HOSTING SERVICES AGREEMENT
Exhibit 10.15
This Hosting Services Agreement (the “Agreement”) between LendingClub Corporation
(“LendingClub”) and FOLIOfn Investments, Inc. (“Customer”) is made effective as of
October 6, 2008 (“Effective Date”).
1. Overview.
1.1. General. This agreement states the terms and conditions by which LendingClub will
deliver and Customer will receive the Service provided by LendingClub, including facilities,
bandwidth and managed services. The specific service to be provided hereunder (the
“Service”) is identified in Schedule A, hereby incorporated by reference into this
Agreement.
1.2. Definitions.
(a) “Customer Technology” means Customer’s proprietary technology, including
Customer’s internet operations design, content, software tools, hardware designs, algorithms,
software (in source and object forms), user interface designs, architecture, class libraries,
objects and documentation (both printed and electronic), know-how, trade secrets and any related
intellectual property rights throughout the world (whether owned by Customer or licensed to
Customer from a third party) and also including any derivatives, improvements, enhancements or
extensions of Customer Technology conceived, reduced to practice, or developed during the term of
this Agreement by Customer.
(b) “Internet Data Center(s)” means any of the facilities used by LendingClub to
provide the Service.
(c) “LendingClub Technology” means LendingClub’s proprietary technology, including
LendingClub services, software tools, hardware designs, algorithms, software (in source and object
forms), user interface designs, architecture, class libraries, objects and documentation (both
printed and electronic), network designs, know-how, trade secrets and any related intellectual
property rights throughout the world (whether owned by LendingClub or licensed to LendingClub from
a third party) and also including any derivatives, improvements, enhancements or extensions of
LendingClub Technology conceived, reduced to practice, or developed during the term of this
Agreement by either party.
(d) “Rules And Regulations” means the LendingClub general rules and regulations
governing Customer’s use of the Service, including, but not limited to, on line conduct.
(e) “Service Commencement Date” means the date LendingClub will begin providing the
Service to Customer, as indicated in a notice of service commencement delivered by LendingClub to
Customer.
2. Delivery of Services; Term; Exclusivity and Notice.
2.1. Delivery of Services. Customer agrees to take, and LendingClub agrees to provide, the
Service during the Initial Term and for any period thereafter, as specified in paragraph 2.2 below.
2.2. Term.
(a) Term Commencement. The term for the Service will commence on the Service Commencement
Date indicated in the notice of service commencement delivered by LendingClub to Customer when
LendingClub begins providing the Service to Customer.
(b) Term. Unless earlier terminated as provided herein, this Agreement shall be effective
during the period from the Service Commencement Date until the first anniversary of the Service
Commencement Date, unless terminated earlier in accordance with Section 10 (the “Term”).
(c) Renewed Term. If no notice of termination is given in accordance with Section 10 prior to
the expiration of the Term, this Agreement shall automatically renew for a period of one (1) year
(“Renewed Term”).
2.3. Exclusivity. The parties acknowledge that Customer has developed an alternative trading
system for notes or securities and that it is constantly modifying that system. The parties agree
that Customer (or any affiliate of Customer) may, in its sole discretion, operate an alternative
trading system (or similar exchange or system) for the trading of notes or securities by members,
participants, subscribers (or persons of a similar nature) of an Internet-based social lending
platform (howsoever described) that directly or indirectly competes with LendingClub.
3. Fees. LendingClub shall provide the Service to Customer during the term of this Agreement for
no charge.
4. Confidential Information; Intellectual Property Ownership.
4.1. Confidential Information.
(a) Customer’s
Confidentiality Obligation. For so long as this Agreement remains in effect
and for a period of ten (10) years after any expiration or termination of this Agreement, Customer
agrees that it and its managers, employees, consultants, agents and advisors shall treat
confidentially and not disclose, or permit any affiliate of it or their respective advisors,
employees, agents or representatives to disclose, to any third party any non-public or proprietary
information received from or on behalf of LendingClub or about LendingClub (“Confidential
Information”). Confidential Information will include all information in tangible or intangible
form that is marked or designated as confidential or that, under the circumstances of its
disclosure, should be considered confidential. Confidential Information also will include, but not
be limited to, LendingClub Technology, Customer Technology, and the terms and conditions of this
Agreement. Further, for the avoidance of doubt, such Confidential Information shall include any
personally identifiable information about any borrower or lender member of the LendingClub
Internet-based social lending platform, excluding information provided by any lender member to
Customer in the course of establishing or maintaining a brokerage account for any such person or
relating to executing a transaction for any such person. Customer agrees not to use such
Confidential Information for any purpose other than for the purposes contemplated under this
Agreement, without obtaining the prior written consent of LendingClub, except (i) portions of such
information that are or become generally available to the public other than as a result of
disclosure by Customer in violation of this Agreement, (ii) portions of such information received
on a non-confidential basis from a third party who, to such recipient’s knowledge, is not
prohibited from disclosing the information pursuant to a confidentiality agreement with, or
fiduciary obligations to, LendingClub, and (iii) for the purpose of making any disclosures required
by applicable law. In the event that such Confidential Information is disclosed in accordance with
this paragraph, Customer agrees to contractually require each person to whom it has provided such
Confidential Information as expressly permitted hereunder or with the prior written consent of
LendingClub to keep such information confidential and to use and disclose it only in connection
with its performance under this Agreement.
