Exhibit 2.2
LICENSE AGREEMENT
THIS AGREEMENT, is made as of this 20th day of July, 2005, by and
between IPOX Xxxxxxxx LLC ("IPOX"), a Delaware limited liability company, with
its principal place of business located at 000 Xxxx Xxxxxxx Xxxxxxxxx, Xxxxxxx,
Xxxxxxxx 00000, and Xxx Xxxxxx Funds Inc. ("Xxx Xxxxxx"), a Delaware
corporation, with its principal place of business located at 0000 Xxxxxx xx xxx
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
W I T N E S S E T H:
WHEREAS, IPOX compiles, calculates and maintains the U.S. IPOX Composite
Index, the U.S. IPOX-100 Index and the U.S. IPOX-30 Index for initial public
offerings in the United States (the "U.S. IPOX Indices");
WHEREAS, IPOX uses in commerce and has certain trade name, trademark and/or
service xxxx rights to the designations "IPOX," "IPOX Xxxxxxxx," "IPOX-100" and
"IPOX-30" (the "IPOX Marks");
WHEREAS, IPOX owns rights in and to the U.S. IPOX Indices, the proprietary
data contained therein, and the IPOX Marks (such rights, including without
limitation, copyright, trademark or proprietary rights and trade secrets, being
hereinafter collectively referred to as the "Property");
WHEREAS, Xxx Xxxxxx sponsors, underwrites and distributes a wide array of
unit investment trusts ("UITs");
WHEREAS, Xxx Xxxxxx desires to establish one or more UITs which will each
invest all or a portion of its assets in securities which replicate the
components of a U.S. IPOX Index or are selected from the components of a U.S.
IPOX Index (the "Trusts");
WHEREAS, Xxx Xxxxxx, on behalf of the Trusts, desires to license the
Property for use in connection with the Trusts; and
WHEREAS, IPOX is willing to license the Property to Xxx Xxxxxx and the
Trusts under the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and conditions contained herein and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
1. Grant of License. (a) Subject to the terms and conditions of this
Agreement, IPOX hereby grants to Xxx Xxxxxx and the Trusts a limited, exclusive
(as set forth in Section 4) license to use and refer to the Property in
connection with the Trusts. The license granted herein shall continue until the
later to occur of the termination of this Agreement or the termination date of
the last existing Trust which Trust shall be scheduled to terminate no later
than five and one-half (5 1/2) years following the termination of this
Agreement.
(b) IPOX covenants and agrees that no person or entity other than Xxx
Xxxxxx shall need to obtain any other license with respect to the Property in
connection with the creation, offering or operation of the Trusts.
(c) IPOX represents and warrants that it has made common law claims to
or otherwise owns all proprietary rights, including trade secrets, in and to the
Property and has the right to license the same to Xxx Xxxxxx and the Trusts
pursuant to this Agreement.
(d) Xxx Xxxxxx, on behalf of the Trusts, acknowledges that IPOX has
represented and warranted that the Property is the exclusive property of IPOX
and that IPOX has and retains all proprietary rights thereto except to the
extent otherwise provided herein. Except as otherwise specifically provided
herein, IPOX reserves all rights to the Property, and this Agreement shall not
be construed to transfer to Xxx Xxxxxx or the Trusts any ownership right to, or
equity interest in, any of the Property.
2. Fees. For the license granted herein, Xxx Xxxxxx, on behalf of the
Trusts, agrees that each Trust shall pay IPOX a quarterly fee during the term of
such Trust equal to 3 basis points (0.03%) of the average daily net asset value
of such Trust during each calendar quarter during such Trust's term multiplied
by the U.S. IPOX Index Ratio. The term "U.S. IPOX Index Ratio" means the portion
of the initial portfolio securities in a Trust selected with reference to a U.S.
IPOX Index as a percentage of all assets in such Trust at the time of the
creation of such Trust. Xxx Xxxxxx shall make an advance payment of license fees
to IPOX on the Effective Date in the amount of $50,000 (the "Advance Payment")
which shall be applied against future license fees payable hereunder until such
fees total such amount and thereafter the license fees payable hereunder shall
be paid within thirty (30) days following the close of each calendar quarter in
which such fees are incurred. In the event that the total license fees payable
to IPOX hereunder for all Trusts do not exceed the amount of the Advance
Payment, IPOX shall refund to Xxx Xxxxxx the excess of the Advance Payment over
the actual amount of the license fees payable hereunder for all Trusts within
thirty (30) days of the termination date of the last existing Trust.
