UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: January 4, 2016
WisdomTree Continuous Commodity Index Fund
(Registrant)
(Exact name of registrant as specified in its charter)
WisdomTree Continuous Commodity Index Master Fund
(Rule 140 Co-Registrant)
(Exact name of registrant as specified in its charter)
|
Delaware (State or other jurisdiction of incorporation or organization) |
26-0151234 (Registrant) 26-0151301 (Co-Registrant) (IRS Employer ID Number) | |
|
c/o WisdomTree Commodity Services, LLC 245 Park Avenue 35th Floor New York, NY (Address of principal executive offices) |
10167 (Zip Code) |
001-33908
001-33909
(Commission File Number)
GREENHAVEN CONTINUOUS COMMODITY INDEX FUND
(Registrant’s former name and former fiscal year, if changed since last report)
GREENHAVEN CONTINUOUS COMMODITY INDEX MASTER FUND
(Co-registrant’s former name and former fiscal year, if changed since last report)
1-866-909-9473
(Registrants’ telephone number, including area code)
c/o GreenHaven Commodity Services, LLC
3340 Peachtree Road
Suite 1910
Atlanta, GA
(Registrants’ former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrants under any of the following provisions (see General Instruction A.2. below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
INTRODUCTORY NOTE
As previously disclosed, GreenHaven LLC (“GH”), GreenHaven Commodity Services, LLC (“GHCS”) and certain other parties entered into a Unit Purchase Agreement (the “Purchase Agreement”) with WisdomTree Investments, Inc. (“WTI”) on October 29, 2015.
Pursuant to the Purchase Agreement, GH agreed to transfer and sell to WTI all of GH’s interest in its wholly-owned subsidiary GHCS, including the sole and exclusive power to direct the business and affairs of GreenHaven Continuous Commodity Index Fund (the “Fund”) and GreenHaven Continuous Commodity Index Master Fund (the “Master Fund”, and together with the Fund, the “Funds”) as well as certain other assets pertaining to the management of the Funds, subject to various terms and conditions (the “Transaction”).
The Transaction was consummated on January 4, 2016. As a result, WTI became the sole member of GHCS, the managing owner and commodity pool operator of the Funds. Effective as of January 4, 2016, the Certificate of Formation of GHCS has been amended to change the name of GHCS from “GreenHaven Commodity Services, LLC” to “WisdomTree Commodity Services, LLC” (the “Managing Owner”). Further, similar certificates of amendment apply with respect to the Funds to reflect “WisdomTree” instead of “GreenHaven” in the Funds’ names.
Item 1.01. Entry into a Material Definitive Agreement.
In connection with the Transaction, the Managing Owner and/or the Funds have entered into several agreements, including the following:
| - | A Commodity Subadvisory Agreement with GreenHaven Advisors, LLC (“GH Advisors”), a form of which is attached hereto as Exhibit 10.1, pursuant to which GH Advisors will serve as the commodity trading advisor with respect to the Master Fund’s investments for a period of time. GH Advisors is owned by several of the equity owners of GH. |
| - | A Master Custodian Agreement with State Street Bank and Trust Company (“State Street”), a form of which is attached hereto as Exhibit 10.2, pursuant to which State Street will act as a custodian of the assets of the Funds and provide accounting and other services. |
| - | An Administration Agreement with State Street, a form of which is attached hereto as Exhibit 10.3, pursuant to which State Street will provide certain administrative, legal, and financial reporting services for the maintenance and operations of the Funds. |
| - | A Distribution Services Agreement with Foreside Fund Services, LLC (“Foreside”), a form of which is attached hereto as Exhibit 10.4, pursuant to which Foreside will provide certain distribution services to the Fund, including assisting with certain functions relating to distribution, including receiving and processing Basket orders. |
| - | A Transfer Agency and Services Agreement with State Street, a form of which is attached hereto as Exhibit 10.5, pursuant to which State Street will provide certain transfer agency services associated with receiving and processing Basket orders and matters related to transfer of the Funds’ shares. |
| - | Participant Agreements among certain authorized participants, the Managing Owner, the Distributor and the Fund in relation to Basket creation and redemption in order to reflect the new servicing relationships with State Street and Foreside, a form of which is attached hereto as Exhibit 10.6. |
Each of the foregoing descriptions is a summary only, and in each case is qualified in its entirety by reference to the copy of the agreement described.
Further, in connection with the Transaction, the Managing Owner and Thomson Reuters (Markets) LLC (“Thomson Reuters”) have entered into an Amended and Restated License Agreement, dated as of November 12, 2015 (the “A&R License Agreement”), attached hereto as Exhibit 10.7, which amended and restated the License Agreement originally entered into as of July 19, 2006, between Thomson Reuters and GreenHaven, LLC (the “License Agreement”). The A&R License Agreement amends the License Agreement to, among other things: (a) extend the term though December 31, 2020, (b) provide additional indemnities in favor of the Managing Owner for third party infringement claims and (c) revise the license fee structure. The foregoing description is a summary only, and is qualified in its entirety by reference to the copy of the A&R License Agreement.
Item 1.02. Termination of a Material Definitive Agreement.
In connection with the Transaction, the Managing Owner and/or the Funds have terminated certain agreements, including the following:
| - | Administration Agreement with the Bank of New York (“BoNY”) |
| - | Global Custody Agreement with BoNY |
| - | Transfer Agency and Service Agreement with BoNY |
| - | Distribution Services Agreement with ALPS Distributors, Inc. |
| - | Marketing Services Agreement with ALPS Distributors, Inc. |
| - | Participant Agreements among certain authorized participants, the Managing Owner, the Fund’s former distributor and the Fund |
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
The Funds are Delaware statutory trusts and have no directors or executive officers. They are managed by the Managing Owner.
In connection with the Transaction, effective as of January 4, 2016, the following individuals have resigned as executive officers and directors of the Managing Owner: Ashmead Pringle (formerly chief executive officer and director), Cooper Anderson (formerly chief financial officer and director), Scott Glassing (formerly a trader), Thomas J. Mangold (formerly a director), Stephen O’Grady (formerly a director) and Cengiz Searfoss (formerly a director).
Effective as of January 4, 2016, the following individuals were appointed as executive officers of the Managing Owner, and will thus participate in managing the Funds:
Gregory Barton – President and Chief Executive Officer. Mr. Barton has served as the Executive Vice President—Operations and Chief Operating Officer of WTI since October 2012. Prior to that, Mr. Barton served as Executive Vice President Business and Legal Affairs, General Counsel and Secretary of TheStreet, Inc., a financial media company, from June 2009 to July 2012, following his service as General Counsel and Secretary of Martha Stewart Living Omnimedia, Inc., a media and merchandising company, from October 2007 to August 2008. From October 2004 to October 2007, Mr. Barton served as Executive Vice President, Licensing and Legal Affairs, General Counsel and Secretary, and from November 2002 to October 2004, as Executive Vice President, General Counsel and Secretary, of Ziff Davis Media Inc., a technology media company. Preceding Ziff Davis, Mr. Barton served in a variety of positions at WTI (then known as Individual Investor Group, Inc.) from August 1998 to November 2002, including President, Chief Financial Officer and General Counsel; and prior to that served from September 1996 to August 1998 as Vice President, Corporate and Legal Affairs, and General Counsel, and from
May 1995 to September 1996 as General Counsel, of Alliance Semiconductor Corporation, an integrated circuit company. From June 2006 through October 2012, Mr. Barton served as an Independent Trustee and Chairman of the Audit Committee for the WisdomTree Trust. Mr. Barton received a B.A. degree, summa cum laude, from Claremont McKenna College and a J.D. degree, magna cum laude, from Harvard Law School. Mr. Barton is 54 years old. Mr. Barton became a Principal and Associated Person of the Managing Owner on or around January 4, 2016.
Amit Muni – Executive Vice President of Finance, Chief Financial Officer and Treasurer. Mr. Muni has served as WTI’s Executive Vice President—Finance and Chief Financial Officer since March 2008. Prior to joining WTI, Mr. Muni served as Controller and Chief Accounting Officer of International Securities Exchange Holdings, Inc., an electronic options exchange, from 2003 until March 2008. Mr. Muni was Vice President, Finance, of Instinet Group Incorporated, an electronic agency broker-dealer, from 2000 to 2003. From 1996 until 2000, Mr. Muni was employed as a Manager of the Financial Services Industry Practice of PricewaterhouseCoopers LLP, an accounting firm. From 1991 until 1996, Mr. Muni was an accountant and a senior auditor for National Securities Clearing Corporation, a firm that provides centralized clearing, information and settlement services to the financial industry. Mr. Muni received a B.B.A. in Accounting from Pace University and is a Certified Public Accountant. Mr. Muni is 46 years old. Mr. Muni became a Principal of the Managing Owner on or around January 4, 2016.
David Castano – Principal Financial Officer. Mr. Castano has been Director of Fund Accounting & Administration of WisdomTree Asset Management, Inc. (“WTAM”) since 2011 and Treasurer/Principal Financial Officer of the WisdomTree Trust since 2013. Prior to joining WTAM, Mr. Castano was Vice President of Legg Mason & Co., where he served as Treasurer from 2010 to 2011 and Controller from 2006 to 2010 of certain mutual funds associated with Legg Mason & Co. From 2004 to 2006, Mr. Castano served as an Assistant Treasurer of Lord Abbett mutual funds. Mr. Castano received a B.B.A. in Accounting from Pace University. Mr. Castano is 44 years old.
Peter Ziemba – Executive Vice President, Chief Legal Officer and Secretary. Mr. Ziemba has served as WTI’s Executive Vice President—Business and Legal Affairs since January 2008 and Chief Legal Officer since March 2011. From April 2007 to March 2011, Mr. Ziemba served as WTI’s General Counsel. Prior to WTI, Mr. Ziemba was a partner in the Corporate and Securities department of Graubard Miller, which served as WTI’s primary corporate counsel, from 1991 to 2007, and was employed at that firm beginning in 1982. Mr. Ziemba received his B.A. in History with university honors from Binghamton University and his J.D., cum laude, from Benjamin N. Cardozo School of Law. Mr. Ziemba served as a director of WTI from 1996 to 2003. Mr. Ziemba is 58 years old.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
In connection with the Transaction, effective as of January 4, 2016, the Fund’s Certificate of Trust and its Declaration of Trust and Trust Agreement have been amended to effect the following: (i) the name of the Fund has been changed from “GreenHaven Continuous Commodity Index Fund” to “WisdomTree Continuous Commodity Index Fund”; and (ii) the name of the Trustee is Delaware Trust Company, successor-in-interest to CSC Trust Company of Delaware. A copy of the Fund’s amended Certificate of Trust is filed as Exhibit 3.1 hereto and a copy of its amended Declaration of Trust and Trust Agreement is filed as Exhibit 3.2 hereto.
Additionally, effective as of January 4, 2016, the Master Fund’s Certificate of Trust and its Declaration of Trust and Trust Agreement have been amended to effect the following: (i) the name of the Master Fund has been changed from “GreenHaven Continuous Commodity Index Master Fund” to “WisdomTree Continuous Commodity Index Master Fund”; and (ii) the name of the Trustee is Delaware Trust Company, successor-in-interest to CSC Trust Company of Delaware. A copy of the Master Fund’s amended Certificate of Trust is filed as Exhibit 3.3 hereto and a copy of its amended Declaration of Trust and Trust Agreement is filed as Exhibit 3.4 hereto.
The Funds filed a press release regarding the name changes prior to the filing of this Form 8-K.
