EXHIBIT 99.2
TRANSITION SERVICES
AGREEMENT
This Transition Services Agreement
(“Agreement”), dated as of December 8, 2005, by
and between Instinet Holdings Incorporated f/k/a Iceland
Acquisition Corp., a Delaware corporation (“Newco”),
Norway Acquisition Corp. f/k/a Instinet Group Incorporated, a
Delaware corporation (“Company”) and The Nasdaq Stock
Market, Inc., a Delaware corporation
(“Parent”).
WHEREAS, Company entered into that
certain Agreement and Plan of Merger, dated as of April 22,
2005, by and among Instinet Group Incorporated, a Delaware
corporation (“Iceland”), Parent and Company, pursuant
to which, among other things, Company merged with and into Iceland
(the “Merger”);
WHEREAS, concurrently therewith,
Newco, Company and Parent entered into that certain Transaction
Agreement dated as of April 22, 2005 (the “Transaction
Agreement”), pursuant to which Parent and Company agreed to
sell to Newco all of the Newco Assets;
WHEREAS, the Transaction Agreement
provides that the parties shall enter into certain Ancillary
Agreements, including this Agreement; and
WHEREAS, pursuant to the Transaction
Agreement and in order to ensure an orderly transition of Company
following the Merger and sale of the Newco Assets, Newco and
Company are entering into this Agreement, pursuant to which each of
Newco and the Company will provide or cause to be provided certain
transition services to the other party and its subsidiaries
following the Closing Date.
NOW, THEREFORE, in consideration of
the Transaction Agreement, the premises and of the mutual
covenants, representations, warranties and agreements contained
herein and therein, the parties hereto agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Section 1.01 Capitalized terms
used but not defined herein shall have the respective meanings
ascribed to them in the Transaction Agreement.
ARTICLE II
SERVICES
Section 2.01 Services
.
(a) Newco Services . From and
after the Closing Date, on the terms and subject to the conditions
contained herein, Newco shall provide, or shall cause its permitted
assigns to provide, to the Company and its Subsidiaries
(collectively, “Newco Services
Recipients”) the services set forth in
Exhibit A (the “Newco Services”). The Newco Services
will be provided in all respects with the same frequency,
performance capability, functionality, capacity and accuracy as
such services were provided by Iceland during the six
(6) month period prior to the effective date of the
Transaction Agreement (or, as explicitly set forth herein, the
Closing Date) (except to the extent any reduction in the frequency,
performance, capability, functionality, capacity and accuracy of
such services is not, individually or in the aggregate with all
reductions to any services, materially adverse to the conduct of
Newco Services Recipients’ business or Newco Services
Recipients’ relationship with any customer, and
provided that such reduction is consistent with a reduction
in the frequency, performance, capability, functionality, capacity
and accuracy of such services with respect to Newco’s
business), provided that the Newco Services shall be
provided at all times in accordance with applicable Law. In the
event that any Newco Service was routinely provided by Iceland, but
was not provided during the six (6) month period prior to the
effective date of the Transaction Agreement (e.g., an annual
service), such service shall be provided with substantially the
same frequency, performance capability, functionality, capacity and
accuracy as such service was previously provided by Iceland (except
to the extent any reduction in the frequency, performance,
capability, functionality, capacity and accuracy of such services
is not, individually or in the aggregate with all reductions to any
services, materially adverse to the conduct of Newco Services
Recipients’ business or Newco Services Recipients’
relationship with any customer, and provided that such
reduction is consistent with a reduction in the frequency,
performance, capability, functionality, capacity and accuracy of
such services with respect to Newco’s business).