3. Term. Subject to Section 7, the term of this Agreement shall
commence and continue as described in this Section. The term of this Agreement
shall commence as of the date set forth above (the "Effective Date") and shall
remain in full force and effect until the fifth (5th) anniversary of the
Effective Date, unless this Agreement is terminated earlier as provided herein
(such term being referred to as the "Initial Term"). At the end of the Initial
Term, this Agreement shall automatically renew for successive one-year periods
unless a party terminates the Agreement by providing the other party a written
notice to that effect ninety (90) days prior to the end of the then-current
term.
4. Exclusivity and Right of First Refusal. (a) IPOX covenants and
agrees that Xxx Xxxxxx shall be the exclusive sponsor, distributor or seller in
connection with the creation, administration, management, marketing or sale of
any non-exchange-traded UIT based upon any U.S. IPOX Index within the United
States during the period from the Effective Date until the two year anniversary
thereof (the "Initial Exclusivity Period"). The Initial Exclusivity Period shall
be extended until the three year anniversary of the Effective Date (the
"Extended Exclusivity Period") if at the end of the Initial Exclusivity Period
either (i) the aggregate sales of Units of all Trusts, whether or not currently
outstanding, equals at least $200 million or (ii) Xxx Xxxxxx pays IPOX an
exclusivity fee equal to 12 basis points (.12%) multiplied by the difference
between $200 million and the actual aggregate sales of Units of all Trusts. The
Extended Exclusivity Period shall be extended for the remaining term of the
Agreement if at the end of the Extended Exclusivity Period either (i) the
aggregate sales of Units of all Trusts, whether or not currently outstanding,
equals at least $300 million or (ii) Xxx Xxxxxx pays IPOX an exclusivity fee
equal to 12 basis points (.12%) multiplied by the difference between $300
million and the actual aggregate sales of Units of all Trusts. Any exclusivity
fee paid pursuant to this Section 4 shall be paid in addition to any license fee
payable pursuant to Section 2.
Nothing contained herein shall limit the right of IPOX to participate in
the sponsoring, creation, marketing or promotion of any exchange-traded funds
(even those structured as a UIT), private placements, separately managed
accounts, or any product not subject to the registration requirements under the
Investment Company Act of 1940, as amended.
(b) Provided that Xxx Xxxxxx is in material compliance with all terms
and conditions of this Agreement, IPOX covenants and agrees that, during the
term of this Agreement, neither IPOX nor anyone acting on its behalf shall be
associated or involved with anyone in connection with the creation,
administration, management, marketing or sale of any investment company
registered under the Investment Company Act of 1940 unless IPOX shall have first
promptly delivered to Xxx Xxxxxx a good faith written offer for Xxx Xxxxxx or
any of its affiliates to act as sponsor, depositor, adviser, promoter,
underwriter or distributor of such an investment company under the terms and
conditions of such offer and Xxx Xxxxxx and its affiliates shall have failed to
provide a written acceptance of such offer to IPOX within thirty (30) days after
receipt of such offer.
5. Assignment. Neither of the parties hereto may assign its respective
rights and obligations under this Agreement without the prior written consent of
the other.
6. Relationship of the Parties. The parties understand and agree that this
Agreement shall not be deemed to create any partnership or joint venture between
Xxx Xxxxxx and IPOX, and that any services performed hereunder by IPOX shall be
as an independent contractor and not as an employee or agent of Xxx Xxxxxx or
any Trust. IPOX shall have no authority whatsoever to bind Xxx Xxxxxx or any
Trust on any agreement or obligation and IPOX agrees that it shall not hold
itself out as an employee or agent of Xxx Xxxxxx or any Trust.
7. Termination. (a) IPOX may terminate this Agreement immediately upon a
material breach of any obligation, duty, representation, warranty or covenant of
Xxx Xxxxxx that is not remedied within ten (10) business days after written
notice.
(b) Xxx Xxxxxx may terminate this Agreement immediately upon a
material breach of any obligation, duty, representation, warranty or
covenant of IPOX that is not remedied within ten (10) business days after
written notice thereof.
(c) IPOX and Xxx Xxxxxx may terminate this Agreement at any time upon
the execution by all parties of a written agreement to that effect.
