EXHIBIT 10.15
This Service Bureau Operation Agreement AGREEMENT NO:____________________
("Agreement") is made between
Xxxxx & Xxxxx (USA) Inc. ("R&N") DATE OF AGREEMENT:_______________
an Illinois corporation with its
principal place of business at
000 Xxxxx Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
(000) 000-0000 (general)
(000) 000-0000) (fax)
and
Alaron Trading ("Customer")
an Illinois corporation with its
principal place of business at:
000 X. Xxxxxxxxxx Xxxx.
Xxxxxxx, XX 00000
WITNESSESH:
WHEREAS:
R&N is the developer of a futures and options industry applications
software solution and, in connection therewith, provides certain
Processing Services for its customers; and
The Customer wishes to engage R&N to provide to the Customer certain
Processing Services more fully described on Schedule B attached hereto
and made a part hereof, and R&N desires to provide such Processing
Services to the Customer on the terms and conditions set forth below.
NOW, THEREFORE, the Parties agree as follows:
1. DEFINITIONS.
(a) "Confidential Information" means, in the case of R&N (i) the
Intellectual Property, know-how or other material, ideas or concepts relating to
or comprising the Software, including, without limitation, Programs, source
code, object code, Documentation, Enhancements, Releases, Custom Modifications,
specifications, technical manuals, memoranda and advisories, computer
instructions, algorithms, routines, flow diagrams, outlines, schedules and
processes, and (ii) information relating to pricing and the other terms and
conditions of this Agreement. In the case of the Customer, "Confidential
Information" means any non-public information relating to the Customer or the
business of the Customer to which R&N has access in the performance of its
obligations under this Agreement.
However, in either case, "Confidential Information" shall not include:
any information known
generally to the public, other than as a
result of unauthorized disclosure by
the recipient of such information, or
any information which the
recipient of information can show by
evidence to be lawfully known by
such recipient prior to the time of its
disclosure, or
any information that becomes available to either R&N or the
Customer on a non-confidential basis from a third party, provided such
third party is not prohibited from disclosing such information to the
Party.
(b) "Custom Modification" means any modifications or additions to the
Software made by R&N at the request of the Customer.
(c) "Customer Information" shall mean the input data provided by
Customer for processing, the files and processing data therefrom, and any
program(s) provided by the Customer for use in processing of its input data.
(d) "Documentation" means user manuals and all written materials
provided by R&N to the Customer relating specifically to the operation and
functionality of the Software.
(e) "Enhancements" means upgrades, improvements, new versions or
Releases and related materials generally made available, without charge, by R&N
to its customers, which are intended to be used with or which complement
existing Software employed in connection with the provision of the Services
hereunder.
(f) "Installation Date" means the date the Software (or any part
thereof) is made available by R&N for use by the Customer.
(g) "Installation Services" means the services supplied by R&N to the
Customer that functionally set forth in the Documentation, including planning
for access device installation at the Customer site, creation of a Software
environment for Customer's Processing Service, and configuring the Software to
operate in conjunction with Customer's requirements, but shall not include any
Custom Modifications. The training services provided by R&N are set forth in
Schedule C. Fees for Installation Services are in addition to the Processing
Fees and are set forth in Schedule G.
(h) "Intellectual Property" means rights to: (i) inventions, (ii) all
grants or patents or patents for inventions, including reissue thereof, (iii)
all patent applications, (iv) copyrights, (v) all copyright applications, and
(vi) Confidential Information.
(i) "New Software" means any software released generally by R&N after
the date of this Agreement that, in the determination of R&N, incorporates
functions and capabilities not included in the Software, as described in
Schedule A.
(j) "Party" means R&N or the Customer, as the case may be, and
"Parties" means both R&N and the Customer.
(k) "Processing Fees' means the processing service fees specified in
Schedule G.
(l) "Processing Service" shall mean the services to be supplied by R&N
as specified in Schedule B.
(m) "Program" or "Programs" means a set of ordered steps or list of
instructions which are capable when incorporated in a machine-readable medium,
in causing a computer to indicate, perform or achieve particular functions,
tasks or results and includes source-code listings in human- readable and
machine readable form, object code in machine readable form, program files, data
files, field and data definitions and relationships, data definition
specifications, data models, program and system logic, interfaces, program
modules, routines, subroutines, algorithms, program architecture, design
concepts, system designs, program structure, sequence and organization, screen
displays and reports layouts.
(n) "Release' means periodic bug- fixes, modifications made to comply
with regulatory requirements and improvements or additions to the existing
functionality of the Software, and generally made available, without charge, by
R&N to its customers.
(o) [MISSING FROM DRAFT]
(p) "Services" means the rendering of timesharing, service bureau
facilities management or similar services by the Customer utilizing the Software
(or any part thereof) to any entity other than the Customer.
(q) "Software" means the executable from of the futures and options
industry applications software solution more fully described on Schedule A
hereto, together with all Custom Modifications, Releases, New Software and
Enhancements developed or applied by R&N under this Agreement.
(r) "Term" means an initial term of three years from the date on which
Service commences and continuing thereafter for additional successive three-year
terms unless terminated by either Party giving the other not less than six
months' prior written notice to expire at the end of the initial three-year term
or at the end of any subsequent term, as the case may be.
2. PROCESSING SERVICES; SERVICE FEES
(a) Subject to the terms and conditions of this Agreement, including,
without limitation, those terms and conditions set forth in the schedules
attached hereto, R&N agrees to provide the Processing Service to the Customer
during the Term of this Agreement.