(b) Company Services . From
and after the Closing Date, on the terms and subject to the
conditions contained herein, Company shall provide, or shall cause
its permitted assigns to provide, to Newco and its Subsidiaries
(collectively, “Company Services Recipients” and,
together with the Newco Services Recipients, the “Services
Recipients”) the services set forth in Exhibit B (the
“Company Services” and, together with the Newco
Services, the “Services”). The Company Services will be
provided in all respects with the same frequency, performance
capability, functionality, capacity and accuracy as such services
were provided by Company during the six (6) month period prior
to the effective date of the Transaction Agreement (or, as
explicitly set forth herein, the Closing Date) (except to the
extent any reduction in the frequency, performance, capability,
functionality, capacity and accuracy of such services is not,
individually or in the aggregate with all reductions to any
services, materially adverse to the conduct of Company Services
Recipients’ business or Company Services Recipients’
relationship with any customer, and provided that such reduction is
consistent with a reduction in the frequency, performance,
capability, functionality, capacity and accuracy of such services
with respect to Company’s business), provided that the
Company Services shall be provided at all times in accordance with
applicable Law. In the event that any Company Service was routinely
provided by Company, but was not provided during the six
(6) month period prior to the effective date of the
Transaction Agreement (e.g., an annual service), such service shall
be provided with substantially the same frequency, performance
capability, functionality, capacity and accuracy as such service
was previously provided by Company (except to the extent any
reduction in the frequency, performance, capability, functionality,
capacity and accuracy of such services is not, individually or in
the aggregate with all reductions to any services, materially
adverse to the conduct of Company Services Recipients’
business or Company Services
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Recipients’ relationship with any
customer, and provided that such reduction is consistent with a
reduction in the frequency, performance, capability, functionality,
capacity and accuracy of such services with respect to
Company’s business).
(c) Service Providers. For purposes
of this Agreement, “Service Providers” shall refer to
both Newco and the Company, and “Service Provider”
shall refer to either Newco or the Company, when acting in such
capacity.
Section 2.02 Additional
Services
(a) Service Requests . In the
event that the Services, in combination with the other services
provided pursuant to other Ancillary Agreements, are not sufficient
to allow Services Recipients to conduct their business in
substantially the same manner in which they were conducting
business in the six (6) months prior to the effective date of
the Transaction Agreement, subject to Section 6.1(a) of the
Transaction Agreement, Services Recipients may request, and the
relevant Service Provider may agree to provide such additional
services (“Additional Service”), at a reasonable price
to be mutually agreed, required to allow the applicable Services
Recipients to so conduct their business during the Term. Upon the
agreement of the parties for the provision of any Additional
Service, such Additional Service shall be deemed for purposes of
this Agreement to be (i) if provided by Newco, a Newco Service
or (ii) if provided by Company, a Company Service.
(b) Use and Occupancy of Real
Property . From and after the Closing Date, on the terms and
subject to the conditions contained herein and the obtaining by
Newco of any necessary consents, Newco hereby grants to Newco
Services Recipients an exclusive license to use and occupy the
office space set forth on Exhibit A, and a non-exclusive license to
use the common areas of the Harborside Financial Center (the
“Building”), including general parking areas
(designated for employees), common entrances, common elevators and
common bathrooms, subject to such reasonable rules and regulations
as exist in connection with such areas as of the Closing Date.
Newco Services Recipients shall be entitled to use and operate the
furniture and equipment in such office space (i) as such
furniture and equipment was used and operated by Iceland during the
six (6) months prior to the effective date of the Transaction
Agreement and (ii) as is otherwise permitted under that
certain Sublease, dated as of December 18, 2001, by and
between Charles Schwab & Co, Inc., as Sublandlord, and
Instinet Services, L.L.C. (successor-in-interest to Instinet Group
Incorporated), as Subtenant (as amended from time to time, the
“Sublease”). The foregoing license is subject to
compliance by the Newco Services Recipients and their employees and
other invitees with (a) the terms of the Sublease and
(b) use of the premises in accordance with applicable Law.
Company hereby acknowledges that the Newco Services Recipients have
inspected the Building and the furniture and equipment in such
office space and agree to accept the same in its “as
is” condition as of the Closing Date. Company further
acknowledges and agrees that the Newco Services Recipients and
their employees and other representatives shall use due care in
their use of the Building, the furniture and equipment provided
hereunder and keep the same in good working order and condition,
subject to ordinary wear and tear.