Any termination under Section 7(a) or (b) shall not limit any other
remedies for breach the non-breaching party may have at law or in equity.
Notwithstanding any provision of this Agreement to the contrary, termination of
this Agreement shall not constitute termination of any Trust.
8. Confidentiality. (a) The parties agree that certain material and
information which has or may come into the possession or knowledge of each in
connection with this Agreement or the performance hereof (e.g., proprietary
business information (including, without limitation, the names and addresses or
other personal information of customer, distributors, information providers and
suppliers)), consists of confidential and proprietary data whose disclosure to
or use by third parties would be damaging. In addition, the parties may
reasonably designate, by notice in writing delivered to the other parties, other
information as being confidential or a trade secret.
(b) All such proprietary or confidential information of each party
hereto shall be kept secret by the other party to the degree it keeps secret its
own confidential or proprietary information. Such information belonging to a
party shall not be disclosed by such party to its employees, officers, agents,
service providers or affiliates, except on a need-to-know basis, but may be
disclosed by such other party to State, Federal, or other governmental agencies,
authorities or courts as required by law or regulation, or upon their order or
request provided prompt notice of such order or request is given by such party
to the party to which such information belongs, if such notice is legally
permitted.
(c) No information that would otherwise be proprietary or confidential
for purposes of this Agreement pursuant to subsections (a) or (b) above shall be
subject to the restrictions on disclosure imposed by this Section in the event
and to the extent that (i) such information is in, or becomes part of, the
public domain otherwise than through the fault of a party to which such
information does not belong, (ii) such information was known to such party prior
to the execution of this Agreement, or (iii) such information was revealed to
such party by a third person, and which the receiving party reasonably believes
has been obtained by such third person not in violation of any existing
confidentiality or non-disclosure agreement.
(d) Each party acknowledges and agrees that a breach of this Section
would cause a permanent and irreparable damage for which money damages would be
an inadequate remedy. Therefore, each party shall be entitled to seek equitable
relief (including injunction and specific performance) in the event of any
breach of the provisions of this Section, in addition to all other remedies
available to such party at law or in equity.
(e) The covenants set forth in this Section shall survive the
termination of this Agreement.
9. Covenants. During the period of this Agreement and for as long as any of
the Trusts remain outstanding, each of the parties agree to:
(a) comply with all codes, regulations and laws applicable to the
performance of its obligations under this Agreement and obtain or have obtained
all necessary permits, licenses and other authorizations necessary for such
performance and maintain its business reputation and good standing;
(b) in the case of IPOX, make or have made common law claims to rights
related to the Property necessary for the performance of its obligations under
this Agreement,
(c) take such other actions as the other parties hereto may reasonably
request to more effectively carry out its obligations under this Agreement; and
(d) do, or cause to be done, all things necessary, proper or advisable
under applicable laws and regulations, including, but not by way of limitation,
obtaining all consents, approvals, and authorizations, required of such party in
connection with the consummation of the transactions contemplated by this
Agreement. No party shall take any action that would be expected to result in
any of its representations and warranties set forth in this Agreement being or
becoming untrue in any material respect.
In addition, IPOX may not refer to any Trust, Xxx Xxxxxx or any Xxx
Xxxxxx affiliates in any kind of communications, whether oral, written or
electronic, or otherwise, and whether in a piece published by IPOX or in
response to questions of the media or others, without Xxx Xxxxxx'x prior written
consent, except that IPOX may state that IPOX licenses the Property to the
Trusts and may describe any services provided under this Agreement to the extent
that such services are described in any registration statement or other publicly
available materials produced by Xxx Xxxxxx.
10. Indemnification. (a) In the event any claim is brought by any third
party against IPOX that relates to, arises out of or is based upon the
performance by Xxx Xxxxxx of its obligations hereunder, or the failure of Xxx
Xxxxxx, or any of Xxx Xxxxxx'x affiliates, as applicable, to comply with any
law, rule or regulation relating to the Trusts, IPOX shall promptly notify Xxx
Xxxxxx, and Xxx Xxxxxx shall defend such claim at Xxx Xxxxxx'x expense and under
Xxx Xxxxxx'x control. Xxx Xxxxxx shall indemnify and hold harmless IPOX against
any judgment, liability, loss, cost or damage (including litigation costs and
reasonable attorneys' fees) arising from or related to such claim whether or not
such claim is successful. IPOX shall have the right, at its expense, to
participate in the defense of such claim through counsel of its own choosing;
provided, however, that Xxx Xxxxxx shall not be required to pay any settlement
amount that it has not approved in advance. Notwithstanding the above, IPOX
shall not be entitled to indemnification hereunder to the extent that the
judgment, liability, loss, cost or damage arising from a claim for which
indemnification is sought hereunder results directly or indirectly from the
gross negligence or willful misconduct of IPOX.