Item 8.01. Other Events.
The disclosures set forth above in the Introductory Note are hereby incorporated by reference into this Item 8.01.
Item 9.01. Financial Statements and Exhibits.
| (d) | Exhibits. |
| Exhibit No. |
Description | |
| 3.1 | Form of Certificate of Amendment to Certificate of Trust of Greenhaven Continuous Commodity Index Fund | |
| 3.2 | Form of Amendment to the Declaration of Trust and Trust Agreement of Greenhaven Continuous Commodity Index Fund | |
| 3.3 | Form of Certificate of Amendment to Certificate of Trust of Greenhaven Continuous Commodity Index Master Fund | |
| 3.4 | Form of Amendment to the Declaration of Trust and Trust Agreement of Greenhaven Continuous Commodity Index Master Fund | |
| 10.1 | Form of Commodity Subadvisory Agreement | |
| 10.2 | Form of Master Custodian Agreement | |
| 10.3 | Form of Administration Agreement | |
| 10.4 | Form of Distribution Services Agreement | |
| 10.5 | Form of Transfer Agency and Services Agreement | |
| 10.6 | Form of Participant Agreement | |
| 10.7 | Amended and Restated License Agreement |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| WISDOMTREE CONTINUOUS COMMODITY INDEX FUND | ||||
| By WisdomTree Commodity Services, LLC, the Managing Owner | ||||
| By: | /s/ Gregory Barton | |||
| Name: | Gregory Barton | |||
| Title: | President | |||
| WISDOMTREE CONTINUOUS COMMODITY INDEX MASTER FUND | ||||
| By WisdomTree Commodity Services, LLC, the Managing Owner | ||||
| By: | /s/ Gregory Barton | |||
| Name: | Gregory Barton | |||
| Title: | President | |||
Date: January 4, 2016
EXHIBIT INDEX
| Exhibit | ||
| Number | Exhibit Title | |
| 3.1 | Form of Certificate of Amendment to Certificate of Trust of Greenhaven Continuous Commodity Index Fund | |
| 3.2 | Form of Amendment to the Declaration of Trust and Trust Agreement of Greenhaven Continuous Commodity Index Fund | |
| 3.3 | Form of Certificate of Amendment to Certificate of Trust of Greenhaven Continuous Commodity Index Master Fund | |
| 3.4 | Form of Amendment to the Declaration of Trust and Trust Agreement of Greenhaven Continuous Commodity Index Master Fund | |
| 10.1 | Form of Commodity Subadvisory Agreement | |
| 10.2 | Form of Master Custodian Agreement | |
| 10.3 | Form of Administration Agreement | |
| 10.4 | Form of Distribution Services Agreement | |
| 10.5 | Form of Transfer Agency and Services Agreement | |
| 10.6 | Form of Participant Agreement | |
| 10.7 | Amended and Restated License Agreement |
Exhibit 3.1
CERTIFICATE OF AMENDMENT TO CERTIFICATE OF TRUST
OF
GREENHAVEN CONTINUOUS COMMODITY INDEX FUND
THIS CERTIFICATE OF AMENDMENT TO CERTIFICATE OF TRUST OF GREENHAVEN CONTINUOUS COMMODITY INDEX FUND (the “Trust”) is being duly executed and filed by the undersigned to amend the original Certificate of Trust as filed in the Office of the Secretary of State of the State of Delaware on October 27, 2006 to form a statutory trust under the Delaware Statutory Trust Act, 12 Del. C. § 3801 et seq. (as amended from time to time, the “Delaware Act”).
1. Original Name. The original name of the statutory trust is “GreenHaven Continuous Commodity Index Fund.”
2. Change of Name. The name of the statutory trust is changed to “WisdomTree Continuous Commodity Index Fund.”
3. Name of Trustee. The name and business address of the trustee of the Trust with a principal place of business in the State of Delaware are: Delaware Trust Company, successor in interest to CSC Trust Company of Delaware, 2711 Centerville Road, Wilmington, DE 19808.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned has executed this Certificate in accordance with Section 3811 of the Delaware Act on the 4th day of January, A.D. 2016.
| DELAWARE TRUST COMPANY, not in its individual capacity, but solely as trustee | ||
| By: | ||
| Name: | ||
| Title: | ||
[SIGNATURE PAGE TO CERTIFICATE OF AMENDMENT TO CERTIFICATE OF TRUST]
Exhibit 3.2
AMENDMENT
TO THE
DECLARATION OF TRUST AND TRUST AGREEMENT OF
GREENHAVEN CONTINUOUS COMMODITY INDEX FUND
THIS AMENDMENT TO THE DECLARATION OF TRUST AND TRUST AGREEMENT OF GREENHAVEN CONTINUOUS COMMODITY INDEX FUND, dated as of January 4, 2016 (the “Amendment”), is executed and delivered by the undersigned (the “Managing Owner”), being the Managing Owner of GreenHaven Continuous Commodity Index Fund (the “Trust”), pursuant to Section 11.1(b)(iii) of the Declaration of Trust and Trust Agreement, dated as of October 27th, 2006, of the Trust (the “Trust Agreement”). Capitalized terms used herein but not defined shall have the meanings set forth in the Trust Agreement.
WHEREAS, pursuant to Section 11.1(b)(iii) of the Trust Agreement, the Managing Owner may, without the approval of the Limited Owners, make such amendments to the Trust Agreement which the Managing Owner deems advisable; and
WHEREAS, the Managing Owner desires to amend the Trust Agreement as specified herein.
NOW, THEREFORE, the Trust Agreement is hereby amended as follows:
| 1. | Amendment to the name of the Trust. |
The name of the Trust, GreenHaven Continuous Commodity Index Fund, is hereby replaced throughout the Trust Agreement with “WisdomTree Continuous Commodity Index Fund.”
| 2. | Amendment to the name of the Trustee. |
The name of the Trustee, CSC Trust Company of Delaware (“CSC”), is hereby replaced throughout the Trust Agreement with “Delaware Trust Company,” successor in interest to CSC.
| 3. | Except to the extent modified herein, the terms and conditions of the Trust Agreement shall remain in full force and effect. |
| 4. | The Amendment may not be amended, waived or otherwise modified orally without complying with Section 11.1 of the Trust Agreement. |
| 5. | Any signature to the Amendment may be delivered via facsimile, electronic mail (including PDF) or other transmission method and any signature so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes. |
| 6. | This Amendment shall be governed by and construed in accordance with the laws of the State of Delaware. |
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned has caused this Amendment to be duly executed as of the date first set forth above.
| MANAGING OWNER: | ||
| WisdomTree Commodity Services, LLC | ||
| By: | ||
| Name: | Peter M. Ziemba | |
| Title: | Executive Vice President, Chief Legal Officer and Secretary | |
[SIGNATURE PAGE TO AMENDMENT TO TRUST AGREEMENT]
Exhibit 3.3
CERTIFICATE OF AMENDMENT TO CERTIFICATE OF TRUST
OF
GREENHAVEN CONTINUOUS COMMODITY INDEX MASTER FUND
THIS CERTIFICATE OF AMENDMENT TO CERTIFICATE OF TRUST OF GREENHAVEN CONTINUOUS COMMODITY INDEX MASTER FUND (the “Trust”) is being duly executed and filed by the undersigned to amend the original Certificate of Trust as filed in the Office of the Secretary of State of the State of Delaware on October 27, 2006 to form a statutory trust under the Delaware Statutory Trust Act, 12 Del. C. § 3801 et seq. (as amended from time to time, the “Delaware Act”).
1. Original Name. The original name of the statutory trust is “GreenHaven Continuous Commodity Index Master Fund.”
2. Change of Name. The name of the statutory trust is changed to “WisdomTree Continuous Commodity Index Master Fund.”
3. Name of Trustee. The name and business address of the trustee of the Trust with a principal place of business in the State of Delaware are: Delaware Trust Company, successor in interest to CSC Trust Company of Delaware, 2711 Centerville Road, Wilmington, DE 19808.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned has executed this Certificate in accordance with Section 3811 of the Delaware Act on the 4th day of January, A.D. 2016.
| DELAWARE TRUST COMPANY, not in its individual capacity, but solely as trustee | ||
| By: | ||
| Name: | ||
| Title: | ||
[SIGNATURE PAGE TO CERTIFICATE OF AMENDMENT TO CERTIFICATE OF TRUST]
Exhibit 3.4
AMENDMENT
TO THE
DECLARATION OF TRUST AND TRUST AGREEMENT OF
GREENHAVEN CONTINUOUS COMMODITY INDEX MASTER FUND
THIS AMENDMENT TO THE DECLARATION OF TRUST AND TRUST AGREEMENT OF GREENHAVEN CONTINUOUS COMMODITY INDEX MASTER FUND, dated as of January 4, 2016 (the “Amendment”), is executed and delivered by the undersigned (the “Managing Owner”), being the Managing Owner of GreenHaven Continuous Commodity Master Index Fund (the “Trust”), pursuant to Section 11.1(b)(iii) of the Declaration of Trust and Trust Agreement, dated as of October 27th, 2006 and as amended July 29th, 2007, of the Trust (the “Trust Agreement”). Capitalized terms used herein but not defined shall have the meanings set forth in the Trust Agreement.
WHEREAS, pursuant to Section 11.1(b)(iii) of the Trust Agreement, the Managing Owner may, without the approval of the Limited Owners, make such amendments to the Trust Agreement as the Managing Owner deems advisable; and
WHEREAS, the Managing Owner desires to amend the Trust Agreement as specified herein.
NOW, THEREFORE, the Trust Agreement is hereby amended as follows:
| 1. | Amendment to the name of the Trust. |
The name of the Trust, GreenHaven Continuous Commodity Index Master Fund, is hereby replaced throughout the Trust Agreement with “WisdomTree Commodity Index Master Fund.”
| 2. | Amendment to the name of the Trustee. |
The name of the Trustee, CSC Trust Company of Delaware (“CSC”), is hereby replaced throughout the Trust Agreement with “Delaware Trust Company,” successor in interest to CSC.
| 3. | Except to the extent modified herein, the terms and conditions of the Trust Agreement shall remain in full force and effect. |
| 4. | The Amendment may not be amended, waived or otherwise modified orallywithout complying with Section 11.1 of the Trust Agreement. |
| 5. | Any signature to the Amendment may be delivered via facsimile, electronic mail (including PDF) or other transmission method and any signature so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes. |
| 6. | This Amendment shall be governed by and construed in accordance with the laws of the State of Delaware. |
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned has caused this Amendment to be duly executed as of the date first set forth above.
| MANAGING OWNER: | ||
| WisdomTree Commodity Services, LLC | ||
| By: | ||
| Name: | Peter M. Ziemba | |
| Title: | Executive Vice President, Chief Legal Officer and Secretary | |
[SIGNATURE PAGE TO AMENDMENT TO TRUST AGREEMENT]
Exhibit 10.1
FORM OF COMMODITY SUBADVISORY AGREEMENT
THIS COMMODITY SUBADVISORY AGREEMENT (this “Agreement”) is made as of this 4th day of January, 2016, effective as of the 1st day of January, 2016 (the “Effective Date”), by and among GreenHaven Continuous Commodity Index Master Fund, a Delaware statutory trust (to be renamed WisdomTree Continuous Commodity Index Master Fund, the “Fund”), GreenHaven Commodity Services, LLC, a Delaware limited liability company (to be renamed WisdomTree Commodity Services, “Manager”), and GreenHaven Advisors, LLC, a Delaware limited liability company (“Commodity Subadvisor”).
