XX0X.XXX/XXXXXX SERVICES AGREEMENT
THIS SERVICES AGREEMENT (this "Agreement") is made and entered into as of
October 1, 2002, by and between eSpeed, Inc., a Delaware corporation ("eSpeed"),
and XX0x.xxx, LLC, a Delaware limited liability company ("XX0x.xxx"). All
capitalized terms used in this Agreement and not otherwise defined herein shall
have the meanings ascribed to such terms in Section 1 of this Agreement. eSpeed
and XX0x.xxx are each referred to herein as a "Party" and collectively as the
"Parties."
WITNESSETH
WHEREAS, XX0x.xxx intends to engage, inter alia, in the business of
sponsoring an Electronic Trading System, which may be accessed directly through
fully electronic means or through brokers via telephone, in and through which
buyers and sellers of GHG Emission Reduction Units may effect transactions in
those GHG Emission Reduction Units; and
WHEREAS, eSpeed wishes to provide to XX0x.xxx, and XX0x.xxx wishes to
receive from eSpeed: (A) the development, launch, maintenance, refreshment and
enhancement of the global technology infrastructure for the transactional
elements of the Electronic Trading System; and (B) Additional IT Services
pursuant to the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises contained herein, the
Parties hereby mutually agree as follows:
1. DEFINITIONS. For purposes of this Agreement the following capitalized
terms shall have the following meanings.
1.1 "ADDITIONAL E-COMMERCE SERVICES" means services, other than those
listed in the next sentence, using technology developed and/or provided by
eSpeed. Additional E-Commerce Services do not include Wholly Electronic eSpeed
Transaction Services, Broker Assisted Transaction Services, Information
Services, Private Label Systems, Additional IT Services or Web Portal
Transactions.
1.2 "ADDITIONAL E-COMMERCE SERVICES REVENUES" means the fees,
commissions, spreads, markups, charges or other similar amounts received by
XX0x.xxx in connection with Additional E-Commerce Services.
1.3 "ADDITIONAL IT SERVICES" means technology support services for
XX0x.xxx not directly related to the operation of the Electronic Trading System,
including, but not limited to: (A) systems administration and maintenance; (B)
internal network support; (C) support, maintenance, procurement and refreshment
for desktops of end-user equipment; and (D) voice and data communications.
1.4 "AFFILIATE" of any specified party shall mean any other person or
entity directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified party or such specified party's
parent. For the purposes of this definition, "control", when used with respect
to any specified person or entity, means the power to direct the management and
policies of such person or entity, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have the meanings correlative to the foregoing.
1.5 "BROKER ASSISTED TRANSACTION SERVICES" means the effecting of
transactions involving GHG Emission Reduction Units in or through a XX0x.xxx
Broker, including Web Portal Transactions and the entry of an order by a
XX0x.xxx Broker into the Electronic Trading System.
1.6 "BROKER ASSISTED TRANSACTION SERVICES REVENUES" means the revenues
received by XX0x.xxx in connection with Broker Assisted Transaction Services,
less any Government Taxes actually paid by XX0x.xxx, but increased by any
rebates or refunds received by XX0x.xxx in respect of such Government Taxes.
1.7 "XX0X.XXX BROKER" means an officer, director, agent, employee,
service provider or representative of XX0x.xxx or its Affiliates or
subsidiaries.
1.8 "XX0X.XXX SERVICES" means the sponsoring of the Electronic Trading
System and the provision (with the systems and technology support provided, or
otherwise arranged, by eSpeed as contemplated hereby) of any one of, or any
combination of, Broker Assisted Transaction Services, Clearance, Settlement and
Fulfillment Services; Information Services; Additional E-Commerce Services; and
Related Services.
1.9 "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 in compliance with applicable regulatory
requirements, a purchase and sale of a particular GHG Emission Reduction Unit,
including, but not limited to, collection of money; arrangement of delivery of
GHG Emission Reduction Units; receipt, delivery and maintenance of margin and
collateral, if appropriate, dealing with issues relating to failures to receive
or deliver payments or GHG Emission Reduction Units; and collection and payment
of transfer or similar taxes, to the extent applicable to such GHG Emission
Reduction Unit. 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 GHG Emission Reduction Unit.
1.10 "CONVENTION" means the United Nations Framework Convention on
Climate Change.
1.11 "DAMAGES" shall have the meaning ascribed to it in Section 7.1.
1.12 "ELECTRONIC ESPEED TRANSACTION SERVICES" means the effecting of
transactions (other than Broker Assisted Transactions) involving a GHG Emission
Reduction Unit in, on or through the Electronic Trading System. Electronic
eSpeed Transaction Services do not include Clearance, Settlement and Fulfillment
Services; Information Services (if any); Additional E-Commerce Services;
Additional IT Services; Web Portal Transactions; or Related Services.
1.13 "ELECTRONIC TRADING SYSTEM" means the hardware, software, network
infrastructure and other similar assets that are necessary or otherwise used to
effect transactions on or through the electronic marketplace sponsored by
XX0x.xxx, utilizing technology developed and provided by eSpeed, on or through
which wholesale transactions in, and
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purchases and sales of, GHG Emission Reduction Units, may be effected in whole
or in part electronically.
1.14 "FORCE MAJEURE" shall have the meaning ascribed to it in
Section 12.
1.15 "GHG EMISSIONS" means carbon dioxide, methane, nitrous oxide,
hydrofluorocarbons, perflurocarbons and any other gas substance that is the
subject of the Convention and related protocols, treaties, agreements and
instruments, or other gases, tradable renewable energy instruments, and other
tradable environmental instruments subject to domestic, regional, or
international regulation.
1.16 "GHG EMISSION REDUCTIONS" means a reduction in GHG Emissions.
1.17 "GHG EMISSION REDUCTION UNITS" means all rights, benefits, title
and interest related, in whole or in part, to GHG Emission Reductions, or
derivatives thereof, including futures contracts and options on futures
contracts involving GHG Emission Reduction Units, whether in existence as of the
date of this Agreement or arising in the future, without limitation:
1.17.1 any credit issued or granted by a Government Agency in
connection with GHG Emission Reductions;
1.17.2 any tradable allowance or allocated pollution right issued or
granted in connection with GHG Emission Reductions;
1.17.3 the sole right to claim credit in any reporting program
established or maintained by any Government Agency for creation of GHG Emission
Reductions;
1.17.4 the sole right to bank GHG Emission Reductions in any
registry system established or maintained by any Government Agency or
non-governmental organization or entity (a "GHG Emission Reductions Registry");
1.17.5 the sole right to any form of acknowledgment by a
Governmental Agency that actions have been taken by a party or parties in
connection with GHG Emission Reductions that result in the reduction, avoidance,
sequestration or mitigation of GHG Emissions;
1.17.6 the sole right to use GHG Emission Reductions;
1.17.7 the sole right to any form of acknowledgment by a Government
Agency to claim reduction from an emissions baseline when that baseline can be
used for establishing a tradable GHG Emission allowance allocation, and that
beneficial ownership in this reduction, avoidance, sequestration or mitigation
or related tradable allowances can be;
1.17.8 banked for credit in the event of regulation requiring a
party to reduce, avoid, compensate for or otherwise mitigate GHG Emissions;
1.17.9 claimed by a party for credit against that party's compliance
requirement;
1.17.10 put to any other sanctioned use; or
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1.17.11 transferred to another party for any reason;
1.17.12 the sole right to any form of acknowledgment by an
International Agency in respect of GHG Emission Reductions including that the
GHG Emission Reductions constitute tradable emissions reduction units; and
1.17.13 the sole right to any offset of anthropogenic GHG Emissions
caused wholly or in part by the GHG Emission Reductions.
