Exhibit 2.2
LICENSE AGREEMENT
This License Agreement, dated as of ____________, is made by and between
Dow ▇▇▇▇▇ & Company, Inc. ("Dow ▇▇▇▇▇"), having an office at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and ▇▇▇ ▇▇▇▇▇▇ Funds Inc. (the "Licensee"), having an
office at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇.
WHEREAS, Dow ▇▇▇▇▇ compiles, calculates and maintains the Dow ]ones
Industrial Average (the "Index"), and Dow ▇▇▇▇▇ owns rights in and to the Index,
the proprietary data contained therein, and the Dow ▇▇▇▇▇ Marks (defined below)
(such rights, including without limitation, copyright, trademark or proprietary
rights and trade secrets, being hereinafter collectively referred to as the
"Intellectual Property"); and
WHEREAS, Dow ▇▇▇▇▇ uses in commerce and has trade name, trademark and/or
service ▇▇▇▇ rights to the designations "Dow ▇▇▇▇▇," "Dow ▇▇▇▇▇ Industrial
Average," "DJIA," "30 Industrials," "Dow 30," "Dow Industrials," "The Dow," "The
Dow 10" And "The Dow 5" (such rights being hereinafter individually and
collectively referred to as the "Dow ▇▇▇▇▇ Marks"); and
WHEREAS, the Licensee wishes to use the Index and the related Dow ]ones
Marks, pursuant to the terms and conditions hereinafter set forth, in connection
with (i) the issuance, marketing and promotion of the Products (as defined in
Section 1(b)) and (ii) making disclosure about such Products under applicable
laws, rules and regulations in order to indicate that the Products are based on
the Index and that Dow ▇▇▇▇▇ is the source of the Index.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, it is agreed as follows:
1. Grant of License.
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(a) Subject to the terms and conditions of this Agreement, Dow ▇▇▇▇▇
hereby grants to the Licensee a non-transferable (except to affiliates
pursuant to Section 12(a)) non-exclusive license to use and refer to
the Dow ▇▇▇▇▇ Marks in connection with the issuance, sale, marketing
and promotion of the Products in order to indicate that the amounts
payable under the terms of the Products are calculated with reference
to the Strategy (as defined in Schedule A) and that Dow ▇▇▇▇▇ is the
source of the Index, and as may otherwise be required by applicable
laws, rules or regulations or under this Agreement.
(b) As used in this Agreement, "Products" means the products described on
Schedule A hereto. Any material changes to the terms and conditions of
the Products will be subject to Dow ▇▇▇▇▇' prior written consent.
(c) Dow ▇▇▇▇▇ agrees that no person or entity other than the Licensee
shall need to obtain a license from Dow ▇▇▇▇▇ with respect to the
initial sale of the Products or subsequent resales of the Products in
the secondary market.
(d) Nothing contained in this Agreement constitutes a license to the
Licensee to use (i) any one or more of the indexes compiled,
calculated and maintained by Dow ▇▇▇▇▇, including the Index
(collectively, the "Indexes"), or (ii) any one or more of the indexes
of which any of the Indexes is comprised (if applicable) (the
"Component Indexes"), for any purpose, except as otherwise
contemplated by this Agreement.
(e) The Licensee acknowledges that the Index and the Dow ▇▇▇▇▇ Marks are
the exclusive property of Dow ▇▇▇▇▇ and that Dow ▇▇▇▇▇ has and retains
all Intellectual Property and other proprietary rights therein. Except
as otherwise specifically provided herein, Dow ▇▇▇▇▇ reserves all
rights to the Index and the Dow ▇▇▇▇▇ Marks, and this Agreement shall
not be construed to transfer to the Licensee any ownership right to,
or equity interest in, any of the Index or the Dow ▇▇▇▇▇ Marks, or in
any Intellectual Property or other proprietary rights pertaining
thereto.
(f) The Licensee acknowledges that the Index and its compilation and
composition, and any changes therein, are and will be in the complete
control and sole discretion of Dow ▇▇▇▇▇.
2. Term.
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The term of this Agreement shall commence as of the date hereof (the
"Commencement Date") and shall remain in full force and effect until the fifth
anniversary of the Commencement Date, unless this Agreement is terminated
earlier as provided herein (such term being referred to as the "Initial Term").
The first twelve months following the Commencement Date are referred to as the
"First Year," the next twelve months are referred to as the "Second Year," and
so on.
Upon expiration of the Initial Term (other than by reason of termination of
this Agreement as provided herein), this Agreement may be renewed at the
election of the Licensee, by delivery of written notice to Dow ▇▇▇▇▇ to that
effect at least 90 days prior to expiration of the Initial Term, for an
additional five years (the "Renewal Term"); provided, however, that Licensee
shall not have the right to renew the term hereunder without Dow ▇▇▇▇▇' prior
written consent if, (x) at the time of expiration of the Initial Term, the
Licensee is in material breach of this Agreement or (y) the aggregate average
assets invested in the Products in respect of the Fourth Year is less than $500
million. (The Initial Term and the Renewal Term, if any, are referred to herein,
together, as the ("Term.")
3. License Fee.
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(a) As consideration for the license granted herein, the Licensee shall
pay to Dow ▇▇▇▇▇ license fees ("License Fees") as set forth on
Schedule B hereto.
(b) If independently audited financial statements for the Products are
prepared, the Licensee shall provide Dow ▇▇▇▇▇ with such audited
financial statements promptly after receipt thereof by the Licensee.
Dow ▇▇▇▇▇ may use such audited financial statements to confirm the
accuracy of any one or more calculations of License Fees. Dow ▇▇▇▇▇
shall not bear the cost of any such audit. In addition, Dow ▇▇▇▇▇
shall have the right to audit on a confidential basis the relevant
books and records of the Licensee to confirm the accuracy of any one
or more calculations of License Fees. Dow ▇▇▇▇▇ shall bear its own
costs of any such audit unless it is determined that Dow ▇▇▇▇▇ has
been underpaid by 5% or more with respect to the payments being
audited, in which case Dow ▇▇▇▇▇' costs of such audit shall be paid by
the Licensee.
(c) As of December 31 for each year of the Term of this Agreement,
Licensee shall deliver a report to Dow ▇▇▇▇▇ including the amount of
the average daily net assets of each Product as of December 31. Dow
▇▇▇▇▇ shall have the right to request, and the Licensee shall deliver
to Dow ▇▇▇▇▇ promptly upon such a request, reasonable information and
documentation with respect to any Product.
