EXHIBIT 10.14
This Software License Agreement AGREEMENT NO:_____________________
("Agreement") is made between
▇▇▇▇▇ & ▇▇▇▇▇ (USA) Inc. ("R&N") DATE OF AGREEMENT:________________
an Illinois corporation with its
principal place of business at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ (general)
(▇▇▇) ▇▇▇-▇▇▇▇) (fax)
and
Alaron Trading ("Customer")
an Illinois corporation with its
principal place of business at:
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
WITNESSESH:
WHEREAS:
1) 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
2) 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:
Section 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,
R&N/ALARON SOFTWARE LICENSE AGREEMENT
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 recipient prior to the
time of its disclosure, or
any information that become 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 provide familiarity and training pursuant to the functionality 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 License Fee and are set forth in Schedule G.
(h) "New Software" means any software relapsed 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.
(i) "Party" means R&N or the Customer, as the case may be, and the "Parties"
means both R&N and the Customer.
(j) "Processing Fees" means the
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processing service fees specified in Schedule
G.
(k) "Processing Service" shall mean the services to be supplied by R&N as
specified in Schedule B.
(l) "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, algoritluns, program architecture, design
concepts, system designs, program structure, sequence and organization, screen
displays and report layouts.
(m) "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.
(n) "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.
(o) "Software" means the executable form of the futures and options industry
applications software solution more fully described on Schedule A hereto,
together with all Custom Modifications, Relapses, New Software and Enhancements
developed or applied by R&N under this Agreement.
(p) "Term" means an initial term of one year from the date on which Service
commences and continuing thereafter for additional successive one-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.
Section 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 Services to the Customer during the
Term of this Agreement.
(b) R&N shall provide the Processing Services in accordance with the
operating conditions set forth in Schedule D and subject to the terms and
conditions of this Agreement. R&N shall perform the Processing Services in
accordance with its responsibilities defined in Schedule E and will use all
reasonable care and skill in relation thereto.
(c) During the Term of this Agreement, the Customer hereby agrees to pay
monthly Service 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.
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(d) Any media, materials or communications line(s) time-sharing 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 lesser 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.
Section 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.
(c) The Customer shall have a period of thirty days, beginning on the
Installation Date e "Evaluation Period"), to evaluate the Software. If the
Software is unacceptable to the Customer, for any reason, the Customer may,
prior to the expiration of the Evaluation Period, deliver to R&N a written
request to terminate the License. If such notice is timely delivered to R&N, the
Customer shall cease
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use of the Software and shall have no further payment obligations to R&N.
Failure to timely deliver a notice of termination under this Section 4(c) shall
be deemed to be acceptance of the system by the Customer for all purposes hereof
Section 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 requirements of the
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 or 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.
Section 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
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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 Customers 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 retrofitting 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 estimate 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.
Section 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
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delivery time. Work shall be performed on a "Best Efforts Basis" with an
estimated completion time of two (2) hours after notification of the completion
of submission of Customer Information.
(c) Customer shall be solely responsible for the accuracy an 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.
Section 7. Responsibilities of the
Customer.
The Customer shall be exclusively responsible for the accuracy of the input
data, information and the 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 Service.
Section 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)) with such Release 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.
Section 9. Confidentiality.
(a) Each Party hereto agrees to hold the other Party's Confidential
Information in strict confidence. Neither Party will disclose or
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otherwise make the other Party's Confidential Information or any part thereof
available to its third party, except to the extent permitted by the terms of
this Agreement. Each Party shall take the 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 "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 may give rise to irreparable injury to
the Disclosing Parry, 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.
Section 10. Termination; Remedies.
(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 I 1, unless R&N cures such breach
within thirty days after the Customer gives written notice of such breach to
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, 6, 7, 9 and I 1; 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
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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 attorneys' 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 9, 11, 12,
17(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) machine 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.
Section 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 EXPRESS 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
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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.
Section 12. 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 six months following
the earlier of the termination of that person's employment with the other Party
or the termination of this Agreement.
Section 13. 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.
Section 14. 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 its 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. Section 15. 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 mounts 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.
Section 16. 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
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the State of Illinois, 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 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 procedure 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 or 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 the 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 Ml force and
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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 Agree ment 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) Schedules. The Schedules annexed hereto are incorporated by reference and
made a part hereof.
