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SECURITIES RESEARCH AGREEMENT
National Discount Brokers Corporation, a New York corporation (the
"Company") and Deutsche Bank AG ("DB" and together with the Company, the
"Parties") enter into this Agreement as of the June 15, 2000 to memorialize the
Parties' understanding concerning the Company's license to the Research
Material. Any capitalized term used herein without definition shall have the
meaning assigned to such term in the Stockholder Agreement.
W I T N E S S E T H
WHEREAS, DB U.S. Financial Markets Holding Corporation and National
Discount Brokers Group, Inc. ("NDBG") have entered into the Securities
Purchase Agreement (the "Securities Purchase Agreement"), dated as of May 15,
2000; and
WHEREAS, it is an express condition to the purchase and sale of Common
Stock of NDBG thereunder that the Parties enter into this Agreement and the
strategic relationship contemplated hereby;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and for other good and valuable consideration, and
agreements herein contained, the Parties hereto covenant and agree as follows:
Section 1. DEFINITIONS.
As used in this Agreement, the following terms shall have the
respective meanings assigned to them below:
(a) "Agreement" means this Agreement, together with all Exhibits and
Schedules hereto, as the same may be amended from time to time.
References in this Agreement to "herein," "hereunder" and words
of similar import shall be references to this Agreement, together
with all Exhibits and Schedules, as the same may be amended from
time to time.
(b) "Click Agreement" means an electronic agreement between the
Company and a user, in a form to be agreed between the Parties,
as may be amended from time to time by the mutual agreement of
the Parties, that is designed to be executed by such user by
selecting a button or other similar user-prompt.
(c) "Click Agreement Page" means a Page on the NDB Sites on which the
Click Agreement appears, which shall be designed in accordance
with Section 2(f).
(d) "DB IP Rights" means DB's and its Affiliates' (including any DB
Research Affiliate's) Intellectual Property Rights in and to the
Research Material and DB Marks, whether owned or licensed by DB
or its Affiliates.
(e) "DB Marks" means any of DB's or its Affiliates' (including any DB
Research Affiliate's) trademarks, trade names, service marks,
logos and other designations of origin included on or associated
with Research Material.
(f) "DB Research Affiliate" means any Affiliate of DB that produces
the Research Material licensed hereunder to the Company.
(g) "DBSI" means Deutsche Bank Securities, Inc., a broker-dealer
registered with the Securities and Exchange Commission and a
member of the New York Stock Exchange and the National
Association of Securities Dealers, or any of its successors
hereunder.
(h) "Delivery Provider" means any Person identified in accordance
with Section 4(c)(ii) hereof.
(i) "Distribute" means to reproduce, make available, provide,
display, transmit, promote or otherwise distribute through a
secure Internet website, or wireless, cable or other electronic
means of communication.
(j) "Frame" means, with respect to a Page, the simultaneous display
of such Page within an Internet browser or other similar
application with one or more other Pages (or portion thereof) set
off by a constant visible border or frame.
(k) "GCI" means the Global Corporates & Institutions Division of DB
(or any successor division or entity), which prepares
substantially all of the equity research distributed to retail
customers of DB and its Affiliates.
(l) "Inline" (or "Inlining") means, with respect to a Page, the
simultaneous display of such Page within an Internet browser or
other similar application with one or more other Pages (or
portion thereof) without a constant visible border or frame.
(m) "Intellectual Property Rights" means all intellectual property
and similar proprietary rights in any jurisdiction, including all
such rights in and to (i) original works of authorship,
copyrights and moral rights; (ii) issued patents, patent
applications, divisions, continuations and continuations-in-part,
reissues, patents of additions, utility models, inventors'
certificates and invention disclosures; (iii) trademarks, service
marks, brand names, certification marks, trade dress, assumed
names, trade names and other indications of origin; (iv)
confidential and proprietary know-how and trade secrets; and (v)
computer software or hardware, whether or not copyrightable,
including all source code, object code, programs, applications,
tables, models, databases, repositories, specifications and
documentation, including in the case of each of the foregoing
property and rights, all goodwill associated therewith and all
registrations thereof, and applications to register, such
property or rights.
(n) "Knowledge" shall mean the actual knowledge of any member of the
Board of Managing Directors or any executive officer of DB after
due inquiry and an investigation of the books and records of DB
and DBSI.
(o) "Legends" means copyright and other proprietary notices,
disclaimers, credit-lines, date-lines and other legends that (i)
are placed by DB or a DB Research Affiliate on the Research
Material; or (ii) which the Company is required or permitted to
place on the Research Material or in close proximity thereto
under this Agreement or applicable law.
(p) "Licensed DB Page" means a Page on which any Research Material or
portion thereof (including the title thereof) is displayed in
accordance with this Agreement.
(q) "Login Page" means an interactive Page on the NDB Sites that (i)
prompts a user to provide (A) a unique user identification name
or number and (B) a secure password; and (ii) when such
information is validly and properly entered, permits such user to
access a Licensed DB Page.
(r) "NDB Group" means NDBG and any Person of which NDBG owns a
majority of the outstanding voting securities and all majority
owned subsidiaries and all of their respective employees,
officers, directors and agents.
(s) "NDB Research Recipients" means all Persons that maintain retail
brokerage accounts in the United States with the Company.
(t) "NDB Site" means any of (i) the Company's website at "ndb.com"
(or any successor website); or (ii) any other Internet website,
or wireless, cable or other electronic means of communication,
owned, operated or controlled by the Company, as selected or
developed by the Company in its sole discretion from time to
time.
(u) "Page" means a single computer terminal display page of an
Internet website.
(v) "Representative" means, as to any Person, such Person's
Affiliates and its and their directors, officers, employees,
agents, advisors (including, without limitation, financial
advisors, counsel and accountants) and controlling Persons.
(w) "Research Material" means all of the following materials created,
generated, compiled or otherwise developed by GCI for general
distribution to retail customers in the United States that are
required to be reviewed by a supervisory analyst under New York
Stock Exchange Rule 472: (i) all narrative, statistical,
analytical, illustrative and other data concerning issuer,
industry and market analyses, commentary and recommendations
(daily, weekly and monthly, as the case may be) contained in
AM/PM daily calls (video and audio), call summaries, brief
intraday research bulletins relating to equity securities and
industry/company reports, and (ii) all updates, supplements,
amendments, analyses and statistical information related to the
matter referred to in clause (i) above. Research Material also
includes all DB Marks appearing on the information, reports and
other materials described in the preceding sentence.