WHEREAS, Manager serves as the investment manager for the Fund, pursuant to that certain Declaration of Trust and Trust Agreement for the Fund (as such agreement may be modified from time to time); and
WHEREAS, Manager desires to retain Commodity Subadvisor to furnish certain sub-investment advisory services for the Fund upon the terms and conditions hereafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows:
1. Appointment. Manager hereby appoints Commodity Subadvisor to provide sub-investment advisory services to the Fund in the management of the Fund’s Commodity Interests and Collateral (as each term is defined in Section 2 below) for the period commencing on the Effective Date and on the terms set forth in this Agreement. Commodity Subadvisor accepts such appointment and agrees to furnish the services herein set forth for the compensation herein provided. All references to “person” hereon shall include an individual or entity.
2. Services to be Performed. Subject always to the supervision of Manager, Commodity Subadvisor will furnish an investment program in respect of, make investment decisions for, and place all orders for the purchase and sale of futures contracts, forward contracts, options on futures contracts and other commodity interests (“Commodity Interests”) and securities issued by the United States Department of the Treasury (“Collateral”), all on behalf of the Fund and as described in the Fund’s registration statement on Form S-1 as declared effective by the United States Securities and Exchange Commission (the “Registration Statement”), consistent with the investment objectives and restrictions of the Fund described therein. In the performance of its activities and duties, Commodity Subadvisor will satisfy its fiduciary duties to the Fund, will select and monitor on at least a daily basis the Fund’s investments in Commodity Interests and Collateral, and will comply with the provisions of the Fund’s Declaration of Trust and Trust Agreement (the “Trust Agreement”) as filed with the Registration Statement, as the Trust Agreement may be amended from time to time (to the extent Commodity Subadvisor has been provided with amendments), and the Fund’s investment objectives, policies and restrictions as disclosed in the Registration Statement, as such investment objectives, policies and restrictions may be amended from time to time (to the extent Commodity Subadvisor has been provided such amendments). Commodity Subadvisor acknowledges receipt of the Fund’s organizational documents, prospectus and amendments thereto as of the date hereof.
All commissions and expenses arising from the trading of Commodity Interests, or other transactions in the course of the administration of the Fund’s account, shall be charged to the Fund’s account with its clearing broker(s). Manager shall deliver to Commodity Subadvisor, and renew when necessary, a commodity trading authorization appointing Commodity Subadvisor as the Fund’s agent and attorney-in-fact for the purpose of trading Commodity Interests and Collateral on behalf of the Fund. Commodity Subadvisor may place orders for Commodity Interest transactions and purchases and sales of Collateral for the Fund through broker/dealers and futures commission merchants (“FCMs”) selected by Commodity Subadvisor; provided that Commodity Subadvisor will provide Manager and the Fund on a quarterly basis (or more frequently as reasonably requested by Manager) with a list of the broker/dealers and FCMs Commodity Subadvisor is then using (as of the date hereof, the initial list is set forth on Exhibit A hereto), and Manager may, after receiving such list, object in its sole discretion to the use of one or more broker/dealers or FCMs due to, among other reasons, a reasonable belief by Manager that the use of such broker/dealer(s) or FCM(s) would be detrimental to the Fund and its investors, and Commodity Subadvisor shall cease using such broker/dealers or FCMs on behalf of the Fund. Commodity Subadvisor shall use its commercially reasonable efforts to obtain a combination of best price and execution, taking into account all appropriate factors, including price, commission, and the size and difficulty of the transaction. In no instance will a Commodity Interest or Collateral be purchased from the Fund or sold by the Fund to Commodity Subadvisor or any affiliated person of the Fund or Commodity Subadvisor, except with the written consent of the Manager.
Commodity Subadvisor further agrees that it:
a) Will exercise its commercially reasonable judgment and will act in good faith and use reasonable care in performing the activities and duties hereunder;
b) Will conduct its activities and duties under this Agreement in accordance with, and consistent with, any applicable laws, regulations and governmental or self-regulatory authority including, without limitation, all applicable rules and regulations of the United States Commodity Futures Trading Commission (the “CFTC”), in all material respects;
c) Will report regularly to Manager and will make appropriate persons available for the purpose of reviewing with representatives of the Manager on a regular basis the management of the Fund’s Commodity Interests and Collateral, including, without limitation, review of the general investment strategies of the Fund with respect to Commodity Subadvisor’s management of the Fund’s Commodity Interests and Collateral, and the performance of the Fund’s Commodity Interests and Collateral in relation to standard industry indices and passively managed commodity index tracking funds and general conditions affecting the marketplace, and will provide various other reports from time to time as reasonably requested by Manager;
d) Will submit such reports or information as the Manager may reasonably request to assist the Fund’s custodian, administrator, accounting agent, transfer agent and/or independent public accountants (and all other agents, representatives and service providers to the Fund or the Manager) in the performance of their activities or duties, cooperate with such persons, take action to make information in the Commodity Subadvisor’s possession available to such persons for the performance of their activities or duties and requests made in connection therewith, and
2
establish and maintain appropriate operational structure and programs, procedures and interfaces with such persons so as to promote the efficient exchange of information and compliance with applicable law and regulation, and the investment strategies, guidelines and other restrictions and policies of the Fund;
e) Will reasonably assist in the preparation of periodic reports by the Fund to its limited owners and to meet other regulatory or tax requirements applicable to the Fund;
f) Will reasonably cooperate with any third-party audit arranged by the Manager or the Fund to evaluate the effectiveness of compliance controls;
g) Will not, without the prior written approval of Manager, materially deviate or change the Fund’s investment strategies, guidelines and other restrictions and policies;
h) Will monitor the pricing of the Fund’s Commodity Interests and Collateral, and events relating to the commodity markets in which the Fund trades or applicable securities markets, and will notify Manager promptly of any market events or other situations that come to Commodity Subadvisor’s attention (particularly those that may occur after the close of a foreign market in which the Fund’s Commodity Interests may primarily trade but before the time at which the Fund’s Commodity Interests are priced on a given day) that may materially impact the pricing of one or more of the Fund’s Commodity Interests or Collateral. In addition, Commodity Subadvisor will assist Manager in evaluating the impact that such an event may have on the net asset value of the Fund and in determining a recommended fair value of the affected asset or assets;
i) Other than with respect to the preparation of books and records typically produced by others (such as by FCMs, custodians and broker/dealers), will prepare such books and records with respect to the Fund’s Commodity Interests and Collateral as reasonably requested by Manager and will furnish Manager such periodic and special reports and certifications as Manager may reasonably request;
j) Will promptly notify the Fund and the Manager of any material fact known to the Commodity Subadvisor respecting or relating to the Commodity Subadvisor or the Fund that is not contained in the Registration Statement, or any amendment or supplement thereto, but that is required to be disclosed therein, and of any statement contained therein that is or becomes untrue in any material respect; and
k) Will promptly notify the Manager and the Fund of any actual or expected change of control for the Commodity Subadvisor, and of any changes to executive officers, members or key personnel of the Commodity Subadvisor including, without limitation, personnel who are portfolio manager(s) with respect to the Fund.
l) Will obtain and maintain at its sole expense errors and omission insurance in a reasonable scope and amount. For as long as the net value of the Fund’s assets calculated in the manner set forth in the Fund’s Prospectus (as defined below) (the “Assets Under Management”), together with the net value of the assets of the WisdomTree Coal Fund (“TONS”) calculated in the manner set forth in TONS’s prospectus and the net value of the assets of WisdomTree Commodity Index Fund (“GCC”) calculated in the manner set forth in GCC’s prospectus, are
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less than $500,000,000 in the aggregate, $1,000,000 shall be deemed a reasonable amount of errors and omissions insurance coverage. If the Assets Under Management of the Fund, TONS and GCC exceed $500,000,000 in the aggregate, the Commodity Subadvisor will increase its errors and omissions insurance coverage by an appropriate amount.
The Commodity Subadvisor is authorized to and may employ, associate or contract with such person or persons as the Commodity Subadvisor may deem desirable to assist it in performing its activities and duties under this Agreement (including portfolio managers), including Grain Service Corporation, Inc. (“Grain Service”); provided, however, the compensation of such person or persons shall be paid by the Commodity Subadvisor, and the Commodity Subadvisor shall be as fully responsible to the Fund and the Manager for the acts and omissions of any such person or persons as it is for its own acts and omissions. As may be mutually agreed by the Fund, Manager and the Commodity Subadvisor, but in any event at least annually, the Commodity Subadvisor shall discuss with the Fund and Manager any assistance the Commodity Subadvisor has deemed desirable in performing its duties under this Agreement (including person or persons involved therewith).
3. Preparation of Materials. Commodity Subadvisor will reasonably cooperate with Manager and the Fund in the Fund’s endeavors to prepare and update, if necessary, the Registration Statement and a prospectus and disclosure document included therein (the “Prospectus”), promotional brochures or other marketing materials as well as any other materials reasonably requested or required by Manager in connection with the organization, operation, or marketing of the Fund or the registration or renewal of registration of the Shares (as defined in the Prospectus) for sale to the public in all applicable jurisdictions (collectively, with the Registration Statement and Prospectus, the “Materials”). In this regard, Commodity Subadvisor will furnish to Manager such information as may be reasonably requested for inclusion in such Materials. Moreover, Commodity Subadvisor agrees to provide to Manager such information as Manager reasonably requests in order for Manager to make all necessary disclosures regarding Commodity Subadvisor, its principals, its trading performance, customer accounts and otherwise as are required in the reasonable judgment of Manager to be made in such Materials.
4. Representations and Warranties of Manager. Manager hereby represents and warrants to Commodity Subadvisor that this Agreement has been duly and validly executed and delivered by, and is a valid and binding contract of, Manager, enforceable in accordance with its terms and conditions, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights of creditors generally and except as such enforceability of this Agreement is subject to the application of general principles of equity (regardless of whether considered in a proceeding in equity or at law).
5. Representations and Warranties of Commodity Subadvisor. Commodity Subadvisor hereby represents and warrants to the Fund and Manager that:
a) The information and materials relating to Commodity Subadvisor, its businesses, principals, and past performance record that has been requested by Manager, has been delivered to Manager and is current, accurate and complete in all material respects, and notwithstanding Commodity Subadvisor’s relief from certain requirements in Part 4 of the CFTC’s regulations, the Commodity Subadvisor is in compliance with all other applicable laws, rules and regulations.