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Section 2.03 License for Fix
Interface and SmartRouter . From and after the Closing Date, on
the terms and subject to the conditions contained herein, Newco
hereby grants to Newco Services Recipients a non-exclusive,
royalty-free, fully paid-up license to use the software in object
code form described in Schedule 1 (“Fix Interface” and
“SmartRouter,” respectively) for customer access to
order routing substantially in the way it is used as of the Closing
Date until such time as the software described on Schedule 2
(“RASH”) is fully implemented by Company. Newco
Services Recipients acknowledge and agree that Fix Interface and
SmartRouter are licensed to it on an “AS IS, WHERE IS”
basis in its current condition. Newco makes no representations or
warranties whatsoever in connection with Fix Interface and
SmartRouter, and Newco expressly disclaims all representations and
warranties, whether express or implied including any warranty as to
merchantability, fitness for a particular purpose or
non-infringement. It is understood and agreed that no maintenance
or other support shall be provided to the Newco Services Recipients
in connection with the foregoing licensed software. For purposes of
this Agreement, RASH shall be deemed to be fully implemented by the
Company at such time that fewer than an average of five million
shares per day over the course of ten (10) trading days of
Newco Services Recipients’ customer flow (defined as flow for
which Newco Service Recipients are billing those customers directly
but not including customer flow sent over the Instinet Trading
Portal to SmartRouter by Newco Services Recipients’
customers) are sent to destinations other than Newco using
SmartRouter.
Section 2.04 Service
Coordinators; Dispute Resolution
(a) Newco and Company shall each
nominate a representative to act as the primary contact person with
respect to the performance of the Services (each, a “Service
Coordinator”). Unless otherwise agreed by the parties, all
communications relating to this Agreement and to the Services
provided hereunder shall be directed to the Service Coordinators.
The initial Service Coordinators for Newco and Company are set
forth in Section 7.05, as may be modified by either party from
time to time upon prior written notice to the other.
(b) In the event of any dispute
arising out of or related to this Agreement, one party shall notify
the other of its request to resolve a dispute. The Service
Coordinators shall then meet on the telephone or in person to
attempt to reach a mutually satisfactory resolution to the dispute.
If the Service Coordinators are unable to reach a mutually
satisfactory resolution to the dispute after ten (10) Business
Days, the dispute shall be referred to an executive committee
comprised of senior executive officers of each of Newco and
Company. Such executive committee shall meet on the telephone or in
person to attempt to reach a mutually satisfactory resolution to
the dispute. If the executive committee is unable to reach a
mutually satisfactory resolution to the dispute after ten
(10) Business Days, each party may pursue any and all remedies
available to it at law or equity, subject to the provisions of
Section 7.12. The foregoing shall not preclude a party from
seeking any temporary or preliminary injunctive relief from a court
of competent jurisdiction while the parties undertake such dispute
resolution proceedings.
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ARTICLE III
PAYMENT
Section 3.01 Fees . In
consideration for each of the Newco Services, Company shall pay to
Newco the applicable fee set forth on Exhibit A. In consideration
for each of the Company Services, Newco shall pay to Company the
applicable fee set forth on Exhibit B.
Section 3.02 Billing and
Payment Terms . Except to the extent otherwise explicitly set
out in Exhibit A or Exhibit B, any amounts due under this Agreement
shall be billed and paid for in the following manner: (a) each
Service Provider shall invoice Newco or Company, as applicable, on
a monthly basis (such invoice to set forth a description of the
Services provided and such other supporting documentation and other
information as reasonably requested by Newco or Company) for
all Services delivered during the preceding month and any sales,
use or similar taxes imposed on such Services; and (b) each
such invoice shall be payable within forty-five (45) days
after receipt thereof.
ARTICLE IV
ACCESS
Section 4.01 Access .
Newco Services Recipients and their invitees shall have access to
the Building and the office space provided hereunder in
substantially the same manner and on substantially the same basis
as provided to Newco Services Recipients during the six
(6) month period prior to the Closing (except to the extent
any reduction in the manner or basis of the provision of such
access is not, individually or in the aggregate with all reductions
to any services, materially adverse to the conduct of Newco
Services Recipients’ business or Newco Services
Recipients’ relationship with any customer, and
provided that such reduction is consistent with a reduction
in such access with respect to Newco’s business).
Section 4.02 Facilities
Security . Newco shall employ the same facility security
methods employed by Iceland within the six (6) month period
prior to