(b) Work shall be performed by R&N on a best efforts basis with an
estimated completion time of ten hours after notification of last trade entry.
(c) During the Term of this Agreement, the Customer hereby agrees to
pay monthly Services Fees and other charges in the amounts, at the times and in
accordance with the terms set forth in Schedule G attached hereto and made a
part hereof. The
Customer shall pay all such fees and charges, in full and without deduction,
except as provided under Section 2(g), within thirty days of any invoice
therefor.
(d) Any media or materials supplied by R&N in addition to the Services
shall be charged to the Customer at R&N's then-prevailing list prices.
(e) The Customer shall pay to R&N interest upon any amounts which are
not paid by the Customer to R&N when due, at the rate of the lessor of (i) one
and one-half percent (1 1/2%) of the unpaid balance per month, or (ii) the
highest rate of interest allowable under applicable law.
(f) The Customer hereby grants R&N a security interest in all personal
property of the Customer on R&N's premises, from time to time, to secure the
obligations of the Customer to R&N, and in connection therewith, authorizes R&N
at its sole discretion to sign on the Customer's behalf and file financing
statements with respect to such personal property to perfect the security
interest granted hereby.
(g) If the Customer disputes in good faith any charge (a "Disputed
Charge"), the Customer shall so notify R&N in writing within five days after
receiving the invoice for, or notification of, such charge. In such event,
either Party may initiate the dispute resolution process under Section 12(b).
(h) The Software used in connection with the provision of the
Processing Services hereunder is and shall be the sole and exclusive property of
R&N, including all applicable rights to the Confidential Information of R&N and
to the Intellectual Property. No right is granted to the Customer for the use of
Software, directly or indirectly. R&N reserves the right to implement all
upgrades, Releases and Enhancements to the Software, or New Software, which R&N
may, from time to time, develop and, in its sole discretion, deem, advisable to
apply in connection with the provision of Services hereunder, without the
consent of the Customer.
3. INSTALLATION PLAN AND ACCEPTANCE.
(a) The Customer and R&N have prepared and annexed hereto as Schedule I
a mutually acceptable plan for the provision of Installation Services (the
"Installation Plan"). R&N will Provide the Installation Services in accordance
with the Installation Plan. Any further installation, training, software
customization or consultancy services will be provided at the sole discretion of
R&N and will be charged in accordance with R&N's then prevailing standard rates.
All out of pocket expenses incurred by R&N in providing services in connection
with the Installation Plan, including travel and lodging expenses, shall be paid
by the Customer.
(b) The Customer agrees to assign a qualified project leader to the
installation and to assign such other individuals (and resources) on a part-time
or full-time basis to the installation team as required.
4. SOFTWARE SUPPORT SERVICES.
(a) Software support services, as described below ("Support"), will be
provided
by R&N to the Customer for the Software Processing Service.
(b) R&N agrees to provide the following Support services:
Provide the Customer with access to R&N representatives
responsible for coordination, resolution, and follow-up of all support
issues under the terms and conditions of this Section.
Provide the Customer with emergency telephone consultation
service from 6:00 p.m. (Central Time, U.S.) on Sunday until 5:00 p.m.
on Saturday, excluding holidays, using current R&N procedures for the
purpose of resolving Deficiencies in the Software and resolving
operational problems the Customer may encounter, including assistance
in the recovery of systems and data files.
Use commercially reasonable efforts to make and provide to the
Customer, in R&N's sole discretion, without additional charge, such
Enhancements to the Software as R&N deems appropriate to satisfy any
mandatory requirements of the applicable industry clearing houses and
regulatory agencies, taking into account technical feasibility and the
requirements of R&N's customers generally.
Notify the customer of Enhancements to and Maintenance
Releases and Releases of the Software that are available, all of which
must be accepted by the Customer without additional charge of fee.
(c) The Customer agrees to:
Provide R&N with reasonable access to the Customer's personnel
to enable R&N to provide the services specified in this Section.
Maintain a documented log of all support calls, available to
R&N upon request. When placing a call to R&N, the Customer will
reference all applicable sections of Documentation that may be
relevant.
Document all incidents of Software Deficiencies, attach any
pertinent samples of Documentation and include detailed steps to
duplicate the Deficiencies in the Customer's
operating environment.
5. CUSTOM MODIFICATIONS.
The Customer may request R&N to make Custom Modifications to the Software to
meet the Customer's specific requirements. Upon receipt of such request, R&N
may, in its sole discretion, make such Custom Modifications at a rate to be
agreed upon by the Parties. In the event that the Parties shall fail to
expressly agree upon fees and charges for Custom Modifications, the Customer
shall pay R&N its then-current standard charges for the Custom Modifications.
The following procedures will be followed by the Customer and R&N in relation to
any requested Custom Modifications, without prejudice to R&N's right to payment
of fees and charges for Custom Modifications otherwise made at the request of
the Customer:
(a) The Customer shall notify R&N in writing, in the form annexed
hereto as Schedule H (the "Customization Request"), of its request for a
preliminary estimate for Custom Modifications. The Customization Request must
identify specifically the functionality requested and the specifications
thereof, as well as the Customer's agreement to pay the fee set by R&N for
preparing the preliminary estimate.