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Commodity Subadvisor will provide Manager with updated or amended copies of any such materials when and if such materials are updated or amended;
b) Commodity Subadvisor is not registered as an investment adviser with the SEC in reliance on the exception from the definition of “investment adviser” in Section 203(a)(11)(E) of the Investment Advisers Act of 1940;
c) To the extent reasonably available to it and applicable, Commodity Subadvisor has supplied or upon request will supply, and has made available or upon request will make available, for review by Manager or its agents substantially all documents, statements, agreements, confirmations and work papers relating to all accounts managed by Commodity Subadvisor for the period covered in any Materials, including for the Fund;
d) Commodity Subadvisor has met, and will continue to meet for so long as this Agreement remains in effect, any applicable federal or state requirements, or the applicable requirements of any regulatory agency or industry self-regulatory organization, necessary to be met in order to perform services for the Fund pursuant to this Agreement;
e) Commodity Subadvisor is a commodity trading advisor duly registered with the CFTC and is a member in good standing of the National Futures Association (“NFA”). Commodity Subadvisor shall maintain such registration and membership in good standing during the term of this Agreement. Further, Commodity Subadvisor agrees to notify Manager promptly upon (i) a statutory disqualification of Commodity Subadvisor under Sections 8a(2) or 8a(3) of the Commodity Exchange Act (“CEA”), (ii) a suspension, revocation or limitation of Commodity Subadvisor’s commodity trading advisor registration or NFA membership, or (iii) the institution of an action or proceeding that could lead to a statutory disqualification under the CEA or an investigation by any governmental agency or self-regulatory organization of which Commodity Subadvisor is subject or has been advised it is a target (which investigation shall not include routine compliance examinations);
f) There are no material actions that are required to be disclosed pursuant to CFTC Rule 4.34(k);
g) Commodity Subadvisor is a Delaware limited liability company with full power and authority to enter into this Agreement;
h) Commodity Subadvisor maintains errors and omissions insurance coverage in an appropriate scope and amount and shall upon request of Manager, provide Manager a certificate of insurance evidencing same;
i) This Agreement has been duly and validly authorized, executed and delivered by, and is a valid and binding contract of, Commodity Subadvisor enforceable in accordance with its terms and conditions, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights of creditors generally and except as such enforceability of this Agreement is subject to the application of general principles of equity (regardless of whether considered in a proceeding in equity or at law); and
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j) The representations and warranties made in this Agreement by Commodity Subadvisor shall be continuing during the term of this Agreement, and if at any time any event has occurred which would make or tend to make any of the representations and warranties in this Agreement materially untrue, Commodity Subadvisor will promptly notify Manager.
6. Compensation. For the services provided and the expenses assumed pursuant to this Agreement, Commodity Subadvisor agrees to accept as full compensation the fee specified in Exhibit B hereto.
7. Expenses. Commodity Subadvisor will be responsible for and pay all expenses incurred by it in connection with its activities and duties under this Agreement, including, without limitation, providing the personnel, office space and equipment, including any investment related software or technology resources, reasonably necessary therewith; provided, however, the Commodity Subadvisor will not be responsible for the cost of investments (including brokerage commissions and other related expenses) purchased or sold for the Fund. The Fund pays all other costs and expenses of its operations, including custody fees, transfer agent expenses, legal fees, expenses of independent auditors, expenses of preparing, printing and distributing shareholder reports, notices, reports to governmental agencies or self-regulatory organizations and taxes, if any.
8. Independence of Commodity Subadvisor. Commodity Subadvisor shall for all purposes herein be deemed to be an independent contractor and shall, unless otherwise expressly provided or authorized herein, have no authority to act for or represent Manager or the Fund in any way or otherwise be deemed an agent of Manager or the Fund. Commodity Subadvisor shall not offer or sell or solicit any offers to purchase the Shares. However, when requested by Manager at such reasonable times and upon adequate notice as mutually agreed to, Commodity Subadvisor will assist in the general explanation and presentation of Commodity Subadvisor’s trading strategies and methods. Nothing herein contained shall be deemed to require the Fund to take any action contrary to the Trust Agreement, or any applicable statute, regulation or exchange rule or interpretation of the staff of an applicable governmental agency.
9. Records of the Fund. Commodity Subadvisor will instruct the Fund’s broker/dealer(s) and FCMs to furnish copies, and/or will otherwise furnish copies to Manager as requested by Manager, of all trade confirmations and trading reports. Commodity Subadvisor will maintain a record of all trading orders for the Fund’s account that have been filled and will monitor at least daily the Fund’s open positions. Upon the request of Manager, Commodity Subadvisor shall permit Manager or its agents and representatives to inspect such information as Manager may request for the purpose of confirming that the Fund has been treated equitably with respect to trading conducted during the term of this Agreement with all client accounts of Commodity Subadvisor or its affiliates. The books and records pertaining to the Commodity Subadvisor’s activities and duties hereunder shall be the property of the Fund (although the foregoing will not prohibit the Commodity Subadvisor from maintaining copies of all such records). The Manager or its representatives shall have access to such books and records at all times during the Commodity Subadvisor’s normal business hours. Upon the reasonable request of the Manager, copies of any such books and records shall be provided promptly by the Commodity Subadvisor to the Manager or its representatives.
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10. Compliance. The Commodity Subadvisor shall:
a) Promptly notify the Manager upon determination of any error (or discovery of any error by a third party, such as the Fund’s accountant) in connection with its activities and duties hereunder, including but not limited to any trade errors. With respect to any Commodity Subadvisor error, the Commodity Subadvisor shall provide a memorandum to the Manager that sufficiently describes any such error and the action to be taken to prevent future occurrences of such error;
b) Promptly notify the Manager if it becomes aware of any material breach of any of the Fund’s investment strategies, guidelines or other restrictions and policies or of any violation of applicable law or regulation. The Commodity Subadvisor shall also promptly notify the Manager upon detection of any material violations on the Commodity Subadvisor’s own compliance policies and procedures that relate to its activities or duties hereunder;
c) Provide access to the Manager and its agents and representatives to its policies and procedures pertaining to its activities and duties hereunder and shall notify the Manager, via quarterly certification or otherwise at the request of the Manager, of: (1) any material changes to its policies and procedures; (2) any new policies and procedures as they pertain to activities or duties performed hereunder; and (3) the retirement of any policies and procedures as they pertain to activities or duties performed hereunder; and
d) Promptly provide notice to the Manager regarding any inspections, notices or inquiries from any governmental, administrative or self-regulatory agency, including without limitation, any deficiency letter, responses to deficiency letters or similar communications or actions (1) relating to the Commodity Subadvisor’s activities or duties that relate to the Fund or (2) that involve matters that could reasonably be viewed as material to the Commodity Subadvisor’s ability to provide services to the Fund. To the extent that such inspections, notices, or inquiries relate to the Fund, the Commodity Subadvisor shall promptly make available such documents to the Manager.
11. Notice of Threatened, Pending or Completed Actions, Suits or Proceedings.
a) Commodity Subadvisor will give prompt notice to Manager of: (i) any threatened, pending or completed action, suit or proceeding (including, without limitation, any reparations or administrative proceeding threatened or instituted under the CEA to which Commodity Subadvisor was or is a party or is threatened to be a party; and (ii) any judgments or amounts paid by Commodity Subadvisor in settlement in connection with any such threatened, pending or completed action, suit or proceeding.
b) Written notices required to be given pursuant to this Section 11 shall contain all pertinent information concerning the threatened, pending or completed action, suit or proceeding and, in the case of any pending or completed action suit or proceeding, shall include a copy of the complaint, petition or similar documents asserting a claim.
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12. Indemnity.
a) Commodity Subadvisor and each of the Additional Indemnitors listed on Exhibit C hereto (each, an “Additional Indemnitor”, and collectively with Commodity Subadvisor, the “Joint and Several Indemnitors,”) jointly and severally agree to indemnify, defend and hold harmless the Fund and Manager and their affiliates, including their subsidiaries, directors, officers, members, managers, trustees, employees, agents, representatives, partners and shareholders (each, an “Indemnitee”) against any loss, liability, damage, cost, expenses (including reasonable attorneys’ fees and accountants’ fees), judgments and amounts paid in settlement (“Losses”) by reason of: (i) any act or omission of Commodity Subadvisor relating to the Fund (including costs and expenses of investigating and defending any claims, demand or suit and attorneys’ and accountants’ fees), including, without limitation, any willful misfeasance, bad faith or negligence on the Commodity Subadvisor’s part in the performance of its activities and duties or by reason of the Commodity Subadvisor’s reckless disregard of its activities and duties under this Agreement or otherwise for breach of this Agreement; or (ii) any claim, dispute or litigation arising between Commodity Subadvisor or its affiliates and any party other than the Fund or Manager, which claim, dispute or litigation is unrelated to the Fund’s business, and if the Fund or Manager are made a party to such claim, dispute or litigation by such other party. In the event that the Joint and Several Indemnitors collectively fail to promptly pay for (or otherwise reimburse) any Losses, Manager shall be entitled to deduct an amount necessary to pay (or otherwise reimburse) for such Losses from any Fees due or payable to Commodity Subadvisor.
b) Promptly after receipt by an Indemnitee of notice of the commencement of an action as set forth in sub-section a) above, such Indemnitee shall notify Commodity Subadvisor each of the Additional Indemnitors of the commencement thereof (such notice to Commodity Subadvisor pursuant to Section 14 hereof shall constitute notice to each Additional Indemnitor for purposes of this Section 12); but the omission so to notify (or the delay in notifying) the Commodity Subadvisor will not relieve the Joint and Several Indemnitors from any liability that they may have to any Indemnitee, except to the extent that the Joint and Several Indemnitors, jointly and severally, suffer material damage in their ability to respond to such action as a result of the omission. In case any such action is brought against any Indemnitee, and it notified Commodity Subadvisor (and thereby each Additional Indemnitor) of the commencement thereof, the Joint and Several Indemnitors will be entitled to participate therein and, to the extent that they may wish, assume the defense thereof, with counsel reasonably satisfactory to such Indemnitee.
c) The foregoing provisions for indemnification shall survive the termination of this Agreement.
d) Notwithstanding anything in this Agreement to the contrary, all securities laws impose liabilities under certain circumstances on persons who act in good faith, and, therefore, nothing in this Agreement shall constitute a waiver or limitation of liability under such laws to the extent (but only to the extent) such liability may not be waived, modified or limited.
13. Term; Termination; Amendment.
a) The term of this Agreement shall commence on the Effective Date and shall continue until December 31, 2020, unless this Agreement is terminated earlier as provided
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herein. This Agreement shall automatically renew for one-year periods thereafter, unless either party gives at least one hundred twenty (120) days’ notice of termination prior to the end of the then current term, or unless terminated earlier as provided herein.
b) Notwithstanding the foregoing, this Agreement may be terminated in its entirety by Manager immediately upon written notice to Commodity Subadvisor if:
(1) any litigation or proceeding is commenced against Commodity Subadvisor, Grain Service, or any affiliate of Commodity Subadvisor that Manager reasonably believes would have a material adverse effect on Commodity Subadvisor’s ability to perform its obligations to provide sub-investment advisory services to Manager and the Fund;
(2) Commodity Subadvisor commits a material breach of the Agreement, and fails to remedy such breach within a period of thirty (30) business days following receipt of written notice from Manager specifying the breach and requesting its remedy;
(3) Manager ceases to act as overall investment manager to the Fund; provided, however, that if the successor investment manager to the Fund (the “Successor Manager”) is an affiliate of the Manager, such Successor Manager will expressly agree in writing to assume all obligations of the Manager under this Agreement and honor its terms and conditions; provided, further, that in the case of the foregoing, the Manager shall be released from further obligations under this Agreement and each non-assigning party agrees to look solely to the Successor Manager for the performance of the Manager’s obligations; or
(4) the Fund closes for any reason.
c) Notwithstanding the foregoing, this Agreement may be terminated in its entirety by Commodity Subadvisor immediately upon notice to Manager if Manager does not pay undisputed fees due Commodity Subadvisor, and Manager fails to remedy such breach within a period of thirty (30) business days following receipt of notice from Commodity Subadvisor specifying the amount of undisputed fees believed due from Manager, including detailed calculations regarding how the Commodity Subadvisor determined such fees.
