory compliance and (iv) such other
services customary to brokerage operations as are agreed to by CFLP and eSpeed.
"Transaction Revenues" means, in each case, the standard fees,
commissions, spreads, markups or other similar standard amounts received from a
customer in connection with effecting transactions in a Marketplace.
"Unrelated Dealer Businesses" means (i) the equity businesses
of the Cantor Parties as they may exist from time to time, (ii) the money market
instruments and securities lending divisions of the Cantor Parties as they may
exist from time to time, (iii) any business or portion thereof or activity in
which a Cantor Party acts as a dealer or otherwise takes market risk or
positions, including in the process of executing matched principal transactions,
providing the services of a specialist or market maker or providing trading or
arbitrage operations, (iv) activities currently or in the future subject to or
similar to those specified in the United Kingdom Gaming Act of 1963 or any
successor act and (v) any business not involving operating a Marketplace.
"Voice Assisted Brokerage Services" means the effecting of
transactions in, and purchases and sales of, a Product on an Electronic
Marketplace in and through a broker or other human intermediary, in each case
who is an employee of, or providing services to, a Cantor Party. Voice Assisted
Brokerage Services include the entry of an order by a broker or other human
intermediary into the Electronic Trading System.
2. Term. The term of this Agreement shall commence as of the Closing
and shall be in effect perpetually, unless sooner ended by the mutual agreement,
in writing, of CFLP and eSpeed (the "Term").
3. Joint Services in Collaborative Marketplaces.
(a) Subject to the terms and conditions stated herein, the
Cantor Parties and the eSpeed Parties intend to collaborate in providing
Electronic Brokerage Services and Cantor Services to customers in and through
Electronic Marketplaces. In any case in which the Cantor Parties and the eSpeed
Parties do so collaborate, the Marketplace shall be a Collaborative Marketplace
and the respective authority, responsibilities and obligations of the parties
shall be governed by this Section 3.
(b) The parties agree that the Electronic Marketplaces that
are managed by the Cantor Parties prior to the date hereof, all of which are
listed by Product on Annex A hereto, shall be Collaborative Marketplaces
governed by this Section 3. The determination as to whether a Marketplace that
is created after the date hereof is to be a Collaborative Marketplace governed
by this Section 3 shall be made in accordance with Section 7 of this Agreement.
(c) In the case of each Collaborative Marketplace, any Product
or Pricing Decision shall be made jointly by the Cantor Parties and the eSpeed
Parties. If the parties are unable to agree on
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a particular Product or Pricing Decision after good faith efforts to do so, then
the final Product or Pricing Decision shall be made by (i) a Cantor Party, in
the case of a Marketplace or the portion thereof in which or for which a Cantor
Party provides any Voice Assisted Brokerage Services, and (ii) an eSpeed Party,
in the case of a fully electronic Marketplace (that is, a Marketplace in which
no Cantor Party provides Voice Assisted Brokerage Services) or the portion of a
Marketplace that is fully electronic; provided, however, that no Product and
Pricing Decision made by an eSpeed Party with respect to a fully electronic
Marketplace shall result in the Cantor Party's share of Transaction Revenues for
the transactions effected in the Marketplace being less than the amount
necessary to cover the Cantor Party's actual costs of providing Cantor Services
in connection with such Marketplace.
(d) In the case of each Collaborative Marketplace, the
applicable eSpeed Party (i) shall own and operate the Electronic Trading System
associated with the Electronic Marketplace, (ii) shall be responsible, as
between the parties, for the provision of Electronic Brokerage Services to
customers and (iii) except as provided above with respect to Product or Pricing
Decisions, shall have reasonable discretion as to the manner and means of
operating the Electronic Trading System and providing Electronic Brokerage
Services to customers and Cantor brokers in connection therewith.
(e) In the case of each Collaborative Marketplace, the
applicable Cantor Party (i) shall be responsible, as between the parties, for
the provision of Cantor Services to customers and (ii) except as provided above
with respect to Product or Pricing Decisions, shall have reasonable discretion
as to the manner and means of providing the Cantor Services. The applicable
Cantor Party shall be responsible for maintenance of books and records and
compliance with applicable securities laws, rules and regulations, as determined
by the applicable Cantor Party. CFP and CF & Co shall be responsible for
compliance with the reporting requirements under Regulation ATS and related
provisions of the Securities Exchange Act of 1934, as amended. In that regard,
CFP and CF & Co each will be the broker for all transactions in the respective
matching systems, and each will determine the various non-discretionary
parameters under which transactions match in their respective systems. eSpeed
Securities and eSpeed GS shall cooperate with CFP and CF & Co in all regulatory
compliance matters and, if applicable, in complying with Regulation ATS.
(f) Without limiting the authority of the parties in their
respective areas of responsibility pursuant to paragraphs (d) and (e), the
parties recognize the importance of providing an integrated and seamless service
to customers. Accordingly, the parties shall consult diligently and in good
faith, as and as often as necessary, to ensure that their respective services
are properly integrated.