(x) "Transaction Documents" means the Securities Purchase Agreement,
the definitive agreement with respect to the U.S. Underwriting
Agreement, this Agreement and any other agreements, instruments
and documents that may be entered into between the Parties or
their Affiliates relating to the European Joint Venture and the
Worldwide Joint Venture.
(y) "U.S. On-Line Discount Broker" means a securities brokerage firm
that (i) is either located within or otherwise doing business in
the United States; (ii) is duly licensed as a broker-dealer with
the U.S. Securities and Exchange Commission and is a member of
the National Association of Securities Dealers, Inc.; (iii) does
not employ account executives or registered representatives who
(A) are assigned to, and responsible for maintaining
relationships with, customers for the purpose of providing
advised brokerage and trade execution services (whether provided
in person or electronically and whether general or
trade-specific) or (B) are compensated with a portion of the
commissions earned for any trade execution services performed for
such customers; (iv) offers its customers the ability to execute
securities trades directly through computerized on-line or other
electronic or wireless execution systems, including, without
limitation, the Internet and IVR, without the direct assistance
or recommendation of any account executive or registered
representative; and (v) generally charges its customers a lower
cost for its services than is customarily charged in the relevant
market for brokerage services by full service advised brokerage
firms taking into account commission charges, account investment
advisory fees and such other charges and fees and minimum balance
requirements. The term "U.S. On-Line Discount Broker" shall
include, without limitation, any entity listed on a schedule to
be prepared from time to time by the Parties, as amended from
time to time by mutual consent of the Parties. Such schedule
shall not include DB Alex. Brown LLC or DBSI or any of their
respective successors.
Section 2. LICENSE TO THE RESEARCH MATERIAL.
(a) DB hereby grants and will ensure that each DB Research Affiliate
grants to the Company, during the term of this Agreement without
charge, a non-exclusive (except as expressly provided in this
Agreement), non-transferable, non-sublicenseable, royalty-free
license to Distribute the Research Material to the NDB Research
Recipients through any NDB Site, subject to the terms set forth
in this Agreement.
(b) In the event that DB Distributes any of the Research Material to
third parties in the United States without restriction, DB hereby
consents to the Company Distributing such Research Material on
any NDB Site, without restriction.
(c) DB hereby grants and will ensure that each DB Research Affiliate
grants to the Company the right to include certain references to
the Research Material on the Company's promotional material, all
NDB Sites and any other media which the Company or NDBG may use
from time to time in its business and the right to use the DB
Marks solely in connection with such references; provided,
however, that (i) DB shall have a reasonable opportunity to
review any such references and use of the DB Marks prior to
publication; and (ii) the Company shall promptly make any changes
to such references and use of the DB Marks as may be reasonably
requested by DB. DB agrees to conduct any such review in a prompt
manner.
(d) Except as expressly set forth in this Agreement, the Company
shall have no other right to use, copy, display or redistribute
in any form the Research Materials, in whole or in part, without
the prior written consent of DB.
(e) The Company shall design, operate and maintain the NDB Sites such
that (i) the Research Material or any portion thereof (including
the title thereof) is displayed exclusively on a Licensed DB
Page; (ii) each Licensed DB Page may be accessed only by an NDB
Research Recipient, and only after successfully processing a
Login Page by entering (A) a valid user identification name or
number; and (B) a valid password; (iii) no Person may identify
and/or gain access to any Licensed DB Page through the use of any
Internet search engine, a hypertext link on a website other than
the NDB Sites, or any similar means; and (iv) the Company shall
have the ability to terminate any NDB Research Recipient's access
to the Licensed DB Reports if such NDB Research Recipient has
acted in a manner that is detrimental to DB's rights in the
Research Materials and/or upon receipt of a notice from DB
pursuant to Section 8(c) hereof.
(f) The Company shall design each NDB Site such that, as a condition
to access by any NDB Research Recipient to Research Material,
such NDB Research Recipient must access a Click Agreement Page
and execute a Click Agreement. The Click Agreement Page shall be
designed such that (i) the entire text of the Click Agreement
appears on a single Page, in an internal scrollable window or
otherwise; (ii) the button or similar user prompt by which the
user executes the Click Agreement contains the text "I Agree" and
is located immediately proximate to the bottom of the text of the
Click Agreement; and (iii) the title(s) of the Research
Material(s) that the NDB Research Recipient has requested
appear(s) immediately below or is otherwise connected to the
Click Agreement such that it is apparent to the Research
Recipient that the provisions of the Click Agreement relate to
such Research Material(s).
(g) Except as expressly provided herein, the Company shall display
the Research Material on the Licensed DB Pages verbatim as
received and shall not edit, modify or use any portion of
Research Material to create any translation, summary, abstract,
adaptation or other derivative works from the Research Material
in any way, or make any additions thereto or deletions therefrom;
provided, however, that the Company shall be permitted to modify
the layout of Research Material to the extent necessary to comply
with any requirement of any Governmental Entity. The Company
shall not (i) sell, lease, assign, sublicense or otherwise
transfer or provide the Research Material (or any part thereof or
rights therein), directly or indirectly, to any Person or permit
any Person, directly or indirectly, to use, view, copy, download,
Distribute or otherwise have access to the Research Material,
except as otherwise permitted herein; or (ii) copy or reproduce
the Research Material in whole or in part in any form or medium,
except as required in connection with the Company's permitted use
of the Research Material as provided herein.
(h) In no event shall the Company display any Research Material
received more than twenty-four (24) hours earlier under any
heading labeled "New", "Today's News", "Current", or under any
other heading of similar significance.
(i) The Company shall display each Research Material on the Licensed
DB Pages only for so long as DB permits third parties in the
United States to Distribute such Research Material. After such
period, upon notice from DB the Company shall promptly remove
each such Research Material from the Licensed DB Pages.