1.18 "GOVERNMENT AGENCY" means any national, international, federal,
provincial, state, municipal, county, regional or local government or authority,
and includes:
1.18.1 any department, commission, bureau, board, administrative
agency or regulatory body of any government;
1.18.2 an International Agency;
1.18.3 any person or corporation acting as a Registrar in connection
with a GHG Emission Reductions Registry; or
1.18.4 any person or corporation acting as an agent for a
Governmental Agency.
1.19 "GOVERNMENT TAX" means the imposition of a special tax or
surcharge by a Government Agency on the trading of GHG Emissions Reduction
Units.
1.20 "GOVERNING LAW" shall have the meaning ascribed to it in
Section 14.7.
1.21 "HOSTING SERVICES" means services provided by eSpeed to XX0x.xxx
in the development, support and maintenance of XX0x.xxx's affiliated web portal.
1.22 "INDEMNIFIED PARTY" shall have the meaning ascribed to it in
Section 7.3.
1.23 "INDEMNIFYING PARTY" shall have the meaning ascribed to it in
Section 7.3.
1.24 "INFORMATION" means information relating to bids, offers or
trades, or any other content, data or market information, that is input into,
created by or otherwise resides on the Electronic Trading System.
1.25 "INFORMATION SERVICES" means the sale, license or other provision
of Information to a Person with respect to the Electronic Trading System as a
separate service not in connection with transactions by such Person on or
through the Electronic Trading System.
1.26 "INFORMATION SERVICES REVENUES" means the revenues received by
XX0x.xxx in connection with the sale of Information Services.
1.27 "INTELLECTUAL PROPERTY" means all patents, trademarks, trade
secrets, service marks, trade names, labels, slogans, copyrights, drawings,
designs, software, code, inventions, processes, procedures, research records,
market surveys, and know-how, show-how and other intellectual property rights of
the Person.
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1.28 "INTERNATIONAL AGENCY" means any international commission, bureau,
board, administrative agency or regulatory body responsible for measures to
achieve objectives of the Convention.
1.29 "LOSS EVENT" shall have the meaning ascribed to it in Section 4.2.
1.30 "MATERIAL ADVERSE EFFECT" shall have the meaning ascribed to it in
Section 6.3.
1.31 "NEW PRODUCTS" means any products that are not GHG Emission
Reduction Unit, but which pursuant to the provisions of Section 3.3 the Parties
agree will be treated as a GHG Emission Reduction Unit for purposes of this
Agreement.
1.32 "PERSON" means any individual, corporation, general or limited
partnership, limited liability company, joint venture, estate, trust,
association, organization or other entity or governmental or regulatory
authority or agency.
1.33 "PRICING DECISIONS" means the markups, markdowns, rates and
schedules of commissions for Wholly Electronic eSpeed Transaction Services,
Broker Assisted Transaction Services, Additional E-Commerce Services and
Information Services discussed in Section 4.1(D)(iii), including any variation
thereof, by way of rebate, discount or otherwise.
1.34 "PRIVATE LABEL SYSTEM" means the sale, license or other provision
of eSpeed's Intellectual Property or Electronic Trading System for use by a
person (other than eSpeed, XX0x.xxx or their Affiliates) for any purpose.
1.35 "PRIVATE LABEL SYSTEM REVENUES" means the revenues received in
connection with the sale of a Private Label System.
1.36 "PRODUCT DECISIONS" means: (A) the definition of the GHG Emission
Reduction Units; and (B) the rules relating to the mechanics of trading GHG
Emission Reduction Units, and associated trading issues.
1.37 "PROPRIETARY INFORMATION" means any and all non-public information
of a Person, whether in the form of, documents, software, reports, data,
records, forms, or otherwise, including information relating to its market
participants, trading information, financial data, statistical data, strategic
business plans, services (or other proprietary data), pricing or pricing
strategies, site usage, buyer and seller lists, buyer and seller information,
information relating to governmental relations, discoveries, practices,
processes, methods, trade secrets, marketing plans, technology, source codes,
proprietary know-how, and other non-public confidential information of the
Person or its Affiliates, customers, clients or suppliers that, in any case, is
created, developed or discovered by and/or for a Person, or is acquired by a
Person from others.
1.38 "PROVIDING PARTY" shall have the meaning ascribed to it in
Section 13.1.
1.39 "RECEIVING PARTY" shall have the meaning ascribed to it in
Section 13.1.
1.40 "RELATED SERVICES" means: (A) credit and risk management services;
(B) services related to sales positioning of GHG Emission Reduction Units; (C)
oversight of customer
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suitability and regulatory compliance; and (D) such other services customary to
brokerage operations.
1.41 "TRADING SIMULATION" means a fictional representation of existing,
potential, or hypothetical GHG Emission Reduction Unit market(s) for use as an
instructional, training, planning, or policy development tool to assist
prospective market participants, developers, or policy makers to understand how
GHG Emission Reduction Unit markets may operate.
1.42 "TRANSACTION REVENUES" means, collectively, Wholly Electronic
eSpeed Transaction Services Revenues, Broker Assisted Transaction Services
Revenues, Additional E-Commerce Services Revenues, Information Services
Revenues, and other revenues, fees, commissions, spreads, markups, charges or
similar amounts received, by eSpeed or XX0x.xxx in connection with effecting
transactions on or through the Electronic Trading System.
1.43 "WEB PORTAL TRANSACTION" means any transaction involving GHG
Emission Reduction Units or New Products which are not represented on the
Electronic Trading System but are represented on XX0x.xxx's affiliated web
portal.
1.44 "WHOLLY ELECTRONIC ESPEED TRANSACTION" means any Electronic eSpeed
Transaction Service that is not a Broker Assisted Transaction.
1.45 "WHOLLY ELECTRONIC ESPEED TRANSACTION SERVICES REVENUES" means the
fees, commissions, spreads, markups, charges or other similar amounts received
by XX0x.xxx or eSpeed from a customer, directly or indirectly, in connection
with Electronic eSpeed Transaction Services, less any Government Taxes actually
paid by XX0x.xxx or eSpeed, but increased by any rebates or refunds received by
XX0x.xxx or eSpeed in respect of such Government Taxes.
2. TERM. The term of this Agreement shall commence as of the date hereof and
other than those provisions which by their express terms are terminable shall be
perpetual (the "Term"). This Agreement, other than those provisions which
expressly provide for termination, may not be terminated for any reason, except
by the mutual agreement, in writing, of XX0x.xxx and eSpeed. The Parties hereby
acknowledge that it is the express intent of each of the Parties hereto that the
contractual obligations provided for herein shall be perpetual.
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3. SERVICES AND RIGHTS TO INFORMATION.
3.1 eSPEED SERVICES.
3.1.1 eSpeed shall: (A) develop, own, operate and maintain the
Electronic Trading System and other technology associated therewith and
shall pay for and maintain control and ownership over all such technology
and eSpeed's Intellectual Property and Proprietary Information related
thereto; (B) be responsible for the provision of Electronic eSpeed
Transaction Services to XX0x.xxx's customers; (C) provide Hosting Services
to an affiliated web portal for XX0x.xxx; (D) provide, otherwise arrange
for another entity or entities to provide, Additional IT Services to
XX0x.xxx and the Electronic Trading System; (E) except to the extent eSpeed
declines to provide Additional E-Commerce Services, be responsible for
providing, or otherwise arrange for another entity or entities to provide,
Additional E-Commerce Services to XX0x.xxx and the Electronic Trading
System; (F) subject to Sections 3.3 and 3.4 below, have reasonable
discretion as to the manner and means of operating the Electronic Trading
System and providing Electronic eSpeed Transaction Services to XX0x.xxx's
customers and brokers in connection therewith; (G) help develop, maintain
and host Trading Simulations; and (H) for the avoidance of doubt, pay for
and provide to XX0x.xxx those services indicated on Schedule A as being
provided by eSpeed.