(g) All information and data, other than Information, created,
developed, used in connection with or relating to the operation of and effecting
of transactions in any Marketplace ("Data") shall constitute the sole property
of the Cantor Parties or the eSpeed Parties, as applicable, on the following
basis: (i) if the Data relates to
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Financial Products, the Data shall belong solely to the Cantor Parties, (ii) if
the Data relates to a Collaborative Marketplace in which only Products that are
not Financial Products are traded, the ownership of the Data shall be determined
by the Cantor Parties and the eSpeed Parties on a case-by-case basis based on
good faith negotiations, (iii) if the Data relate to an eSpeed Marketplace in
which only Products that are not Financial Products are traded, the Data shall
belong solely to the eSpeed Parties and (iv) if the Data relate to a non-
Collaborative Marketplace that is not an eSpeed Marketplace and in which
Financial Products are traded, the Data shall belong solely to the Cantor
Parties. All Information relating to Financial Products transmitted and
disseminated on or through the Electronic Marketplace shall be the sole property
of the Cantor Parties and, as between the parties, the Cantor Parties shall have
the sole and exclusive right to use, publish and be compensated for Information
Services in connection with or relating to such Information; provided, however,
in the case of each Collaborative Marketplace that the eSpeed Parties shall have
the right (without any obligation to pay the Cantor Parties therefor) to use
such Information in connection with the execution of transactions in the
applicable Collaborative Marketplace.
4. Sharing of Transaction Revenues. The Cantor Parties and the eSpeed
Parties agree to share Transaction Revenues with regard to transactions effected
through Marketplaces in the following manner:
(a) If (i) the Electronic Marketplace is a Collaborative
Marketplace, (ii) the transaction relates to a Financial Product (other than a
Financial Product that is traded on the Cantor Exchange) and (iii) no Cantor
Party provides Voice Assisted Brokerage Services in connection with the
transaction to which the Transaction Revenues relate (that is, the transaction
is fully electronic), then the applicable eSpeed Party will receive the
aggregate Transaction Revenues and will pay to CFLP a service fee equal to 35%
of the Transaction Revenues.
(b) If (i) the Electronic Marketplace is a Collaborative
Marketplace, (ii) the transaction relates to a Financial Product (other than a
Financial Product that is traded on the Cantor Exchange) and (iii) a Cantor
Party provides Voice Assisted Brokerage Services in connection with the
transaction to which the Transaction Revenues relate, then the applicable Cantor
Party will receive the aggregate Transaction Revenues and will pay to the
applicable eSpeed Party a service fee equal to 7% of the Transaction Revenues.
(c) If (i) the Electronic Marketplace is a Collaborative
Marketplace, (ii) the transaction relates to a Product that is traded on the
Cantor Exchange and (iii) no Cantor Party provides Voice Assisted Brokerage
Services in connection with the transaction to which the Transaction Revenues
relate (that is, the transaction is fully electronic), then the applicable
eSpeed Party will receive the aggregate Transaction Revenues and will pay to
CFLP a service fee equal to 20% of the Transaction Revenues.
(d) If (i) the Electronic Marketplace is a Collaborative
Marketplace, (ii) the transaction relates to a Product that is traded on the
Cantor Exchange and (iii) a Cantor Party provides Voice Assisted Brokerage
Services in connection with the transaction to which the Transaction Revenues
relate, then the applicable eSpeed Party will receive the aggregate Transaction
Revenues and will pay to the applicable Cantor Party a service fee equal to 55%
of the Transaction Revenues.
(e) If (i) the Electronic Marketplace is a Collaborative
Marketplace and (ii) the transaction relates to a Product that (x) is not a
Financial Product and (y) is not traded on the Cantor Exchange, then the
applicable Cantor Party and the applicable eSpeed Party will share Transaction
Revenues in such manner as they shall agree.
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(f) If (i) the Electronic Marketplace is an eSpeed Marketplace
and (ii) the transaction relates to a Financial Product, then the applicable
eSpeed Party will receive the aggregate Transaction Revenues and will pay to
CFLP a service fee equal to 20% of the Transaction Revenues.
(g) If (i) the Electronic Marketplace is an eSpeed Marketplace
and (ii) the transaction relates to a Product other than a Financial Product,
then eSpeed will receive and retain all of the Transaction Revenues.
(h) If (i) a transaction is effected in a Marketplace that is
not a Collaborative Marketplace and is not an eSpeed Marketplace, but that is a
Marketplace in which Cantor provides Electronic Brokerage Services, and (ii) the
transaction relates to a Financial Product, then Cantor will receive the
aggregate Transaction Revenues and pay to eSpeed a service fee equal to 30% of
the amount eSpeed would have received pursuant to Section 4 (a) or 4 (b) of this
Agreement if the Marketplace had been a Collaborative Marketplace. For purposes
of this paragraph (h), the Transaction Revenues shall be reduced by the costs
incurred or paid by a Cantor Party to a third party to provide or arrange for
the provision of Electronic Brokerage Services.
(i) If a transaction (i) is not effected through an Electronic
Marketplace, but (ii) is electronically assisted (by way of example, but not
limited to, a screen-assisted open outcry transaction), then the applicable
Cantor Party will receive the aggregate Transaction Revenues and will pay to the
applicable eSpeed Party 2.5% of the Transaction Revenues.
(j) Notwithstanding the foregoing, in the event that a Cantor
Party's direct costs payable to third parties (other than the Cantor Parties and
their affiliates) for providing Clearance, Settlement and Fulfillment Services
with respect to a transaction in a Collaborative Marketplace with respect to any
Financial Product for any month exceed the direct costs incurred by the Cantor
Parties to clear and settle a cash transaction in United States Treasury
securities for such month, the cost of such excess shall be borne pro rata by
the applicable Cantor Party and the applicable eSpeed Party in the same
proportion as the Transaction Revenues and service fees for such transaction
are to be shared.