(j) 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.
(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.
12
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
▇▇▇▇▇ & ▇▇▇▇▇ (USA) Inc. Alaron Trading
By: By:
Name: Name:
Title: Title:
13
SCHEDULE A
RANorder SOFTWARE DESCRIPTION
Maintenance Functions:
The data maintenance functions of RANORDER have been designed to support and
facilitate the use of RANORDER in an on-line environment. Data maintenance is
generally supported via two processes: static data table maintenance and dynamic
table updating. Static data table maintenance involves the establishment and
support of information regarding non-dynamic data, including:
Commodity Masters for Futures & Options (North American Exchanges)
Currency Master and Exchange Master, Symbol Master File
Interface and Printer Definition Tables, Margin Rate Tables
Security Administration Tables
Dynamic data table maintenance involves the ongoing update of transaction
related information, including:
Market Price Data, Customer Account Information
Customer Positions, Customer Orders and Fills
Order Entry:
This set of functions is designed to process customer orders through the system
direct to the exchange floor (printer or terminal device) or to an exchange
based order routing system (when available). Users entering an order have the
facility for viewing customers resting and filled orders; margin requirements,
and marked-to-the-market for both established positions/filled orders and
working orders. In addition, the order entry application includes data
validation functions for many of the data variables required in order entry.
Order Routing:
The order routing facility automates the process of trade submission to an
exchange floor or exchange interface for order routing. Each commodity may be
routed to a specific device (printer or interface) on the exchange floor,
thereby allowing multiple devices on the same exchange floor. Each order is
tagged with the identification of the terminal and person that entered the
order. This allows the filled order to be routed back to that person through the
fill routing subsystem. The printer support software is designed to detect
printer failures and take immediate action depending on the type of failure. The
recovery actions include switching all
14
printing from one printer to a designated backup printer automatically.
Fill Reporting:
The fill reporting facility provides functionality that allows floor personnel
to input/report filled order information. System terminals, located on the
exchange floor, or exchange devices (i.e. TOPS terminals) may be utilized to
enter fill information directly into the customer's account. This subsystem
includes features which minimize the amount of keying, handling unusual
conditions such as split fills and corrections, and routing a hard copy of the
fill information back to the trade originator. Fill reporting functions include
direct to terminal notification, fax transmission, e-mail transmission and
automated voice response.
15
SCHEDULE A
RANorder SOFTWARE DESCRIPTION
(continued)
Marked to the Market:
The system interfaces with a market price feed in order to receive intra-day
price quotes. The quotes may be applied to the positions in any account thereby
providing a summary of the account's current value. Current value calculations
include assessment of risk for existing positions as well as resting orders.
Reporting:
The reporting facility provides functionality that allows system user to
generate a variety of management information reports. Reporting functionality
includes reports on: Orders, Positions, Margins, Account Equity, Open Positions
and Account Summary.
Market Quote Display:
The market quote display functionality may be utilized as an independent quote
system. Different display formats for quotes are available and include:
quick-quote by instrument, category by commodity grouping, and unique by user
preference. Market price data is accepted from Future Sources.
Time and Sale Data:
The time and sale facility will capture and store two or more days of time and
sales information as supplied by the market price vendor. Each tic received is
time stamped and logged as a tic, bid, ask, or range (as supported by the market
price vendor). Inquiries may be made by a specific time bracket or by price
rate.
News Display:
The new display facility provides functionality for capturing and delivering
market related or internal news. The system contains one thousand pages which
may be setup and changed at a user's discretion.
System Security Support:
Security support facilities include: unique user D), unique non-displayed
password, user functionality access authorization, automatic terminal sip-off
with inactivity, account access restrictions by sales-code, and unique access
code for restricted account access.