4. Termination.
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(a) If there is a material breach of this Agreement by either party (such
party, the "breaching party," and, the other party, the "non-breaching
party"), or if either party (such party, the "harmed party") believes
in good faith that material damage or harm is occurring to its
reputation or good will by reason of its continued performance
hereunder (other than pursuant to Section 4(d)), then the
non-breaching party or the harmed party, as the case may be, may
terminate this Agreement, effective thirty (30) days after written
notice thereof to the other party (with reasonable specificity as to
the nature of the breach or the condition causing such damage or harm,
as the case may be, and including a statement as to such party's
intent to terminate), unless the other party shall correct such breach
or the condition causing such damage or harm, as the case may be,
within such 30-day period.
(b) The Licensee may terminate this Agreement upon ninety (90) days' prior
written notice to Dow ▇▇▇▇▇ (or such lesser period of time as may be
necessary pursuant to law, rule, regulation or court order) if (i) any
legislation or regulation is finally adopted or any government
interpretation is issued that in Licensee's reasonable judgment
prevents the Licensee from issuing, marketing or promoting the
Products; (ii) any material litigation or regulatory proceeding
regarding the Products is commenced or threatened and Licensee
reasonably believes that such litigation or proceeding would be
reasonably likely to have a material and adverse effect on the
Products or on Licensee's ability to perform under this Agreement;
(iii) the Licensee elects to terminate the public offering or other
distribution of the Products; or (iv) any of the events set forth in
Section 4(c)(i) through (iii) occurs.
(c) Dow ▇▇▇▇▇ may terminate this Agreement upon ninety (90) days' prior
written notice to the Licensee if (i) any legislation or regulation is
finally adopted or my government interpretation is issued that in Dow
▇▇▇▇▇' reasonable judgment materially impairs Dow ▇▇▇▇▇' ability to
license and provide the Index or the Dow ▇▇▇▇▇ Marks under this
Agreement; (ii) any litigation or proceeding is commenced which
relates, directly or indirectly, to Dow ▇▇▇▇▇' licensing and providing
the Index or the Dow ▇▇▇▇▇ Marks under this Agreement, or any such
litigation proceeding is threatened and Dow ▇▇▇▇▇ reasonably believes
that such litigation or proceeding would be reasonably likely to have
a material and adverse effect on the Index or the Dow ▇▇▇▇▇ Marks or
on Dow ▇▇▇▇▇' ability to perform under this Agreement; (iii) Dow ▇▇▇▇▇
elects (other than pursuant to Section 4(d)) to cease compiling,
calculating and publishing values of the Index; or (iv) any of the
events set forth in Section 4(b)(i) though (iii) occurs.
(d) Notwithstanding anything to the contrary herein, Dow ▇▇▇▇▇ shall have
the right, in its sole discretion, to cease compiling, calculating and
publishing values of the Index at any time that Dow ▇▇▇▇▇ determines
that such Index no longer meets or will not be capable of meeting the
criteria established by Dow ▇▇▇▇▇ for maintaining the Index, and
thereupon to terminate this Agreement (but Dow ▇▇▇▇▇ will use all
reasonable efforts to provide the Licensee with as much prior notice
as is reasonably practicable under the circumstances).
(e) Dow ▇▇▇▇▇ may terminate this Agreement, upon written notice to the
Licensee, if any securities exchange (i) ceases to provide data to Dow
▇▇▇▇▇ necessary for providing the Index, (ii) terminates Dow ▇▇▇▇▇'
right to receive data in the form of a "feed" from such securities
exchange, (iii) materially restricts Dow ▇▇▇▇▇' right to redistribute
data received from such securities exchange, or (iv) institutes
charges (other than nominal charges or charges which Dow ▇▇▇▇▇ deems
to be reasonable to be incurred in connection with providing the
Index) of a type or to an extent applicable to Dow ▇▇▇▇▇ (and not to
others generally) for the provision of data to Dow ▇▇▇▇▇ or the
redistribution of data by Dow ▇▇▇▇▇.
(f) Dow ▇▇▇▇▇ may terminate this Agreement upon written prior notice to
the Licensee if no offering with respect to any Products has commenced
by 90 days after the date hereof.
5. Dow ▇▇▇▇▇ Obligations.
----------------------
(a) Dow ▇▇▇▇▇ is not, and shall not be, obligated to engage in any way or
to any extent in any marketing or promotional activities in connection
with the Products or in making any representation or statement to
investors or prospective investors in connection with the marketing or
promotion of the Products by the Licensee.
(b) Dow ▇▇▇▇▇ agrees to provide reasonable support for the Licensee's
development and educational efforts with respect to the Products by
responding in a timely fashion to any reasonable request by the
Licensee for information regarding the Index.
(c) Dow ▇▇▇▇▇ has, and shall maintain, a policy pursuant to which its
employees who are directly responsible for changes in the components
of the Index are prohibited from purchasing or beneficially owning any
interest in the Products. The Licensee shall have no responsibility
for ensuring that such Dow ▇▇▇▇▇ employees comply with such Dow ▇▇▇▇▇
policy and shall have no duty to inquire whether any purchasers or
sellers of the Products are such Dow ▇▇▇▇▇ employees. Dow ▇▇▇▇▇ shall
have no liability to the Licensee with respect to Dow ▇▇▇▇▇'
employees' adherence or failure of adherence to such policy.
(d) Dow ▇▇▇▇▇ shall use reasonable efforts to safeguard the
confidentiality of all impending changes in the components or method
of computation of the Index until such changes are publicly
disseminated, and shall require the same of any agent with whom it has
contracted for composition thereof. Dow ▇▇▇▇▇ shall implement
reasonable procedures so that only those persons at Dow ▇▇▇▇▇ directly
responsible for changes in the composition or method of computation of
the Index shall be granted access to information respecting impending
changes.
6. Trademark Filings; Recognition of Intellectual Property Rights;
Protection of Intellectual Property, Quality Control.