(k) For any month, for any Product for which sales and
purchases during such month are effected both through fully electronic
transactions and through voice-brokered transactions, Transaction Revenues
earned with respect to such Product shall be allocated between fully electronic
transactions and voice-brokered transactions as follows: the amount of
Transaction Revenues attributable to fully electronic transactions or
voice-brokered transactions, as the case may be, for such Product during such
month in a Marketplace shall be equal to (x) total Transaction Revenues for such
Product for such month in such Marketplace multiplied by (y) a fraction, the
numerator of which is the notional volume (by currency) of all transactions in
such specific Product type for such month in such Marketplace effected by fully
electronic transactions or voice-brokered transactions, as the case may be, and
the denominator of which is the notional volume (by currency) of all
transactions in such specific Product type for such month in such Marketplace.
(l) In the event that a customer does not pay, or pays only a
portion of, the Transaction Revenues relating to a transaction described in
paragraphs (a) through (i) above (a "Loss Event"), then the relevant Cantor
Party and the relevant eSpeed Party each shall bear its respective
7
share of the loss arising from the Loss Event in the same proportion as the
Transaction Revenues and service fees for such transaction are to be shared.
(m) All amounts due and payable to a Cantor Party or an eSpeed
Party by the other pursuant to this Section 4 shall be paid in the manner
specified in Section 12 of this Agreement.
(n) In the event that any Tax is imposed on Transaction
Revenues with respect to a transaction (other than a Tax on net income), the
cost of such Tax will be borne by the applicable eSpeed Party and the applicable
Cantor Party in the same proportion as the Transaction Revenues and service fees
for such transaction are to be shared.
5. Ancillary IT Services.
(a) During the Term, the eSpeed Parties shall provide
Ancillary IT Services to the Cantor Parties.
(b) CFLP shall pay to eSpeed in consideration for the
Ancillary IT Services an amount equal to the direct and indirect, including
overhead, costs that the eSpeed Parties incur in performing those services.
6. Representations and Warranties.
(a) Organization and Good Standing.
(i) Each Executing Cantor Party is duly organized,
validly existing and in good standing under the laws of the state of
its incorporation or organization, as the case may be. Each Executing
Cantor Party has the requisite power and authority to execute, deliver
and perform this Agreement and to consummate the transactions
contemplated hereby.
(ii) Each Executing eSpeed Party is duly organized,
validly existing and in good standing under the laws of the state or
other jurisdiction of its incorporation or organization, as the case
may be. Each Executing eSpeed Party has the requisite power and
authority to execute, deliver and perform this Agreement and to
consummate the transactions contemplated hereby.
(b) Authority; Binding Effect; No Conflicts.
(i) Each Executing Cantor Party has taken all
necessary actions to authorize the execution and delivery of this
Agreement and to perform all of its obligations under, and to
consummate the transactions contemplated by, this Agreement. This
Agreement has been duly and validly executed by each of the Executing
Cantor Parties. This Agreement constitutes the valid and binding
obligation of each of the Executing Cantor Parties enforceable against
each of the Executing Cantor Parties in accordance with its terms,
subject to the effect of reorganization, bankruptcy, insolvency,
moratorium, fraudulent conveyance and other similar laws relating to or
affecting creditors' rights generally and court decisions with respect
thereto, and subject to the application of equitable principles and the
discretion of
8
the court (regardless of whether the enforceability is considered in a
proceeding in equity or at law). The execution, delivery and
performance by each of the Executing Cantor Parties of this Agreement
shall not, with or without the giving of notice or the lapse of time or
both, (x) violate any provision of any federal, state, local or foreign
law, statute, rule or regulation to which any of the Executing Cantor
Parties is subject, (y) violate any injunction, order, judgment,
ruling, decree or settlement applicable to any of the Executing Cantor
Parties or (z) conflict with, or result in a breach or violation of,
any provision of the certificate of incorporation, by-laws, partnership
agreement or similar governing document of any of the Executing Cantor
Parties or any lease, contract, agreement, instrument, undertaking or
covenant by which any of the Executing Cantor Parties is bound.
(ii) Each of the Executing eSpeed Parties has taken all
necessary corporate actions to authorize, execute and deliver this
Agreement and to perform all of its obligations under, and to
consummate the transactions contemplated by, this Agreement. This
Agreement has been duly and validly executed by each of the Executing
eSpeed Parties. This Agreement constitutes the valid and binding
obligation of each of the Executing eSpeed Parties enforceable against
each of the Executing eSpeed Parties in accordance with its terms,
subject to the effect of reorganization, bankruptcy, insolvency,
moratorium, reorganization, fraudulent conveyance and other similar
laws relating to or affecting creditors' rights generally and court
decisions with respect thereto, and subject to the application of
equitable principles and the discretion of the court (regardless of
whether the enforceability is considered in a proceeding in equity or
at law). The execution, delivery and performance by each of the
Executing eSpeed Parties of this Agreement and the consummation by each
of the Executing eSpeed Parties of the transactions contemplated hereby
will not, with or without the giving of notice or the lapse of time or
both, (x) violate any provision of any federal, state or local law,
statute, rule or regulation to which any of the Executing eSpeed
Parties is subject, (y) violate any injunction, order, judgment,
ruling, decree or settlement applicable to any of the Executing eSpeed
Parties, or (z) conflict with, or result in a breach or violation of,
any provision of the certificate of incorporation or by-laws of any of
the Executing eSpeed Parties or any lease, contract, agreement,
instrument, undertaking or covenant by which any of the Executing
eSpeed Parties is bound.