3.1.2 eSpeed shall provide XX0x.xxx with services at the same level
as are provided by eSpeed to any other client or customer of eSpeed that
utilizes the same hardware, software, network infrastructure and other
similar assets that are utilized for the Electronic Trading System. In
addition, at such time as GHG Emission Reduction Units are traded on the
Electronic Trading System the Parties shall agree to appropriate
qualitative service levels.
3.2 XX0X.XXX SERVICES. XX0x.xxx shall: (A) be responsible for the
provision of the Clearance, Settlement and Fulfillment Services and the Related
Services as well as those portions of the Broker Assisted Transaction Services
and Information Services not provided by eSpeed; (B) except as provided below
with respect to Product Decisions and Pricing Decisions, have reasonable
discretion as to the manner and means of providing the XX0x.xxx Services; (C)
maintain its books and records; (D) retain all rights to data and information
relating to its marketplace activities and (E) for the avoidance of doubt, pay
for and provide at its own cost and expense those services indicated on Schedule
A as being provided by XX0x.xxx. In that regard, XX0x.xxx will be the broker for
all transactions in the matching systems and, in conjunction with eSpeed
pursuant to Section 3.3, will determine the various non-discretionary parameters
under which transactions match in the Electronic Trading System.
3.3 PRODUCT DECISIONS. Any Product Decision shall be made jointly by
eSpeed and XX0x.xxx within 30 days. If the Parties are unable to agree on a
particular Product Decision after good faith efforts to do so, then the final
Product Decision shall be made by XX0x.xxx. Notwithstanding the foregoing, the
definition and introduction of New Products shall require the prior written
consent of eSpeed and XX0x.xxx.
3.4 PRICING DECISIONS. Any Pricing Decision shall be made jointly by
eSpeed and XX0x.xxx; provided, however, after the initial Pricing Decisions are
made, XX0x.xxx may increase or decrease the initial commission rates and data
pricing by 10% (provided, however,
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that in the event that, and for so long as, eSpeed is providing market hosting
services to a third party that is a competitor of XX0x.xxx with respect to the
trading of GHG Emissions Reduction Units XX0x.xxx may increase or decrease such
rates and pricing by 40%). Notwithstanding the foregoing, XX0x.xxx shall have
the right to decrease such commission rate and data pricing by greater than 40%
to a level equal to the rates and pricing charged by such competitor (or by any
Affiliate of eSpeed that is a competitor of XX0x.xxx with respect to the trading
of GHG Emissions Reduction Units.)
3.5 JOINT COOPERATION. Without limiting the authority of the Parties in
their respective areas of responsibility pursuant to Sections 3.1, 3.2, 3.3 and
3.4 above, the Parties recognize the importance of providing integrated and
seamless service to XX0x.xxx's 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. Each Party agrees to comply in all
material respects with all applicable laws, rates and regulations and each Party
shall cooperate with the other in all regulatory compliance matters and in
complying with applicable laws, rules and regulations.
3.6 RIGHTS TO INFORMATION. All Information shall be deemed Proprietary
Information of XX0x.xxx and its sole property, which may be licensed by
XX0x.xxx, in its discretion, to its customers solely for their internal use and
not for distribution thereof, except as expressly provided herein.
3.7 REVIEW OF SERVICE LEVELS; BASKET.
3.7.1 eSpeed and XX0x.xxx shall establish a Compliance Committee
(the "Compliance Committee") to be comprised of four members. eSpeed shall
designate, in its sole discretion, two members to the Compliance Committee,
and XX0x.xxx shall designate, in its sole discretion, two members to such
Compliance Committee (provided that XX0x.xxx's designees shall be full-time
employees of XX0x.xxx or of any of its wholly-owned subsidiaries, ultimate
parent entities or wholly-owned subsidiaries of any of its ultimate parent
entities). The act of a majority vote of the members of the Compliance
Committee shall be the act of the Compliance Committee. The Compliance
Committee shall meet promptly after notice is provided by XX0x.xxx to each
member of the Compliance Committee of eSpeed's failure to meet a service
level that are agreed to from time to time in accordance with Section 3.1.2
("Service Level") by giving notice at least seven days prior to the meeting
date. Any other meeting of the Compliance Committee may be called by any
member of the Compliance Committee by giving notice to all of the members
at least seven days prior to the meeting date. Members of the Compliance
Committee may participate in a meeting by means of telephone if all persons
participating in the meeting can hear each other at the same time. Written
minutes shall be kept of all meetings of the Compliance Committee.
3.7.2 In the event that (i) eSpeed has failed to meet a Service
Level (other than a failure resulting from force majeure) and (ii) such
failure, either individually or together with other Service Level failures,
is material to the operation of the Electronic Trading System (a "XX0x.xxx
Technology Request Event"), XX0x.xxx shall be entitled to direct eSpeed to
expend an amount reasonably commensurate with the Service Level failure
giving rise to such direction, up to an amount equal to 10% of the
Transaction Revenues
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received by XX0x.xxx in the aggregate, for the preceding 12 month period
(the "Basket"); provided, however, that at no time shall the Basket equal
an amount in excess of $10 million or equal an amount less than $1 million
for any and all Service Level failures during the Term of this Agreement on
technology upgrades to the Electronic Trading System. Any such expenditures
must be devoted to technology upgrades by eSpeed to the Electronic Trading
System designed to address such Service Level failure. If XX0x.xxx shall
have directed eSpeed to expend an amount from the Basket in order to
address the Service Level failure, the Compliance Committee shall
determine, by majority vote, the amount of funds which are appropriate for
expenditure to rectify a Service Level failure and the nature of the
technology upgrades that the funds are to be expended upon. The Compliance
Committee shall further direct and instruct the spending of such amounts
from the Basket, including the timing of such expenditures. The sole remedy
for an eSpeed Service Level failure or a XX0x.xxx Technology Request Event
shall be the ability of XX0x.xxx, as set forth above, to direct and
instruct the spending of amounts from the Basket.
3.7.3 In the event that the Compliance Committee cannot agree as to
eSpeed's performance of the Service Levels, the appropriate amount to be
withdrawn from the Basket, and/or the nature or timing of the upgrades on which
such amount is to be spent, as contemplated by subsection 3.7.2 above or on
performance standards or expenditures required by this section, then the
Compliance Committee shall submit such dispute to be resolved by binding
arbitration. If there is a dispute as to the appropriate amount to withdraw from
the Basket to correct a Service Level failure, then the Compliance Committee
shall submit such dispute to binding arbitration as set forth below, but eSpeed
shall nevertheless promptly spend the amount from the Basket which eSpeed deems
appropriate to address the Service Level failure pending arbitration with
respect to the balance which is under dispute.
(i) Conduct Of Arbitration, Authority Of The Arbitrators: Any such
arbitration shall be governed by the Federal Arbitration Act and
conducted in accordance with the Commercial Arbitration Rules of the
American Arbitration Association. The construction, and interpretation
of this Agreement, and all procedural aspects of the arbitration
conducted pursuant hereto shall be decided by the arbitrators. In
deciding the substance of the Parties' dispute, the arbitrators shall
refer to the Governing Law. It is agreed that the arbitrators shall
have no authority to award treble, exemplary or punitive damages of
any type under any circumstances whether or not such damages may be
available under state or federal law, or under the Federal Arbitration
Act, or under the Commercial Arbitration Rules of the American
Arbitration Association, and the Parties hereby waive their right, if
any, to recover any such damages.