(b) LendingClub’s Confidentiality Obligation. For so long as this Agreement remains in effect
and for a period of ten (10) years after any expiration or termination of this Agreement,
LendingClub agrees that it and its directors, employees, consultants, agents, representatives and
advisors shall treat confidentially and will not disclose to any third party any Confidential
Information received from or on behalf of Customer or any of its affiliates, or use such
Confidential Information for any purpose other than providing the Service or for the fulfillment of
LendingClub’s obligations under this Agreement without obtaining the prior written consent of
Customer, except (i) portions of such information that are or become generally available to the
public other than as a result of disclosure by LendingClub in violation of this Agreement, (ii)
portions of such information received on a non-confidential basis from a third party who, to such
recipient’s knowledge, is not prohibited from disclosing the information pursuant to a
confidentiality agreement with, or fiduciary obligations to, Customer, and (iii) for the purpose of
making any disclosures required by applicable law.
(c) Permitted Disclosure. Notwithstanding paragraphs (a) and (b) above, either party may
disclose Confidential Information received from the other if:
(i) such information is disclosed, in compliance with applicable law, by the receiving party
to its advisors, representatives, agents and employees, acting in their capacity as such, who have
a need to know such Confidential Information in connection with the performance of this Agreement;
provided, however, that such advisors, representatives, agents and employees shall be required to
agree to abide by the requirements of this Section 4.1 and the receiving party shall be liable to
the other party for any breach of these requirements by its advisors, employees, agents and
representatives; or
(ii) either party determines that it is required by applicable law to disclose information not
otherwise permitted to be disclosed pursuant hereto. In advance of any such disclosure (to the
extent legally permitted and reasonably practicable), the receiving party shall consult with the
other party regarding such disclosure and seek confidential treatment for such portions of the
disclosure as may be requested by the other party. Such receiving party shall have no liability
hereunder if, prior to the required disclosure, the receiving party receives a written opinion from
its counsel opining that such disclosure is required by law or regulation. In addition,
notwithstanding any other provision of this Agreement, either party shall be permitted to file a
copy of this Agreement with any governmental authority or securities regulatory body, as necessary.
(d) Damages Not an Adequate Remedy. Without prejudice to any other rights or remedies of a
party, the parties acknowledge and agree that damages would not be an adequate remedy for any
breach of this Section 4.1 and the remedies of prohibitory injunctions and other relief are
appropriate and may be sought for any threatened or actual breach of any provision of this Section
4.1. No proof of special damages shall be necessary for the enforcement of any party’s rights
under this Section 4.1.
4.2. Intellectual Property.
(a) Ownership. Except for the rights expressly granted herein, this Agreement does not
transfer from LendingClub to Customer any LendingClub Technology, and all right, title and interest
in and to LendingClub Technology will remain solely with LendingClub. Except for the rights
expressly granted herein, this Agreement does not transfer from Customer to LendingClub any
Customer Technology, and all right, title and interest in and to Customer Technology will remain
solely with Customer. LendingClub and Customer each agrees that it will not, directly or
indirectly, reverse engineer, decompile, disassemble or otherwise attempt to derive source code or
other trade secrets from the other party.
(b) General Skills and Knowledge. Notwithstanding anything to the contrary in this Agreement,
neither party will be prohibited or enjoined at any time from utilizing any skills or knowledge of
a general nature acquired during the course of providing or receiving the Service, including,
without limitation, information publicly known or available or that could reasonably be acquired in
similar work performed for another.
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5. LendingClub Representations and Warranties.