(c) Litigation; No Undisclosed Liabilities. Except as
disclosed in the Prospectus relating to eSpeed's initial public offering, there
is no litigation pending or, to CFLP's knowledge, threatened, which questions
the validity or enforceability of this Agreement or seeks to enjoin the
consummation of any of the transactions contemplated hereby.
7. New Marketplaces; Non-competition; Strategic Alliances.
(a) If a Cantor Party wishes to create a new Marketplace for a
Financial Product, then such Cantor Party may, by providing a New Market Notice
to eSpeed, require eSpeed to provide, or cause another eSpeed Party to provide,
Electronic Brokerage Services with respect to that Marketplace. In such a case,
eSpeed shall use commercially reasonable efforts to develop an Electronic
Trading System for, and to render Electronic Brokerage Services with respect to,
that Marketplace under the terms of this Agreement. If eSpeed is able to develop
and put into operation an Electronic Trading System for the Marketplace within
180 days, then the Marketplace shall be a Collaborative
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Marketplace and the operation thereof shall be subject to the provisions of
Section 3 of this Agreement. If, after diligent effort, eSpeed is unable to
develop and put into operation an Electronic Trading System for the Marketplace
within 180 days, then (i) eSpeed shall have no liability to any Cantor Party for
its failure to provide an Electronic Trading System, (ii) the Cantor Party may
create and operate the Marketplace in any manner that the Cantor Party deems to
be acceptable and (iii) the Marketplace shall not be a Collaborative
Marketplace. CFLP agrees that its proposal to create a New Marketplace and the
requirements relating thereto will be commercially reasonable in scope and that
CFLP or another Cantor Party will diligently pursue the development of such
Marketplace in a meaningful way and that failure to do so within two years of
the provision of the New Market Notice will cause any rights of the eSpeed
Parties and the Cantor Parties in this Section 7 and Section 8 of this Agreement
to revert to their original status.
(b) If a Cantor Party wishes to create a new Marketplace for a
Financial Product that will involve the provision of Electronic Brokerage
Services and the Cantor Party does not require eSpeed to operate an Electronic
Trading System and to provide Electronic Brokerage Services for that Marketplace
pursuant to paragraph (a) of this Section 7, then the Cantor Party shall provide
to eSpeed a New Market Notice relating thereto and eSpeed shall have a right of
first refusal to provide Electronic Brokerage Services with respect to that
Marketplace under the terms of this Agreement. If eSpeed notifies the Cantor
Party that it wishes to provide Electronic Brokerage Services with respect to
the new Marketplace, then eSpeed shall use commercially reasonable efforts to
develop and put into operation an Electronic Trading System for the Marketplace
within 180 days. If eSpeed is able to develop and put into operation an
Electronic Trading System for the Marketplace within 180 days, then the
Marketplace shall be a Collaborative Marketplace and the operation thereof shall
be subject to Section 3 of this Agreement. If, after diligent effort, eSpeed is
unable to develop and put into operation an Electronic Trading System for the
Marketplace within 180 days, or eSpeed notifies the Cantor Party that it does
not wish to provide Electronic Brokerage Services with respect to the new
Marketplace, then (i) the applicable Cantor Party may provide or obtain from a
third party Electronic Brokerage Services for that Marketplace in any manner
that the Cantor Party deems to be acceptable and (ii) the Marketplace shall not
be a Collaborative Marketplace. CFLP agrees that its proposal to create a New
Marketplace and the requirements relating thereto will be commercially
reasonable in scope and that CFLP or another Cantor Party will diligently pursue
the development of such Marketplace in a meaningful way and that failure to do
so within two years of the provision of the New Market Notice will cause any
rights of the eSpeed Parties and the Cantor Parties in this Section 7 and
Section 8 of this Agreement to revert to their original status.
(c) If a Cantor Party wishes to create a new Electronic
Marketplace for a Product that is not a Financial Product, then the Cantor Party
shall provide to eSpeed a New Market Notice relating thereto. eSpeed or another
eSpeed Party shall have the opportunity to offer to provide Electronic Brokerage
Services with respect to the new Marketplace, which offer the Cantor Party shall
review and negotiate in good faith, but may accept or reject in its reasonable
discretion. If the Cantor Party accepts the eSpeed Party's negotiated terms of
proposed offer to provide Electronic Brokerage Services, then the Marketplace
shall be a Collaborative Marketplace and the operation thereof shall be subject
to Section 3 of this Agreement on such terms as the applicable Cantor Party and
the eSpeed Party shall agree. If the Cantor Party rejects the eSpeed Party's
negotiated terms of proposed offer to provide Electronic Brokerage Services,
then (i) the Marketplace shall not be a
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Collaborative Marketplace and (ii) the Cantor Party may create and operate the
Marketplace in any manner that the Cantor Party deems to be acceptable.