14. Notices. All notices, requests, claims, demands and other communications required or permitted to be given under this Agreement shall be in writing and shall be delivered by hand or sent by an internationally recognized overnight courier service with signature required for delivery, by facsimile where a confirmation of receipt is obtained, provided, however, that if sent by facsimile the written communication must also be sent by next business day delivery via an internationally recognized overnight courier service with signature required for delivery, or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties hereto at the following addresses:
If to Manager or the Fund:
WisdomTree Commodity Services, LLC
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c/o WisdomTree Investments, Inc.
245 Park Avenue, 35th Fl.
New York, NY 10167
Attention: Peter Ziemba
Facsimile: (917) 267-3851
If to Commodity Subadvisor:
GreenHaven Advisors, LLC
c/o Grain Service Corporation, Inc.
3340 Peachtree Road, Suite 1910
Atlanta, GA 30326
Attention: Ashmead Pringle
Facsimile: (404) 261-5468
All such communications so addressed shall be deemed given (i) when delivered, if delivered personally to the intended recipient, or if sent by an internationally recognized courier service with signature required for delivery, or if sent by facsimile and a confirmation of receipt is obtained, and the written communication has also be sent for next business day delivery via an internationally recognized courier service with signature required for delivery, or (ii) three business days after being mailed if sent by certified or registered mail, postage prepaid, return receipt requested, or upon delivery if actual delivery occurs earlier.
15. Confidentiality. Each party agrees that it will treat confidentially all information provided by the other party regarding such other party’s business and operations, including without limitation, with respect to the Commodity Subadvisor, the investment activities and holdings of the Fund and all information obtained in the ordinary course of performing its activities and duties hereunder about the Fund’s prior, present or potential limited owners. All confidential information provided by a party hereto shall be used by any other party hereto solely for the purpose of rendering or receiving services pursuant to this Agreement and, except as may be required in carrying out this Agreement, shall not be disclosed to any third party. The foregoing shall not be applicable to any information (i) that is publicly available when provided or thereafter becomes publicly available, other than through a breach of this Agreement, (ii) that is independently derived by either party hereto without the use of any information provided by the other party hereto in connection with this Agreement, (iii) that is disclosed, upon prior notice to the party whose information is being disclosed (to the extent such notice is permissible), in the manner and to the extent required in any legal or regulatory proceeding, investigation, audit, examination, subpoena, civil investigative demand or other similar process, or by operation of law or regulation, or (iv) where the party seeking to disclose has received the prior written consent of the party providing the information, which consent shall not be unreasonably withheld. Notwithstanding the foregoing, each party acknowledges that the other party may provide access to and use of confidential information relating to the other party to the disclosing party’s employees, contractors, agents, professional advisors, auditors or persons performing similar functions, as necessary solely for the purpose of rendering services under this Agreement, provided that each person or entity shall be subject to confidentiality obligations substantially similar to those set forth herein. If either party becomes aware of a breach of this confidentiality provision, it will notify promptly the other party of such breach and provide such details as it
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deems appropriate and in accordance with the standard of care hereunder regarding the extent of the breach of confidentiality. Each party’s obligations under this clause shall survive for a period of one (1) year following the expiration or termination of this Agreement.
16. Business Continuity. The Commodity Subadvisor shall maintain business continuity, disaster recovery, and backup capabilities and facilities, through which the Commodity Subadvisor will be able to perform its activities and duties hereunder with minimal disruptions or delays. The Commodity Subadvisor will employ reasonable safeguards designed to protect the Fund’s confidential information. Upon request, the Commodity Subadvisor shall provide to the Manager copies of its written business continuity, disaster recovery and backup plan(s) or sufficient information and written certification regarding such plans to satisfy the Manager. The Commodity Subadvisor represents that it tests its plan(s) on at least an annual basis, and shall, at the Manager’s request, provide the Manager with information regarding the results of its testing.
17. Assignment and Successors. This Agreement may not be assigned without the express written consent of the other party, which consent shall not be unreasonably withheld. No activities or duties hereunder may delegated by either party, except as expressly set forth in Section 2. This Agreement is made solely for the benefit of, and shall be binding upon, the parties and their respective permitted successors and assigns, and no other person shall have any right or obligation under it. Any assignment in violation of this Agreement shall be void and of no effect. Notwithstanding the foregoing, in the event that the Manager engages in any (a) merger or consolidation into or with any other corporation or entity, (b) sale, conveyance, transfer, license, lease or other disposition of all or substantially all of the assets of the Manager or (c) acquisition by any person of more than fifty percent (50%) of the voting power of all securities of the Manager (collectively, a “Change of Control”), the Manager may, in its sole discretion and without the consent of the Commodity Subadvisor or any other party hereto, assign this Agreement in connection with such Change of Control and, upon such assignment and Change of Control, the successor-in-interest to Manager as a result of the Change in Control will expressly agree in writing to assume this Agreement and honor its terms and conditions, and Manager shall be released from further obligations under this Agreement and each non-assigning Party agrees to look solely to the successor-in-interest of the Manager for the performance of the Manager’s obligations.
18. Miscellaneous. The captions in this Agreement are included for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. If any provision of this Agreement is held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement will not be affected thereby.
19. Applicable Law, Entire Agreement, Amendments. This Agreement shall be construed in accordance with applicable federal law and the laws of the State of New York, without reference to any conflict of law principles to the contrary. Commodity Subadvisor consents to jurisdiction and venue of the state and federal courts sitting in the State of New York, County of New York, U.S.A. This Agreement is the entire agreement of the parties in respect of the subject matter and may be amended only by a writing signed by the parties.
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20. Obligations of Fund Only. This Agreement is executed on behalf of the Fund by officers of the Manager as officers and not individually and the obligations imposed upon the Fund by this Agreement are not binding upon any of the Fund’s trustees or shareholders individually but are binding only upon the assets and property of the Fund.
21. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but such counterparts shall, together, constitute only one instrument.
22. Commodity Subadvisor’s Rule 4.7 Advisory and Fund Consent. PURSUANT TO AN EXEMPTION FROM THE COMMODITY FUTURES TRADING COMMISSION IN CONNECTION WITH ACCOUNTS OF QUALIFIED ELIGIBLE PERSONS, THIS BROCHURE OR ACCOUNT DOCUMENT IS NOT REQUIRED TO BE, AND HAS NOT BEEN, FILED WITH THE COMMISSION. THE COMMODITY FUTURES TRADING COMMISSION DOES NOT PASS UPON THE MERITS OF PARTICIPATING IN A TRADING PROGRAM OR UPON THE ADEQUACY OR ACCURACY OF COMMODITY TRADING ADVISOR DISCLOSURE. CONSEQUENTLY, THE COMMODITY FUTURES TRADING COMMISSION HAS NOT REVIEWED OR APPROVED THIS TRADING PROGRAM OR THIS BROCHURE OR ACCOUNT DOCUMENT.
The Fund consents to its account being managed by Commodity Subadvisor being an exempt account under CFTC Rule 4.7.
[SIGNATURES ON NEXT PAGE]
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IN WITNESS WHEREOF, Manager, the Fund and Commodity Subadvisor have caused this Agreement to be executed as of the day and year first above written.
GREENHAVEN COMMODITY SERVICES, LLC
(to be renamed WISDOMTREE COMMODITY SERVICES, LLC),
a Delaware limited liability company
By: WisdomTree Investments, Inc.
Its: Sole Member
| By: | ||
| Name: | ||
| Title: |
GREENHAVEN CONTINUOUS COMMODITY
INDEX MASTER FUND
(to be renamed WISDOMTREE CONTINUOUS COMMODITY INDEX
MASTER FUND),
a Delaware statutory trust
By: GREENHAVEN COMMODITY SERVICES, LLC
(to be renamed WISDOMTREE COMMODITY SERVICES, LLC),
its Manager
By: WisdomTree Investments, Inc.
Its: Sole Member
| By: | ||
| Name: | ||
| Title: |
[SIGNATURE PAGE TO COMMODITY SUBADVISORY AGREEMENT – GREENHAVEN CONTINUOUS COMMODITY INDEX MASTER FUND]
IN WITNESS WHEREOF, Manager, the Fund and Commodity Subadvisor have caused this Agreement to be executed as of the day and year first above written.
GREENHAVEN ADVISORS, LLC,
a Delaware limited liability company
| By: | ||
| Name: | Ashmead Pringle | |
| Title: | Managing Member |
AGREED, FOR THE LIMITED PURPOSES SET FORTH IN SECTION 12:
ADDITIONAL INDEMNITORS, EACH IN THEIR INDIVIDUAL CAPACITIES
| By: | ||
| Name: | Ashmead Pringle |
| By: | ||
| Name: | Thomas Cooper Anderson |
| By: | ||
| Name: | Thomas J. Fernandes |
[SIGNATURE PAGE TO COMMODITY SUBADVISORY AGREEMENT – GREENHAVEN CONTINUOUS COMMODITY INDEX MASTER FUND]
EXHIBIT A
List of Broker/Dealers and FCMs
Morgan Stanley & Co. LLC
EXHIBIT B
Compensation
a) For the services provided and the expenses assumed pursuant to this Agreement, Commodity Subadvisor agrees to accept as full compensation an annual fee equal to twenty percent (20%) of the Manager’s management fee plus twenty percent (20%) of the Fund’s other expense accrual (excluding brokerage expense accrual) based on the Fund’s average daily net assets (the “Fee”); provided, however the minimum annual Fee that Commodity Subadvisor will be paid shall be $200,000 (the “Minimum Annual Fee”). The Fee shall accrue on each calendar day and shall be paid by Manager within seven (7) days after the first business day of the next succeeding calendar month. The daily fee accrual shall be computed by multiplying the fraction of one divided by the number of days in the calendar year by the applicable annual rate of fee, and multiplying this product by the net assets of the Fund as of the close of business on the last preceding business day on which the Fund’s net asset value was determined. The Fund’s net asset value for this purpose shall be calculated as provided in the Fund’s prospectus then in effect. If, at the end of each calendar year that this Agreement remains in effect, beginning January 1, 2016, and each monthly Fee has been calculated and paid to Commodity Subadvisor (other than the payment for the last month of the calendar year), Commodity Subadvisor has not received Fees equal to the Minimum Annual Fee, then Manager shall pay the shortfall amount to Commodity Subadvisor at the same time that Manager makes the payment to Commodity Subadvisor for the last month of the applicable calendar year.
b) For the month and year in which this Agreement becomes effective or terminates, there shall be an appropriate proration of the Fee on the basis of the number of days that the Agreement is in effect during the month and year, respectively. By way of example, if this Agreement were to terminate on the 100th day of a calendar year because the Fund closed on that day, then the Minimum Annual Fee for that partial year would be $200,000 x (100/365).
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EXHIBIT C
Additional Indemnitors
Ashmead Pringle
Thomas Cooper Anderson
Thomas J. Fernandes
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Exhibit 10.2
Form Of Master Custodian Agreement
This Agreement made as of January 4, 2016, and to have an effective date on January 1, 2016, is by and between each commodity pool entity set forth on Schedule A hereto (each such commodity pool entity and each commodity pool entity made subject to this Agreement in accordance with Section 22.5 below shall hereinafter be referred to as a “Fund”) and State Street Bank and Trust Company, a Massachusetts trust company (the “Custodian”).
Witnesseth:
Whereas, the Fund is authorized to issue common units of beneficial interest (“Shares”);
Whereas, the Fund will issue and redeem Shares only in aggregations known as “Baskets,” generally in exchange for a specified cash payment, as more fully described in the currently effective prospectus and statement of additional information of the Fund related to the Fund (collectively, the “Prospectus”);
Whereas, WisdomTree Commodity Services, LLC or WisdomTree Coal Services, LLC, as applicable, serves as the managing owner and/or sponsor, and commodity pool operator, of the Fund (the “Managing Owner” or “Sponsor”); and
Whereas, the Sponsor on behalf of the Fund has selected and desires to retain the Custodian to act as custodian of Fund assets, and the Custodian is willing to provide such services to the Fund upon the terms and conditions hereinafter set forth.