(j) DB or the applicable DB Research Affiliate shall at all times
retain exclusive and complete editorial control over the Research
Materials with respect to both form and content, and the Company
shall comply with all of DB's editorial instructions respecting
the Research Material. Without limiting the foregoing, in the
event that DB or any DB Research Affiliate issues and transmits
to the Company any retraction, correction or alteration of any
Research Material, the Company shall promptly display such
retraction, correction or alteration on the Licensed DB Pages in
such manner as DB or such DB Research Affiliate shall reasonably
request. DB also reserves the right, upon written notice to the
Company, to require the Company to remove immediately any
Research Material or a category of Research Material from the NDB
Sites to the extent that DB or any DB Research Affiliate takes
comparable steps, in comparable circumstances, to cease
Distributing or making such Research Material available
generally.
(k) Display of Research Materials
(i) Format. The Company shall post the Research Materials on the NDB
Sites exclusively (A) in Adobe Acrobat (".pdf") format; (B) upon
the prior written consent of DB, which shall not be unreasonably
withheld, in another equivalent "read-only" format; or (C) upon
the prior written consent of DB, which shall be at DB's sole
discretion, in any other format in which DB is at that time
displaying the Research Material in comparable circumstances.
(ii) Inlining Prohibited. The Company shall not Inline, but may Frame,
any Research Materials. If the Company becomes aware that a third
party is Inlining or Framing the Research Material, the Company
will cooperate with DB to cause such third party to cease and
desist from such Inlining or Framing.
(iii) Co-Branding Confusion. The Company shall not display any third
party's name, logo, trademark, service mark or other identifier
on an NDB Site (including, without limitation, by Framing) in
such way as to give a viewer the impression that such third party
is a publisher, distributor, author, owner or sponsor of the
Research Materials or an Affiliate of DB, including any DB
Research Affiliate.
(iv) Content. The Company shall not, without DB's prior written
consent, Frame any Research Material with, or display with any
Research Material or on any Licensed DB Page, any NDB or third
party content, including, without limitation, news, research,
analytics and commentary.
(v) Advertising. The Company shall not display any advertising on any
Licensed DB Page that falsely implies that the advertiser is a
publisher, distributor, author, owner or sponsor of the Research
Material or an Affiliate of DB, including any DB Research
Affiliate. DB also reserves the right, in the exercise of its
reasonable discretion and upon written notice to the Company
(setting forth in reasonable detail the reasons for such
requirement), to require the Company to remove immediately any
advertising from the Licensed DB Pages. In exercising its
reasonable discretion, DB may take into consideration, among
other factors, its determination regarding legal and compliance
risks, reputational concerns and the Company's compliance with
the provisions of this Agreement. The Company shall promptly give
DB written notice confirming any such removal.
(vi) Legends.
(A) The Company shall display and shall not remove or conceal
any Legend affixed by DB or any DB Research Affiliate to the
Research Materials. To the extent not already present, the
Company shall insert on each Licensed DB Page that contains
Research Material or any portion thereof and in close
proximity to such Research Materials or portion thereof the
following Legend:
Copyright [Year] [Deutsche Bank]. All Rights Reserved.
"[DEUTSCHE BANK]" is a service mark of [Deutsche Bank].
(B) In connection with any Research Material prepared by a
Person relying on the exemption from broker-dealer
registration afforded by Rule 15a-6 of the Exchange Act,
including the so-called "Research Interpretation" described
in Exchange Act Release No. 27017 (July 11, 1989), 43 SEC
Docket 2079, (A) DBSI shall be the U.S. broker-dealer
accepting responsibility for the content of such Research
Material; and (B) such Research Material shall contain a
Legend to such effect to the extent required by Rule 15a-6
and the Research Interpretation.
(C) The Company shall add such additional Legends relating to
the Research Materials to the Licensed DB Pages as (I) may
be required by applicable law; (II) as it may deem necessary
or appropriate in its reasonable discretion, provided that
the Company shall give DB timely prior notice of any such
additional Legends and reasonable opportunity to comment
thereon; and (III) DB shall require from time to time in its
reasonable discretion, upon prior written notice to the
Company.
Section 3. DELIVERY AND ARCHIVAL RESPONSIBILITIES.
(a) Throughout the term of this Agreement, DB shall, without charge,
deliver the Research Material to the Company or a Delivery Provider in
the format described in Section 2(k)(i) above, or in such format as
the Parties may agree, concurrently with the time DB first makes the
Research Material available (i) publicly, (ii) to retail customers in
the United States (including through First Call Corporation, Multex
Systems, Inc. or a similar third party), or (iii) to any DB customer;
provided that (x) the delivery by DB of the Research Material outside
of the United States or to institutional customers, whether
in the United States or otherwise, shall not give rise to any
obligation to deliver such Research Material to the Company under this
Section 3(a); (y) any delivery to the Company shall be subject to any
embargo specified by DB in its sole discretion in connection with its
publication, dissemination or distribution of the Research Material
generally; and (z) DB shall not be required to deliver Research
Material if it would cause DB to violate any Law, rule or regulation
of any Governmental Entity.
(b) DB, for the benefit of and upon request by the Company, shall, without
charge: (i) provide access to the Research Material archived for the
three years immediately preceding the date of such request but in no
event prior to January 1, 2000; and (ii) promptly, upon such request,
deliver to the Company or Delivery Provider such archived material in
such format as contemplated by Section 2(k)(i); and (iii) maintain and
make available, promptly on request, a copy of each item of such
archived material and any other Research Material made available to
the Company hereunder for a period of three years following
termination of this Agreement (in such format as contemplated by
section 2(k)(i)) for use by the Company exclusively to satisfy any
recordkeeping or related requirements to which the Company may be
subject under applicable Laws, orders, rules and regulations and not
for purposes of commercial exploitation; provided, however, that after
the termination of this Agreement, the Company may only request copies
of Research Material that was produced prior to the termination of
this Agreement and is maintained by DB pursuant to any recordkeeping
or related requirements to which it is subject or otherwise.
(c) Nothing herein shall require DB or any DB Research Affiliate to create
Research Material. Except as provided in this Agreement, DB and each
DB Research Affiliate shall have no obligation to deliver Research
Material to the Company or provide to the Company any additional
information, materials, services or support pursuant to this
Agreement. In the event that DB provides any additional information or
materials to the Company, unless DB otherwise agrees in writing, DB's
obligations respecting such additional information and materials shall
be in accordance with its obligations hereunder respecting Research
Material.