(d) If an eSpeed Party wishes to create a new Electronic
Marketplace for a Financial Product, then the eSpeed Party shall provide to CFLP
a New Market Notice relating thereto and CFLP or another Cantor Party shall have
a right of first refusal to provide the applicable Cantor Services with respect
to that Marketplace under the terms of this Agreement. If, within 30 days of
receiving the New Market Notice, CFLP or another Cantor Party notifies the
eSpeed Party that it wishes to provide such Cantor Services with respect to the
new Marketplace, then the Marketplace shall be a Collaborative Marketplace and
the operation thereof shall be subject to Section 3 of this Agreement. If (i)
CFLP notifies the eSpeed Party that it does not wish to provide such Cantor
Services or (ii) fails to notify the eSpeed Party within the 30-day time period
that it wishes to provide such Cantor Services with respect to the new
Marketplace, then the eSpeed Party may provide or obtain from a third party
those services for that Marketplace in any manner that the eSpeed Party deems to
be acceptable, and the Marketplace shall be an eSpeed Marketplace for purposes
of this Agreement.
(e) If an eSpeed Party wishes to create a new Electronic
Marketplace for a Product that is not a Financial Product, then the eSpeed Party
shall provide to CFLP a New Market Notice relating thereto. CFLP or another
Cantor Party shall have the opportunity to offer to provide Cantor Services with
respect to the new Marketplace if, within 30 days of receiving the New Market
Notice, CFLP or another Cantor Party notifies the eSpeed Party that it wishes to
provide such Cantor Services with respect to the new Marketplace. The eSpeed
Party shall review and negotiate the offer of CFLP or the other CFLP Party in
good faith, but may accept or reject in its reasonable discretion. If the eSpeed
Party accepts a Cantor Party's negotiated terms of proposed offer to provide
Cantor Services, then the Marketplace shall be a Collaborative Marketplace and
the operation thereof shall be subject to Section 3 of this Agreement on such
terms as the applicable Cantor Party and the eSpeed Party shall agree. If the
eSpeed Party rejects the Cantor Party's negotiated terms of proposed offer to
provide Cantor Services, then (i) the Marketplace shall not be a Collaborative
Marketplace and (ii) the eSpeed Party may create and operate the Marketplace in
any manner that the eSpeed Party deems to be acceptable.
(f) No eSpeed Party shall, directly, indirectly or in
connection with a third Person, engage in any activities competitive with a
business activity now or hereafter conducted by a Cantor Party or provide or
assist any other Person in providing any Cantor Service, other than (i) in
collaboration with a Cantor Party pursuant to Section 3 of this Agreement, (ii)
with respect to a new Marketplace involving a Financial Product, after CFLP (x)
has indicated that it is unable or unwilling to provide such Cantor Service or
(y) fails to indicate to the eSpeed Party within the prescribed 30-day period
that it does wish to provide such Cantor Service with respect to that
Marketplace in accordance with paragraph (d) of this Section 7, (iii) with
respect to a new Marketplace involving a Product that is not a Financial Product
in accordance with paragraph (c) or paragraph (e) of this Section 7 or (iv) with
respect to an Unrelated Dealer Business in which an eSpeed Party develops and
operates a fully electronic Marketplace.
(g) No Cantor Party shall, directly, indirectly or in
connection with a third Person, provide or assist any other Person in providing
Electronic Brokerage Services, other than (i) in collaboration with eSpeed
pursuant to Section 3 of this Agreement, (ii) with respect to a new
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Marketplace, after eSpeed (x) has indicated that it is unable to develop and put
into operation an Electronic Trading System with respect to that new Marketplace
in accordance with paragraph (a) of this Section 7 or (y) has declined to
exercise its right of first refusal or is unable to develop and put into
operation an Electronic Trading System with respect to that new Marketplace in
accordance with paragraph (b) of this Section 7, including, without limitation,
the time period specified therein, or (iii) with respect to an Unrelated Dealer
Business.
(h) Notwithstanding the foregoing and anything to the contrary
in this Section 7, the Unrelated Dealer Businesses are expressly excluded from
eSpeed's rights of first refusal under paragraph (b) and the conduct by any
Cantor Party of any of the Unrelated Dealer Businesses shall not be deemed to be
a violation of this Section 7.
(i) The Cantor Parties and the eSpeed Parties shall be
entitled to and may enter into strategic alliances, joint ventures, partnerships
or similar arrangements with Persons and consummate Business Combinations
("Alliance Opportunities") with Persons on the following basis only. If an
Alliance Opportunity (i) relates to a Person that directly or indirectly
provides Cantor Services and engages in business operations that do not
involve Electronic Brokerage Services, then any Cantor Party shall be entitled
to consummate a transaction with respect to such an Alliance Opportunity, (ii)
relates to a Person that directly or indirectly provides Electronic Brokerage
Services and engages in business operations that do not involve any Cantor
Service, then any eSpeed Party shall be entitled to consummate a transaction
with respect to such an Alliance Opportunity and (iii) is an Alliance
Opportunity with respect to a Person other than those described in clauses (i)
and (ii) above, then the Cantor Parties and the eSpeed Parties shall cooperate
to jointly pursue and consummate a transaction with respect to such Alliance
Opportunity on mutually agreeable terms. For purposes of this paragraph, a
"Business Combination" shall mean, with respect to any Person, a transaction
initiated by and/or in which a Cantor Party or an eSpeed Party is the acquiror
involving (i) a merger, consolidation, amalgamation or combination, (ii) any
sale, dividend, split or other disposition of any capital stock or other equity
interests (or securities convertible into or exchangeable for or options or
warrants to purchase any capital stock or other equity equivalents) of the
Person, (iii) any tender offer (including without limitation a self-tender),
exchange offer, recapitalization, liquidation, dissolution or similar
transaction, (iv) any sale, dividend or other disposition of a significant
portion of the assets and properties of the Person (even if less than all or
substantially all of such assets or properties), and (v) entering into of any
agreement or understanding, or the granting of any rights or options, with
respect to any of the foregoing.