5.1. General. LendingClub represents and warrants that (a) it has the legal right to enter
into this Agreement and perform its obligations hereunder, and (b) the performance of its
obligations and delivery of the Service to Customer will not violate any applicable U.S. laws or
regulations or cause a breach of any agreements with any third parties.
5.2. Service Performance Warranty. LendingClub warrants that it will perform the Service in a
manner consistent with industry standards reasonably applicable to the performance thereof.
5.3. No Other Warranty. Except for the express warranties set forth in this Section 5, the
Service is provided on an “as is” basis, and Customer’s use of the Service is at its own
risk. LendingClub does not make, and hereby disclaims, any and all other express and/or implied
warranties, including, but not limited to, warranties of merchantability, fitness for a particular
purpose, noninfringement and title, and any warranties arising from a course of dealing, usage, or
trade practice. LendingClub does not warrant that the Service will be uninterrupted, error-free,
or completely secure.
5.4. Disclaimer of Actions Caused by and/or Under the Control of Third Parties. LendingClub
does not and cannot control the flow of data to or from LendingClub’s network and other portions of
the internet. Such flow depends in large part on the performance of internet services provided or
controlled by third parties. At times, actions or inactions of such third parties can impair or
disrupt Customer’s connections to the internet (or portions thereof). Although LendingClub will
use commercially reasonable efforts to take all actions it deems appropriate to remedy and avoid
such events, LendingClub cannot guarantee that such events will not occur. Accordingly,
LendingClub disclaims any and all liability resulting from or related to such events.
6. Customer Obligations.
6.1. Warranties of Customer.
(a) General. Customer represents and warrants that the performance of its obligations and use
of the Service (by Customer, its customers and users) will not violate any applicable laws,
regulations or the Rules and Regulations or cause a breach of any agreements with any third
parties.
(b) Breach of Warranties. In the event of any material breach of the foregoing warranty, in
addition to any other remedies available at law or in equity, LendingClub will have the right, in
its sole reasonable discretion, to suspend immediately the Service if deemed reasonably necessary
by LendingClub to prevent any harm to LendingClub and its business. LendingClub will provide
notice and opportunity to cure if practicable depending on the nature of the breach. Once cured,
LendingClub will promptly restore the Service.
6.2. Compliance With Law and Rules and Regulations. Customer agrees that it will use the
Service only for lawful purposes and in accordance with this Agreement. Customer will comply at
all times with all applicable laws and regulations and the Rules and Regulations, as updated by
LendingClub from time to time. The Rules and Regulations are incorporated herein and made a part
hereof by this reference. LendingClub may change the Rules and Regulations upon fifteen (15) days’
written notice to Customer. Customer agrees that it has received, read and understands the current
version of the Rules and Regulations. The Rules and Regulations contain restrictions on Customer’s
and Customer’s users’ online conduct (including prohibitions against unsolicited commercial email)
and contain financial penalties for violations of such restrictions. Customer agrees to comply
with such restrictions and shall use commercially reasonable efforts to cause Customer’s users to
comply with such restrictions. Customer acknowledges that LendingClub exercises no control
whatsoever over the content of the information passing through Customer’s site(s).
6.3. Restrictions on Use of Services. Customer shall not resell the Service to any third
parties.
7. Insurance.
7.1. LendingClub Minimum Levels. LendingClub agrees to keep in full force and effect during
the term of this Agreement: (i) comprehensive general liability insurance in an amount standard
for the industry and appropriate to cover its liabilities hereunder and (ii) workers’ compensation
insurance in an amount not less than that required by applicable law. LendingClub agrees that it
will ensure and be solely responsible for ensuring that its contractors and subcontractors maintain
insurance coverage at levels no less than those required by applicable law and customary in
LendingClub’s and its agents’ industries.
8. Limitations of Liability.
8.1. Consequential Damages Waiver. In no event will either party be liable or responsible to
the other for any type of incidental, punitive, indirect or consequential damages, including, but
not limited to, lost revenue, lost profits, replacement goods, loss of technology, rights or
services, loss of data, or interruption or loss of use of service or equipment, even if advised of
the possibility of such damages, whether arising under theory of contract, tort (including
negligence), strict liability or otherwise.
8.2. Basis of the Bargain; Failure of Essential Purpose. The parties acknowledge that they
each entered into this Agreement in reliance upon the limitations of liability and the disclaimers
of warranties and damages set forth herein, and that the same form an essential basis of the
bargain between the parties. The parties agree that the limitations and exclusions of liability
and disclaimers specified in this Agreement will survive and apply even if found to have failed of
their essential purpose.