(d) Neither DB nor any DB Research Affiliate shall have any obligation to
provide assistance or training to the Company with respect to the
Distribution of the Research Material on the NDB Sites.
Section 4. REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS.
(a) DB hereby represents, warrants and covenants to the Company as follows:
(i) DB or one or more of the DB Research Affiliates, as the case may
be, is the exclusive owner of the Research Material or otherwise
has obtained all required third party consents or the right
(including Intellectual Property Rights) to permit DB to grant to
the Company the license to the Research Material and the DB IP
Rights as set forth in this Agreement throughout the term of this
Agreement. The use by the Company of the Research Material and
the DB IP Rights owned by DB or the DB Research Affiliates, and
to the Knowledge of DB the DB IP Rights licensed to DB or the DB
Research Affiliates, in accordance with this Agreement will not
breach, violate, infringe or constitute misappropriation of any
Intellectual Property Rights of any other Person. DB's execution,
delivery and performance of this Agreement does not and will not
give rise to any rights of a Person, other than DB, to request,
demand or claim a right to compensation or payment by the Company
with respect to the Company's license of the Research Material
and the DB IP Rights owned by DB or the DB Research Affiliates,
and to the Knowledge of DB the DB IP Rights licensed to DB or the
DB Research Affiliates, in conformity with this Agreement, and
there is no actual or, to the knowledge of DB, threat of, demand,
claim, investigation or other proceeding brought by any third
party with respect to the Research Material and the DB IP Rights
based on an alleged right to compensation or violation of any
right or agreement involving DB or a DB Research Affiliate.
(ii) The Research Material will be prepared, reviewed, and Distributed
by DB and/or DBSI pursuant to this Agreement in accordance with
all applicable requirements, rules and regulations of the
Securities and Exchange Commission, any stock exchange (including
the New York Stock Exchange, Inc.) and any self-regulatory
organization (including the National Association of Securities
Dealers, Inc.) having jurisdiction.
(iii) DBSI is duly licensed as a broker-dealer and in good standing
with the Securities and Exchange Commission and each of DB and/or
DBSI is duly licensed as a broker-dealer or other regulated
financial institution, as applicable, in any other jurisdiction
where the conduct of its business requires such licensing, except
where the failure to have such a license would not be reasonably
likely to have a Material Adverse Effect on the business of DB
and its Subsidiaries taken as a whole. DBSI is a member firm in
good standing of the National Association of Securities Dealers,
Inc. or the New York Stock Exchange, Inc., and the Securities
Industry Protection Corporation. Each of DB and DBSI has all
permits, licenses and authorizations required by applicable
regulatory authorities or governmental entities to conduct the
transactions contemplated by this Agreement.
(iv) DB is exempt from the registration requirements of Section
15(a)(1) and 15B(a)(1) of the Exchange Act because of the
exemption pursuant to Rule 15a-6 under the Exchange Act and has
complied with and performed its obligations in accordance with
Rule 15a-6(a)(1)-(3) under the Exchange Act.
(v) Each DB Research Affiliate is either (A) duly licensed as a
broker-dealer and in good standing with the Securities and
Exchange Commission and a member firm in good standing of the
National Association of Securities Dealers, Inc. or the New York
Stock Exchange, Inc., and the Securities Industry Protection
Corporation; or (B) with respect to the Distribution of Research
Material, exempt from the registrations of Section 15(a)(1) and
15B(a)(1) of the Exchange Act because of the exemption pursuant
to Rule 15a-6 under the Exchange Act and has complied with and
performed its obligations in accordance with Rule 15a-6(a)(1)-(3)
under the Exchange Act.
(vi) During the term of this Agreement, without the Company's prior
consent, DB shall not directly Distribute the Research Material
to any U.S. On-Line Discount Broker, other than the Company for
purposes of reDistribution to retail investors in the United
States. The foregoing shall not prohibit or restrict DB's
existing agreements with First Call Corporation and Multex
Systems, Inc.
(b) The Company hereby represents, warrants and covenants that (i) the Company
takes full responsibility for any suitability obligations it may have in
connection with making the Research Material available, and the
Distribution of the Research Material, to individual NDB Research
Recipients; (ii) Research Material will not be made available in a
commingled format with research items prepared by any other broker-dealer;
and (iii) it shall comply with all Laws, orders, rules and regulations
applicable to its use of any of the Research Material, including, without
limitation, any such Laws, orders, rules or regulations of any Governmental
Entity (including for these purposes the NASD) having jurisdiction over the
Company's business activities.
(c) Each of the Parties, except as otherwise contemplated by this Agreement,
acknowledges and agrees that the Research Material may be made available on
a secure basis to the Company and the NDB Research Recipients (i) through
any NDB Site; or (ii) through a service provider or providers selected by
the Company at any time during the term of this Agreement and subject to
DB's consent, such consent not to be unreasonably withheld (a "Delivery
Provider").
Section 5. ADDITIONAL INTELLECTUAL PROPERTY RIGHTS.
(a) The Company hereby acknowledges and agrees that (i) as between DB and the
Company, DB or each applicable DB Research Affiliate owns or has a license
to all right, title and interest in and to the Research Material and DB IP
Rights; (ii) as between DB and the Company, the Research Material and DB IP
Rights, and the goodwill therein, constitute the valuable property of DB
and each applicable DB Research Affiliate; and (iii) except as expressly
provided herein, this Agreement transfers no title, ownership right or
Intellectual Property Rights to the Company with respect to the Research
Material or DB IP Rights. All rights with respect to the Research Material
and DB IP Rights, whether now existing or hereafter arising, that are not
expressly granted to the Company herein are reserved to DB and each
applicable DB Research Affiliate. Any goodwill generated through the
Company's use of the Research Material and DB IP Rights shall inure solely
to the benefit of DB and each applicable DB Research Affiliate. The Company
also covenants not to challenge DB's ownership of the Research Material and
the DB IP Rights licensed hereunder in any form or manner.
(b) The Company, in connection with the licensed use of the DB Marks, shall
maintain the quality control standards provided by DB to the Company in
writing from time to time that DB maintains with respect to its use of the
DB Marks generally.
(c) Except as expressly provided in this Agreement, the Company shall have no
other rights with respect to any of the Research Material as a result of
this Agreement.