8. Exclusive Patent License.
Subject to the following sentence, CFLP hereby grants to
eSpeed an exclusive, perpetual, irrevocable, worldwide, royalty-free right and
license, with the right to sublicense to its subsidiaries and affiliates, under
all patents and patent applications of CFLP related to Electronic Marketplaces,
now known and existing, including all provisionals, divisionals, continuations,
continuations-in-part, reissues and extensions derived therefrom, as well as all
foreign patents and patent applications now known or pending and other
counterparts thereof (the "Patent Rights"). The Cantor Parties agree to take all
commercially reasonable actions requested by the eSpeed Parties, at the sole
expense of the eSpeed Parties, to cause the Patent Rights to remain in full
force and effect to the extent permitted by law. In the event that eSpeed (x)
has indicated that it is unable to develop and put
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into operation an Electronic Trading System with respect to a new Marketplace in
accordance with paragraph (a) of Section 7 or (y) has declined to exercise its
right of first refusal with respect to a new Marketplace in accordance with
paragraph (b) of Section 7, then the Cantor Parties shall have a limited right
to use the Patent Rights solely in connection with the operation of that new
Marketplace. The Cantor Parties shall cooperate with eSpeed, at eSpeed's sole
expense, in any attempt by eSpeed to prevent or otherwise seek remedies or
damages which, in any case, shall inure to eSpeed for any third party
infringement of the Patent Rights that are the subject of the license granted to
eSpeed pursuant to this Section 8 or to defend against any third party claim
relating to the Patent Rights.
9. Indemnification.
(a) CFLP's Indemnification Obligations. Subject to the terms
and conditions of this Section 9, CFLP agrees to defend, indemnify and hold
eSpeed, the other eSpeed Parties and their respective officers, directors,
affiliates, agents, attorneys, employees and representatives harmless from and
against any and all liabilities, losses, costs, damages, expenses, penalties,
fines and taxes, including, without limitation, reasonable legal and other
expenses (collectively, "Damages"), directly or indirectly arising out of,
resulting from or relating to:
(i) any breach of any covenant, agreement or
obligation of any Cantor Party contained in this Agreement; and
(ii) any liability resulting from CFLP broker errors
and errors arising in connection with the provision by any Cantor Party
of Clearance, Settlement and Fulfillment Services.
(b) eSpeed's Indemnification Obligations. Subject to the terms
and conditions of this Section 9, eSpeed agrees to defend, indemnify and hold
CFLP, the other Cantor Parties and their respective officers, directors,
affiliates, agents, attorneys, employees and representatives harmless from and
against any and all Damages directly or indirectly arising out of, resulting
from or relating to:
(i) any breach of any covenant, agreement or
obligation of any eSpeed Party contained in this Agreement;
(ii) any liability resulting from failures of
eSpeed's technology and errors caused by the technology of the
Electronic Marketplaces; and
(iii) any liability resulting from any claims
asserted against Cantor with respect to an eSpeed Party's exercise of
its Patent Rights.
(c) Claims for Indemnification; Defense of Indemnified Claims.
For purposes of this Section, the party entitled to indemnification shall be
referred to as the "Indemnified Party" and the party required to indemnify shall
be referred to as the "Indemnifying Party." In the event that the Indemnifying
Party shall be obligated to the Indemnified Party pursuant to this Section 9 or
in the event that a suit, action, investigation, claim or proceeding is begun,
made or instituted as a result of which the Indemnifying Party may become
obligated to the Indemnified Party hereunder, the
13
Indemnified Party shall give prompt written notice to the Indemnifying Party of
the occurrence of such event, specifying the basis for such claim or demand, and
the amount or estimated amount thereof to the extent then determinable (which
estimate shall not be conclusive of the final amount of such claim or demand);
provided, however, that the failure to give such notice shall not constitute a
waiver of the right to indemnification hereunder unless the Indemnifying Party
is actually prejudiced in a material respect thereby. The Indemnifying Party
agrees to defend, contest or otherwise protect the Indemnified Party against any
such suit, action, investigation, claim or proceeding at the Indemnifying
Party's own cost and expense with counsel of its own choice, who shall be,
however, reasonably acceptable to the Indemnified Party. The Indemnifying Party
may not make any compromise or settlement without the prior written consent of
the Indemnified Party (which will not be unreasonably withheld or delayed) and
the Indemnified Party shall receive a full and unconditional release reasonably
satisfactory to it pursuant to such compromise or settlement. The Indemnified
Party shall have the right but not the obligation to participate at its own
expense in the defense thereof by counsel of its own choice. If requested by the
Indemnifying Party, the Indemnified Party shall (at the Indemnifying Party's
expense) (i) cooperate with the Indemnifying Party and its counsel in contesting
any claim or demand which the Indemnifying Party defends, (ii) provide the
Indemnifying Party with reasonable access during normal business hours to its
books and records to the extent they relate to the condition or operation of a
Marketplace and are requested by the Indemnifying Party to perform its
indemnification obligations hereunder, and to make copies of such books and
records, and (iii) make personnel available to assist in locating any books and
records relating to a Marketplace or whose assistance, participation or
testimony is reasonably required in anticipation of, preparation for or the
prosecution and defense of, any claim subject to this Section 9. In the event
that the Indemnifying Party fails timely to defend, contest or otherwise protect
the Indemnified Party against any such suit, action, investigation, claim or
proceeding, the Indemnified Party shall have the right to defend, contest or
otherwise protect the Indemnified Party against the same and may make any
compromise or settlement thereof and recover the entire cost thereof from the
Indemnifying Party, including, without limitation, reasonable attorneys' fees,
disbursements and all amounts paid as a result of such suit, action,
investigation, claim or proceeding or compromise or settlement thereof.