(ii) Forum For Arbitration And Selection Of Arbitrators: The arbitration
proceeding shall be conducted in New York. Within 30 days of the
notice of initiation of the arbitration procedure, each Party shall
select one arbitrator. The two arbitrators shall each be a person who
has over eight years professional experience and who has not
previously been employed
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by either Party and does not have a direct or indirect interest in
either Party or the subject matter of the arbitration. The two
arbitrators shall select a third arbitrator. If the two arbitrators
can not agree upon a third arbitrator within thirty (30) days, then
the third arbitrator shall be selected in accordance with the
Commercial Arbitration Rules of the American Arbitration Association.
The costs of arbitration shall be divided equally and each Party shall
bear the costs of its own counsel fees with respect to such
arbitration.
(iii) Confidentiality: To the fullest extent permitted by law, any
arbitration proceeding and the arbitrators' award shall be
maintained in confidence by the Parties.
3.8 LOCATION OF SYSTEM OPERATIONS. The Parties understand and agree
that XX0x.xxx's system operations supported by eSpeed shall be conducted at a
location mutually agreed upon by eSpeed and XX0x.xxx.
4. SHARING AND ALLOCATION OF REVENUES; PAYMENT FOR CERTAIN SERVICES.
4.1 REVENUES AND PAYMENTS.
(A) WHOLLY ELECTRONIC ESPEED TRANSACTIONS. Subject to Section 4.1(H)
below, if a transaction is a Wholly Electronic eSpeed Transaction, then eSpeed
will be entitled to 100% of the Wholly Electronic eSpeed Transaction Services
Revenues and will pay to XX0x.xxx a fee of 50% of the Wholly Electronic eSpeed
Transaction Services Revenues for providing Clearance, Settlement and
Fulfillment Services; provided, however, that to the extent that exchange and
third party fees are incurred with respect to a Wholly Electronic eSpeed
Transaction, such fees shall be deducted from the determination of Wholly
Electronic eSpeed Transaction Services Revenues.
(B) BROKER ASSISTED TRANSACTION SERVICES. Subject to Section 4.1(H)
below, if a transaction is a Broker Assisted Transaction Services transaction,
then XX0x.xxx will be entitled to 100% of the Broker Assisted Transaction
Services Revenues and will pay to eSpeed a fee of (a) 15% of the Broker Assisted
Transaction Services Revenues for transactions entered into on or prior to
December 31, 2003 and (b) 20% of the Broker Assisted Transaction Services
Revenues for transactions entered into on or after January 1, 2004 for the
utilization of the Electronic Trading Systems in support of Broker Assisted
Transaction Services, as well as for Hosting Services and Additional IT
Services.
(C) ADDITIONAL E-COMMERCE SERVICES REVENUES. If a transaction is an
Additional E-Commerce Services transaction, then XX0x.xxx will be entitled to
100% of the Additional E-Commerce Services Revenues and, if eSpeed has provided
the Additional E-Commerce Services, will pay to eSpeed a fee of (a) 15% of the
Additional E-Commerce Services Revenues if the Additional E-Commerce Services
Transaction is entered into on or prior to December 31, 2002 and (b)) 20% of the
Additional E-Commerce Services Revenue if the Additional E-Commerce Services
Transaction is entered into on or after January 1, 2004 for the utilization of
the Electronic Trading System in support of Additional E-Commerce Services.
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(D) INFORMATION SERVICES REVENUES.
(i) If the Information Services transaction is the provision of
Information to XX0x.xxx solely for it internal use, eSpeed shall
not be entitled to a fee.
(ii) If the Information Services transaction is the sale by XX0x.xxx
of Information to which XX0x.xxx has added value then XX0x.xxx
will pay eSpeed an amount that is mutually agreed by the parties.
(iii) If the Information Services transaction is the sale by XX0x.xxx
of Information in substantially the same form provided by eSpeed
to XX0x.xxx, then XX0x.xxx will pay to eSpeed a fee of 50% of the
revenues from such sale.
(E) PRIVATE LABEL SYSTEM. If a transaction is a Private Label System
transaction, then eSpeed will be entitled to a fee, in an amount to be mutually
agreed upon by the Parties, for the utilization of eSpeed's services in support
of Private Label System Services; provided, however, that in the instance where
the client requests additional product upgrades, or customization beyond that
provided in standard Private Label Systems, eSpeed shall provide a price
quotation to XX0x.xxx for such customization, which shall be added to that
portion of the Private Label Revenues due eSpeed upon consummation of the sale.
Pricing for any such customization shall be estimated in a manner at least as
favorable to XX0x.xxx as eSpeed utilizes in pricing its analogous Private Label
Services to third party purchasers.
(F) ADDITIONAL IT SERVICES. eSpeed shall provide Additional IT Services
to XX0x.xxx hereunder at no additional cost or expense to XX0x.xxx. eSpeed may
arrange for another entity or entities (subject to XX0x.xxx's reasonable
approval) to provide Additional IT Services, eSpeed will be responsible for all
fees, expenses and taxes, if any, payable to such other entity or entities for
such services and XX0x.xxx shall be made a third-party beneficiary of any
agreement between eSpeed and such other entity. In the event that (after
consulting with eSpeed) XX0x.xxx arranges for another entity or entities to
provide Additional IT Services, XX0x.xxx will be responsible for all fees,
expenses and taxes, if any, payable to such entity or entities. XX0x.xxx or its
designee shall be the lessee or owner of any equipment and hardware, and the
licensee of any software, provided by a third party with respect to Additional
IT Services.
(G) HOSTING SERVICE. eSpeed shall provide Hosting Services to XX0x.xxx
hereunder at no additional cost or expense to XX0x.xxx. eSpeed may arrange for
another entity or entities (subject to XX0x.xxx's reasonable approval) to
provide Hosting Services, eSpeed will be responsible for all fees, expenses and
taxes, if any, payable to such other entity or entities for such services and
XX0x.xxx shall be made a third-party beneficiary of any agreement between eSpeed
and such other entity. In the event that (after consulting with eSpeed) XX0x.xxx
arranges for another entity or entities to provide Hosting Services, XX0x.xxx
will be responsible for all fees, expenses and taxes, if any, payable to such
entity or entities. XX0x.xxx or its designee shall be the lessee or owner of any
equipment and hardware, and the licensee of any software, provided by a third
party with respect to Hosting Services.
(H) ADJUSTMENTS TO REVENUE ALLOCATIONS. For any month, for any GHG
Emission Reduction Units for which transactions during such month are effected
both as Wholly
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Electronic eSpeed Transactions and Broker Assisted Transactions and where
Transaction Revenues are paid which are not specifically identifiable as either
Wholly Electronic eSpeed Transaction Services Revenues or Broker Assisted
Transaction Services Revenues (e.g. a fixed price arrangement with a XX0x.xxx
customer covering both Electronic eSpeed Transaction Services and Broker
Assisted Transaction Services), Transaction Revenues earned with respect to such
GHG Emission Reduction Units shall be allocated between Wholly Electronic eSpeed
transactions and Broker Assisted transactions as follows: the amount of
Transaction Revenues attributable to Wholly Electronic eSpeed transactions or
Broker Assisted transactions, as the case may be, for such GHG Emission
Reduction Units during such month shall be equal to (i) total Transaction
Revenues attributable to Wholly Electronic eSpeed transactions or Broker
Assisted transactions, for such GHG Emission Reduction Units for such month
multiplied by (ii) a fraction, the numerator of which is the notional volume (by
currency) of all transactions in such specific GHG Emission Reduction Unit type
for such month effected by Wholly Electronic eSpeed transactions or Broker
Assisted transactions, as the case may be, and the denominator of which is the
notional volume (by currency) of all transactions in such specific GHG Emission
Reduction Unit type for such month.