(d) DB shall have the exclusive right to prosecute and maintain any
registrations of any of the DB IP Rights and to defend any claim of
infringement related thereto. The Company shall execute such documents and
provide such reasonable cooperation to DB, at DB's expense, as DB may
reasonably request in order to perfect, evidence, protect or secure such
rights and to conduct such prosecution, registration or defense.
(e) The Company shall promptly notify DB of any threat, warning or notice in
writing of any claim or action adverse to any of DB IP Rights that the
Company may receive from time to time. In the event that an NDB Research
Recipient engages in any activity that is adverse to the DB IP Rights, upon
the reasonable request of DB, the Company shall cooperate with DB in taking
action to protect DB's rights, including terminating such NDB Research
Recipient's access to the Research Material on the NDB Sites.
(f) The Company shall take no action inconsistent with the acknowledgements,
agreements and assignments set forth in this Section. In particular, the
Company shall not at any time undertake to copyright or trademark (or apply
for a copyright or trademark registration) or apply for a patent with
respect to any of the Research Material or DB IP Rights or any portion
thereof. The Company shall not at any time during the term of this
Agreement or at any time after termination or expiration of this Agreement
(i) use the Research Material or DB IP Rights in any way that may tend to
impair the validity of DB's or any DB Research Affiliate's rights therein;
or (ii) take any other action that could disparage, or jeopardize or impair
DB's or any DB Research Affiliate's rights in, the Research Material or DB
IP Rights (including the goodwill associated with the DB Marks) or their
validity or enforceability.
Section 6. CONFIDENTIALITY.
(a) The Company acknowledges that it may, during the term of this Agreement
acquire information, other than the Research Material, which is proprietary
or confidential to DB or its clients or customers or to a third party to
whom DB has an obligation of confidentiality (collectively, the "DB
Proprietary Information"). The DB Proprietary Information does not include
information which (i) is or becomes generally available to the public other
than as a result of a prohibited disclosure by the Company or the Company's
Representatives; (ii) was available to the Company on a nonconfidential
basis prior to its disclosure by DB or DB's Representatives; (iii) becomes
available to the Company on a nonconfidential basis from a Person other
than DB or DB's Representatives who is not otherwise bound by a
confidentiality agreement with DB or any Representative of DB, or is
otherwise not under an obligation to DB or any Representative of DB not to
transmit the information to the Company; or (iv) is independently developed
by the Company. Except as required by law, the Company agrees to hold and
to cause its employees and agents to hold the DB Proprietary Information in
strict confidence, and not to copy for use by Persons other than the
Company, reproduce, sell, assign, license, market, transfer or otherwise
dispose of the DB Proprietary Information or to give or disclose the DB
Proprietary Information to third parties. In the event that the Company is
requested pursuant to, or required by, applicable Law, regulation or legal
process or is requested by any court, regulatory agency or any
self-regulatory authority to disclose any DB Proprietary Information or any
other information concerning DB, the Company agrees to provide DB with
prompt notice of such request or requirement in order to enable DB to seek
an appropriate protective order or other remedy, to consult with the
Company with respect to DB taking steps to resist or narrow the scope of
such request or legal process, or to waive compliance, in whole or in part,
with the terms of this provision. In any such event, the Company will use
its commercially reasonable efforts to obtain from the party to whom
disclosure is made written assurances that all DB Proprietary Information
and other information that is so disclosed will be accorded confidential
treatment.
(b) DB acknowledges that it may, during the term of this Agreement acquire
information which is proprietary or confidential to the Company or its
clients or customers or to a third party to whom the Company has an
obligation of confidentiality (collectively, the "Company Proprietary
Information"). The Company Proprietary Information does not include
information which (i) is or becomes generally available to the public other
than as a result of a prohibited disclosure by DB or DB's Representatives;
(ii) was available to DB on a nonconfidential basis prior to its disclosure
by the Company or the Company's Representatives; (iii) becomes available to
DB on a nonconfidential basis from a Person other than the Company or the
Company's Representatives who is not otherwise bound by a confidentiality
agreement with the Company or any Representative of the Company, or is
otherwise not under an obligation to the Company or any Representative of
the Company not to transmit the information to; or (iv) is independently
developed by DB. Except as required by law, DB agrees to hold and to cause
its employees and agents to hold the Company Proprietary Information in
strict confidence, and not to copy for use by Persons other than DB,
reproduce, sell, assign, license, market, transfer or otherwise dispose of
the Company Proprietary Information or to give or disclose the Company
Proprietary Information to third parties. In the event that DB is requested
pursuant to, or required by, applicable Law, regulation or legal process or
is requested by any court, regulatory agency or any self-regulatory
authority to disclose any Company Proprietary Information or any other
information concerning DB, DB agrees to provide the Company with prompt
notice of such request or requirement in order to enable the Company to
seek an appropriate protective order or other remedy, to consult with DB
with respect to the Company taking steps to resist or narrow the scope of
such request or legal process, or to waive compliance, in whole or in part,
with the terms of this provision. In any such event, DB will use its
commercially reasonable efforts to obtain from the party to whom disclosure
is made written assurances that all Company Proprietary Information and
other information that is so disclosed will be accorded confidential
treatment.
Section 7. PUBLICITY.
DB acknowledges and agrees that the Company may Distribute the Research Material
as contemplated by this Agreement. Each of the Parties agrees that the other
shall be entitled to advertise and market the existence and the availability of
the Research Material to the NDB Research Recipients and others, but not the
terms of this Agreement; provided, however, that (a) each of the Parties shall
have had reasonable opportunity to review any advertising or marketing materials
prepared by the other Party prior to use of such advertisement or marketing
initiative; and (b) each Party shall make any changes to such materials as may
reasonably be requested by the other Party. DB and the Company agree not to
disclose this Agreement in any manner nor make copies available to any third
party without the prior written consent of the other Party hereto, except as
required by law. In the event that either Party is requested pursuant to, or
required by, applicable law or regulation or by legal process to disclose this
Agreement it shall promptly inform the other Party of such request or
requirement in order to enable the Parties to jointly seek an appropriate
protective order or other remedy, or to resist or narrow the scope of such
request or legal process. In any such event, each Party agrees to use its
commercially reasonable efforts to obtain from the third party to whom
disclosure is made written assurances that this Agreement will be accorded
confidential treatment.