(b) In the event any claim is brought by any third party against Xxx
Xxxxxx, any of the Trusts, or any of Xxx Xxxxxx'x affiliates that relates to,
arises out of or is based upon the performance by IPOX of its obligations
hereunder, or the failure of IPOX to comply with any law, rule or regulation,
Xxx Xxxxxx, the Trusts, or Xxx Xxxxxx'x affiliates, as the case may be, shall
promptly notify IPOX and IPOX shall defend such claim at its expense and under
its control. IPOX shall indemnify and hold harmless Xxx Xxxxxx, the Trusts, and
Xxx Xxxxxx'x affiliates against any judgment, liability, loss, cost or damage
(including litigation costs and reasonable attorneys' fees) arising from or
related to such claim, whether or not such claim is successful. Xxx Xxxxxx, the
Trusts, or Xxx Xxxxxx'x affiliates, as the case may be, shall have the right, at
their expense, to participate in the defense of such claim through counsel of
their own choosing; provided, however, IPOX shall not be required to pay any
settlement amount that it has not approved in advance. Notwithstanding the
above, neither Xxx Xxxxxx, the Trusts, nor any of Xxx Xxxxxx'x affiliates shall
be entitled to indemnification hereunder to the extent that the judgment,
liability, loss, cost or damage arising from a claim for which indemnification
is sought hereunder results directly or indirectly from the gross negligence or
willful misconduct of Xxx Xxxxxx, the Trusts, or Xxx Xxxxxx'x affiliates.
(c) The indemnifications set forth in this Section shall survive the
termination of this Agreement for any cause whatsoever.
11. Governing Law. This Agreement shall be interpreted, construed and
enforced in accordance with the laws of the State of New York without reference
to or inclusion of the principles of choice of law or conflicts of law of that
jurisdiction. It is the intent of the parties that the substantive law of the
State of New York govern this Agreement and not the law of any other
jurisdiction incorporated through choice of law or conflicts of law principles.
12. Waiver of Breach. The failure of a party to require the performance
of any term of this Agreement or the waiver of a party of any breach hereunder
shall not prevent a subsequent enforcement of such term nor be deemed a waiver
of any subsequent breach.
13. Scope of Agreement. This document constitutes the entire Agreement of
the parties with respect to the subject matter hereof, supersedes all prior oral
or written agreements, and can be amended only by a writing executed by all of
the parties.
14. Notices. All notices from any party to the other pursuant to this
Agreement shall be in writing or by facsimile transmission and shall be sent to
the following addresses, or to such addresses as the parties hereto may be
notified in writing from time to time:
If to IPOX:
000 Xxxx Xxxxxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx Xxxxxxxx
If to Xxx Xxxxxx:
0 Xxxxxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxxx Xxxxxxx, XX 00000-0000
Attn: Xxxxx Xxxxxxx
With copy to :
Xxx Xxxxxx Investments Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Office of the General Counsel
Notices shall be deemed given upon receipt via certified mail,
overnight courier, or hand delivery.
15. Severability. In the event that any provision of this Agreement or
application hereof to any person or in any circumstances shall be determined to
be invalid, unlawful, or unenforceable to any extent, the remainder of this
Agreement, and the application of any provision to persons or circumstances
other than those as to which it is determined to be unlawful, invalid or
enforceable, shall not be affected thereby, and each remaining provision of this
Agreement shall continue to be valid and may be enforced to the fullest extent
permitted by law.
16. Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument.
IN WITNESS WHEREOF, each of the parties hereto have caused this
Agreement to be executed by a duly authorized representative thereof as of the
date first above written.
IPOX XXXXXXXX LLC
By
Name_____________________________________________________
Title____________________________________________________
XXX XXXXXX FUNDS INC.
By
Name_____________________________________________________
Title____________________________________________________