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9. Indemnification.
9.1. Customer’s Indemnification of LendingClub. Customer shall defend, indemnify and hold
LendingClub harmless from and against any and all claims, demands, causes of action, or suits of
any nature or character based on any legal theory, including products liability, strict liability,
violation of any federal, state or local law, rule or regulation, or the sole or concurrent
negligence of any person (“Claims”) to which LendingClub may become subject (including any legal or
other expenses reasonably incurred by it in connection with investigating any Claim against it and
defending any action and any amounts paid in settlement or compromise, provided Customer shall have
given its prior written approval of such settlement or compromise, which approval shall not be
unreasonably withheld or delayed) that arise, directly or indirectly, from (i) any third party
Claim resulting from any breach by Customer (or its affiliates) of this Agreement or the failure to
perform any activities necessary under this Agreement by any employee of Customer, (ii) any grossly
negligent act or omission to act by any employee of Customer relating to any activities, if any,
performed under this Agreement, or (iii) Customer’s (or its affiliates’) willful misconduct or
fraud.
9.2. LendingClub’s Indemnification of Folio. LendingClub shall defend, indemnify and hold
Customer and its affiliates harmless from and against any and all Claims to which Customer and its
affiliates may become subject (including any legal or other expenses reasonably incurred by it in
connection with investigating any Claim against it and defending any action and any amounts paid in
settlement or compromise, provided LendingClub shall have given its prior written approval of such
settlement or compromise, which approval shall not be unreasonably withheld or delayed) that arise,
directly or indirectly, from any third party Claim arising from any activities by Customer,
Customer’s affiliates or Customer’s employees or agents relating to this Agreement (including, for
the avoidance of doubt, any action or claim brought by a regulator or self-regulatory organization
under federal or state securities laws, rules or regulations), except to the extent such Claim is a
result of Customer’s gross negligence, willful misconduct or fraud (or the gross negligence,
willful misconduct or fraud of any Customer employee) with respect to this Agreement.
9.3. Exclusivity of Remedies. Subject to Sections 4.1(d) and 8, absent actual fraud or
willful misconduct by any of the parties to this Agreement, and except for matters for which the
remedy of specific performance, injunctive relief or other non-monetary equitable remedies are
available, the indemnification rights provided above shall be the sole and exclusive remedy of the
parties under this Agreement.
10. Termination.
10.1. Termination with Notice. The following parties may terminate this Agreement:
(a) LendingClub in writing, without cause, effective nine (9) months’ after notice is sent to
Customer, provided, however, this Agreement shall terminate along with the Services Agreement if
the Services Agreement is terminated in accordance with Section 2.2(a)(i) thereof;
(b) Customer in writing, without cause, effective nine (9) months’ after such notice is sent
to LendingClub;
(c) Either party, in writing, effective immediately, in the event of any material breach of
any warranty, representation or covenant of this Agreement by the other party which remains uncured
thirty (30) days after written notice of such breach to such other party; or
(d) Either party, upon mutual agreement of the parties.
10.2. Cross-termination. Notwithstanding the foregoing, this Agreement shall terminate
immediately upon the effective termination of the License Agreement between the parties, dated
October 6, 2008 (“License Agreement”) or the Services Agreement between the parties, dated October
6, 2008.
10.3. Effect of Termination. Upon the effective date of termination of this Agreement:
(a) LendingClub will immediately cease providing the Service; and
(b) Within thirty (30) days of such termination, each party will return all Confidential
Information of the other party in its possession and will not make or retain any copies of such
Confidential Information except as required to comply with any applicable legal or accounting
record keeping requirement.
10.4. Survival. The following provisions will survive any expiration or termination of the
Agreement: Sections 4.1, 4.2, 5.3, 8, 9, 10.3 and 11.
11. Miscellaneous Provisions.
11.1. Force Majeure. Neither party will be liable for any failure or delay in its performance
under this Agreement due to any cause beyond its reasonable control, including acts of war, acts of
god, earthquake, flood, embargo, riot, sabotage, labor shortage or dispute, governmental act or
failure of the internet (not resulting from the actions or inactions of LendingClub), provided that
the delayed party: (a) gives the other party prompt notice of such cause, and (b) uses its
reasonable commercial efforts to promptly correct such failure or delay in performance. If
LendingClub is unable to provide Service for a period of sixty (60) consecutive days as a result of
a continuing force majeure event, Customer may cancel the Service.