16
SCHEDULE B
RANorder PROCESSING SERVICES
Maintenance of the following files:
Commodity Masters for Futures & Options (North American Exchanges)
Currency Master and Exchange Master
Screen & Report Titles Master and Instrument Type Master
RANorder Base Screen Menu
Processing of the RANorder Start-of-Day job stream which includes: Retrieval of
Customer account information Retrieval of Customer position information Loading
of Customer account information Loading of Customer position information
Initiation of Daily Start-Up Procedure:
Printers
TOPS Interface
Access Devices
Processing of Transaction Activity
Intra-day Filled Transaction Submission to Back-Office
Processing of Transaction Data File (if applicable)
End-of-Day Transaction Submission to Back-Office
Monitor & Reprint Jobs (if applicable)
Monitor System Functions
Utilization & System Performance
Networking
Price Feed
Initiation of Daily Shut-Down Procedure:
Printers
TOPS Interface
Access Devices
Access to Internet RANorder Site
17
Hosting of Internet Server
Provision of HTML front-end screens for order entry, account status and
statements
Administer System Security
Configuration Planning for Client Access Devices
Upgrades of RANORDER application software and Upgrades of IBM Operating System
Software
18
SCHEDULE C
Training Services Description
RANorder Systems Administration System Configuration Daily Procedures Remote
System Access Data File & System Maintenance Customer Account Maintenance
Customer Order Maintenance Customer Position Maintenance Sign-on Data File
Maintenance Market News Data File Maintenance Historical Price Database
Maintenance Location Routing Maintenance Printer Routing Maintenance Printer
Test System Sign-on Message Maintenance Commodity Code Maintenance
Miscellaneous System Functions
Broadcast Message Facility
Background Job File Maintenance
Background Job Submission
Back-office Data Entry
Cash File Maintenance
Phone Number File Maintenance
RANorder Functionality
Account Inquiry/Order Entry
Order Entry - Without Account Positions
Order Entry - with Account Positions
Display Account Positions
Order Check for account
Cancel Order
Cancel/Replace Order
Reprint and Order
Update Customer Messages
Customer Account Master Inquiry
Check Unreported Fills
Open Order Check-out
Print Account Positions
Rolodex Maintenance
19
SCHEDULE C
Training Services Description
(continued)
Quick Quote & Sales (Optional Service) Quick Quote Personal Quote Page Category
Quote Time & Sales by Time Time & Sales by Price Personal Quote Page Set-Up
Historical Price Inquiry Market News Report Generation Reports on Orders Reports
on Positions Margin Reports Account Equity Report Inquiry Open Positions Inquiry
Account Summary Inquiry Managed Account Functions Managed Account File
Maintenance Display/Report Non-Distributed Fills Fill Distribution Report
RANorder Training Session Description One end-user training session Up to 10
end-users Customer may video tape session One Systems administration training
session
20
SCHEDULE D
RANORDER Processing Services
Operating Conditions
Operating Conditions
R&N RANorder Service Bureau operating conditions are listed below.
R&N RANorder Service Bureau will accept orders twenty-four hours a day.
Operational staff for the RANorder Service Bureau will be available from 6:00 am
to 6:00 p.m. (Central Standard Time on CME/CBT trading days) Monday through
Friday. Support telephone consultation services will be available 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.
Access to the R&N RANorder Service Bureau processing service outside of the
service hours stated must be approved by R&N RANorder Service Bureau operational
staff.
R&N RANorder Service Bureau will, under normal conditions and given Customer's
submission of Customer Information by 6:00 am CST (submission time), process the
Customer's Information beginning at 6:00 am CST or earlier when possible. In the
event of a unforeseen delay, R&N RANorder Service will notify Customer and make
"best efforts" to begin order processing by no later than 7:00 am CST.
RANORDER documentation will be provided as follows:
1 RANORDER User Guide
1 RANORDER Reports Guide
21
SCHEDULE E
RANORDER Processing Services
Responsibilities
R&N RANorder Service Bureau Respo0nsiblites:
R&N will provide the central processing hardware, software and equipment for the
RANorder Service Bureau. All other hardware, communications equipment or
supplies are the responsibility of the customer.
R&N RANorder 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 workstation at the R&N RANorder Service Bureau operations
center for R&N RANorder Service Bureau operations 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.
R&N will monitor network communications and equipment. R&N will coordinate
problem resolution with Customer for Customer owned network and communications
equipment. R&N will facilitate resolution of communication line issues.
R&N will administer security functions for the system based upon Customer
prepared and submitted User and Password Set-up Requests. R&N will maintain,
update and modify all required maintenance files.