(b) In response to the Customization Request, R&N will develop a
preliminary estimate of the cost to perform the Custom Modifications and the
additional costs that may be involved in retro-fitting the Custom Modifications
with respect to any new Releases or Enhancements and an initial determination of
the appropriateness of the specifications requested by the Customer. The
Customer will have thirty days after receiving the preliminary estate to notify
R&N whether to proceed with a detailed estimate and detailed design
specifications for the Custom Modifications.
(c) After receiving the detailed design specifications for the Custom
Modifications, the Customer will notify R&N of any and all changes to the
specifications. R&N will then resubmit the final specifications for the
Customer's written acceptance. Once the Customer accepts the final
specifications, any further changes requested by the Customer must be approved
by R&N and may result in additional cost.
(d) R&N will design and program the Custom Modifications according to
the final specifications approved by the Customer. R&N and the Customer will
agree on the timetable for the application of the Custom Modifications to the
Services.
(e) The Customer shall pay R&N for preparing the preliminary estimate
and the detailed estimate, developing specifications, programming, and testing
the Custom Modifications in accordance with the charging basis quoted by R&N
when submitting its preliminary estimate as modified in writing upon the mutual
consent of the Parties.
(f) R&N shall not make any Custom Modifications which R&N believes are
or may be unfeasible, illegal or in violation of the proprietary rights of
others. R&N shall not pay any royalty or other fee to the Customer for the use
of any Confidential Information, Intellectual Property, software, ideas or
techniques developed from or relating to Custom Modifications.
6. CUSTOMER INFORMATION.
(a) Customer shall provide within sufficient time (by the agreed upon
submission time set forth in Schedule D) all Customer Information required by
R&N to enable R&N to perform the Processing Services. In the event the Customer
Information is not submitted by the agreed upon submission time, or is
incomplete, incorrect or not in the form specified by R&N, R&N shall not be
responsible for the delivery time (Processing Service delivery time set forth in
Schedule D).
(b) In the event of late submission of Customer Information and upon
the availability to R&N of complete and correct Customer Information, R&N will
notify Customer of the new Processing Service delivery time. Work shall be
performed on a
"Best Efforts Basis" with an estimated completion time of ten (10) hours after
notification of last trade entry. Upon delivery to Customer of its completed
processing work, Customer shall assume risk of loss, and R&N shall replace any
lost damaged portion at Customer's expense.
(c) Customer shall be solely responsible for the accuracy and
completeness of Customer Information provided by Customer to R&N pursuant to
this Agreement, and for the correctness of the format. Customer shall verify
such data or report promptly to R&N after receipt thereof, any errors with
respect to any data or report. R&N assumes no responsibility for verification.
Customer operation responsibilities are further specified in Schedules E and F.
(d) Upon termination of this Agreement for any reason other than
termination by R&N due to default by Customer, R&N will assist in transferring
Customer Information to the Customer or to another data processing company and
retain said Customer Information for archival purposes for a period of thirty
days. Said assistance shall be limited to that assistance which in R&N's sole
judgment is reasonably under the circumstances. Customer shall pay R&N for staff
time spent in providing such assistance at R&N's then prevailing hourly rates
for machine time, the costs of the media on which Customer Information is
stored, for transportation costs and for any other reasonable related expense.
7. RESPONSIBILITIES OF THE CUSTOMER.
The Customer shall be exclusively responsible for the accuracy of the input
data, information and documentation provided to R&N in connection with the
Services to be provided hereunder and shall:
(a) provide R&N with reasonable access to the Customer's personnel and
facilities to enable R&N to provide the Services.
(b) implement sufficient
procedures to satisfy its requirements for
security and accuracy;
(c) convert the Customer's
accounting data to the format required by the
Software;
(d) within sufficient time, provide R&N with all Customer information
required by R&N to enable R&N to perform the Services. In the event that the
information is not delivered by the agreed upon delivery time, or is incomplete,
incorrect or not in the form specified by R&N, R&N shall not be responsible for
meeting agreed upon delivery times, which delivery times shall be automatically,
commensurately delayed. promptly following the availability to R&N of complete
and correct Customer information, R&N will notify the Customer of the new
delivery time. Upon delivery to the Customer of its completed processing work,
the Customer shall assume risk of loss and R&N shall replace and lost or damaged
portion of the completed processing work at the Customer's expense, to the
extent R&N retains such information.
8. RELEASES/NEW SOFTWARE MODULES.
(a) R&N will make Releases available to the Customer free of charge
(subject to Section 4(a) and 10(b)) when such Releases are made generally
available by R&N to its other customers.
(b) From time to time, R&N may develop New Software modules. The
Customer may acquire a license to use any New Software Module by paying R&N its
then-current fees and charges. Once installed, the New Software module will be
deemed to be part of the Software subject to the terms and conditions of this
Agreement.
(c) If the Customer requires R&N to install Releases or New Software
modules such services will be subject to charge by R&N at its then-current
published rates.
9. CONFIDENTIALITY.
(a) Each Party hereto agrees to hold the other Party's confidential
Information in strict confidence. Neither Party will disclose or otherwise make
the other Party's Confidential Information or any part thereof available to any
third party, except to the extent permitted by the terms of this Agreement. Each
Party shall take reasonable action to satisfy its obligations under this
Agreement with respect to use, copying, modification, protection and maintaining
the confidentiality of the Confidential Information of the other Party,
including the prevention of any unauthorized disclosure by any of such Party's
employees.