4.2 CUSTOMER NON-PAYMENTS. In the event that a customer does not pay,
or pays only a portion of, the Transaction Revenues relating to a transaction
described in Section 4.1(A), (B), (C) and (D) above (each a "Loss Event" and
collectively, the "Loss Events"), then XX0x.xxx shall bear the loss arising from
the Loss Event and XX0x.xxx shall ensure (by way of direct payment or otherwise)
that eSpeed receive its full share of the Transaction Revenues specified in
Section 4.1(A), (B), (C) and (D) for such transaction notwithstanding any such
customer failure to pay. XX0x.xxx shall be provided with a grace period of up to
90 days for late payments by customers after which a Loss Event will be deemed
to have occurred. XX0x.xxx shall use commercially reasonable efforts to
diligently collect Transaction Revenues, and if Cantor Xxxxxxxxxx, X.X. or its
affiliates are not then providing collection services for XX0x.xxx, eSpeed shall
have the right to review, upon reasonable prior notice and during normal
business hours, any outstanding accounts.
4.3 PAYMENT PROCEDURE. All amounts due and payable pursuant to this
Section 4 shall be paid in the manner specified in Section 9 below.
4.4 TAXES.
(A) Each Party shall be fully responsible for the payment of any and all
taxes required by law to be paid by that Party, except for taxes on the other
Party's net income.
(B) In the event that any tax is imposed on Transaction Revenues with
respect to a transaction described in this Section 4 (other than a tax on net
income), the cost of such tax shall be borne by the applicable Party in the same
proportion as the applicable Transaction Revenues for such transaction are to be
shared.
4.5 TERMINATION OF CERTAIN SERVICES.
(A) XX0x.xxx may, upon providing eSpeed with 180 days' prior written
notice and granting eSpeed with an initial opportunity to provide Additional IT
Services and eSpeed's rejection of such opportunity, arrange for another entity
or entities to provide all of the Additional IT Services for XX0x.xxx. In the
event that XX0x.xxx arranges for such other entity
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or entities to provide Additional IT Services, XX0x.xxx will be responsible for
all fees, expenses and taxes, if any, payable to such entity or entities.
XX0x.xxx or its designee shall be the lessee or owner of any equipment and
hardware, and the licensee of any software, provided by a third party with
respect to Additional IT Services.
(B) XX0x.xxx may request that eSpeed provide Additional E-Commerce
Services, as provided for hereunder, eSpeed may, within 30 days, refuse to
provide such Additional E-Commerce Services. Upon such refusal by eSpeed,
XX0x.xxx may arrange for another entity or entities to provide such Additional
E-Commerce Services. In the event that XX0x.xxx arranges for another entity to
provide Additional E-Commerce Services, XX0x.xxx will be responsible for all
fees, expenses and taxes, if any, payable to such entity or entities. XX0x.xxx
or its designee shall be the lessee or owner of any equipment and hardware, and
the licensee of any software, provided by a third party with respect to
Additional E-Commerce Services.
(C) XX0x.xxx may, upon approval of its board or other governance body and
upon providing eSpeed with 180 days' prior written notice, arrange for another
entity or entities to provide Hosting Services, either in whole or part for
XX0x.xxx, provided that such arrangement will not in eSpeed's reasonable
determination interfere with its Service Levels. In the event that XX0x.xxx
arranges for such other entity or entities to provide Hosting Services, XX0x.xxx
will be responsible for all fees, expenses and taxes, if any, payable to such
entity or entities. XX0x.xxx or its designee shall be the lessee or owner of any
equipment and hardware, and the licensee of any software, provided by a third
party with respect to Hosting Services.
(D) Notwithstanding the foregoing, eSpeed shall continue to provide any
services subject to such termination at the Service Levels provided herein until
the effective date of such termination.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF XX0X.XXX. XX0x.xxx
represents, warrants and covenants to eSpeed that:
5.1 ORGANIZATION. XX0x.xxx is duly organized, validly existing and in
good standing under the laws of the state of its organization and has all
requisite power and authority to carry on its business as now being conducted or
proposed to be conducted.
5.2 AUTHORITY; BINDING EFFECT. XX0x.xxx has all requisite power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary and appropriate action on the part of XX0x.xxx. This Agreement
has been duly executed and delivered by XX0x.xxx and constitutes the legal,
valid and binding obligation of XX0x.xxx, enforceable against it in accordance
with its terms, except as such enforceability may be limited by or subject to
any bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
the enforcement of creditors' rights generally and subject to general principles
of equity.
5.3 NO CONFLICTS. The execution and delivery of this Agreement by
XX0x.xxx does not, and the consummation of the transactions contemplated hereby
will not, (A) conflict with, or result in any violation or breach of, any
provision of the Limited Liability Company Operating Agreement or the
Certificate of Formation of XX0x.xxx, (B) result in any violation or breach of,
or constitute (with or without notice or lapse of time, or both) a default (or
give rise to a right of
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termination, cancellation or acceleration of any obligation or loss of any
material benefit) under, or require a consent or waiver under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, lease, contract
or other agreement, instrument or obligation to which XX0x.xxx is a party or by
which it or any of its properties or assets may be bound (except for any such
violations, breaches, defaults, conflicts or violations that, singly or in the
aggregate would not have a material adverse effect on XX0x.xxx, eSpeed, or their
properties, assets or their ability to perform their obligations under this
Agreement ("Material Adverse Effect")), or (C) conflict with or violate any
permit, concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to XX0x.xxx or any of its properties or
assets (except for any such conflicts or violations as, singly or in the
aggregate, would not have a Material Adverse Effect).
5.4 LITIGATION; NO UNDISCLOSED LIABILITIES. There is no litigation
pending or, to XX0x.xxx'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.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF ESPEED. eSpeed represents,
warrants and covenants to XX0x.xxx that:
6.1 ORGANIZATION. eSpeed is duly organized, validly existing and in
good standing under the laws of the state of its incorporation and has all
requisite corporate power and authority to carry on its business as now being
conducted or proposed to be conducted.
6.2 AUTHORITY; BINDING EFFECT. eSpeed has all requisite corporate power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary and appropriate corporate action on the part of eSpeed. This
Agreement has been duly executed and delivered by eSpeed and constitutes the
legal, valid and binding obligation of eSpeed, enforceable against it in
accordance with its terms, except as such enforceability may be limited by or
subject to any bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors' rights generally and subject to
general principles of equity.
6.3 NO CONFLICTS. The execution and delivery of this Agreement by
eSpeed does not, and the consummation of the transactions contemplated hereby
will not, (A) conflict with, or result in any violation or breach of, any
provision of the Certificate of Incorporation or Bylaws of eSpeed, (B) result in
any violation or breach of, or constitute (with or without notice or lapse of
time, or both) a default (or give rise to a right of termination, cancellation
or acceleration of any obligation or loss of any material benefit) under, or
require a consent or waiver under, any of the terms, conditions or provisions of
any note, bond, mortgage, indenture, lease, contract or other agreement,
instrument or obligation to which eSpeed is a party or by which it or any of its
properties or assets may be bound (except for any such violations, breaches,
defaults, conflicts or violations that, singly or in the aggregate would not
have a Material Adverse Effect), or (C) conflict with or violate any permit,
concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to eSpeed or any of its properties or
assets (except for any such conflicts or violations as, singly or in the
aggregate, would not have a Material Adverse Effect).