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(a) Dow ▇▇▇▇▇ shall apply only for such trademark and trade name
registrations for the Dow ▇▇▇▇▇ Marks only in such jurisdictions, if
any, where Dow ▇▇▇▇▇, in its sole discretion, considers such filings
appropriate. The Licensee shall reasonably cooperate with Dow ▇▇▇▇▇ in
the maintenance of such rights and registrations and shall do such
acts and execute such instruments as are reasonably necessary or
appropriate for such purpose. The Licensee shall use the following
notice when referring to the Index or any of the Dow ▇▇▇▇▇ Marks in
any written informational materials to be used in connection with the
Products (including all prospectuses, registration statements,
advertisements, brochures and promotional and any other similar
informational materials, including documents required to be filed with
governmental or regulatory agencies) that in any way use or refer to
Dow ▇▇▇▇▇, the Index or any of the Dow ▇▇▇▇▇ Marks (collectively, the
"Informational Materials"):
"Dow ▇▇▇▇▇ Industrial Averagesm", "DJIAsm", "Dow 30sm", "Dow
Industrials", "The Dowsm", and "The Dow 10sm" are service marks of Dow
▇▇▇▇▇ & Company, Inc. and have been licensed for use for certain
purposes by [INSERT NAME OF LICENSEE]. [INSERT NAME OF LICENSEE]'S
[INSERT NAME OF PRODUCT(S)], based on the Dow ▇▇▇▇▇ Industrial
Averagesm, are not sponsored, endorsed, sold or promoted by Dow ▇▇▇▇▇,
and Dow ▇▇▇▇▇ makes no representation regarding the advisability of
investing in such product(s). or such similar language as may be
approved in advance in writing by Dow ▇▇▇▇▇.
(b) The Licensee agrees that the Dow ▇▇▇▇▇ Marks and all Intellectual
Property and other rights, registrations and entitlement thereto,
together with all applications, registrations and filings with respect
to any of the Dow ▇▇▇▇▇ Marks and any renewals and extensions of any
such applications, registration and filings, are and shall remain the
sole and exclusive property of Dow ▇▇▇▇▇. The Licensee acknowledges
that each of the Dow ▇▇▇▇▇ Marks is part of the business and goodwill
of Dow ▇▇▇▇▇ and agrees that it shall not, during the Term or
thereafter, contest the fact that the Licensee's rights in the Dow
▇▇▇▇▇ Marks under this Agreement (i) are limited solely to the use of
the Dow ▇▇▇▇▇ Marks in connection with the issuance, marketing, and/or
promotion of the Products and disclosure about the Products under
applicable law as provided in Section 1(a), and (ii) shall cease upon
termination or expiration of this Agreement, except as otherwise
expressly provided herein. Upon termination or expiration of this
Agreement, the Licensee shall have no right to use any Dow ▇▇▇▇▇ Marks
and shall inform any recipients of Informational Materials that in any
way use or refer to any Dow ▇▇▇▇▇ Marks that this Agreement has been
terminated or has expired and that Dow ▇▇▇▇▇ no longer provides the
Index to the Licensee, The Licensee recognizes the great value of the
reputation and goodwill associated with the Dow ▇▇▇▇▇ Marks and
acknowledges that such goodwill associated with the Dow ▇▇▇▇▇ Marks
belongs exclusively to Dow ▇▇▇▇▇, and that Dow ▇▇▇▇▇ is the owner of
all right, title and interest in and to the Dow ▇▇▇▇▇ Marks in
connection with the Products. The Licensee further acknowledges that
all rights in any translations, derivations or modifications in the
Dow ▇▇▇▇▇ Marks which may be created by or for the Licensee shall be
and shall remain the exclusive property of Dow ▇▇▇▇▇ and said property
shall be and shall remain a part of the Intellectual Property subject
to the provisions and conditions of this Agreement. The Licensee shall
never, either directly or indirectly, contest Dow ▇▇▇▇▇' exclusive
ownership of any of the Intellectual Property. The Licensee shall not,
except with Dow ▇▇▇▇▇' prior written consent, use any Dow ▇▇▇▇▇ ▇▇▇▇,
or the designation "Dow ▇▇▇▇▇" or "Dow," or any other Dow ▇▇▇▇▇ ▇▇▇▇,
in conjunction with the Licensee's own trademark(s) resulting in a
composite ▇▇▇▇, and, if the License obtains Dow ▇▇▇▇▇' consent
therefor, then such resulting composite ▇▇▇▇ shall be part of the
Intellectual Property of Dow ▇▇▇▇▇ and included in the Dow ▇▇▇▇▇ Marks
as defined herein, and Dow ▇▇▇▇▇ shall be permitted to register such
usage in all jurisdictions, if any, as Dow ▇▇▇▇▇ deems to be
reasonably necessary or prudent, without opposition from the Licensee.
The Licensee agrees to cooperate with Dow ▇▇▇▇▇, at Dow ▇▇▇▇▇'
expense, in the maintenance of such rights and registrations and shall
do such acts and execute such instruments as are reasonably necessary
or appropriate for such purpose.
(c) In the event that the Licensee learns of any infringement or imitation
of the Index and/or any Dow ▇▇▇▇▇ ▇▇▇▇, or of any use by any person of
a trademark similar to any of the Dow ▇▇▇▇▇ Marks, it shall promptly
notify Dow ▇▇▇▇▇. Dow ▇▇▇▇▇ shall take such action, if any, as it
deems advisable for the protection of rights in and to the Index and
the Dow ▇▇▇▇▇ Marks and, if requested to do so by Dow ▇▇▇▇▇, the
Licensee shall cooperate with Dow ▇▇▇▇▇ in all reasonable respects, at
Dow ▇▇▇▇▇' expense, including, without limitation, by being a
plaintiff or co-plaintiff and, upon Dow ▇▇▇▇▇' reasonable request, by
causing its officers to execute appropriate pleadings and other
necessary documents. In no event, however, shall Licensee or Dow ▇▇▇▇▇
be required to take any action Licensee or Dow ▇▇▇▇▇, respectively,
deems inadvisable. The Licensee shall have no right to take any action
which would materially affect the Index and/or any of the Dow ▇▇▇▇▇
Marks without Dow ▇▇▇▇▇' prior written approval.
(d) The Licensee shall use all reasonable efforts to protect the goodwill
and reputation of Dow ▇▇▇▇▇, the Index and the Dow ▇▇▇▇▇ Marks in
connection with its use of the Index and any of the Dow ▇▇▇▇▇ Marks
under this Agreement. The Licensee shall submit to Dow ▇▇▇▇▇, for Dow
▇▇▇▇▇' review and approval, and the Licensee shall not use until
receiving Dow ▇▇▇▇▇' approval thereof in writing, all Informational
Materials that in any way use or refer to Dow ▇▇▇▇▇, the Index or any
of the Dow ▇▇▇▇▇ Marks. Dow ▇▇▇▇▇' approval shall be required with
respect to the use of and description of Dow ▇▇▇▇▇, the Index or any
of the Dow ▇▇▇▇▇ Marks. Dow ▇▇▇▇▇ shall notify the Licensee of its
approval or disapproval of any Informational Materials within 72 hours
(excluding any day which is a Saturday or Sunday or a day on which The
New York Stock Exchange is closed) Wowing receipt thereof from the
Licensee. Once Informational Materials have been approved by Dow
]ones, subsequent Informational Materials which do not alter the use
or description of Dow ▇▇▇▇▇, the Index or such Dow ▇▇▇▇▇ Marks, as the
case may be, need not be submitted for review and approval by Dow
▇▇▇▇▇.