(b) Neither Party will remove or permit to be removed from any item
included in the other Party's Confidential Information any proprietary,
confidential or copyright notices, markings or legends placed thereon
by such Party.
(c) Each Party shall assist the other Party in identifying and
preventing any unauthorized use or disclosure of its Confidential Information or
any portion thereof. Without limiting the foregoing, a Party (a "Recipient
Party") shall notify the other Party (the "Disclosing Party") immediately in the
event that the Recipient Party learns or has reason to believe that any person
who has had access to the confidential Information of the Disclosing Party, or
any portion thereof, has violated or intends to violate the terms of this
Agreement, and the Recipient Party will cooperate with the Disclosing Party in
seeking injunctive or other equitable relief in the name of the Disclosing Party
against any such person.
(d) Each Party acknowledges that the unauthorized disclosure of any of
the other Party's Confidential Information or any material, ideas or concepts
relating to such Confidential Information may give rise to irreparable injury to
the Disclosing Party, inadequately compensable in damages. Accordingly, each
Party shall be entitled to injunctive relief against the breach or threatened
breach of any of the foregoing undertakings, in addition to any other legal
remedies which may be available. and each Party hereby consents to such
injunctive relief. Nothing herein shall be construed as prohibiting either Party
from pursuing any other remedies available to such Party for such a breach or
threatened breach, including the recovery of monetary damages from the other
Party.
10. TERMINATION; REMEDIES.
Subject to the provisions of Section 11(d):
(a) The Customer shall have the
right to terminate this Agreement upon thirty days' prior written notice to R&N
upon a material breach by R&N of its obligations set forth in Sections 3, 4, 9
and 11, unless R&N cures such breach within thirty days after the Customer gives
written notice of such breach of R&N.
(b) R&N shall have the right to terminate this Agreement upon thirty
days' prior written notice (unless such breach is curable and is cured by the
Customer within thirty days) to the Customer upon (i) the Customer's failure to
pay any sums due hereunder, (ii) a material breach by the Customer of the
Customer's obligations set forth in Sections 3, 4, 7, 9, and 11; or (iii) the
termination or cessation of the business of the Customer.
(c) In the event of termination under subsection (b) above, R&N shall
be permitted to, in addition to any other remedies it may have in law or equity:
automatically, and without any
further action by R&N, terminate the
Services;
take immediate possession of any Confidential Information held
by the Customer, and all copies thereof wherever located, without
notice or demand; and
recover from the Customer the aggregate of all Service Fees,
as defined in Schedule G, that are then due, or will become due during
the then-current Term, all other fees and charges then payable to or
earned by R&N through the date of termination, reasonable attorney's
fees and expenses incurred in enforcing (including the cost of
consulting with an attorney to determine the scope of the Customer's
breaches) any of the terms and provisions of this Agreement.
(d) Notwithstanding the foregoing, the provisions of Sections 5, 7, 8
and 12(b) shall survive the termination of this Agreement.
(e) Upon termination of this Agreement for any reason other than
termination by R&N due to default or breach by the Customer, R&N will assist in
transferring Customer information to the Customer or to another data processing
company, provided, however, that such assistance shall be limited to that
assistance which in R&N's sole discretion is reasonably available. The Customer
shall pay R&N for: (i) staff time expended in the provision of such assistance,
at R&N's then-prevailing hourly rates, (ii) machining time, (iii) the cost of
the media on which the Customer's information is stored, (iv) transportation
costs, and (v) all other reasonable expenses incurred by R&N in connection with
such assistance.
11. WARRANTIES AND LIABILITY.
(a) R&N warrants that, during the term of this Agreement, the Services
will be conducted with reasonable care and skill.
(b) The warranty set forth above shall not extend to Deficiencies
contained in the Software caused by any of the following: (i) alterations,
modifications or revisions to or of the Software performed by a party other
than R&N; (ii) negligence in the operation or use of the; (iii) operation of the
Software not in accordance with the Documentation; and (iv) an act of God or any
factor beyond R&N's reasonable control.
(c) THE WARRANTY STATED ABOVE IS IN LIEU OF AND R&N HEREBY DISCLAIMS
ALL OTHER WARRANTIES EXPRESSED OR IMPLIED, INCLUDING WITHOUT LIMITATION, THE
IMPLIED WARRANTY OF MERCHANTABILITY AND IMPLIED WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE, WARRANTIES ARISING BY STATUTE OR OTHERWISE IN LAW, OR FROM A
COURSE OF DEALING OR USAGE OF TRADE.
(d) IN NO EVENT SHALL R&N BE LIABLE FOR LOST PROFITS, LOSS OF GOODWILL,
LOSS OR ALTERATION OF CUSTOMER DATA, FAILURE TO REALIZE EXPECTED SAVINGS,
INABILITY TO USE ANY COMPUTER PROGRAMS, REGULATORY PENALTIES, OR FOR ANY
COMMERCIAL ECONOMIC, SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY OR CONSEQUENTIAL
DAMAGE EVEN IF R&N HAS BEEN ADVISED OF OR FORESEES A POSSIBILITY OF, ANY OF
THESE DAMAGES OCCURRING. R&N'S MAXIMUM LIABILITY TO THE CUSTOMER FOR ANY AND ALL
BREACHES OF THIS AGREEMENT SHALL IN NO EVENT EXCEED THE LESSER OF THE AGGREGATE
OF THE FEES AND CHARGES ACTUALLY PAID BY THE CUSTOMER TO R&N, HEREUNDER WITHIN
THE TWELVE- MONTH PERIOD IMMEDIATELY PRECEDING THE CUSTOMER'S NOTIFICATION TO
R&N OF SUCH BREACH OR DEFAULT, OR $1,000,000.