Now, Therefore, in consideration of the mutual covenants and agreements hereinafter contained, the parties hereto agree as follows:
Section 1. Employment of Custodian and Property to be Held by It
The Sponsor on behalf of the Fund hereby employs the Custodian as a custodian of assets of the Fund, including securities which the Fund desires to be held in places within the United States (“domestic securities”) and securities it desires to be held outside the United States (“foreign securities”). The Fund agrees to deliver to the Custodian all securities and cash of the Fund, and all payments of income, payments of principal or capital distributions received by it with respect to all securities owned by the Fund from time to time, and the cash consideration received by it for such shares as may be issued or sold from time to time. The Custodian shall not be responsible for any property of a Fund which is not received by it or which is delivered out in accordance with Proper Instructions (as such term is defined in Section 8 hereof), so long as the Custodian has met its standard of care as specified in Section 16.1 of this Agreement.
With respect to uncertificated shares or other interests (the “Underlying Shares”) in collective investment vehicles, including, among others, registered “investment companies” (as defined in Section 3(a)(1) of the Investment Company Act of 1940, as amended from time to time, the holding of confirmation statements that identify the shares as being recorded in the Custodian’s name on behalf of the Fund will be deemed custody for purposes hereof.
Upon receipt of Proper Instructions, the Custodian shall on behalf of the Fund appoint one or more banks, trust companies or other entities located in the United States and designated in such Proper Instructions to act as a sub-custodian for the purposes of effecting such transaction(s) as may be designated by the Fund. Each such designated sub-custodian is referred to herein as a “Special Sub-Custodian.” The Custodian may place and maintain the Fund’s foreign securities with foreign banking institution sub-custodians employed by the Custodian and/or foreign securities depositories, in accordance with the applicable provisions of Sections 3 and 4 hereof.
Section 2. Duties of the Custodian with Respect to Property of the Fund to be Held in the United States
Section 2.1 Holding Securities. The Custodian shall hold and physically segregate for the account of the Fund all non-cash property to be held by it in the United States, including all domestic securities owned by such Fund other than (a) securities which are maintained pursuant to Section 2.9 in a clearing agency which acts as a securities depository or in a book-entry system authorized by the U.S. Department of the Treasury (each, a “U.S. Securities System”) and (b) Underlying Shares owned by the Fund which are maintained pursuant to Section 2.11 hereof in an account with State Street Bank and Trust Company or such other entity which may from time to time be appointed by the Fund to act as a transfer agent for the Underlying Portfolios and with respect to which the Custodian is provided with Proper Instructions (the “Underlying Transfer Agent”).
Section 2.2 Delivery of Domestic Securities. The Custodian shall release and deliver domestic securities owned by a Fund held by the Custodian, in a U.S. Securities System account of the Custodian or in an account at the Underlying Transfer Agent, only upon receipt of Proper Instructions on behalf of the applicable Fund, specifying (a) the domestic securities of the Fund to be delivered and (b) the person or persons to whom delivery of such securities shall be made.
Section 2.3 Registration of Securities. Domestic securities held by the Custodian (other than bearer securities) shall be registered in the name of the Fund or in the name of any nominee of the Fund or of any nominee of the Custodian which nominee shall be assigned exclusively to the Fund, unless the Fund has authorized in writing the appointment of a nominee to be used in common with other investment companies or funds having the same investment adviser or managing owner as the Fund, or in the name or nominee name of any agent appointed pursuant to Section 2.8 or in the name or nominee name of any sub-custodian appointed pursuant to Section 1. All securities accepted by the Custodian on behalf of the Fund under the terms of this Agreement shall be in “street name” or other good delivery form. If, however, the Fund directs the Custodian to maintain securities in “street name”, the Custodian shall utilize reasonable efforts only to timely collect income due the Fund on such securities and to notify the Fund of relevant corporate actions including, without limitation, pendency of calls, maturities, tender or exchange offers.
Section 2.4 Payment of Fund Monies. The Custodian shall pay out monies of the Fund upon receipt of Proper Instructions on behalf of the Fund, specifying (a) the amount of such payment and (b) the person or persons to whom such payment is to be made.
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Section 2.5 Bank Accounts. The Custodian shall open and maintain a separate bank account or accounts in the United States in the name of the Fund, subject only to draft or order by the Custodian acting pursuant to the terms of this Agreement, and shall hold in such account or accounts, subject to the provisions hereof, all cash received by it from or for the account of the Fund. Funds held by the Custodian for the Fund may be deposited by it to its credit as Custodian in the banking department of the Custodian or in such other banks or trust companies as it may in its discretion deem necessary or desirable; provided, however, that every such bank or trust company shall be qualified to act as a custodian and that each such bank or trust company and the funds to be deposited with each such bank or trust company shall on behalf of the Fund as approved by the Fund or its Sponsor. Such funds shall be deposited by the Custodian in its capacity as Custodian and shall be withdrawable by the Custodian only in that capacity.
Section 2.6 Determination of Fund Deposit, etc. Subject to and in accordance with the directions of the Sponsor, the Custodian shall determine for the Fund after the end of each trading day on the New York Stock Exchange (the “NYSE”), in accordance with the respective Fund’s policies as adopted from time to time and in accordance with the procedures set forth in the Prospectus, the amount of cash or cash equivalent proceeds required for the issuance or redemption, as the case may be, of Shares in Basket aggregations of such Fund on such date. The Custodian shall provide or cause to be provided this information to the Funds’ distributor and other persons according to the policy established by the Fund and shall disseminate such information on each day that the NYSE is open, including through the facilities of the National Securities Clearing Corporation, prior to the opening of trading on the NYSE.
Section 2.6A. Allocation of Deposit Security Shortfalls. While the Fund does not anticipate that its Baskets will generally contain securities (“Deposit Securities”), the Fund acknowledges that the Custodian maintains only one account on the books of the National Securities Clearing Corporation (the “NSCC”) for the benefit of all exchange traded funds for which the Custodian serves as custodian, including the Fund (collectively, the “ETF Custody Clients”). In the event that (a) two or more ETF Custody Clients require delivery of the same Deposit Security in order to purchase a Basket, and (b) the NSCC, pursuant to its Continuous Net Settlement system, delivers to the Custodian’s NSCC account less than the full amount of such Deposit Security necessary to satisfy in full each affected ETF Custody Client’s required amount (a “Common Deposit Security Shortfall”), then, until all Common Deposit Security Shortfalls for a given Deposit Security are satisfied in full, the Custodian will allocate to each affected ETF Custody Client, on a pro rata basis, securities and/or cash received in the Custodian’s NSCC account relating to such shortfall, first to satisfy any prior unsatisfied Common Deposit Security Shortfall, and then to satisfy the current Common Deposit Security Shortfall.
Section 2.7 Collection of Income. Subject to the provisions of Section 2.3, the Custodian shall collect on a timely basis all income and other payments with respect to registered domestic securities held hereunder to which the Fund shall be entitled either by law or pursuant to custom in the securities business, and shall collect on a timely basis all income and other payments with respect to bearer domestic securities if, on the date of payment by the issuer, such securities are held by the Custodian or its agent thereof, and shall credit such income, as collected, to such Fund’s custodian account. The Custodian shall present for payment all income items requiring presentation
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as and when they become due and shall collect interest when due on securities held hereunder. Income due each Fund on securities loaned shall be the responsibility of the Fund. The Custodian will have no duty or responsibility in connection therewith, other than to provide the Fund with such information or data as may be necessary to assist the Fund in arranging for the timely delivery to the Custodian of the income to which the Fund is properly entitled.
Section 2.8 Appointment of Agents. The Custodian may at any time or times in its discretion appoint (and may at any time remove) any other bank or trust company which is itself qualified to act as a custodian, as its agent to carry out such of the provisions of this Section 2 as the Custodian may from time to time direct; provided, however, that the appointment of any agent shall not relieve the Custodian of its responsibilities or liabilities hereunder. The Underlying Transfer Agent shall not be deemed an agent or sub-custodian of the Custodian for purposes of this Agreement.
Section 2.9 Deposit of Fund Assets in U.S. Securities Systems. The Custodian may deposit and/or maintain securities owned by the Fund in a U.S. Securities System in accordance with applicable Securities and Exchange Commission rules and regulations, if any, and to the extent applicable hereto.
Section 2.10 Segregated Account. Upon receipt of Proper Instructions, the Custodian shall on behalf of the Fund establish and maintain a segregated account or accounts for and on behalf of such Fund for any purpose, into which account or accounts may be transferred cash and/or securities, including securities maintained in an account by the Custodian pursuant to Section 2.9 hereof.
Section 2.11 Deposit of Fund Assets with the Underlying Transfer Agent. Underlying Shares beneficially owned by the Fund shall be deposited and/or maintained in an account or accounts maintained with an Underlying Transfer Agent and the Custodian’s only responsibilities with respect thereto shall be limited to the following:
| 1) | Upon receipt of a confirmation or statement from an Underlying Transfer Agent that such Underlying Transfer Agent is holding or maintaining Underlying Shares in the name of the Custodian (or a nominee of the Custodian) for the benefit of a Fund, the Custodian shall identify by book-entry that such Underlying Shares are being held by it as custodian for the benefit of such Fund. |
| 2) | In respect of the purchase of Underlying Shares for the account of a Fund, upon receipt of Proper Instructions, the Custodian shall pay out monies of such Fund as so directed, and record such payment from the account of such Fund on the Custodian’s books and records. |
| 3) | In respect of the sale or redemption of Underlying Shares for the account of a Fund, upon receipt of Proper Instructions, the Custodian shall transfer such Underlying Shares as so directed, record such transfer from the account of such Fund on the Custodian’s books and records and, upon the Custodian’s receipt of the proceeds |
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therefor, record such payment for the account of such Fund on the Custodian’s books and records.
| 4) | The Custodian will implement procedures to ensure that the Underlying Transfer Agent’s records of the Fund’s holdings of Underlying Shares are properly reconciled with the Custodian’s records. |
Section 2.12 Ownership Certificates for Tax Purposes. The Custodian shall execute ownership and other certificates and affidavits for all federal and state tax purposes in connection with receipt of income or other payments with respect to domestic securities of the Fund held by it and in connection with transfers of securities.
Section 2.13 Proxies. The Custodian shall deliver to the Fund, in the most expeditious manner practicable, all forms of proxies, all notices of meetings, and any other notices or announcements affecting or relating to securities owned by the Fund that are received by the Custodian, any Sub-Custodian, or any nominee of either of them (or with the exercise of reasonable care that the Custodian, any Sub-Custodian, or any nominee of either of them should have become aware), and, upon receipt of Proper Instructions, the Custodian shall execute and deliver, or cause such Sub-Custodian or nominee to execute and deliver, such proxies or other authorizations as may be required. The Custodian recognizes that this requirement applies to all securities and that the Fund’s investments in non-U.S. securities may entail proxies and notices, which, for the avoidance of doubt, are subject to this Agreement. Except as directed pursuant to Proper Instructions, neither the Custodian nor any Sub-Custodian or nominee shall vote upon any such securities, or execute any proxy to vote thereon, or give any consent or take any other action with respect thereto. In the event that the Custodian is unable to vote upon any such securities in accordance with Proper Instructions for any reason including, but not limited to, the failure of the Fund to deliver any necessary powers of attorney or other documentation, the Custodian shall promptly notify (subject to market practices and rules) the Fund. The Fund acknowledges that local conditions, including lack of regulation, onerous procedural obligations, lack of notice and other factors may have the effect of severely limiting the ability of the Fund to exercise shareholder rights.