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11.2. No Lease; Agreement Subordinate to Master Lease. This Agreement is a services agreement
and is not intended to and will not constitute a lease of any real property. Customer acknowledges
and agrees that (i) it has been granted only a license to use the Internet Data Centers in
accordance with this Agreement; (ii) Customer has not been granted any real property interest in
the Internet Data Centers; (iii) Customer has no rights as a tenant or otherwise under any real
property or landlord/tenant laws, regulations, or ordinances; and (iv) this Agreement, to the
extent it involves the use of space leased by LendingClub, shall be subordinate to any lease
between LendingClub and its landlord(s).
11.3. Non-Solicitation. During the term of this Agreement and continuing through the first
anniversary of the termination of this Agreement, Customer agrees that it will not, and will ensure
that its affiliates do not, directly or indirectly, solicit or attempt to solicit for employment
any persons employed by LendingClub or contracted by LendingClub to provide Service to Customer.
11.4. Third Party Beneficiaries. LendingClub and Customer agree that, except as otherwise
expressly provided in this Agreement, there shall be no third party beneficiaries to this
Agreement, including but not limited to the insurance providers for either party or the customers
of Customer.
11.5. Governing Law. This Agreement is made under and will be governed by and construed in
accordance with the laws of the Commonwealth of Virginia (except that body of law controlling
conflicts of law) and specifically excluding from application to this Agreement that law known as
the United Nations Convention on the International Sale of Goods.
11.6. Severability; Waiver. In the event any provision of this Agreement is held by a
tribunal of competent jurisdiction to be contrary to the law, the remaining provisions of this
Agreement will remain in full force and effect. The waiver of any breach or default of this
Agreement will not constitute a waiver of any subsequent breach or default, and will not act to
amend or negate the rights of the waiving party.
11.7. Assignment. Customer may not assign its rights or delegate its duties under this
Agreement either in whole or in part without the prior written consent of LendingClub, and any
attempted assignment or delegation without such consent will be void. LendingClub may assign this
Agreement in whole or part. LendingClub also may delegate the performance of certain Services to
third parties, including LendingClub’s wholly owned subsidiaries, provided LendingClub controls the
delivery of such Services to Customer and remains responsible to Customer for the delivery of such
Services. This Agreement will bind and inure to the benefit of each party’s successors and
permitted assigns.
11.8. Notice. All notices, requests, demands or other communications hereunder shall be in
writing and shall be deemed to have been duly given when transmitted by facsimile during business
hours with proof of confirmation from the transmitting machine, or delivered by courier or other
hand delivery, as follows:
LendingClub Corporation:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
FOLIOfn Investments, Inc.:
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇
11.9. Relationship of Parties. LendingClub and Customer are independent contractors and this
Agreement will not establish any relationship of partnership, joint venture, employment, franchise
or agency between LendingClub and Customer. Neither LendingClub nor Customer will have the power
to bind the other or incur obligations on the other’s behalf without the other’s prior written
consent, except as otherwise expressly provided herein.
11.10. Entire Agreement; Counterparts; Originals. This Agreement, including all documents
incorporated herein by reference, constitutes the complete and exclusive agreement between the
parties with respect to the subject matter hereof, and supersedes and replaces any and all prior or
contemporaneous discussions, negotiations, understandings and agreements, written and oral,
regarding such subject matter. This Agreement may be executed in two or more counterparts, each of
which will be deemed an original, but all of which together shall constitute one and the same
instrument. Once signed, any reproduction of this Agreement made by reliable means (e.g.,
photocopy, facsimile) is considered an original. This Agreement may be changed only by a written
document signed by authorized representatives of LendingClub and Customer in accordance with this
Section 11.10.
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Authorized representatives of Customer and LendingClub have read the foregoing and all documents
incorporated therein and agree and accept such terms effective as of the date first above written.
| FOLIOfn Investments, Inc.: | LendingClub Corporation: | |||||||||
Signature:
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/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | Signature: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ | |||||||
Print Name:
|
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | Print Name: | ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ | |||||||
Title:
|
Chief Executive Officer and President | Title: | Chief Executive Officer | |||||||
| Date: | October 8, 2008
|
Date: | October 6, 2008 | |||||||
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Schedule A
SERVICE
The operation and hosting of the current release and version of LendingClub’s computer software
program as configured for use by FOLIOfn Investments, Inc., to operate an alternative trading
system for the trading of certain notes issued by LendingClub and held by members of the
LendingClub Internet-based social lending platform who also are customers of Folio, including all
related updates, revisions, error corrections and enhancements thereof which are provided by
LendingClub to Customer.