Section 8. AUDIT RIGHTS; RECORD-KEEPING.
(a) DB shall have the right to conduct, from time to time, reasonable audits of
the Company for the purpose of confirming the compliance of the Company
with the terms of Section 2. To facilitate such audits, the Company shall,
on DB's reasonable request, give DB free access during normal business
hours to the NDB Sites, including to all Licensed DB Pages. In the event
that DB reasonably determines that the Company has breached the terms of
Section 2, in addition to the other rights granted to DB under this
Agreement, DB shall have the right to reasonably limit the categories of
the Research Materials provided to the Company, by providing written notice
to the Company (setting forth in reasonable detail the reasons for such
termination or limitation); provided, however, that (i) the Company shall
have a reasonable opportunity to cure any breach that was not intentional
and that is capable of being cured, and (ii) upon request by the Company,
DB shall in good faith discuss with the Company the reasons for such
termination and, if possible, any alternatives thereto. In exercising its
right to limit the license grant, DB may take into consideration, among
other factors, its determination regarding legal and compliance risks,
reputational concerns and the Company's compliance with the provisions of
this Agreement.
(b) (i) The Company shall maintain a log of the total number of times the
Licensed DB Pages are accessed by users of the NDB Sites. Upon DB's
request, the Company shall provide a complete copy of such log to DB at no
additional cost to DB.
(ii) The Company shall maintain a log of the names of all NDB Research
Recipients as well as their user identification names or numbers and
passwords.
(c) DB shall at all times have the right, in its reasonable business discretion
to direct the Company to exclude any particular NDB Research Recipient from
accessing the Research Materials. In exercising such right, DB may take
into consideration factors affected by such NDB Research Recipient's access
to the Research Materials, including legal and compliance risks,
reputational concerns and such NDB Research Recipient's compliance with the
provisions of the relevant Click Agreement. For purposes of this Section,
"reputational concerns" means that the particular NDB Research Recipient's
access to the Research Material would be reasonably likely to impugn or
besmirch the reputation and value of DB and/or the DB Marks.
Section 9. LIMITATION OF WARRANTIES AND LIABILITIES.
(a) EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT, THE RESEARCH MATERIAL IS
PROVIDED TO THE COMPANY HEREUNDER STRICTLY ON AN "AS IS" BASIS, AND NO
WARRANTIES, EXPRESS OR IMPLIED, REPRESENTATIONS OR PROMISES HAVE BEEN MADE
OR ARE GIVEN BY DB OR ANY AFFILIATE OF DB TO THE COMPANY OR ANY OTHER
PERSON (INCLUDING ANY NDB RESEARCH RECIPIENT) REGARDING THE ACCURACY,
TIMELINESS ORIGINALITY, MERCHANTABILITY, SUITABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OF THE RESEARCH MATERIAL OR ANY OTHER MATTER AND NO
WARRANTY IS GIVEN THAT THE RESEARCH MATERIAL WILL CONFORM TO ANY
DESCRIPTION THEREOF OR BE FREE OF DEFECTS.
(b) EXCEPT AS PROVIDED IN SECTION 13 HEREOF, IN NO EVENT SHALL EITHER PARTY,
THEIR RESPECTIVE AFFILIATES OR THEIR RESPECTIVE REPRESENTATIVES HAVE ANY
LIABILITY TO THE OTHER PARTY OR ANY OTHER PERSON (INCLUDING ANY NDB
RESEARCH RECIPIENT) FOR ANY CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY
OR SPECIAL DAMAGES (INCLUDING LOST PROFITS AND REVENUES) ARISING OUT OF OR
IN ANY MANNER IN CONNECTION WITH THIS AGREEMENT, THE PERFORMANCE OR BREACH
HEREOF, THE SUBJECT MATTER HEREOF OR THE PARTIES' OR ANY OTHER PERSON'S USE
OF, OR INABILITY TO USE, THE RESEARCH MATERIAL REGARDLESS OF THE FORM OF
ACTION (INCLUDING NEGLIGENCE OR STRICT LIABILITY) AND WHETHER OR NOT THE
OTHER PARTY HAS BEEN ADVISED OF, OR OTHERWISE MIGHT HAVE ANTICIPATED THE
POSSIBILITY OF, SUCH DAMAGES. SUBJECT TO SECTIONS 4(a) AND 13 HEREOF, BY
USING THE RESEARCH MATERIAL, THE COMPANY AGREES TO ASSUME THE ENTIRE RISK
OF SUCH USE.
Section 10. DB'S PROPRIETARY NOTICES.
DB shall have the right to require that the Research Material released and
Distributed to the NDB Research Recipients or as otherwise contemplated by this
Agreement bear the DB Marks inserted therein, and made a part thereof by DB or
any DB Research Affiliate, as the case may be.
Section 11. THE COMPANY AS A PRIVILEGED DB RESEARCH CUSTOMER.
With regard to the Company's license of the Research Material under this
Agreement and such third-party access to the Research Material as is permitted
by this Agreement with respect to certain third parties other than the Company
("Permitted Purchasers"), DB agrees to treat the Company as a privileged
customer with respect to the Distribution of the Research Material. DB
represents that all of the indemnities provided to the Company hereunder are or
will be comparable to or better than those provided by DB to Permitted
Purchasers with respect to the Distribution of the Research Material. If, during
the term of this Agreement, DB enters into an agreement with any Permitted
Purchaser with respect to the Distribution of the Research Material with any
indemnities more favorable to such Permitted Purchaser in the aggregate, then DB
shall so notify the Company and promptly take all steps necessary to effect an
appropriate amendment to this Agreement.
Section 12. ASSIGNMENT.
This Agreement may be assigned by either Party to an Affiliate, as part of the
sale of its securities brokerage business or, in the case of DB, the sale of
GCI, or pursuant to any merger, consolidation or other reorganization, without
the other Party's consent, upon prior written notice to the other Party. Except
as provided in the preceding sentence, neither Party shall assign this Agreement
without the other Party's prior written consent, which consent shall not be
unreasonably withheld. An assignee of either Party, if authorized hereunder,
shall have all of the rights and obligations of the assigning Party set forth in
this Agreement. Any purported assignment in violation of this Section 12 shall
be null and void for all purposes.