▇▇▇▇▇ & ▇▇▇▇▇'▇ Software Support Services consists of a support facility that
will be the first point of contact for all support requirements. Such
requirements are categorized into Level I, Level II and Technical Support. A
central number is utilized for all support services: 312-559- 9086.
General functionality queries and system problems will be reported to the Level
I support facility7. All queries will be electronically monitored and referred
to the appropriate support area for follow through until resolution is obtained.
Support staff will attend most issues regarding system usage, however if any
problem, which results in a delay to data entry or general system operations,
cannot be resolved, the support staff will notify either Level II or Technical
Support as appropriate.
Level II support is an advanced point of contact for problems associated with
processing activities of the RANorder system. Level II support will generally
respond to issues related to the ability of the system to continue processing,
networking issues and software faults.
22
SCHEDULE E
RANORDER Processing Services
Responsibilities
(continued)
Customer Responsibilities:
Communications lines and hardware, networking equipment, printers and access
devices are the responsibility of the client.
Customer will be responsible for preparing and submitting required account and
position files on a daily basis before 6:00 am CST. Files will be compliance
with R&N standard RANorder File Specification Format.
Customer will designate a System Administrative, User Liaison and User Trainer
to facilitate the operations of the RANorder system. Customer will channel
RANorder support inquiries through Designated System Administrator and/or User
Liaison to R&N support facilities.
Customer will coordinate, secure and maintain, at its own expense, an order
routing interface facility (TOPS)for use with the RANorder system. Customer will
acquire, as its own expense, a market data feed from Futures Source.
23
SCHEDULE F
RANorder Processing Service
Client Operations Responsibilities
The operational responsibilities of a R&N RANORDER Service Bureau Customer
include, but are not limited to, the following functions:
Maintenance of all master files that are not maintained by R&N.
Creation and submission of daily account and position files from Customer's
back-office system.
Entry of all order, order maintenance and order fills.
Generation and printing of all system reports.
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SCHEDULE G
Processing, Installation, and Miscellaneous Fees
1. Processing Service Fees
The RANorder service bureau processing price schedule is based on two
components: a minimum monthly charge which is base don the number of
accounts maintained on the system, and a volume charge associated with
the actual number of contracts processed by the system. The actual
monthly fee is the greater of the minimum monthly charge or the volume
based charges. The processing fee schedules for these charges are
detailed below:
Minimum Monthly Charge
Number of Accounts Minimum Monthly Charge
Up to 2,000 $ 3,000
Up to 4,000 $ 4,000
Up to 6,000 $ 5,000
Over 6,000 $ 6,000
Volume Activity Charges
Number of Contracts Monthly Activity Charge
0 to 20,000 $ 3,500
20,001 to 30,000 $ 4,500
30,001 to 40,000 $ 5,000
40,001 to 50,000 $ 5,500
50,001 to 70,000 $ 6,500
70,001 to 90,000 $ 7,300
Number of Accounts
Highest number of accounts downloaded to the system during the month
Number of Contracts
Actual number of filled contracts(half-turns) filled or entered into
the system during the month
2. 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 however any such increase (if applicable)
will be limited to 25% of then current Processing Fees as set forth
herein.
25
SCHEDULE G
Processing, Installation, and Miscellaneous Fees
(continued)
3. Installation Fee
There will be a non-refundable initial installation fee for the
processing service and Software described in Schedule A and B. The fee
will be $10,000.00 and encompasses project planning, R&N project
management, installation support, configuration set-up 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.
4. Payment of Processing Fees
The Processing and Installation Fees for the initial Term shall be
payable in accordance with the following schedule:
(a) the Installation Fee shall be payable upon execution of this
Agreement;
(b) Processing Fees shall be payable monthly based upon the actual
usage incurred during the prior month
5. Additional Services
This Agreement excludes the provision of futures and option market
prices and SPAN arrays (if required). 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 responsibility of the Customer.
Any charges as a result of using third-party vendors to perform
processing services for the Customer will be the responsibility of the
Customer.
Customer will utilize time-share Internet communications lines and will
be allocated (on a percent utilization of capacity basis) a portion of
the total line cost. The minimum monthly fee will be $500.
26
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:
27
SCHEDULE I
Installation Plan
(See Attached Project Plan)
28