Exhibit (h)(3)
SUBLICENSE AGREEMENT
This Sublicense Agreement (the "Agreement") is made as of July 9, 2002, by and
between ETF Advisors, LP, a Delaware Limited Partnership (the "Advisor") and ETF
Advisors Trust, a business trust established under the laws of the State of
Delaware (the "Trust").
RECITALS
WHEREAS, pursuant to that certain "License Agreement" dated July 4, 2002 (the
"License Agreement") by and among Xxxx Holdings LLC, Xxxx Labs Inc. (together,
"Xxxx") and Advisor, Advisor obtained a license to use in connection with
"Products" (as that term is defined in the License Agreement) certain indexes
owned and managed by Xxxx (the "Xxxx Indexes"), along with associated marks (the
"Xxxx Xxxxx"); and
WHEREAS, Advisor has the right pursuant to paragraph 1 of the License Agreement
to sublicense its rights thereunder to any Advisor Fund, of which Trust is one;
and
WHEREAS, Trust wishes to use the Xxxx Indexes and the Xxxx Xxxxx in connection
with the establishment of a series of exchange traded funds (each, an "Fund"),
each based on an Index, and to use the Xxxx Xxxxx in connection with the
identification and marketing of the Funds and in connection with making
disclosures about the Funds under applicable laws, rules and regulations; and
WHEREAS, Advisor wishes to grant a sublicense to Trust for the use of the
Xxxx Indexes and Xxxx Xxxxx;
NOW THEREFORE, the parties agree as follows:
1. Grant of Sublicense. Subject to the terms and conditions of this Agreement,
Advisor hereby grants to Trust a sublicense to use the Xxxx Indexes (and
associated data and information) and the Xxxx Xxxxx listed on Exhibit A in
the manner set forth in, and subject to the terms of, the License
Agreement, including without limitation the restrictions in the License
Agreement that Trust will not have the further power to sublicense third
parties to use the Xxxx Indexes and the Xxxx Xxxxx.
2. Performance of Obligations Under the License. Trust will be responsible for
performing all of Advisor's executory obligations under the License
Agreement (other than the payment of license fees), as such obligations
relate to use of the Xxxx Indexes and the Xxxx Xxxxx in connection with the
formation and operation of Products (as that term is defined in the License
Agreement).
3. Fees. Trust shall no obligation to pay any sublicense fees to Advisor or
Xxxx under this sublicense agreement.
4. Termination. This Agreement shall terminate if (a) the License Agreement
terminates, or (b) Advisor or an affiliate of Advisor ceases to exercise
investment discretion over the Trust or any Fund in its capacity as
manager, investment adviser, trustee, or other comparable capacity. Advisor
shall notify Trust as soon as reasonably practicable of the occurrence of
an event described in (a) above. Upon termination of this Agreement,
Trust's right to use the Xxxx Indexes and the Xxxx Xxxxx shall terminate
immediately.
5. Indemnification. Trust shall indemnify and hold harmless Advisor, its
officers, employees, agents, successors, and assigns against all judgments,
damages, costs or losses of any kind (including reasonable attorneys' and
experts' fees) resulting from any claim, action or proceeding (collectively
"claims") that arises out of or relates to (a) the creation, marketing,
advertising, selling, and operation of the Trust or interests therein, or
(b) any breach by Advisor of its covenants, representations, and warranties
under the License Agreement caused by the actions or inactions of Trust or
Trust's sublicensees, or (c) errors in the calculation of any Xxxx Index,
or delays in the dissemination of any Xxxx Index, or (d) any violation of
applicable laws (including, but not limited to, banking, commodities, and
securities laws) arising out of the offer, sale, operation, or trading of
the Trust or interests therein, except to the extent such claims result
from the negligence, gross negligence or willful misconduct of Advisor or
its affiliates. The provisions of this section shall survive termination of
this Agreement.
6. Assignment. Trust will not make, or purport to make, any assignment or
other transfer of this Agreement. Advisor may assign its rights and
obligations under this Agreement effective upon the giving of written
notice to Trust.
7. Amendment. No provision of this Agreement may be waived, altered, or
amended except by written agreement of the parties.
8. Entire Agreement. This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof.
9. Construction. Headings used in this Agreement are for convenience only, and
shall not affect the construction or interpretation of any of its
provisions. Each of the provisions of this Agreement is severable, and the
invalidity or inapplicability of one or more provisions, in whole or in
part, shall not affect any other provision. To the extent not preempted by
federal law, this Agreement shall be construed and interpreted under the
laws of the State of New York.
10. Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but such counterparts
together shall constitute only one instrument.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed
as of the date first set forth above.
ETF ADVISORS TRUST
By: /s/ Xxxxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Director
ETF ADVISORS, LP
By: /s/ Xxxxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Director
Exhibit A to Sublicense Agreement dated July 9, 2002
Xxxx Indexes:
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Xxxx Adjusted 1 Year Treasury Index
Xxxx 2 Year Treasury Index
Xxxx 5 Year Treasury Index
Xxxx 10 Year Treasury Index
Xxxx Xxxxx:
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"XXXX," "Xxxx Index," "FITR" and "FITRS