(d) Payments; Non-Exclusivity. Any amounts due an Indemnified
Party under this Section 9 shall be due and payable by the Indemnifying Party
within fifteen (15) business days after (x) in the case of a claim which does
not involve any third party, receipt of written demand therefor and (y) in the
case of a claim which involves a third party, the final disposition of such
claim or demand, provided that reasonable legal and other out-of-pocket costs
and expenses are reimbursed currently within 15 business days after demand
therefor. The remedies conferred in this Section 9 are intended to be without
prejudice to any other rights or remedies available at law or equity to the
Indemnified Parties, now or hereafter.
10. Relationship of the Parties. The relationship of the Cantor Parties
on the one hand and the eSpeed Parties on the other hand is that of independent
contractors. Pursuant to this Agreement, the Cantor Parties and the eSpeed
Parties intend to render separate but related services to customers and to
divide certain of the revenues arising from those services, but the parties do
not intend to share profits or losses or to enter into or create any
partnership, and no partnership or other like arrangement shall be deemed to be
created hereby. None of the Cantor Parties or eSpeed Parties shall have any
claim against the others or right of contribution with respect to any uninsured
loss incurred by any of them nor shall any of them have a claim or right against
the others with respect to
14
any loss that is deemed to be included within the deductible, retention or
self-insured portion of any insured risk.
11. Audit. eSpeed may request a review, by those certified public
accountants who examine CFLP's books and records, of CFLP's allocation of
Transaction Revenues to eSpeed to determine whether such allocation was based
upon the procedures set forth herein. Such a review is to be conducted at
eSpeed's expense. CFLP may request a review, by those certified public
accountants who examine eSpeed's books and records, of eSpeed's allocation of
Transaction Revenues to CFLP to determine whether such allocation was based upon
the procedures set forth herein. Such a review is to be conducted at CFLP's
expense.
12. Invoicing and Billing; Payment of Service Fees. Each of eSpeed and
CFLP shall pay to the other, within 30 days of the end of each calendar month,
the amounts due and received to the Cantor Parties or the eSpeed Parties, as the
case may be (determined in the manner provided in Section 4 of this Agreement),
during that calendar month. eSpeed shall invoice CFLP for charges for Ancillary
IT Services provided pursuant hereto on a monthly basis as incurred, such
invoices to be delivered to CFLP by eSpeed within 15 days after the end of each
calendar month. CFLP shall pay to eSpeed the aggregate charge for Ancillary IT
Services provided under this Agreement in arrears within 30 days after the end
of each calendar month. Amounts due by one party to another under this Agreement
shall be settled against amounts due by the second party to the first under this
or any other agreement. All payments to be made pursuant to this Agreement shall
be exclusive of United Kingdom Value Added Tax which, if applicable to any
payments hereunder, shall be added to the amount of, and be paid in addition to,
such payments.
13. Documentation. All Transaction Revenues, service fees, fees for
Ancillary IT services and other benefits hereunder shall be substantiated by and
payments thereof shall be preceded or accompanied by, as applicable, appropriate
schedules, invoices or other documentation.
14. Force Majeure. Any failure or omission by a party in the
performance of any obligation under this Agreement shall not be deemed a breach
of this Agreement or create any liability if the same arises from any cause or
causes beyond the control of such party, including, but not limited to, the
following, which, for purposes of this Agreement shall be regarded as beyond the
control of each of the parties hereto: acts of God, fire, storm, flood,
earthquake, governmental regulation or direction, acts of the public enemy, war,
rebellion, insurrection, riot, invasion, strike or lockout; provided, however,
that such party shall resume the performance whenever such causes are removed.
15. Post-Termination Payments. Notwithstanding any provision herein to
the contrary, all payment obligations hereof shall survive the happening of any
termination of this Agreement until all amounts due hereunder have been paid.
16. Confidentiality.
(a) CFLP and its affiliates agree to treat as confidential and
not to disclose to any person (other than to CFLP employees who have a need to
know the same for purposes of CFLP's performing its obligations hereunder) or
use the same for its own benefit or for any purpose other than performing its
obligations hereunder, all confidential or proprietary information, trade
secrets,
15
information related to, and all subject matter covered by, any pending patent
applications, data, plans, strategies, projections, budgets, reports, research,
financial information, files, reports, software, agreements and other materials
and information (individually and collectively, "Confidential Information") it
receives, obtains or learns about eSpeed and its affiliates, an Electronic
Marketplace or any other program, service, software or system eSpeed and/or CFLP
develops in connection with this Agreement. CFLP shall notify those of its
employees who perform services for eSpeed and its affiliates of this covenant
and shall, to the extent practical, secure their agreement to abide by its
terms.