12. INTELLECTUAL PROPERTY INDEMNITY.
(a) R&N shall indemnify and hold the Customer harmless from liability
for any action brought against the Customer to the extent that such action is
based on a claim that the Software use within the scope of this Agreement
infringes any United States Intellectual Property.
(b) The right of Indemnification as set forth herein is subject to all
of the following: (i) the Customer shall provide R&N with prompt written notice
of the action; (ii) R&N shall select legal counsel to defend, compromise or
settle the action in the sole discretion of R&N; (iii) the Customer shall
provide R&N with all available information known to the Customer, assistance,
authority, and cooperation to enable R&N to defend, compromise, or settle the
action, and (iv) if the use of the Software becomes, or in R&N's opinion is
likely to become, the subject of a claim of infringement, the Customer shall
permit R&N, at R&N's option and expense, either to procure the right for the
Customer to continue to use the Software or to replace or modify the Software so
that it becomes non- infringing and retains substantially the same functionality
as that described in the Documentation.
(c) R&N shall have no liability for any claim of Intellectual Property
infringement rights of third parties based on modification of the Software by
the Customer or any third party, or the use of or
combination of the Software by the Customer or any third party with programs or
software or any parts thereof not furnished to the Customer by R&N. The
provisions of this Section 14 state the entire scope of the liability of R&N
with respect to infringement of the Intellectual Property, and the Customer
hereby expressly waives any other such liabilities.
13. RECRUITMENT.
Each Party agrees not to retain, hire or contract with in any capacity
whatsoever any employee of the other Party for a period of twelve months
following the earlier of the termination of that person's employment with the
other Party or the termination of this Agreement.
14. SURVIVAL.
The obligations and agreements of the Customer and R&N contained in
Sections 5, 7, 8, and 12(b) shall survive the termination of this Agreement for
whatever reason. 15. EVENTS BEYOND CONTROL OF PARTIES.
Notwithstanding any provision to the contrary contained herein, the
failure or delay in performance by either Party shall be excused to the extent
it is caused by an event beyond such Party's reasonable control provided the
Party prevented from or delayed in rendering performance notifies the other
Party and in detail of the commencement and need of such a cause, and provided
further that such Party uses it best efforts to render performance in a timely
manner. The obligation of both Parties to perform under this Agreement shall be
suspended during such event for a maximum period of sixty days. 16. TAXES.
(a) In addition to any other payments required to be paid by the
Customer, the Customer shall pay all tariffs, import duties, license and
registration fees, sales, use, rental, transfer or other taxes, whether federal,
state or local, however designated, and all other assessments which are levied
or imposed by reason of the Services to be provided hereunder, excluding,
however, income taxes which may be levied against R&N. The Customer shall
reimburse R&N for the amount of any such tariffs, import duties and taxes paid
or advanced by R&N as a result of the provision of Services hereunder.
(b) If any withholding taxes are applicable in respect of amounts
payable, the Customer shall remit the applicable amount to the relevant taxing
authorities and shall furnish to R&N information regarding such remittance in
sufficient detail to enable R&N to substantiate any claim for a foreign tax
credit.
17. MISCELLANEOUS.
(a) Notices. Any notices or other communications required or permitted
hereunder shall be in writing and shall be given by personal delivery or by
United States certified mail, return receipt requested, postage prepaid,
addressed to the location stated above or to such other address as either Party
may designate by notice to the other Party. All notices shall be deemed
effective upon the earlier of receipt, seven business days after such notice is
postmarked, or, if delivered personally, upon the date of
delivery.
(b) Governing Law; Dispute Resolution. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York, without
regard to the conflict of laws principles
thereof.
At the written request of a Party, each Party will appoint a
knowledgeable, responsible representative to meet and negotiate in good faith to
resolve any dispute arising under this Agreement. The Parties intend that these
negotiations be conducted by non-lawyer, business representatives. The location,
format, frequency, duration and conclusion of these discussions shall be left to
the discretion of the representatives. Upon agreement, the representatives may
utilize other alternative dispute resolution procedures such as mediation to
assist in the negotiations. Discussions and correspondence among the
representatives for purposes of these negotiations shall be treated as
confidential information developed for purposes of settlement, exempt from
discovery and production, which shall not be admissible in the arbitration
described below or in any lawsuit without the concurrence of all Parties.
Documents identified in or provided with such communications, which are not
prepared for purposes of the negotiations, are not sot prepared for purposes of
the negotiations, are not so exempted and may, if otherwise admissible, be
admitted in evidence in the arbitration or lawsuit.