14
6.4 LITIGATION; NO UNDISCLOSED LIABILITIES. There is no litigation
pending or, to eSpeed'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. INDEMNIFICATION.
7.1 XX0X.XXX'S INDEMNIFICATION OBLIGATIONS. Subject to the terms and
conditions of this Section 7, XX0x.xxx agrees to defend, indemnify and hold
eSpeed and eSpeed's stockholders, subsidiaries, officers, directors, Affiliates,
agents, attorneys, employees and representatives harmless from and against any
and all third party claims, demands, actions, causes of actions, judgments,
liabilities, losses, damages, expenses, penalties, fines, taxes, and reasonable
expenses and costs (including reasonable attorneys' fees) (collectively,
"Damages"), directly or indirectly arising out of, resulting from or relating
to:
(A) Any unauthorized modification, misuse or other improper or
unauthorized actions taken by XX0x.xxx, or any of XX0x.xxx's members,
subsidiaries, officers, directors, Affiliates, agents, attorneys, employees,
representatives, or any XX0x.xxx customers, with respect to the technologies of
eSpeed and its subsidiaries and Affiliates;
(B) The negligence or willful misconduct of XX0x.xxx or its members,
subsidiaries, officers, directors, Affiliates, agents, attorneys, employees,
representatives or customers;
(C) XX0x.xxx's customers' claims and disputes;
(D) services, systems and technology support not provided, or otherwise
arranged, by eSpeed; and
(E) any breach of any representation or warranty by XX0x.xxx under this
Agreement.
7.2 eSpeed's Indemnification Obligations.
(A) Subject to the terms and conditions of this Section 7, eSpeed agrees
to defend, indemnify and hold XX0x.xxx and XX0x.xxx's members, subsidiaries,
officers, directors, Affiliates, agents, attorneys, employees, representatives
and customers harmless from and against any and all Damages, directly or
indirectly arising out of, resulting from or relating to:
(i) Any infringement of the Intellectual Property of any third party
by eSpeed and its subsidiaries and Affiliates.
(B) Notwithstanding the foregoing, the indemnification provided in
subsection (A) above shall not apply to any Damages, directly or indirectly
arising out of, resulting from or relating to:
(i) Any unauthorized modification, misuse or other improper or
unauthorized actions taken by XX0x.xxx, XX0x.xxx's members,
subsidiaries, officers, directors, Affiliates, agents, attorneys,
employees, representatives, or customers with respect to the
systems or technology support provided by eSpeed and its
Affiliates under this Agreement; and
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(ii) The negligence or willful misconduct of XX0x.xxx or its members,
subsidiaries, officers, directors, Affiliates, agents, attorneys,
employees, representatives, or customers.
(C) Except as expressly provided herein, eSpeed shall exercise no control
over, and accepts no responsibility for, the content of the Information passing
through the Electronic Trading System. Use of any Information obtained via the
Electronic Trading System shall be at XX0x.xxx's customers own risk. eSpeed
specifically denies any responsibility for the accuracy or quality of
Information obtained through its services. XX0x.xxx shall obtain, maintain,
update and enforce such agreements with its customers, as are reasonably
requested by eSpeed, to ensure that eSpeed is fully protected against
liabilities arising from customer claims and disputes.
(D) Access to the Electronic Trading System will be provided by eSpeed on
an "as is" basis, except as otherwise provided in Section 3.1.2. Except as
expressly provided herein, eSpeed makes no warranties, representations, or
guarantees as to merchantability, fitness for any particular purpose or
otherwise with respect to the Electronic Trading System, its content, any
hardware or software provided by eSpeed, the Additional IT Services being
provided or arranged by eSpeed hereunder, or any other matter. Technical
difficulties could be encountered in connection with the Electronic Trading
System and/or the Additional IT Services. These difficulties could involve,
among others, failures, delays, malfunctions, software erosion or hardware
damage, which difficulties could be the result of hardware, software or
communication link inadequacies or other causes. Such difficulties could lead to
possible economic and/or data loss. Neither eSpeed nor its Affiliates or any of
their respective employees shall be liable for any direct or indirect Damages of
whatsoever nature or have any other liability to XX0x.xxx, including, without
limitation, any such Damages for loss resulting or arising from delays,
non-deliveries, misdeliveries or service interruptions or resulting or arising
from using, accessing, installing, maintaining, modifying, deactivating or
attempting to access the Electronic Trading System, providing Additional IT
Services or otherwise.
(E) In case any one or more of the covenants and/or agreements of eSpeed
set forth in this Agreement shall have been breached by eSpeed, XX0x.xxx's sole
remedy shall be to protect and enforce its rights by proceeding in equity in an
action for specific performance of any such covenant or agreement contained in
this Agreement, and/or a temporary or permanent injunction. XX0x.xxx shall have
no right to terminate this Agreement (other than those provisions which
expressly provide for termination) or to pursue a claim for Damages in the event
of any such breach or otherwise without the express written consent of eSpeed.
7.3 RISK ALLOCATION.
NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY (NOR TO ANY PERSON CLAIMING
RIGHTS DERIVED FROM THE OTHER PARTY'S RIGHTS) FOR INCIDENTAL, INDIRECT,
CONSEQUENTIAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES OF ANY KIND -- INCLUDING
LOST REVENUES OR PROFITS, LOSS OF BUSINESS OR LOSS OF DATA -- ARISING OUT OF
THIS AGREEMENT (INCLUDING WITHOUT LIMITATION AS A RESULT OF ANY BREACH OF ANY
WARRANTY OR OTHER TERM OF THIS AGREEMENT), REGARDLESS OF WHETHER THE PARTY
LIABLE OR ALLEGEDLY LIABLE WAS ADVISED, HAD OTHER REASON TO KNOW, OR IN FACT
KNEW OF THE POSSIBILITY THEREOF.
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7.4 CLAIMS FOR INDEMNIFICATION; DEFENSE OF INDEMNIFIED CLAIMS. A Party
entitled to indemnification pursuant to this Section 7 (an "Indemnified Party")
shall provide written notice to the indemnifying party (the "Indemnifying
Party") of any claim of such Indemnified Party for indemnification under this
Agreement promptly after the date on which such Indemnified Party has actual
knowledge of the existence of such claim. Such notice shall specify the nature
of such claim in reasonable detail and the Indemnifying Party shall be given
reasonable access to any documents or properties within the control of the
Indemnified Party as may be useful or necessary in the investigation of the
basis for such claim. The failure to so notify the Indemnifying Party shall not
constitute a waiver of such claim except to the extent that the Indemnifying
Party is materially prejudiced by such failure. If any Indemnified Party seeks
indemnification hereunder based upon a claim asserted by a third party, then the
Indemnifying Party shall have the right (without prejudice to the right of any
Indemnified Party to participate at its expense through counsel of its own
choosing) to defend such claim at its expense and through counsel of its own
choosing (and reasonably acceptable to the Indemnified Party) if it gives
written notice of its intention to do so no later than 20 days following notice
thereof by an Indemnified Party; provided, however, that, if, in the reasonable
opinion of counsel to the Indemnified Party, separate counsel is required
because a conflict of interest would otherwise exist, the Indemnified Party
shall have the right to select separate counsel to participate in the defense of
such action on its behalf, at the expense of the Indemnifying Party; provided
further, however, that the Indemnified Party shall always have the right to
select one separate counsel to participate in the defense of such action on its
behalf, at its own expense. If the Indemnifying Party does not so choose to
defend any such claim asserted by a third party for which any Indemnified Party
would be entitled to indemnification hereunder, then the Indemnified Party shall
be entitled to recover from the Indemnifying Party all of the reasonable
attorney's fees and other costs and expenses of litigation incurred in the
defense of such claim. It is understood that the Indemnifying Party shall not,
in connection with any proceeding or related proceedings in the same
jurisdiction, in any case be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Indemnified Parties.