(b) eSpeed and its affiliates agree, during the term of this
Agreement, to treat as confidential and not to disclose to any person (other
than to eSpeed employees who have a need to know the same for purposes of
eSpeed's performing its obligations hereunder) or use the same for its own
benefit or for any purpose other than performing its obligations hereunder, all
Confidential Information it receives, obtains or learns about CFLP and its
affiliates or any other program, service, software or system CFLP and/or eSpeed
develops in connection with this Agreement. eSpeed shall notify those of its
employees who perform services under this Agreement of this covenant and shall,
to the extent practical, secure their agreement to abide by its terms.
(c) Notwithstanding the foregoing, neither party shall be
obligated with respect to confidential or proprietary information that it can
document: (i) is or has become readily publicly available through no fault of
its own or that of its affiliates, employees or agents; or (ii) is received from
a third party lawfully in possession of such information and lawfully empowered
to freely disclose such information to it; or (iii) was lawfully in its
possession, without restriction, after the date hereof.
17. Miscellaneous.
(a) This Agreement and all the covenants herein contained
shall be binding upon the parties hereto, their respective heirs, successors,
legal representatives and assigns. No party shall have the right to assign all
or any portion of its rights, obligations or interests in this Agreement or any
monies which may be due pursuant hereto without the prior written consent of the
other affected parties and which consent may not be unreasonably withheld.
(b) No waiver by any party hereto of any of its rights under
this Agreement shall be effective unless in writing and signed by an officer of
the party waiving such right. No waiver of any breach of this Agreement shall
constitute a waiver of any subsequent breach, whether or not of the same nature.
This Agreement may not be modified except by a writing signed by officers of
each of the parties hereto; provided, however, that each amendment, modification
and/or waiver hereof or hereunder must be approved by a majority of the outside
directors of eSpeed or the applicable eSpeed Party. For purposes of this
Agreement, an outside director shall mean a director who is not an employee,
partner or affiliate (other than solely by reason of being an eSpeed director)
of eSpeed, CFLP or any of their respective affiliates.
(c) This Agreement constitutes the entire Agreement of the
parties with respect to the services and benefits described herein, and cancels
and supersedes any and all prior written or oral contracts or negotiations
between the parties with respect to the subject matter hereof.
16
(d) This Agreement shall be strictly construed as independent
from any other agreement or relationship between the parties.
(e) This Agreement is made pursuant to and shall be governed
and construed in accordance with the laws of the State of New York, without
regard to the principles of conflict of laws thereof.
(f) The descriptive headings of the several sections hereof
are inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
(g) Any notice, request or other communication required or
permitted in this Agreement shall be in writing and shall be sufficiently given
if personally delivered or if sent by registered or certified mail, postage
prepaid, addressed as follows:
(i) If to a Cantor Party:
--------------------
Xxx Xxxxx Xxxxx Xxxxxx, 000xx Xxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
(ii) If to an eSpeed Party:
---------------------
Xxx Xxxxx Xxxxx Xxxxxx, 000xx Xxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
The address of any party hereto may be changed on notice to
the other parties hereto duly served in accordance with the foregoing
provisions.
[Signature Pages to Follow]
IN WITNESS WHEREOF, the parties hereto have executed or caused this
Joint Services Agreement to be executed in their respective names by their
respective officers thereunto duly authorized, as of the date first written
above.
CANTOR XXXXXXXXXX, X.X.
By: CF Group Management, Inc.,
its Managing General Partner
By:
-----------------------------------
Name:
Title:
CANTOR XXXXXXXXXX SECURITIES
By: Cantor Xxxxxxxxxx, X.X.
its Managing General Partner
By: CF Group Management, Inc.
its Managing General Partner
By:
-----------------------------------
Name:
Title:
CANTOR XXXXXXXXXX & CO.
By: Cantor Xxxxxxxxxx Securities
its Managing General Partner
By: Cantor Xxxxxxxxxx, X.X.
its Managing General Partner
By: CF Group Management, Inc.
its Managing General Partner
By:
-----------------------------------
Name:
Title:
CANTOR XXXXXXXXXX PARTNERS
By: Cantor Xxxxxxxxxx Securities
its Managing General Partner
By: Cantor Xxxxxxxxxx, X.X.
its Managing General Partner
By: CF Group Management, Inc.
its Managing General Partner
By:
-----------------------------------
Name:
Title:
CANTOR XXXXXXXXXX INTERNATIONAL
By:
-----------------------------------
Name:
Title:
CANTOR XXXXXXXXXX GILTS
By:
-----------------------------------
Name:
Title:
eSPEED, INC.
By:
-----------------------------------
Name:
Title:
eSPEED SECURITIES, INC.
By:
-----------------------------------
Name:
Title:
eSPEED GOVERNMENT SECURITIES, INC.
By:
-----------------------------------
Name:
Title:
eSPEED MARKETS, INC.
By:
-----------------------------------
Name:
Title:
eSPEED INTERNATIONAL, LIMITED
By:
-----------------------------------
Name:
Title:
ANNEX A
o U.S. Government Securities
o United Kingdom and European Government Bonds
o Eurobonds
o Corporate Bonds
o U.S. Agency Securities
o Emerging Market Government Bonds and Emerging Market Eurobonds
o Global Repurchase Agreements and Reverse Repurchase Agreements (U.S.,
Europe and Emerging Market Countries)
o U.S. Municipal Bonds
o U.S. Treasury Futures