If the negotiations do not resolve the dispute within sixty days of the
initial written request, or if neither Party makes such a request within sixty
days of the dispute, the dispute shall be submitted to binding arbitration by a
single arbitrator pursuant to the Commercial Arbitration Rules of the American
Arbitration Association. A Party may demand such arbitration in accordance with
the procedures set out in those rules. Discovery shall be controlled by the
arbitrator and shall be permitted to the extent set out in this Section. Each
Party may submit in writing to a Party, and that Party shall so respond. Each
Party is also entitled to take the oral deposition of one individual of another
Party. Additional discovery may be permitted upon mutual agreement of the
Parties. The arbitration shall be held in Chicago, Illinois. The arbitrator
shall control the scheduling so as to process the matter expeditiously. The
Parties may submit written briefs. The arbitrator shall rule on the dispute by
issuing a written opinion within thirty days after the close of hearings. The
times specified in this Section may be extended upon mutual agreement of the
Parties of by the arbitrator upon a showing of good cause. Judgment upon the
award rendered by the arbitrator may be entered in any court having
jurisdiction.
Each Party shall bear its own costs of these procedures. A Party
seeking discovery shall reimburse the responding Party the costs of production
of documents (to include search time and reproduction costs). The Parties shall
equally split the fees of the arbitration and the arbitrator.
(c) Strict Compliance. The failure by either Party to insist upon the
strict performance of any covenant, agreement, term or condition of this
Agreement, or to exercise any right or remedy consequent upon a breach thereof,
shall not constitute a waiver of any such breach or any subsequent breach of
such covenant, agreement, term or condition. The
waiver of any breach shall not affect or alter this Agreement, but each and
every covenant, agreement, term and condition of this Agreement shall continue
in full force and effect with respect to any other then existing or subsequent
breach thereof.
(d) Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original, but all of which shall
constitute but one and the same instrument.
(e) Amendments. Neither this Agreement nor any term or provision hereof
may be changed, waived, discharged or terminated, except upon the written
consent of all Parties.
(f) Captions. The captions to this Agreement are for convenience of
reference only and in no way define, limit or describe the scope or intent of
this Agreement or any part hereof, nor in any way affect this Agreement or any
part hereof.
(g) Assignment. This Agreement may not be assigned by the Customer
without the prior written consent of R&N, which R&N may withhold in its sole
discretion. Any attempt by the Customer to assign, transfer or sublicense any of
the Software or any of the rights, duties or obligations under this Agreement in
violation of this Agreement shall be null and void and of no force or effect.
(h) Severability. If any provisions of this Agreement shall for any
reason be held to be invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provision hereof, and this Agreement
shall be construed as if such invalid or unenforceable provisions were omitted.
(i) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the Parties hereof, and their respective heirs,
executors, administrators, successors and permitted assigns.
(j) Schedules. The Schedules annexed hereto are incorporated by
reference and made a part hereof:
(k) Entire Agreement. This Agreement, together with all Schedules
hereto and together with any amending correspondence which is executed on behalf
of both Parties, constitutes the entire agreement between the Parties hereto
with respect to the subject matter thereof.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first above written.
Xxxxx & Xxxxx (USA) Inc. Alaron Trading
By:________________________________ By:_____________________________
Name:______________________________ Name:___________________________
Title:_____________________________ Title:__________________________
SCHEDULE A
RISC SOFTWARE DESCRIPTION
Data Entry Base:
Non-clearing Trade - Full form Ability for User to Define Trade entry
screens Bust/Make-up/Leave Entry & Correction P&S, Commission
Adjustment & Correction Journaling Trade Correction Cash Entry &
Correction Settlement Price Update Worksheet On-line Help Multiple line
trade entry w/duplication
Master File Update:
Commodity Master & Settlement Price
Commodity Master file
All futures world-wide
All world-wide options on futures
Exchange Table for 99 exchanges
Contra Account Table
Settlement Price Master File
Account Master File
8-digit account number 99 currency subledgers Account G/L numbers
segregated/non-segregated
Option Strike File
put/call strike price
expiration date
Multiple Firm Number Table
reports header controls
Calendar
Run-date control
Actual valid trading dates
Future valid trading dates
Valid trading/business date per currency
Automatic generation of last trading
dates/expiration dates etc.
Automatic IPL & session dates Master file defaulting Account -
salesman - location - firm Commodity - exchange
Collateral
Collateral master file
Collateral rate detail file
Automatic Offsetting of positions prioritized for:
Day trades
Overnight trades, spreads
Special makeups bust/leave open Automatic Commissioning:
Unlimited tables
Day/overnight/spread
Opening/half turn/round turn
Formulas by: Commodity/membership/exchange/group
account/salesman/location/firm/global
Reports Base:
Preliminary Listings:
Trades by user
Trades by Commodity Number
Trades by Salesman/Account
Trades by Exchange
Cash & Adjustment Entries
Day Trade Journals in Account sequence Busts & Make-ups Exercises,
Assignments & Expirations Report P&S Recap by Commodity Settlement
Prices Needed Report Delivery Month Position Report Open Position
Report - Detail & Summary P/L Report - Monthly & Yearly Deleted Account
Purge & List - Year End Ledger Recap and Summary Account Statements:
Combined Confirmation, P&S & Open Positions
Cash & Adjustments
Account Balances
Monthly Activity Statement & Open Position Statement
Confirmation messages
Alternate confirmation name/address
Programs & Documentation:
Object code for all programs, and files RISC User's manual On-line
documentation library using the HELP key
Additional Functions:
Supplementary reports:
Preliminary Listing of trades by selected exchange
Day Trade Journal in Price Sequence
Optional Statements:
Duplicate Statements, Daily & Monthly
Statement messages by firm, branch, A/E, or account
Securities on Deposit for margin tracking: Entry & correction
Preliminary listing of entries Collateral listings of entries
T-bills conversion to cash on maturity
Collateral on account equity report & client statements Interest
Pay/Collect on account Equity Automatic Reversal accounting for P&S and
Busts
A/E Trader reporting:
P/L recap by A/E Trader--daily
P/L & commission recap by A/E Trader--monthly
Commission summary by A/E Trader--monthly Margins:
DAR SPAN) Margining Customer Equity & Margin Status Report Futures
outright and inter-month spreads Inter-commodity, crush spreads with
ratios Options margined at net-short-premium Inter-crop year spreads
Omnibus accounts margined gross Horizontal spreads and Crush spreads
Futures to futures spreads Straddles and Conversions Covered
purchases and writes Vertical spreads and Reverse conversions Mixed
spreads and Butterfly spreads Condor spreads and Box spreads
Margin call reports:
Margin Request Slips
Margin Call & Debit Equity Listing
Margin Call Reduction & Deletions Report
Cross Account Margining for Grouped Accounts
Branch transmissions:
Condensed Equity & Margin status
Preliminary Listing
Capital Computations - FCM Capital Reports:
Capital Requirements List - Month End
Concentration Reports - Weekly
CFTC & Exchange regulatory reporting:
CFTC '01 Report Preparation
SCHEDULE B
RISC PROCESSING SERVICES
Maintenance of the following files:
Commodity Masters for Futures & Options
Currency Master and Exchange Master
Regulation Code Master and System Calendar Master
Screen & Report Titles Master and Instrument Type Master Opposite
Broker & Opposite Firm Masters for CME & CBOT exchanges Speculative
Limits and Reportable Levels Master files RISC Base Menu and RJS files
Processing of the RISC End of Day job stream which includes:
Spooling of all end of day reports, including customer statements.
These will be held in the spool file, and Customer will be responsible
for releasing and printing.
Creation of a microfiche tape, if service selected
Processing of the RISC Beginning of Day job stream which includes: Preparation
of files for the next business day Starting of file journaling and the
prelim journal job
Creation and Transmission of the following files, if necessary: CFTC 01
reportable file (daily) and CME 25 & Over reportable file (daily)
Equity Wire statements (daily)
Processing of the RISC Month End job stream which includes:
Spooling of all end of day reports, including customer statements.
These will be held in the spool file, and Customer will be responsible
for releasing and printing.
Creation of a microfiche tape, if service selected
Backup of Client's data files as follows:
Daily, before end of day processing with a 5 day rotation Daily, after
end of day processing with a 5 day rotation Monthly, before month end
processing with a 12 month rotation
Processing of the RISC Year End job stream which includes: Printing of all Tefra
year end reports Delivery of yearly reports to Customer's office
Creation of IRS 1099 tape, if necessary Upgrades of RISC application
software and Upgrades of IBM Operating System Software
SCHEDULE C
Training Services Description
SCHEDULE D
RISC Processing Services Schedule
R&N Service Bureau operating conditions are listed below.
R&N Service Bureau Service Hours will be from 7:00 am to 9:00 pm Central
Standard Xxx on CME/CBT trading days.
Access to the R&N Service Bureau processing service outside of the service hours
stated must be approved by R&N Service Bureau operations.
R&N Service Bureau will, under normal conditions and given Customer's submission
of Customer Information by 7:00 pm CST (submission time), process the Customer's
daily transactions beginning at 9:00 pm CST or earlier when possible. Processing
Service overnight information and reports will generally be delivered by 6:00 am
CST (delivery time). In the event of a unforeseen delay, R&N Service Bureau will
notify Customer and make "best efforts" to achieve a delivery time no later than
8:00 am CST.
RISC documentation will be provided as follows:
1 RISC User Guide - Volumes 2A and 2B
1 RISC Training Manual
1 RISC Reports Guide
SCHEDULE E
RISC Processing Services
R&N Service Bureau Responsibilities:
The hardware, equipment and supplies provided by R&N Service Bureau are listed
below. Any other hardware, equipment or supplies not listed will be the
responsibility of the customer.
R&N Service Bureau data center will provide the Customer with floor space,
electrical power, and operations support necessary to provide the processing
services as specified in Schedule B.
R&N will provide a printer at the R&N Service Bureau data center for printing
Customer's batch processing reports. R&N will provide a workstation at the R&N
Service Bureau data center for R7N Service Bureau operations and staff to
process the Customer's data. An alternate R&N Service Bureau System at the R&N
Service Bureau data center will be available as a backup should there be a
hardware problem on the primary production system, Provided Customer executes a
separate Disaster Recovery agreement.
As a daily print report alternative, R&N Service Bureau will use one part, green
bar printer paper for printing batch processing reports and three part statement
forms for daily and monthly statements. Customer agrees to reimburse R&N Service
Bureau for the actual cost plus 20% of all paper that R&N Service Bureau uses to
print the Customer's reports.
R&N will assist Customer personnel in starting sufficient parallel operation.
Customer is responsible for continuation of parallel operations, and insuring
that data and information is accurate.
R&N Service Bureau will provide support for non-standard requests, provided that
Customer agree to pay for such requests on a time and materials basis, and the
request is approved by R&N.
Customer Responsibilities:
The hardware, equipment and supplies that are the responsibility of the client
are listed below. Other items may be necessary to satisfy the client's
processing needs.