Section 2.14 Communications Relating to Domestic Fund Securities. Subject to the provisions of Section 2.3, the Custodian shall transmit promptly to the Fund all written information received by the Custodian from issuers of the securities being held for the Fund. With respect to tender or exchange offers, the Custodian shall transmit promptly to the Fund all written information received by the Custodian from issuers of the securities whose tender or exchange is sought and from the party (or its agents) making the tender or exchange offer. The Custodian shall not be liable for any untimely exercise of any tender, exchange or other right or power in connection with domestic securities or other property of the Fund at any time held by it unless (i) the Custodian is in actual possession of such domestic securities or property and (ii) the Custodian receives Proper Instructions with regard to the exercise of any such right or power, and both (i) and (ii) occur at least three business days prior to the date on which the Custodian is to take action to exercise such right or power. The Custodian shall also transmit promptly to the Fund all written information received by the Custodian regarding any class action or other collective litigation in connection with Fund securities or other assets issued in the United States and then held, or previously held, during the
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relevant class-action period during the term of this Agreement by the Custodian for the account of the, including, but not limited to, opt-out notices and proof-of-claim forms. The Custodian will not support class-action participation by the Fund beyond such forwarding of written information received by the Custodian. For the avoidance of doubt, upon and after the effective date of any termination of this Agreement, with respect to the Fund the Custodian shall have no responsibility to so transmit any information under this Section 2.14.
Section 2.15. Provision of Information. At the request of the Fund, the Custodian shall promptly provide to the Fund all information relating to the Fund, or any of its Fund’s, cash, securities, and other assets which may be reasonably requested by the Fund in order to determine the amount to be paid to the Custodian under Section 15 hereof. Such information shall be delivered to the Fund at such time(s) and in such form(s) specified by the Fund.
Section 3. [Reserved]
Section 4. Activities of the Custodian with Respect to Property Held Outside the United States
Section 4.1. Appointment of Foreign Sub-Custodians. The Fund hereby authorizes and instructs the Custodian to employ as sub-custodians for the Fund's securities and other assets maintained outside the United States in the countries listed on Schedule A (“foreign countries”) the foreign banking institutions and foreign securities depositories designated on Schedule A hereto (“foreign sub-custodians”).
Section 4.2. Foreign Securities Systems. Except as may otherwise be agreed upon in writing by the Custodian and the Fund, assets of the Fund shall be maintained in a clearing agency which acts as a securities depository or in a book-entry system for the central handling of securities located outside the United States (each, a “Foreign Securities System”) only through arrangements implemented by the foreign banking institutions serving as sub-custodians pursuant to the terms hereof.
Section 4.4. Holding Securities. Foreign securities and other financial assets held outside of the United States shall be maintained in a Foreign Securities System in a foreign country through arrangements implemented by the Custodian or foreign sub-custodian, as applicable, in the foreign country. The Custodian shall identify on its books as belonging to the Fund the foreign securities and other financial assets held by each foreign sub-custodian or Foreign Securities System. The Custodian may hold foreign securities and other financial assets for all of its customers, including the Fund, with any foreign sub-custodian in an account that is identified as the Custodian’s account for the benefit of its customers; provided however, that (a) the records of the Custodian with respect to foreign securities or other financial assets of the Fund maintained in the account shall identify those securities and other financial assets as belonging to the Fund and (b) to the extent permitted and customary in the market in which the account is maintained, the Custodian shall require that securities and other financial assets so held by the foreign sub-custodian be held separately from any assets of the foreign sub-custodian or of other customers of the foreign sub-custodian.
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Section 4.4. Registration of Foreign Securities. Foreign securities and other financial assets held outside of the United States maintained in the custody of foreign sub-custodian and that are not bearer securities shall be registered in the name of the Fund or in the name of the Custodian or in the name of any foreign sub-custodian or in the name of any nominee of any of the foregoing. The Fund agrees to hold any such nominee harmless from any liability as a holder of record of the foreign securities or other financial assets. The Custodian or foreign sub-custodian reserves the right not to accept securities or other financial assets on behalf of the Fund under the terms of this Agreement unless the form of the securities or other financial assets and the manner in which they are delivered are in accordance with local market practice.
Section 4.5 Agreements with Foreign Banking Institutions. The Custodian shall use commercially reasonable efforts to require that each agreement with a foreign banking institution employed as a foreign sub-custodian shall provide that: (a) the Fund's assets will not be subject to any right, charge, security interest, lien or claim of any kind in favor of the foreign banking institution or its creditors or agent, except a claim of payment for their safe custody or administration or, in the case of cash deposits, liens or rights in favor of creditors of the foreign banking institution arising under bankruptcy, insolvency or similar laws; (b) beneficial ownership of the Fund's assets will be freely transferable without the payment of money or value other than for custody or administration; (c) adequate records will be maintained identifying the assets as belonging to the Fund; (d) officers of (references to officers and/or trustees of the Fund as used herein shall be deemed to include officers and/or trustees/directors of the Sponsor) or auditors employed by, or other representatives of the Fund, including to the extent permitted under applicable law the independent public accountants for the Fund, will be given access to the books and records of the foreign banking institution relating to its actions under its agreement with the Custodian; and (e) assets of the Fund held by the foreign sub-custodian will be subject only to the instructions of the Custodian or its agents.
Section 4.6 Access of Independent Accountants of the Fund. Upon request of the Fund, the Custodian will use commercially reasonable efforts to arrange for the independent accountants of the Fund to be afforded access to the books and records of any foreign banking institution employed as a foreign sub-custodian insofar as such books and records relate to the performance of such foreign banking institution under its agreement with the Custodian.
Section 4.7. Reports by Custodian. The Custodian will supply to the Fund from time to time, as mutually agreed upon, statements in respect of the securities and other assets of the Fund held by foreign sub-custodians, including but not limited to an identification of entities having possession of the Fund's foreign securities and other assets and advices or notifications of any transfers of securities to or from each custodial account maintained by a foreign banking institution for the Custodian on behalf of the Fund indicating, as to foreign securities acquired for the Fund, the identity of the entity having physical possession of such securities.
Section 4.8 Bank Accounts.
4.8.1 General. The Custodian shall identify on its books as for the account of the Fund the amount of cash (including cash denominated in foreign currencies) deposited with the Custodian. The Custodian shall maintain cash deposits in on book currencies on its balance sheet.
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The Custodian shall be liable for such balances. If the Custodian is unable to maintain, or market practice does not facilitate the maintenance for the Fund of a cash balance in a currency as an on book currency, a deposit account shall be opened and maintained by the Custodian outside the United States on behalf of the Fund with foreign sub-custodian. The Custodian shall not maintain the cash deposit on its balance sheet. The foreign sub-custodian will be liable for such balance directly to the Fund. All deposit accounts referred to in this Section shall be subject only to draft or order by the Custodian or, if applicable, the foreign sub-custodian acting pursuant to the terms of this Agreement. Cash maintained in a deposit account and denominated in an “on book” currency will be maintained under and subject to the laws of The Commonwealth of Massachusetts. The Custodian will not have any deposit liability for deposits in any currency that is not an “on book” currency.
4.8.2 Non-U.S. Branch and Non-U.S. Dollar Deposits. In accordance with the laws of the Commonwealth of Massachusetts, the Custodian shall not be required to repay any deposit made at a non-U.S. branch of the Custodian or any deposit made with the Custodian and denominated in a non-U.S. dollar currency, if repayment of the deposit or the use of assets denominated in the non-U.S. dollar currency is prevented, prohibited or otherwise blocked due to (a) an act of war, insurrection or civil strife; (b) any action by a non-U.S. government or instrumentality or authority asserting governmental, military or police power of any kind, whether such authority be recognized as a de facto or a de jure government, or by any entity, political or revolutionary movement or otherwise that usurps, supervenes or otherwise materially impairs the normal operation of civil authority; or (c) the closure of a non-U.S. branch in order to prevent, in the reasonable judgment of the Custodian, harm to the employees or property of the Custodian.
Section 4.9. Collection of Income. The Custodian shall use reasonable commercial efforts to collect all income and other payments with respect to the Foreign Assets held hereunder to which the Fund shall be entitled. If extraordinary measures are required to collect the income or payment, the Fund and the Custodian shall consult as to such measures and as to the compensation and expenses of the Custodian relating to such measures. The Custodian shall credit income to the Company as such income is received or in accordance with the Custodian’s then current payable date income schedule. Any credit to the Company in advance of receipt may be reversed when the Custodian determines that payment will not occur in due course, and the Company may be charged at the Custodian’s applicable rate for time credited. Income on securities or other financial assets loaned other than from the Custodian’s securities lending program shall be credited as received.
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Section 4.10. Transactions in Foreign Custody Account.
4.10.1 Delivery Out. The Custodian or a foreign sub-custodian shall release and deliver foreign securities or other financial assets held outside of the United States owned by the Fund and held by the Custodian or such foreign sub-custodian, or in a Foreign Securities System account, only upon receipt of Proper Instructions, specifying the foreign securities to be delivered and the person or persons to whom delivery is to be made. The Custodian shall pay out, or direct the respective foreign sub-custodian or the respective Foreign Securities System to pay out, cash of the Fund only upon receipt of Proper Instructions specifying the amount of the payment and the person or persons to payment is to be made.
4.10.2 Market Conditions. Notwithstanding any provision of this Agreement to the contrary, settlement and payment for Foreign Assets received for the account of the Fund and delivery of Foreign Assets maintained for the account of the Fund may be effected in accordance with the customary established securities trading or processing practices and procedures in the country or market in which the transaction occurs, including, without limitation, delivering Foreign Assets to the purchaser thereof or to a dealer therefor (or an agent for such purchaser or dealer) with the expectation of receiving later payment for the Foreign Assets from such purchaser or dealer.
Section 4.11 Shareholder or Bondholder Rights. The Custodian shall use reasonable commercial efforts to facilitate the exercise of voting and other shareholder and bondholder rights with respect to foreign securities and other financial assets held outside the United States, subject always to the laws, regulations and practical constraints that may exist in the country where the securities or other financial assets are issued. The Custodian may utilize Broadridge Financial Solutions, Inc. or another proxy service firm of recognized standing as its delegate to provide proxy services for the exercise of shareholder and bondholder rights. Local conditions, including lack of regulation, onerous procedural obligations, lack of notice and other factors may have the effect of severely limiting the ability of the Fund to exercise shareholder and bondholder rights.
Section 4.12. Communications. The Custodian shall transmit promptly to the Fund written information with respect to materials received by the Custodian through foreign sub-custodian from issuers of the foreign securities and other financial asset assets being held outside the United States for the account of the Fund. The Custodian shall transmit promptly to the Fund written information with respect to materials so received by the Custodian from issuers of foreign securities whose tender or exchange is sought or from the party or its agent making the tender or exchange offer. The Custodian shall also transmit promptly to the Fund all written information received by the Custodian through foreign sub-custodian from issuers of the foreign securities or other financial assets issued outside of the United States and being held for the account of the Fund regarding any class action or other collective litigation relating to the Fund’s foreign securities or other financial assets issued outside the United States and then held, or previously held, during the relevant class-action period during the term of this Agreement by the Custodian via a foreign sub-custodian for the account of the Fund, including, but not limited to, opt-out notices and proof-of-claim forms. The Custodian does not support class-action participation by the Fund beyond such forwarding of written information received by the Custodian.