Section 13. INDEMNITY.
(a) DB hereby agrees to indemnify, defend and hold harmless the Company
and each of its employees, officers, directors, agents and Affiliates
(and each of their employees, officers, directors, agents and
Affiliates) from and against any and all losses, claims, damages or
liabilities (including without limitation reasonable legal fees and
other expenses) (collectively, "Losses") arising out of or related to
any claim, demand, action, suit or proceeding of any nature
(collectively, a "Proceeding") asserted by any third party which, if
true, would constitute (i) an infringement, breach, violation or
misappropriation of any copyright, patent, trademark (or other
indication of origin), know how or trade secret of such third party
based on the use of the Research Material; (ii) libel related to the
contents of the Research Material; and (iii) a breach, or alleged
breach, of any representation or warranty set forth in Section
4(a)(ii), except to the extent any such Proceeding results from any
gross negligence or willful misconduct on the part of the Company or
any modification by the Company of the Research Material.
(b) The Company hereby agrees to indemnify, defend and hold harmless DB
and each of its employees, officers, directors, agents and Affiliates
(and each of their employees, officers, directors, agents and
Affiliates) from and against any and all Losses arising out of or
related to any Proceeding asserted by any third party based on (i) any
inaccurate, untimely or incomplete transmission of Research Material
caused by the Company or any Delivery Provider, and (ii) any use by
the Company or any Delivery Provider of Research Material in a manner
not authorized under this Agreement, except to the extent any such
Proceeding results from a Loss subject to Section 13(a).
(c) In the event that a Proceeding is asserted or commenced against a
Person for which such Person is entitled to indemnification under this
Agreement, the indemnified Person ("Indemnified Party") shall give the
indemnifying Person ("Indemnifying Party") prompt written notice of
such Proceeding. The failure of the Indemnified Party to give such
notice shall not relieve the Indemnifying Party of its obligations
under this Section 13 except to the extent that the Indemnifying Party
is actually and materially prejudiced by the failure to give such
notice. In case any such Proceeding shall be brought against the
Indemnified Party and it shall notify the Indemnifying Party thereof,
the Indemnifying Party shall be entitled to participate in, and, to
the extent that it shall wish, to assume the defense thereof,
including appeals, with counsel reasonably satisfactory to the
Indemnified Party, and after notice from the Indemnifying Party to the
Indemnified Party of its election so to assume the defense thereof,
the Indemnifying Party shall not be liable to such Indemnified Party
for any legal or other expenses subsequently incurred by the
Indemnified Party after the date such notice is given to the
Indemnified Party in connection with the defense thereof. The
Indemnified Party shall have the right, but not the obligation, to
participate at its own cost and expense in such defense by counsel of
its own choice. In the event that the Indemnifying Party and the
Indemnified Party are named parties in or are subject to such
Proceeding and either such party determines with the advice of counsel
that there may be one or more legal defenses available to it that are
different from or additional to those available to the other party or
that a material conflict of interest between such parties may exist in
respect of such Proceeding, the Indemnified Party may retain the
defense of such Proceeding on its own behalf and in such case the
Indemnifying Party shall be required to pay any legal or other
expenses, including, without limitation, reasonable attorneys' fees
and disbursements, incurred by the Indemnified Party in such defense.
If the Indemnifying Party shall assume the defense of any such
Proceeding, the Indemnified Party shall cooperate with it and the
Indemnifying Party shall not, without the consent of the Indemnified
Party consent, settle, compromise, consent to the entry of any
judgment in or otherwise seek to terminate such Proceeding (whether or
not any Indemnified Party is a party thereto) unless such settlement,
compromise, consent or termination includes a release (i) of the
Indemnified Party from any liabilities arising out of such Proceeding,
(ii) which does not constitute an admission of wrongdoing by the
Indemnified Party, (iii) which does not restrict in any manner the
activities of the Indemnified Party and (iv) which if it provides for
the payment of money such payment is satisfied in full by the
Indemnifying Party. No Indemnified Party seeking indemnification,
reimbursement or contribution under this Agreement will, without the
Indemnifying Party's prior written consent, settle, compromise,
consent to the entry of any judgment in or otherwise seek to terminate
any Proceeding referred to in Paragraph (a) except as permitted in the
following sentence. Provided the proper notice has been duly given, if
the Indemnifying Party shall decide not to assume the defense of any
Proceeding, the Indemnified Party may respond to, contest and defend
against such Proceeding and make in good faith any compromise or
settlement with respect thereto, subject to the Indemnifying Party's
written consent in the event that the proposed compromise or
settlement materially affects the Indemnifying Party, which consent
shall not be unreasonably withheld or delayed, and recover any
reasonable Losses incurred as a result of such response, contest or
defense of such Proceeding or the settlement or compromise thereof
from the Indemnifying Party.
(d) If the indemnification provided for in Section 13(a) is judicially
determined to be unavailable to an Indemnified Party in respect of any
Losses indemnified hereunder, in lieu of indemnifying such Indemnified
Party hereunder, the Indemnifying Party shall contribute to the amount
paid or payable by such Indemnified Party as a result of such Losses
in such proportion as is appropriate to reflect the relative fault of
the Indemnified Party and the Indemnifying Party, as well as any other
relevant equitable considerations.
Section 14. NOTICE.
All notices required or permitted to be given by one Party to the other under
this Agreement shall be sufficient if sent by e-mail, fax, overnight express
delivery or certified mail, return receipt requested, to such Party at the
address set forth below or to such other address as the Parties entitled to
receive the notice has designated by notice hereunder to the other Party.
If to DB, to:
Deutsche Bank AG, New York Branch
31 West 52nd Street
New York, NY 10019
Attention: General Counsel
Tel. No.: (212) 469-8200
If to the Company, to:
National Discount Brokers Corporation
90 Hudson Street
Jersey City, NJ 07302
Attention: Executive Vice President &
General Counsel
Tel. No.: 201-209-7050
Fax No.: 201-209-6914
E-mail: [email protected]
Section 15. TERMINATION.