Leased (or Dial-up) telephone lines as follows: Between Customer's back office
and R&N Service Bureau data center Between R&N Service Bureau data center and
exchange cleared, if necessary Backup dial lines for fall back should a leased
line fail
Modems with dial backup for the leased telephone lines as follows: Two 28,800
baud modems for the back office leased line.
An IBM 5394 or equivalent remote controller for each of the back office's leased
lines.
Any workstations and printers necessary for the Customer's back office daily
processing functions. R&N suggests at least 2 workstations and a 600 line per
minute printer at each back office location.
Customer will provide any preprinted or custom forms for use with the RISC
Software application.
Unless the print report alternative, as stated in Schedule E is requested, the
Customer will print all reports at the Customer location on a Customer-owned
printer. Customer is responsible for maintaining an adequate supply of stock
forms in each office location to accommodate processing and printing
requirements.
SCHEDULE F
Processing Service - Client Operations Responsibilities
The operational responsibilities of a R&N RISC Service Bureau Customer include,
but are not limited to, the following functions:
Maintenance of all master files that are not maintained by R&N. This includes,
but is not limited to, the following files:
Account, Salesman, Location, Firm and Company master files Commission,
fee and interest rates and their usage Carrying Broker, Margin Grouping
and Omnibus relationship files Confirm Message Text and Compliance
Document master files Prelim master and item files Transmission and
Print Routing master files Span scale up files Floor Broker master
Entry of daily transactions which include:
Trade entry and correction Cash and adjustment entry and correction
Collateral entry and correction Special makeups and P&S reinstates
Deliveries, exercise and assignments
Generation and printing of the following reports:
Intra-day prelims of trades, cash, etc.
Interest calculation report and posting
Generation and transmission of the required exchange files
SCHEDULE G
Processing, Installation, and Miscellaneous Fees
1. Processing Service Fees
Activity Processing Fees
Transactions $ 0.075 each
Positions $0.03 each
Daily Customer Statements: $ included
Monthly Customer Statements: $ included
TIF Base and 1 (one) TIF Facility $ included
CFTC Reporting $ included
Large Trader Reporting $ included
SPAN and Settlement Prices (US Markets only) $ 500.00 per month
RANrec (1 methods) $ included
Functional Facilities Fees
Clearing Interfaces (CBT, CME, NY, Montreal etc.) $400.00 per month
Realtime Price Inquiry Module (excludes market price feed) $700.00 per
month
Canadian Regulatory Reporting $300.00 per month
General Ledger Interface $250.00 per month
Trade Import Base Module (TIF) $300.00 per month
Trade Import Facility $200.00 per month
Trade Export Base Module (TEF) $300.00 per month
Trade Export Facility $200.00 per month
Data Export Base Module $300.00 per month
Data Export Facility $300.00 per month
Large Trader Reporting and Transmission $200.00 per month
Japanese Market Requirements $550.00 per month
Flex Options $550.00 per month
Foreign Exchange $550.00 per month
Additional Services Fees
One Communications Port $150.00 per month
Speedscan File Export & Disk Archiving
(Monthly Reports/Files) $.05 per page
(one time set-up charge $1200)
Equity Wire Transmission Services per minute charge
Settlement Prices $100.00 per exchange
SPAN Files $100.00 per exchange
RANrec (3 methods) $250.00 per month
RANwindows $300.00 per month
Disaster Recovery Services Based on users reqmts
Customization Services Standard R&N
Additional User Training time & material rates
Consulting Services time & material rates
Hardware and Communications Billed at cost
2. Minimum Monthly Charge
For Activity Processing and Required Facilities $4,000.00
3. Fee Schedule at Renewal
No less than three months prior to the last date upon which the
Customer may provide notice of termination of this Agreement, R&N shall
provide the Customer with a revised Processing Fee Schedule applicable
to the next renewal term, if any. Such revised Processing Fee Schedule
may be increased by R&N up to R&N's then-prevailing price as set forth
on its published price lists.
4. Installation Fee
There will be an initial installation fee for the processing service
and Software described in Schedule A and B. The fee will be $15,000 and
encompass project planning, R&N project management, installation
support, conversion activities and system training). Custom
Modifications and expenses related to the implementation of any future
modules or hardware upgrades require payment of additional fees and
will be billed separately.
Payment of Processing Fees
The Processing and Installation Fees for the initial Term shall be
payable in accordance with the following schedule:
the Installation Fee shall be payable upon execution of this Agreement;
Processing Fees shall be payable monthly based upon the actual usage
incurred during the
prior month
Additional Services
This Agreement excludes the provision of settlement prices and SPAN
arrays. A monthly fee will be assessed for the prices and SPAN arrays
associated with each individual exchange. Additional services which may
also be required, but not exclusively limited to, include Disaster
Recovery Service and Real Time Price Feed, and shall require payment of
additional fees and will be billed separately.
All communication line costs are the rsponsibility of the Customer.
This includes, but is not limited to, Easylink and Graphnet
transmission charges.
Any charges as a result of using third-party vendors to perform
processing services for the Customer will be the responsibility of the
Customer. This includes, but is not limited to, such services as
creating microfiche and delivering statements to customers
electronically.
SCHEDULE H
CUSTOMIZATION REQUEST
Date:
Requested Functionality:
Specifications:
Programs Affected:
The Customer agrees to pay to R&N a preliminary estimate fee in the amount of
___________.
The charges estimated for the above-requested modifications are _______________.
The Customer
By:___________________________
Name:
Title:
SCHEDULE I
Installation Plan