(e) Whenever the Dow ▇▇▇▇▇ Marks are used in any Informational Material in
connection with any of the Products, the name of the Licensee shall
appear in close proximity to the Dow ▇▇▇▇▇ Marks so that the identity
of the Licensee, and its status as in authorized licensee of such Dow
▇▇▇▇▇ Marks, is clear and obvious.
(f) The Licensee agrees that any proposed material change by the Licensee
in (i) the terms and conditions of the Products or (ii) the use of the
Dow ▇▇▇▇▇ Marks shall be submitted to Dow ▇▇▇▇▇ for, and shall be
subject to, Dow ▇▇▇▇▇' prior written consent.
(g) In the event Dow ▇▇▇▇▇ ceases to compute, calculate and publish the
values of the Index pursuant to Section 4(c)(iii) or 4(d) hereof, Dow
▇▇▇▇▇ shall provide to the Licensee a list of companies, shares
outstanding and divisors for the discontinued Index as of the
effective date of termination. The Licensee may thereafter use such
information to compute, calculate and publish a new index as the bases
for the Products previously based upon the discontinued Index;
provided, however, that the Licensee shall not thereafter make any
reference to the Dow ▇▇▇▇▇ Marks in respect of any such new index, or
any products based thereon, and Dow ▇▇▇▇▇ shall have no further
obligations to the Licensee whatsoever with respect to the
discontinued Index, the new index, or any products based thereon and,
provided, further, that the Licensee shall prominently disclaim any
relationship with Dow ▇▇▇▇▇ in respect of the new index. The Licensee
may use the Dow ▇▇▇▇▇ Marks after the date of termination for the sole
purpose of providing notification of such termination as it relates to
the Products; provided, that such notification shall be subject to the
prior written approval of Dow ▇▇▇▇▇ and Licensee shall not be deemed
to be in default of its obligations pursuant to this Section 6(g) upon
any unreasonable denial or delay in approval by Dow ▇▇▇▇▇.
7. Proprietary Rights.
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(a) The Licensee acknowledges that the Index is selected, compiled,
coordinated, arranged and prepared by Dow ▇▇▇▇▇ through the
application of methods and standards of judgment used and developed
through the expenditure of considerable work, time and money by Dow
▇▇▇▇▇. The Licensee also acknowledges that the Index and the Dow ▇▇▇▇▇
Marks are valuable assets of Dow ▇▇▇▇▇ and agrees that it will take
reasonable measures to prevent any unauthorized use of the information
provided to it concerning the selection, compilation, coordination,
arrangement and preparation of the Index.
(b) Each party shall treat as confidential and shall not disclose or
transmit to any third party (i) any documentation or other materials
that are marked as "Confidential" by the providing party and (ii) the
terms of this Agreement (collectively, "Confidential Information").
Confidential Information as described in clause (i) of the preceding
sentence shall not include (A) any information that is available to
the public or to the receiving party hereunder from sources other than
the providing party (provided that such source is not subject to a
confidentiality agreement with regard to such information) or (B) any
information that is independently developed by the receiving party
without use of or reference to information from the providing party.
(c) Notwithstanding the foregoing, either party may reveal Confidential
Information to any regulatory agency or court of competent
jurisdiction if such information to be disclosed is (i) approved in
writing by the providing party for disclosure or (ii) required by law,
regulatory agency or court order to be disclosed by the receiving
party, provided, if permitted by law, that prior written notice of
such required disclosure is given to the providing party and provided
further that the receiving party shall cooperate with the providing
party to limit the extent of such disclosure. The provisions of
Sections 7(b) and (c) shall survive termination or expiration of this
Agreement for a period of five (5) years from disclosure by either
party to the other of the last item of such Confidential Information.
8. Warranties; Disclaimers.
------------------------
(a) Each party represents and warrants to the other that it has the
authority to enter into this Agreement according to its terms, and
that its execution and delivery of this Agreement and its performance
hereunder will not violate any agreement applicable to it or violate
any applicable law or regulation. The Licensee represents and warrants
to Dow ▇▇▇▇▇ that the issuance, marketing, promotion, sale and resale
of the Products by the Licensee will not violate any agreement
applicable to the Licensee or violate any applicable laws, rules or
regulations, including without limitation, securities, commodities and
banking laws applicable to Licensee.
(b) The Licensee represents, warrants and covenants to Dow ▇▇▇▇▇ that the
Products shall at all times comply with the descriptions set forth on
Schedule A, as such may be modified from time to time in compliance
with this Agreement.
(c) The Licensee shall, to the extent lawful, include the statement
contained in Exhibit I hereto in any filing with a governmental
agency, each prospectus and registration statement, and in any
contracts relating to the Products (and upon request shall furnish
copies thereof to Dow ▇▇▇▇▇), and the Licensee expressly agrees to be
bound by the terms of the statement contained in Exhibit I hereto
(which terms are expressly incorporated herein by reference and made a
part hereof). Any changes in the statement contained in Exhibit I
hereto must be approved in advance in writing by an authorized officer
of Dow ▇▇▇▇▇.
(d) Notwithstanding any provision of this Agreement, and without limiting
the disclaimers set forth in this Agreement (including in Exhibit I
hereto), in no event shall the cumulative liability of Dow ▇▇▇▇▇ to
the Licensee and its affiliates under or relating to this Agreement at
any time exceed the aggregate amount of License Fees received by Dow
▇▇▇▇▇ pursuant to this Agreement.