Notwithstanding the assumption of the defense of any claim by an Indemnifying
Party, the Indemnified Party shall have the right to approve the terms of any
settlement of a claim (which approval shall not be unreasonably withheld or
delayed) if such settlement (A) does not include as an unconditional term the
giving by the claimant or the plaintiff to the Indemnified Party a release from
all liability in respect to such claim or (B) requires anything from the
Indemnified Party other than the payment of money damages which the Indemnifying
Party has agreed to pay in full. The Indemnifying Party shall not be liable for
any settlement of any proceeding effected without its prior written consent (not
to be unreasonably withheld or delayed).
8. RELATIONSHIP OF THE PARTIES. The relationship of XX0x.xxx and eSpeed
is that of independent contractors. Pursuant to this Agreement, XX0x.xxx and
eSpeed 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 (except as expressly provided in Sections 4.1
and 4.2 above and including with respect to a Loss Event as set forth in Section
4.2) or to enter into or create any partnership, and no partnership or other
like arrangement shall be deemed to be created hereby. Neither XX0x.xxx nor
eSpeed shall have any claim against the other or right of contribution with
respect to any uninsured loss incurred by the other nor shall either Party have
a claim or right against the other with respect to any loss that is deemed to be
included within the deductible, retention or self-insured portion of any insured
risk.
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9. INVOICING AND BILLING.
9.1 XX0x.xxx shall pay to eSpeed, within 5 business days of collection,
the amounts due and owing to eSpeed (determined in the manner provided in
Section 4 above).
9.2 eSpeed shall invoice XX0x.xxx for charges for services rendered
pursuant to Section 4.1(E) above on a monthly basis as incurred, such invoices
to be delivered to XX0x.xxx by eSpeed within 15 days after the end of each
calendar month. XX0x.xxx shall pay to eSpeed the respective amounts owing for
such services provided under this Agreement within 30 days after receipt of
invoice.
9.3 XX0x.xxx agrees that time shall be of the essence with respect to any
payments due under this Section 9.
10. DOCUMENTATION. All Transaction Revenues 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.
11. FORCE MAJEURE. If either Party is rendered unable, wholly or in part, by
force majeure not reasonably within its control, to perform or comply with any
obligation of this Agreement, upon giving notice and reasonably full particulars
to the other Party, such obligation shall be suspended during the continuance
and to the extent of the inability so caused (and any such failure to perform or
comply shall not be deemed to constitute a breach of any kind whatsoever),
provided obligations to make payments then due hereunder shall not be suspended,
and provided further that the cause of suspension shall be remedied so far as
possible with reasonable dispatch.
The term "force majeure" shall include, without limitation, acts of God;
hurricanes, tornadoes or like adverse weather of unusual amount, intensity or
duration; fire; accidents; equipment failures; utility or transportation
interruptions; labor disputes, lockouts, strikes and other industrial, civil or
public disturbance; war and war-like operations; invasions; rebellions;
hostilities; sabotage; obtaining of required permits or approvals (provided
prompt and proper application there for is made); compliance with any laws,
orders, rules, or regulations; inability to obtain third-party cooperation; acts
of restraints of government or governmental bodies, courts or authorities, civil
or military; and other matters beyond the reasonable control of the applicable
party.
12. PROPRIETARY INFORMATION.
12.1 In consideration of a Party furnishing (the "Providing Party")
Proprietary Information (as defined below) to the other Party (the "Receiving
Party"), XX0x.xxx and eSpeed agree that the Providing Party's Proprietary
Information will be kept confidential by the Receiving Party, will not be
disclosed to any other person, and will be used by the Receiving Party only for
purposes consistent with the performance of this Agreement. The Receiving Party
shall use the same care and discretion to avoid disclosure, publication or
dissemination as it uses with its own similar information that it does not wish
to disclose, publish or disseminate, and in any case no less than reasonable
care, to safeguard the Providing Party's Proprietary Information from
unauthorized disclosure. The Receiving Party shall inform each of its
Representatives receiving the Proprietary Information of the confidential nature
of the Proprietary Information and shall direct such Representatives to treat
the Proprietary Information confidentially in
18
accordance with each of the terms and conditions of this Agreement, and the
Receiving Party shall be responsible for any use of the Proprietary Information
by its Representatives inconsistent with this Agreement. Without the prior
written consent of the Providing Party and subject to the other provisions of
this Agreement, the Receiving Party will not, and will direct its
Representatives not to, disclose to any third person that any Proprietary
Information has been made available from the Providing Party.
12.2 If the Receiving Party is required pursuant to legal process to
disclose any of the Providing Party's Proprietary Information or any discussions
between the Parties, the Receiving Party will promptly notify the Providing
Party to permit it to seek a protective order or take other appropriate action.
The Receiving Party will cooperate in the Providing Party's efforts to obtain a
protective order or other reasonable assurance that confidential treatment will
be accorded the Proprietary Information or discussions between the Parties. If,
in the absence of a protective order, the Receiving Party or any of its
Representatives is, in the written opinion of counsel addressed to it, compelled
as a matter of law to disclose the Proprietary Information or the discussions
between the Parties, the Receiving Party may disclose to the Person compelling
disclosure only that part of the Proprietary Information or the discussions as
is required by law to be disclosed.
12.3 The Receiving Party will promptly notify the Providing Party in
writing if any information comes to the attention of any of its Representatives,
which information may indicate there was or is likely to be a loss of
confidentiality of any portion of the Providing Party's Proprietary Information.
The Receiving Party shall, at the Providing Party's expense, use reasonable
efforts to retrieve the lost or wrongfully disclosed Proprietary Information and
to prevent further unauthorized disclosure or loss of any Proprietary
Information.
12.4 Notwithstanding the foregoing, it is understood that any information
known or available in the trade or otherwise in the public domain, through no
act or failure to act by the Receiving Party or its Representative(s), or
previously and lawfully known to the Receiving Party or subsequently lawfully
acquired by the Receiving Party from third parties not under any obligation of
confidentiality or secrecy to the Providing Party, will not be deemed to be
Proprietary Information.
12.5 The Parties acknowledge and understand that this Agreement does not
limit or restrict the ability of either Party to engage in its respective
business, nor does it limit either Party's use or application of any information
or knowledge acquired or developed independently without breach of this
Agreement in the course of such business.
12.6 Each Party acknowledges that any breach or violation of this Section
12 cannot be sufficiently remedied by money damages alone and, accordingly, the
Providing Party will be entitled, in addition to damages and any other remedies
provided by law, to seek specific performance, injunctive and other equitable
relief respecting any such violation.
12.7 For purposes of this Agreement, "Representatives" shall include each
of the Parties and their respective members, subsidiaries, officers, directors,
Affiliates, agents, attorneys, employees, representatives, or customers.