(a) Either Party may terminate this Agreement in its sole discretion by
providing written notice to the other Party (i) upon the occurrence of
a For Cause Termination Event with respect to the other Party; or (ii)
upon the giving of a notice of termination, by any party, of any of
the other Joint Venture Agreements. Notwithstanding any termination
effected pursuant to this Section 15, the rights and obligations set
forth in Sections 5, 6, 7, 9, 11, 13, 14, 15, 16 and 17 shall survive
any termination of this Agreement, and no such termination shall
relieve any Party of liability it may have incurred hereunder prior to
such termination.
(b) Upon termination or expiration of this Agreement for any reason, all
rights of the Company with respect to the Research Material licensed
hereunder shall terminate and the Company shall delete or destroy all
Research Material in the Company's possession, custody or control and
provide written confirmation of such deletion or destruction to DB
within 30 days of such termination or expiration and the Company shall
not use such Research Material for any purpose. The rights of each
Party under this Section 15(b) are without prejudice to any other
rights of the Parties pursuant to this Agreement and shall not be
affected by any dispute between the Parties with respect to this
Agreement or any other matter.
(c) For purposes of this Agreement, "For Cause Termination Event" means,
with respect to any Party, (i) a material breach by such Party or any
of its Affiliates of any covenant or warranty contained in this
Agreement, which breach shall not have been cured within 90 days
following delivery of a notice in writing by the non-breaching Party
to the breaching Party that specifies in detail the matter
constituting such breach and such action as may be reasonably required
to effect its cure; (ii) an Insolvency Event of the non-terminating
Party; and (iii) a Change in Control of the non-terminating Party.
Section 16. REMEDIES.
Each of the Parties acknowledges and agrees that the benefits to be
obtained by the other Party from this Agreement are unique, and each Party
acknowledges and agrees that the other Party shall be entitled to seek all
available remedies in the event of any breach by it of any representation,
warranty or agreement contained herein, including specific performance
and/or injunctive remedies. In addition, in the event that any Party
breaches any provision of this Agreement, the other Party may exercise all
remedies available under this Agreement or applicable law.
Section 17. MISCELLANEOUS.
(a) Nothing contained herein shall make the Parties partners or render any
of them liable to make payments not expressly identified or referred
to in this Agreement.
(b) The Parties hereby agree that this Agreement, and the respective
rights, duties and obligations of the parties hereunder, shall be
governed by and construed in accordance with the Laws of the State of
New York, without giving effect to principles of conflicts of Laws
thereunder. To the fullest extent permitted by applicable Law, each of
the Parties hereby (i) irrevocably consents and agrees that any legal
or equitable action or proceeding arising under or in connection with
this Agreement shall be brought exclusively in the state and federal
courts having jurisdiction in New York County, New York; and (ii) by
execution and delivery of this Agreement, irrevocably submits to and
accepts, with respect to any such action or proceeding, for itself and
in respect of its properties and assets, for purposes of this
Agreement, the jurisdiction of the aforesaid courts, and irrevocably
waives any objection to venue in such courts.
(c) Each of the Parties hereby expressly waives its rights to a jury trial
of any claim or cause of action based upon or arising out of this
Agreement. Each of the Parties also waives any bond or surety of
security upon such bond which might but for this waiver, be required
of any Party. The scope of this waiver is intended to be all
encompassing of any and all disputes that may be filed in any court
and that relate to the subject matter of this Agreement, including,
without limitation, contract claims, tort claims, breach of duty
claims, and all other common law and statutory claims. The Parties
further warrant and represent that each of them has reviewed this
waiver with its legal counsel, and that each voluntarily waives its
jury trial rights following consultation with legal counsel. This
waiver is irrevocable and may only be modified by written amendment to
this Agreement. In the event of litigation, this Agreement may be
filed as a written consent to a trial (without a jury) by the court.
(d) If any provision of this Agreement is held invalid or otherwise
unenforceable, the enforceability of the remaining provisions shall
not be impaired thereby.
(e) The failure by any party to exercise any right provided for herein
shall not be deemed a waiver of any right hereunder.
(f) Each Party agrees to bear its own expenses in connection with this
Agreement and the transactions contemplated hereby.
(g) This Agreement sets forth the entire understanding of the Parties as
to its subject matter and may not be modified except in a writing
executed by both Parties. In particular, this Agreement supersedes the
letter of intent, dated March 27, 2000, between NDB and Deutsche Bank
Americas Holding Corporation, with respect to the subject matter
hereof, among other matters.
(h) No waiver by either Party of a breach of any provision of this
Agreement by the other party shall operate or be construed as a waiver
of any subsequent breach.
(i) Except with respect to any obligations to make payments when due,
neither Party shall be liable to the other Party hereto for any
failure or delay in the performance of its obligations under this
Agreement to the extent such failure or delay is caused by a Force
Majeure Event (as defined below), provided, however, that this
Agreement may be terminated by the Party whose performance is not
affected by the Force Majeure Event if the Force Majeure Event
continues for a period of more than thirty (30) days. The Party whose
performance is affected by a Force Majeure Event shall use reasonable
efforts to: (i) avoid, remove, or minimize the impact of such event on
its performance and other obligations; and (ii) recommence performance
of its obligations at the required level as soon as possible. If
either Party is, or anticipates it is likely to be, delayed or
prevented from performing its obligations in connection with a Force
Majeure Event, such Party shall promptly notify the other Party by
telephone with confirmation in writing within two (2) business days
after the inception of such delay. As used herein, the term "Force
Majeure Event" refers to fire, flood, earthquake, the elements, other
casualties, riot, civil disorder, rebellion, war, revolution, states
of belligerency or acts of the public enemy, labor disputes, or any
other cause beyond the reasonable control of the Party whose
performance is delayed or otherwise affected by such event.
(j) This Agreement may be executed in multiple counterparts, each of which
shall constitute an original but all of which shall constitute but one
and the same instrument. One or more counterparts of this Agreement
may be delivered via telecopier, with the intention that they shall
have the same effect as an original counterpart hereof.
<PAGE>
IN WITNESS WHEREOF, the Parties have executed this agreement on the
date first set forth above.
DEUTSCHE BANK AG
By: /s/ Thomas A. Curtis
--------------------
Name: Thomas A. Curtis
Title: Attorney-In-Fact
NATIONAL DISCOUNT BROKERS CORPORATION
By: /s/ Dennis Marino
-----------------
Name: Dennis Marino
Title: Chairman