9. Indemnification.
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(a) The Licensee shall indemnify and hold harmless Dow ▇▇▇▇▇ and its
affiliates, and their respective officers, directors, members,
employees and agents, against any and all judgments, damages,
liabilities, costs and losses of any kind (including reasonable
attorneys' and experts' fees) (collectively, "Losses") as a result of
any claim, action or proceeding that arises out of or relates to (i)
this Agreement (except to the extent such Losses arise out of or
relate to a breach by Dow ▇▇▇▇▇ of its representations and warranties
under this Agreement) or (ii) the Products, provided, however, that
Dow ▇▇▇▇▇ must promptly notify the Licensee in writing of any such
claim, action or proceeding (but the failure to do so shall not
relieve the Licensee of any liability hereunder except to the extent
the Licensee has been materially prejudiced therefrom). The Licensee
may elect, by written notice to Dow ▇▇▇▇▇ within ten (10) days after
receiving notice of such claim, action or proceeding from Dow ▇▇▇▇▇,
to assume the defense thereof with counsel reasonably acceptable to
Dow ▇▇▇▇▇. If the Licensee does not so elect to assume such defense or
disputes its indemnity obligation with respect to such claim, action
or proceeding, or if Dow ▇▇▇▇▇ reasonably believes that there are
conflicts of interest between Dow ▇▇▇▇▇ and the Licensee or that
additional defenses are available to Dow ▇▇▇▇▇ with respect to such
defense, then Dow ▇▇▇▇▇ may retain its own counsel to defend such
claim, action or proceeding, at the Licensee's expense. The Licensee
shall periodically reimburse Dow ▇▇▇▇▇ for its expenses incurred under
this Section 9. Dow ▇▇▇▇▇ shall have the right, at its own expense, to
participate in the defense of any claim, action or proceeding against
which it is indemnified hereunder and with respect to which the
Licensee has elected to assume the defense; provided, however, that
Dow ▇▇▇▇▇ shall have no right to control the defense, consent to
judgment, or agree to settle any such claim, action or proceeding
without the written consent of the Licensee. The Licensee, in the
defense of any such claim, action or proceeding, except with the
written consent of Dow ▇▇▇▇▇, shall not consent to entry of any
judgment or enter into any settlement which (i) does not include, as
an unconditional term, the grant by the claimant to Dow ▇▇▇▇▇ of a
release of all liabilities in respect of such claims or (ii) otherwise
adversely affects the rights of Dow ▇▇▇▇▇.
(b) The indemnification provisions set forth herein are solely for the
benefit of Dow ▇▇▇▇▇ and are not intended to, and do not, create any
rights or causes of actions on behalf of any third party.
10. Suspension of Performance.
--------------------------
Notwithstanding anything herein to the contrary, neither Dow ▇▇▇▇▇ nor the
Licensee shall bear responsibility or liability for any Losses arising out of
any delay in or interruptions of performance of their respective obligations
under this Agreement due to any act of God, act of governmental authority, or
act of public enemy, or due to war, the outbreak or escalation of hostilities,
riot, fire, flood, civil commotion, insurrection, labor difficulty (including,
without limitation, any strike, other work stoppage, or slow-down), severe or
adverse weather conditions, power failure, communications line or other
technological failure, or other similar cause beyond the reasonable control of
the party so affected; provided, however, that this Section 10 shall not affect
the Licensee's obligation under Section 9(a) in the case of any claim, action or
proceeding brought by a third party.
11. Injunctive Relief.
------------------
In the event of a material breach by one party ("Breaching Party") of
provisions of this Agreement relating to the Confidential Information of the
other party ("Non-breaching Party"), the Breaching Party acknowledges and agrees
that damages would be an inadequate remedy and that the Non-breaching Party
shall be entitled to preliminary and permanent injunctive relief to preserve
such confidentiality or limit improper disclosure of such Confidential
Information, but nothing herein shall preclude the Non-breaching Party from
pursuing any other action or remedy for any breach or threatened breach of this
Agreement. All remedies under this Section 11 shall be cumulative.
12. Other Matters.
--------------
(a) This Agreement is solely and exclusively between the parties hereto
and, except to the extent otherwise expressly provided herein, shall
not be assigned or transferred, nor shall any duty hereunder be
delegated, by either party, without the prior written consent of the
other party, and any attempt to so assign or transfer this Agreement
or delegate any duty hereunder without such written consent shall be
null and void; provided, however, that any successor through sale,
merger, corporate reorganization, or otherwise, to Licensee's Unit
Investment Trust business, and any affiliate which, directly or
indirectly, controls, is controlled by or is under common control with
the Licensee may use the Index and the Dow ▇▇▇▇▇ Marks in connection
with the issuance, marketing and promotion of the Products, provided
that such affiliate or successor shall be subject to all of the terms
and conditions of this Agreement applicable to the Licensee. This
Agreement shall be valid and binding on the parties hereto and their
successors and permitted assigns.
(b) This Agreement including the Schedules and Exhibits hereto (which are
hereby expressly incorporated into and made a part of this Agreement),
constitutes the entire agreement of the parties hereto with respect to
its subject matter. This Agreement supersedes any and all previous
agreements between the parties with respect to the subject matter of
this Agreement. There are no oral or written collateral
representations, agreements or understandings except as provided
herein.
(c) No waiver, modification or amendment of any of the terms and
conditions hereof shall be valid or binding unless set forth in a
written instrument signed by duly authorized officers of both parties.
The delay or failure by any party to insist, in any one or more
instances, upon strict performance of any of the terms or conditions
of this Agreement or to exercise any right or privilege herein
conferred shall not be construed as a waiver of any such term,
condition, right or privilege, but the same shall continue in full
force and effect.
(d) No breach, default or threatened breach of this Agreement by either
party shall relieve the other party of its obligations or liabilities
under this Agreement with respect to the protection of the property or
proprietary nature, or confidentiality, of any property, which is the
subject of this Agreement.
(e) All notices and other communications under this Agreement shall be (i)
in writing, (ii) delivered by hand (with written confirmation of
receipt), by registered or certified mail (return receipt requested),
or by facsimile transmission (with written confirmation of receipt),
to the address or facsimile number set forth below or to such other
address or facsimile number as either party shall specify by a written
notice to the other, and (iii) deemed given upon receipt.
If to Dow ▇▇▇▇▇: Dow ▇▇▇▇▇ & Company, Inc.
---------------
U.S. Route ▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Managing Director, Dow ▇▇▇▇▇ Indexes
Fax No: 609/▇▇▇-▇▇▇▇
With a copy to: Dow ▇▇▇▇▇ & Company, Inc.
--------------
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Legal Department
Fax No: 212/▇▇▇-▇▇▇▇
If to the Licensee: ▇▇▇ ▇▇▇▇▇▇ Funds Inc.
------------------
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇▇
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
(f) 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. Each party agrees that any legal
action, proceeding, controversy or claim between the parties arising
out of or relating to this Agreement may be brought and prosecuted
only in the United States District Court for the Southern District of
New York or in the Supreme Court of the State of New York in and for
the First Judicial Department, and by execution of this Agreement each
party hereto submits to the exclusive jurisdiction of such court and
waives any objection it might have based upon improper venue or
inconvenient forum. Each party hereto hereby waives any right it may
have in the future to a jury trial in connection with any legal
action, proceeding controversy or claim between the parties arising
out of or relating to this Agreement.