12.8 Each Party agrees that each of the covenants regarding Proprietary
Information contained in this Section 12 is a reasonable covenant under the
circumstances, and further agrees
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that if, in the opinion of any court of competent jurisdiction, any such
covenant is not reasonable in any respect, such court shall have the right,
power and authority to excise or modify such provision or provisions of such
covenant as to the court shall appear not reasonable and to enforce the
remainder of the covenants in this Section 12 as so amended.
12.9 Neither Party will possess or assert any lien or security interest
against or in the other Party's Proprietary Information. No licenses are granted
in either Party's Proprietary Information except as expressly set forth in this
Agreement. Each Party will return the other Party's Proprietary Information
promptly upon request.
12.10 The provisions of this Section 12 shall survive the expiration or
termination of this Agreement for a period of three years.
13. MISCELLANEOUS.
13.1 EXCLUSIVITY. During the Term, eSpeed shall be the sole and
exclusive provider of Electronic Transaction Services to XX0x.xxx. Nothing in
this Agreement shall prevent eSpeed from participating in other markets (whether
non-electronic, fully-electronic or partially-electronic) or providing services
similar or comparable to the Electronic Transaction Services provided by eSpeed
hereunder to any other market (whether non-electronic, fully-electronic or
partially-electronic).
13.2 BINDING NATURE; ASSIGNMENT. This Agreement and all the covenants
herein contained shall be binding upon the Parties, their respective successors
and permitted 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
Party, which consent may not be unreasonably withheld except as provided below:
13.2.1 eSpeed may assign its rights, obligations or interests under this
Agreement, in whole or in part, to a 90%-owned subsidiary of eSpeed or its
Affiliate; provided, further, however, that such assignment shall not relieve
eSpeed from its obligations hereunder.
13.2.2 XX0x.xxx may assign its rights, obligations or interests under
this Agreement, in whole or in part, to a trading subsidiary that may be
established in the future, and that may have a different ownership than
XX0x.xxx. In addition XX0x.xxx may assign its rights, obligations and interests
under this Agreement to a successor that is effectuating an initial Public
Offering.
13.3 WAIVER; AMENDMENTS. This Agreement may be amended, modified,
superseded, canceled or renewed, and the terms or covenants hereof may be
waived, only by a written instrument executed by all of the Parties hereto or,
in the case of a waiver, by the Party waiving compliance. Except as otherwise
specifically provided in this Agreement, no waiver by either Party hereto of any
breach by the other Party of any condition or provision of this Agreement to be
performed by such other Party shall be deemed a waiver of a similar or
dissimilar provision or condition at the same or at any prior or subsequent
time.
13.4 ENTIRE AGREEMENT. This Agreement constitutes the entire Agreement
of the Parties with respect to the services and benefits described herein, and
cancels and supersedes any
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and all prior written or oral contracts or negotiations between the Parties with
respect to the subject matter hereof.
13.5 SEVERABILITY. If any part of any provision of this Agreement or
any other agreement, document or writing given pursuant to or in connection with
this Agreement shall be invalid or unenforceable under applicable law, said part
shall be ineffective to the extent of such invalidity only, without in any way
affecting the remaining parts of said provision or the remaining provisions of
this Agreement.
13.6 CONSTRUCTION. This Agreement shall be strictly construed as
independent from any other agreement or relationship between the Parties.
13.7 GOVERNING LAW. 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. Each Party hereto
(A) hereby irrevocably and unconditionally submits to the exclusive jurisdiction
of any court of the State of New York or any federal court sitting in the State
of New York for purposes of any suit, action or other proceeding arising out of
this Agreement or the subject matter hereof brought by any Party, (B) hereby
waives and agrees not to assert, by way of motion, as a defense, or otherwise,
in any such suit, action or proceeding, any claim that it is not subject
personally to the jurisdiction of the above-named courts, that its property is
exempt or immune from attachment or execution, that the suit, action or
proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Agreement or the subject matter
hereof may not be enforced in or by such court, and (C) hereby waives in any
such action, suit, or proceeding any offsets or counterclaims or any right to a
jury trial. Each Party hereby consents to service of process by certified mail
at the address set forth in Section 14.10 below and agrees that its submission
to jurisdiction and its consent to service of process by mail is made for the
express benefit of the other party hereto. Final judgment against any party, in
any action, suit or proceeding shall be conclusive, and may be enforced in other
jurisdictions (A) by suit, action or proceeding on the conclusive evidence of
the fact and of the amount of any indebtedness or liability of the party therein
described or (B) in any other manner provided by or pursuant to the laws of such
other jurisdiction.
13.8 HEADINGS. The descriptive headings in this Agreement are for
convenience only and shall not control or affect the meaning or construction of
any of the provisions hereof.
13.9 FURTHER ASSURANCES. The Parties shall, at their own cost and
expense, execute and deliver such further documents and instruments and shall
take such other actions as may be reasonably required or appropriate to carry
out the intended purposes of this Agreement.
13.10 NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed to have been given if delivered personally or
sent by facsimile transmission, overnight courier, or certified, registered or
express mail, postage prepaid. Any such notice shall be deemed given when so
delivered personally or sent by facsimile transmission (provided that a
confirmation copy is sent by overnight courier), two days after deposit with an
overnight courier, or if mailed, five days after the date of deposit in the
United States mails, as follows:
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If to eSpeed:
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
If to XX0x.xxx:
Xxx Xxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention: Xxxxx Xxxxxxxx
Facsimile: x00 00 0000 0000
The address of any Party may be changed on notice to the other Party duly served
in accordance with the foregoing provisions.
13.11 NOTIFICATION FAILURE. The failure of either Party to give notice
of default or to enforce or insist upon compliance with any of the terms or
conditions of this Agreement shall not be considered a waiver of any other term
or condition of this Agreement.
13.12 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.
Delivery of a telecopied version of one or more signatures on this Agreement
shall be deemed adequate delivery for purposes of this Agreement.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
in their respective names by their respective officers duly authorized, as of
the date first written above.
ESPEED, INC.
By: /s/ Xxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxxx
Title: President
XX0X.XXX, LLC
By: /s/ Xxxxx Xxxxxxxx
--------------------------------------
Name: Xxxxx Xxxxxxxx
Title: CEO
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SCHEDULE A
Allocation of Costs
------------------------------------------
XX0x.xxx eSpeed
---------------------------------------------------------------------------------------------------------
Development of systems based on eSpeed proprietary technology X
---------------------------------------------------------------------------------------------------------
Web based technology:
o build, programming, functionality, useability testing X
o branding & design X
o content, including e.g. media subscriptions, etc. X
o database technologies X
o images X
o webtrends, search engine technology research X
o subscription search engine positioning services X
o content management systems X
---------------------------------------------------------------------------------------------------------
Hosting, including all hardware and software, red-alert & X
keynote monitoring
---------------------------------------------------------------------------------------------------------
Backups and backup systems X
---------------------------------------------------------------------------------------------------------
24 hour by 7 days a week management of all security,
infrastructure and monitoring of critical network and
communication services, including regular security audits of X
all XX0x.xxx applications
---------------------------------------------------------------------------------------------------------
Bandwidth for connecting XX0x.xxx offices at Cantor/eSpeed
locations plus other XX0x.xxx office locations by prior
agreement; dial-ups; software licensing for website X
development and other XX0x.xxx applications (e.g. Perforce,
Visual Studio)
---------------------------------------------------------------------------------------------------------
Enterprise software licensing (eg. All that that is already X
covered by eSpeed site license agreements)
---------------------------------------------------------------------------------------------------------
Software licensing for administration and sales (e.g. Act). X
---------------------------------------------------------------------------------------------------------
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