(g) This Agreement (and any related arrangements between the parties
hereto) is solely and exclusively for the benefit of the parties
hereto and their respective successors, and nothing in this Agreement
(and any related arrangements between the parties hereto), express or
implied, is intended to or shall confer on any other person or entity
(including, without limitation, any sublicensee of the Licensee
hereunder or any purchaser of any Products issued by the Licensee),
any rights, benefits or remedies of any nature whatsoever under or by
reason of this Agreement (or any such related arrangements between the
parties hereto).
(h) Sections 6(b), 7(b) and (c) (as provided therein), 8, 9, 11 and 12(f),
and this Section 12(h), shall survive the expiration or termination of
this Agreement.
(i) The parties hereto are independent contractors. Nothing herein shall
be construed to place the parties in the relationship of partners or
joint venturers, and neither party shall acquire any power, other than
as specifically and expressly provided in this Agreement, to bind the
other in any manner whatsoever with respect to third parties.
(j) All references herein to "reasonable efforts" shall include taking
into account all relevant commercial and regulatory factors. All
references herein to "regulations" or "regulatory proceedings" shall
include regulations or proceedings by self-regulatory organizations
such as securities exchanges.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date first set forth above.
DOW ▇▇▇▇▇ & COMPANY, INC.
By:
------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
▇▇▇ ▇▇▇▇▇▇ FUNDS INC.
By:
------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
INDEX OF ATTACHMENTS
SCHEDULES:
Schedule A Products Description
Schedule B License Fees
EXHIBITS:
Exhibit I Disclaimer Language
SCHEDULE A
PRODUCTS DESCRIPTION
One or more investment funds sponsored by the Licensee, whose investment
objective is based on a Strategy. The term "Strategy" shall mean an investment
strategy that meets one of the following descriptions:
1) Funds are invested in the ten stocks included in the Index that have
the highest dividend yield as a percentage of their period-end stock
price (the "High-Yield Stocks"). These investments are held for a
specified period of time. This strategy is commonly referred to as the
"dogs" of The DowSM investment strategy. Any such fund shall be named,
"The DowSM Strategic 10 Trust".
2) Funds are invested in the second through sixth lowest priced stocks
that make up the High-Yield Stocks (the "Five Selected Stocks"). These
investments are held for a specified period of time. Any such fund
shall be named, "The DowSM Strategic 5 Trust".
3) Funds are invested in all thirty stocks included in the Index (the
"Dow Industrial Stocks"). These investments are held for a specified
period of time. Any such fund shall be named, "The Dow 30SM Index
Trust".
4) Funds are invested in a combination of all the Dow Industrial Stocks
(at least 50%) and United States Treasury STRIPS. These investments
are held for a specified period of time. Any such fund shall be named,
"The Dow 30SM and Treasuries [Maturity Date] Trust".
SCHEDULE B
LICENSE FEES
Licensee shall pay license fees in accordance with the following:
o On the Commencement Date, and, during the Term, on each anniversary of
the Commencement Date, the Licensee will pay to Dow ▇▇▇▇▇ a flat
annual minimum payment equal to Fifty Thousand Dollars ($50,000) in
respect of the twelve-month period commencing on the Commencement Date
or such anniversary date, as the case may be (each, an "Annual Minimum
Payment"). Notwithstanding the foregoing, with respect to the first
Annual Minimum Payment, Licensee shall pay to Dow ▇▇▇▇▇ $35,000 upon
the Commencement Date and $15,000 upon the earlier of (i) the launch
of The Dow 30SM Index Trust and The Dow 30SM and Treasuries [Maturity
Date] Trust and (ii) sixty (60) days after the Commencement Date.
o In addition, during each Year (defined below) of the Term, the
Licensee will provide to Dow ▇▇▇▇▇ a written report (each, a "Monthly
Report"), within 10 days after each month-end, which sets forth (i)
the asset balance for each Product at such month-end, and (ii) a
calculation of the Rolling Average Asset Balance (defined below) at
such month-end. Within 10 days after the end of each Quarter (defined
below) during each Year of the Term, the Licensee will pay (each, a
"Quarterly Payment") to the Dow ▇▇▇▇▇ affiliate designated by Dow
▇▇▇▇▇ an amount equal to one quarter of the Basis Point Amount
(defined below); provided, however, that, in each year of the Term,
Licensee shall be entitled to apply a credit in an amount equal to the
Annual Minimum Payment against the aggregate of the Quarterly Payments
for that year until such credit is depleted.
o All amounts will be paid in cash and will be non-refundable; provided,
however, that Licensee (without limiting any other remedy available at
law or equity) shall be entitled to a pro rata refund of License Fees
paid in the event that this Agreement is terminated by Licensee
pursuant to Section 4(a) due to Dow ▇▇▇▇▇'▇ breach of this Agreement
and it is determined by a court of competent jurisdiction that Dow
▇▇▇▇▇ was in material breach of this Agreement.
o All amounts are stated in U.S. dollars (at the applicable exchange
rate prevailing at the time payment is due, as published in The Wall
Street Journal).
o The terms hereof shall be deemed "Confidential Information" for
purposes of Section 7(b) of this Agreement.
o Definitions:
------------
"Basis Point Amount" means, at any time during a Year, an amount equal to
two (2) basis points (.0002) on the then Rolling Average Asset Balance.
"Quarter" means, with respect to any Year, the three-month period
commencing on the first day of such Year, and each succeeding three-month period
during such Year.
"Rolling Average Asset Balance" means, at any month-end during a Year, the
average assets in the Products in the aggregate for the month then ended
together with all previous months in such Year, calculated by adding the
month-end asset balances for the Products for such months and dividing the
result by the number of such months.
"Year" means a twelve-month period commencing on the Commencement Date or
on any anniversary of the Commencement Date.
EXHIBIT I
The [Products] are not sponsored, endorsed, sold or promoted by Dow ▇▇▇▇▇.
Dow ▇▇▇▇▇ makes no representation or warranty, express or implied, to the owners
of the [Product(s)] or any member of the public regarding the advisability of
investing in securities generally or in the [Product(s)] particularly. Dow
▇▇▇▇▇' only relationship to the Licensee is the licensing of certain trademarks,
trade names and service marks of Dow ▇▇▇▇▇ and of the Dow ▇▇▇▇▇ Industrial
Average,SM which is determined, composed and calculated by Dow ▇▇▇▇▇ without
regard to [the Licensee] or the [Product(s)]. Dow ▇▇▇▇▇ has no obligation to
take the needs of [the Licensee] or the owners of the [Product(s)] into
consideration in determining, composing or calculating the Dow ▇▇▇▇▇ Industrial
AverageSM. Dow ▇▇▇▇▇ is not responsible for and has not participated in the
determination of the timing of, prices at, or quantities of the [Product(s)] to
be issued or in the determination or calculation of the equation by which the
[Product(s)] are to be converted into cash. Dow ▇▇▇▇▇ has no obligation or
liability in connection with the administration, marketing or trading of the
[Product(s)].
DOW ▇▇▇▇▇ DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE
DOW ▇▇▇▇▇ INDUSTRIAL AVERAGESM OR ANY DATA INCLUDED THEREIN AND DOW ▇▇▇▇▇ SHALL
HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. DOW ▇▇▇▇▇
MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY [THE
LICENSEE], OWNERS OF THE [PRODUCT(S)], OR ANY OTHER PERSON OR ENTITY FROM THE
USE OF THE DOW ▇▇▇▇▇ INDUSTRIAL AVERAGESM OR ANY DATA INCLUDED THEREIN. DOW
▇▇▇▇▇ MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL
WARRANTIES, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH
RESPECT TO THE DOW ▇▇▇▇▇ INDUSTRIAL AVERAGESM OR ANY DATA INCLUDED THEREIN.
WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL DOW ▇▇▇▇▇ HAVE ANY
LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL
DAMAGES OR LOSSES, EVEN IF NOTIFIED OF THE POSSIBILITY THEREOF. THERE ARE NO
THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN DOW ▇▇▇▇▇
AND [THE LICENSEE].
AMENDMENT NO. 2 TO
LICENSE AGREEMENT DATED
SEPTEMBER 8,1998
This Amendment No. 2 to the License Agreement dated September 8, 1998
between Dow ▇▇▇▇▇ & Company, Inc. ("Dow ▇▇▇▇▇") and ▇▇▇ ▇▇▇▇▇▇ Funds Inc. (the
"Licensee"), as amended by an amendment dated December 1, 1999 ("Amendment No.
1"), is made this February 1, 2000 between Dow ▇▇▇▇▇ and the Licensee. All
capitalized terms used in this Amendment No. 2 without definition shall have the
meaning ascribed to them in the License Agreement or Amendment No. 1, as the
case may be.
WHEREAS, Dow ▇▇▇▇▇ has previously granted Licensee a license to use Dow
▇▇▇▇▇'▇ Intellectual Property in connection with the issuance, marketing and
promotion of Products and the Dow 5 Tech Funds.
WHEREAS, Licensee was obligated to pay Dow ▇▇▇▇▇ an Annual Minimum Payment
and Quarterly Payment with respect to the Products, and a separate Dow 5 Tech
Fund Annual Minimum Payment and Dow 5 Tech Fund Quarterly Payment with respect
to the Dow 5 Tech Funds.
WHEREAS, the parties wish to consolidate the payments for the Products and
the Dow 5 Tech Fund.
NOW, THEREFORE, the parties agree as follows:
1. Licensee shall pay License Fees in accordance with the following:
(a) On each anniversary of the Commencement Date, Licensee will pay to Dow
▇▇▇▇▇ a flat annual minimum payment of $70,000 for the twelve-month
period beginning on such anniversary date, which represents the
combined annual minimum payment for the Products and the Dow 5 Tech
Funds, except that the payment due on September 8, 2000 will be
$65,000.
(b) In addition, during each Year (defined below) of the Term, Licensee
will provide to Dow ▇▇▇▇▇ a written report (each, a "Quarterly
Report"), within 10 days after the end of each Quarter (defined
below), which sets forth (i) the combined asset balance for each
Product and Dow 5 Tech Fund at such Quarter-end, and (ii) a
calculation of the Rolling Average Asset Balance (defined below) at
such Quarter-end. Within 10 days after the end of each Quarter during
each Year of the Term, the Licensee will pay (each, a "Quarterly
Payment") to the Dow ▇▇▇▇▇ affiliate designated by Dow ▇▇▇▇▇ an amount
equal to one quarter of the Basis Point Amount (defined below);
provided, however, that in each year of the Term, Licensee shall be
entitled to apply a credit in an amount equal to the Annual Minimum
Payment against the aggregate of the Quarterly Payments for that Year
until such credit is depleted.
(c) All amounts will be paid in cash and will be non-refundable; provided,
however, that Licensee (without limiting any other remedy available at
law or equity) shall be entitled to a pro rata refund of License Fees
paid in the event that this Agreement is terminated by Licensee
pursuant to Section 4(a) of the License Agreement due to Dow ▇▇▇▇▇'▇
breach of the License Agreement and it is determined by a court of
competent jurisdiction that Dow ▇▇▇▇▇ was in material breach of the
License Agreement. All amounts are stated in U.S. dollars (at the
applicable exchange rate prevailing at the time payment is due, as
published in The Wall Street Journal).
(d) The terms hereof shall be deemed "Confidential Information" under the
License Agreement.
(e) These terms are defined as follows:
"Basis Point Amount" means, at any time during a Year, an amount equal to
two basis points (.0002) on the then Rolling Average Asset Balance.
"Quarter" means, with respect to any Year, the three-month period
commencing on the first day of such Year, and each succeeding three-month period
during such Year.
"Rolling Average Asset Balance" means, at any Quarter-end during a Year,
the average aggregate assets in the Products and the Dow 5 Tech Funds for the
Quarter then ended, calculated by adding the asset balances for the Products and
the Dow 5 Tech funds for the three months in such Quarter and dividing the
result by three.
"Year" means a twelve-month period commencing on the Commencement Date or
on any anniversary of the Commencement Date.
2. Except as expressly amended hereby, all provisions in the License
Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to
the License Agreement to be executed as of the date set forth above.
▇▇▇ ▇▇▇▇▇▇ FUNDS INC. DOW ▇▇▇▇▇ & COMPANY, INC.
By: By:
------------------------ --------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President, Dow ▇▇▇▇▇ Indexes
CONFIDENTIAL
AMENDMENT NO. 1 TO
LICENSE AGREEMENT DATED
SEPTEMBER 8, 1998
This Amendment No. 1 to the License Agreement dated September 8, 1998
between Dow ▇▇▇▇▇ & Company, Inc. ("Dow ▇▇▇▇▇") and ▇▇▇ ▇▇▇▇▇▇ Funds Inc. (the
"Licensee") is made this December 1, 1999 by and between Dow ▇▇▇▇▇ and the
Licensee.
WHEREAS, Dow ▇▇▇▇▇ previously granted Licensee a license to use certain
intellectual property of Dow ▇▇▇▇▇ (as more fully defined in the License
Agreement, the "Intellectual Property") in connection with issuance, marketing
and promotion of certain investment products (as more fully defined in the
License Agreement, the "Products");
WHEREAS, Licensee wishes to issue, sell, market and promote additional
financial products as described in Schedule A hereto (the "Dow 5 Tech Funds")
based on a strategy related to the Dow ▇▇▇▇▇ Industrial AverageSM, and Dow ▇▇▇▇▇
is willing to grant a license to use the Intellectual Property in connection
with the Dow 5 Tech Funds;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreement contained herein and in the License Agreement, it is agreed as
follows:
1. Subject to the terms and conditions of the License Agreement, Dow
▇▇▇▇▇ hereby grants to Licensee a non-transferable non-exclusive
license to use and refer to the Dow ▇▇▇▇▇ Marks in connection with the
issuance, sale, marketing and promotion of the Dow 5 Tech Funds to
indicate that the amounts payable under the terms of the Dow 5 Tech
Funds are calculated with reference to the Dow 5 Tech Strategy (as
defined in Schedule A hereto) and that Dow ▇▇▇▇▇ is the source of the
Dow ▇▇▇▇▇ Industrial Average, and as may otherwise be required by
applicable laws, rules or regulations under the License Agreement and
this Amendment.
2. Except as otherwise expressly provided herein, all terms and
conditions of the License Agreement that apply to the Products shall
apply equally to the Dow 5 Tech Funds.
3. In consideration for the license granted under this Amendment,
Licensee shall pay to Dow ▇▇▇▇▇ the license fees set forth in Schedule
B hereto. Notwithstanding anything to the contrary in this Amendment,
Licensee shall pay to Dow ▇▇▇▇▇ the Dow 5 Tech Fund Annual Minimum
Payment (as defined in Schedule B hereto) with respect to the initial
Dow 5 Tech Fund upon signing of this Amendment.
4. For the avoidance of doubt, the parties hereby acknowledge and agree
that the Products under the License Agreement (i) shall be registered
under the Investment Company Act of 1940 of the United States and (ii)
shall not be traded or listed on an Organized Securities Market.
"Organized Securities Market" shall mean a U.S. national securities
exchange, an automated quotation or other electronic trading system of
a U.S.-registered securities association, a foreign securities
exchange or any other domestic or foreign securities market determined
by Dow ▇▇▇▇▇ in its reasonable judgment to constitute an Organized
Securities Market.
5. Except as expressly amended hereby, all provisions in the License
Agreement shall continue to remain in full force and effect.
6. Except as otherwise specified herein, all capitalized terms used in
this Amendment shall have the meaning ascribed to them in the License
Agreement,
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to
the License Agreement to be executed as of the date first set forth above.
DOW ▇▇▇▇▇ & COMPANY, INC,
By:
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President, Dow ▇▇▇▇▇ Indexes
▇▇▇ ▇▇▇▇▇▇ FUNDS INC.
By:
------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
SCHEDULE A
PRODUCTS DESCRIPTION
The Dow 5 Tech Funds shall be investment funds that meet the following
criteria: (i) the investment objective of the funds is determined with reference
to the Dow 5 Tech Strategy; (ii) the funds are registered under the Investment
Company Act of 1940; and (iii) the funds are not listed or traded on an
Organized Securities Market. The "Dow 5 Tech Strategy" shall mean funds are
invested (a) 50% in the five stocks in the Dow ▇▇▇▇▇ Industrial Average that
have the highest dividend yield as a percentage of their period-end stock prices
and (b) 50% in five other technology (as defined by Compustat's S&P Technology
Sector identifier) stocks. The initial Dow 5 Tech Fund shall be named the "Dow 5
& Tech Strategic Trust".
SCHEDULE B
LICENSE FEES
Licensee shall pay license fees with respect to the Dow 5 Tech Funds in
accordance with the following:
On the Deposit Date (as defined below), and, during the Term, on each
anniversary of the Deposit Date, the Licensee will pay to Dow ▇▇▇▇▇ a flat
annual minimum payment of $20,000 in respect of the twelve-month period
commencing on the Deposit Date or such anniversary date, as the case may be
(each, a "Dow 5 Tech Fund Annual Minimum Payment").
In addition, during each Year (defined below) of the Term, the Licensee
will provide to Dow ▇▇▇▇▇ a written report (each, a "Quarterly Dow 5 Tech Fund
Report"), within 10 days after the end of each Quarter (as defined below), which
sets forth (i) the asset balance for the Dow 5 Tech Funds at such Quarter-end,
and (ii) a calculation of the Dow 5 Tech Fund Rolling Average Asset Balance
(defined below) at such Quarter-end. Within 10 days after the end of each
Quarter during each Year of the Term, the Licensee will pay (each, a "Dow 5 Tech
Fund Quarterly Payment") to the Dow ▇▇▇▇▇ affiliate designated by Dow ▇▇▇▇▇ an
amount equal to one quarter of the Dow 5 Tech Fund Basis Point Amount (defined
below); provided, however, that, in each year of the Term, Licensee shall be
entitled to apply a credit in an amount equal to the Dow 5 Tech Fund Annual
Minimum Payment against the aggregate of the Dow 5 Tech Fund Quarterly Payments.
III. Additional Payment Terms:
-------------------------
A. All amounts will be paid in cash and will be non-refundable.
B. All amounts are stated in U.S. dollars (at the applicable exchange
rate prevailing at the time payment is due, as published in The Wall
Street Journal).
C. The terms hereof shall be deemed "Confidential Information" under the
License Agreement.
IV. Definitions:
------------
"Deposit Date" means the date on which a Dow 5 Tech Fund is deposited.
"Dow ▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇" means, at any time during a Year, an
amount equal to two basis points (.0002) on the then Rolling Average Asset
Balance.
"Dow 5 Tech Fund Rolling Average Asset Balance" means, at any Quarter-end
during a Year, the average assets in the Dow 5 Tech Funds in the aggregate for
the Quarter then ended, calculated by adding the asset balances for the Dow 5
Tech Funds for the three months in such Quarter and dividing the result by
three.
"Quarter" means, with respect to any Year, the three-month period
commencing on the first day of such Year, and each succeeding three-month period
during such Year.
"Year" means a twelve-month period commencing on Deposit Date or any
anniversary of the Deposit Date, as the case may be.