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Section 5. Contractual Settlement Services (Purchase / Sales)
Section 5.1 The Custodian shall, in accordance with the terms set out in this section, debit or credit the appropriate cash account of theFund in connection with (i) the purchase of securities for theFund, and (ii) proceeds of the sale of securities held on behalf of the Fund, on a contractual settlement basis.
Section 5.2 The services described above (the “Contractual Settlement Services”) shall be provided for such instruments and in such markets as the Custodian may advise from time to time. The Custodian may terminate or suspend any part of the provision of the Contractual Settlement Services under this Agreement at its sole discretion immediately upon notice to the, including, without limitation, in the event of force majeure events affecting settlement, any disorder in markets, or other changed external business circumstances affecting the markets or the Fund, provided that the Custodian shall be acting within the standard of care set forth in Section 16.1.
Section 5.3 The consideration payable in connection with a purchase transaction shall be debited from the appropriate cash account of the Fund as of the time and date that monies would ordinarily be required to settle such transaction in the applicable market. The Custodian shall promptly recredit such amount at the time that the Fund or the Fund notifies the Custodian by Proper Instruction that such transaction has been canceled.
Section 5.4 With respect to the settlement of a sale of securities, a provisional credit of an amount equal to the net sale price for the transaction (the “Settlement Amount”) shall be made to the account of the Fund as if the Settlement Amount had been received as of the close of business on the date that monies would ordinarily be available in good funds in the applicable market. Such provisional credit will be made conditional upon the Custodian having received Proper Instructions with respect to, or reasonable notice of, the transaction, as applicable; and the Custodian or its agents having possession of the asset(s) (which shall exclude assets subject to any third party lending arrangement entered into by a Fund) associated with the transaction in good deliverable form and not being aware of any facts which would lead them to believe that the transaction will not settle in the time period ordinarily applicable to such transactions in the applicable market.
Section 5.5. Simultaneously with the making of such provisional credit, the Fund agrees that the Custodian shall have, and hereby grants to the Custodian, a security interest in any property at any time held for the account of the Fund to the full extent of the credited amount, and each Fund hereby pledges, assigns and grants to the Custodian a continuing security interest and a lien on any and all such property under the Custodian’s possession, in accordance with the terms of this Agreement. In the event that the Fund fails to promptly repay any provisional credit, the Custodian shall have all of the rights and remedies of a secured party under the Uniform Commercial Code of The Commonwealth of Massachusetts.
Section 5.6 The Custodian shall have the right to reverse any provisional credit or debit given in connection with the Contractual Settlement Services at any time when the Custodian believes, in its reasonable judgment, that such transaction will not settle in accordance with its terms or amounts due pursuant thereto, will not be collectable or where the Custodian has not been provided Proper Instructions with respect thereto, as applicable, and the Fund shall be responsible
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for any costs or liabilities resulting from such reversal. Upon such reversal, a sum equal to the credited or debited amount shall become immediately payable by the Fund to the Custodian and may be debited from any cash account held for benefit of the Fund.
Section 5.7 In the event that the Custodian is unable to debit an account of the Fund, and the Fund fails to pay any amount due to the Custodian at the time such amount becomes payable in accordance with this Agreement, (i) the Custodian may charge the Fund for reasonable costs and expenses associated with providing the provisional credit, including without limitation the cost of funds associated therewith, (ii) the amount of any accrued dividends, interest and other distributions with respect to assets associated with such transaction may be set off against the credited amount, (iii) the provisional credit and any such costs and expenses shall be considered an advance of cash for purposes of the Agreement and (iv) the Custodian shall have the right to setoff against any property and to sell, exchange, convey, transfer or otherwise dispose of any property at any time held for the account of the Fund to the full extent necessary for the Custodian to make itself whole.
Section 6. Foreign Exchange.
Section 6.1. Generally. Upon receipt of Proper Instructions, which for purposes of this section may also include security trade advices, the Custodian shall facilitate the processing and settlement of foreign exchange transactions. Such foreign exchange transactions do not constitute part of the services provided by the Custodian under this Agreement.
Section 6.2. Fund Elections. The Fund (or its Sponsor acting on its behalf) may elect to enter into and execute foreign exchange transactions with third parties that are not affiliated with the Custodian, with State Street Global Markets, which is the foreign exchange division of State Street Bank and Trust Fund and its affiliated companies (“SSGM”), or with a sub-custodian. Where the Fund or its Sponsor gives Proper Instructions for the execution of a foreign exchange transaction using an indirect foreign exchange service described in the Client Publications, the Fund (or its Sponsor) instructs the Custodian, on behalf of the Fund, to direct the execution of such foreign exchange transaction to SSGM or, when the relevant currency is not traded by SSGM, to the applicable sub-custodian. The Custodian shall not have any agency (except as contemplated in preceding sentence), trust or fiduciary obligation to the Fund, its Sponsor or any other person in connection with the execution of any foreign exchange transaction. The Custodian shall have no responsibility under this Agreement for the selection of the counterparty to, or the method of execution of, any foreign exchange transaction entered into by the Fund (or its Sponsor acting on its behalf) or the reasonableness of the execution rate on any such transaction.
Section 6.3. Fund Acknowledgement The Fund acknowledges that in connection with all foreign exchange transactions entered into by the Fund (or its Sponsor acting on its behalf) with SSGM or any sub-custodian, SSGM and each such sub-custodian:
| (i) | shall be acting in a principal capacity and not as broker, agent or fiduciary to the Fund or its Sponsor; |
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| (ii) | shall seek to profit from such foreign exchange transactions, and are entitled to retain and not disclose any such profit to the Fund or its Sponsor; and |
| (iii) | shall enter into such foreign exchange transactions pursuant to the terms and conditions, including pricing or pricing methodology, (a) agreed with the Fund or its Sponsor from time to time or (b) in the case of an indirect foreign exchange service, (i) as established by SSGM and set forth in the Client Publications with respect to the particular foreign exchange execution services selected by the Fund or the Sponsor or (ii) as established by the sub-custodian from time to time. |
Section 6.4. Transactions by State Street. The Custodian or its affiliates, including SSGM, may trade based upon information that is not available to the Fund (or its Sponsor acting on its behalf), and may enter into transactions for its own account or the account of clients in the same or opposite direction to the transactions entered into with the Fund (or its Sponsor), and shall have no obligation, under this Agreement, to share such information with or consider the interests of their respective counterparties, including, where applicable, the Fund or the Sponsor.
Section 7. Payments for Sales or Repurchases or Redemptions of Shares
The Custodian shall receive from the distributor of the Shares or from the Fund’s transfer agent (the “Transfer Agent”), as the case may be, and deposit into the account of the appropriate Fund such payments as are received for Shares, in Basket aggregations, thereof issued or sold from time to time by the Fund. The Custodian will provide timely notification to the Fund and the Transfer Agent of any receipt by it of payments for shares of such Fund.
From such funds and securities as may be available for the purpose, the Custodian shall, upon receipt of instructions from the Transfer Agent, make funds and securities available for payment to, or in accordance with the instructions of, Authorized Participants (as defined in the Prospectus) who have delivered to the Transfer Agent proper instructions for the redemption or repurchase of their shares, in Basket aggregations, which shall have been accepted by the Transfer Agent, the applicable Fund Securities (as defined in the Prospectus) (or such securities in lieu thereof as may be designated by the Sponsor of the Fund in accordance with the Prospectus) for such Fund and the Cash Redemption Amount (as defined in the Prospectus), if applicable, less any applicable Redemption Transaction Fee (as defined in the Prospectus). The Custodian will transfer the applicable Fund Securities to or on the order of the Authorized Participant. Any cash redemption payment (less any applicable Redemption Transaction Fee) due to the Authorized Participant on redemption shall be effected through the DTC (as defined in the Prospectus) system or through wire transfer in the case of redemptions effected outside of the DTC system.
Section 8. Proper Instructions
“Proper Instructions,” which may also be standing instructions, shall mean instructions received by the Custodian from the Fund or its Sponsor or a person or entity duly authorized by either of them. Such instructions may be in writing signed by the authorized person or persons or may be in a tested
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communication or in a communication utilizing access codes effected between electro-mechanical or electronic devices or may be by such other means and utilizing such intermediary systems and utilities as may be agreed from time to time by the Custodian and the person(s) or entity giving such instruction, provided that the Fund has followed any security procedures agreed to from time to time by the Fund and the Custodian including, but not limited to, the security procedures selected by the Fund via the form of Funds Transfer Addendum hereto, the terms of which are hereby agreed to. The Custodian may agree to accept oral instructions, and in such case oral instructions will be considered Proper Instructions. The Fund shall cause all oral instructions to be confirmed in writing. The Custodian shall be entitled conclusively to rely and act upon Proper Instructions until the Custodian has received notice of any change from the Fund and has had a reasonable time to implement such change. The Custodian may act on a Proper Instruction if it reasonably believes it contains sufficient information, and may refrain from acting on any Proper Instructions until such time that it has determined, in its sole discretion, that is has received any required clarification and/or authentication of Proper Instructions, provided the Custodian shall be acting within the standard of care set forth in Section 16.1. The Custodian may rely upon and shall be protected in acting upon any instructions, notice, request, consent, certificate or other instrument or paper believed by it in good faith to be genuine and to have been properly executed by or on behalf of the Fund.
If the Custodian is not provided with reasonable time to execute a Proper Instruction (including any Proper Instruction not to execute, or any other modification to, a prior Proper Instruction) the Custodian will use good faith efforts to execute the Proper Instruction but will not be responsible or liable if such efforts are not successful (including any inability to change any actions that the Custodian had taken pursuant to the prior Proper Instruction) provided that the Custodian has acted within the standard of care set forth in Section 16.1. The inclusion of a statement of purpose or intent (or any similar notation) in a Proper Instruction shall not impose any additional obligations on the Custodian or condition or qualify its authority to effect such Proper Instruction. The Custodian will not assume a duty to ensure that the stated purpose or intent is fulfilled, and will have no responsibility or liability when it follows the Proper Instruction without regard to such purpose or intent provided that the Custodian has acted within the standard of care set forth in Section 16.1.
Concurrently with the execution of this Agreement, and from time to time thereafter, as appropriate, the Fund shall deliver to the Custodian an officer’s certificate setting forth the names, titles, signatures and scope of authority of all persons authorized to give Proper Instructions or any other notice, request, direction, instruction, certificate or instrument on behalf of the Fund. Such certificate may be accepted and conclusively relied upon by the Custodian and shall be considered to be in full force and effect until receipt by the Custodian of a similar certificate to the contrary.
Section 9. [Reserved]
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Section 10. Actions Permitted without Express Authority
The Custodian may in its discretion, without express authority from the,but otherwise acting within the standard of care set forth in Section 16.1:
| 1) | Make payments to itself or others for minor expenses of handling securities or other similar items relating to its duties under this Agreement; provided that all such payments shall be accounted for to the Fund; |
| 2) | Surrender securities in temporary form for securities in definitive form; |
| 3) | Endorse for collection, in the name of the Fund, checks, drafts and other negotiable instruments; and |
| 4) | In general, attend to all non-discretionary details in connection with the sale, exchange, substitution, purchase, transfer and other dealings with the securities and property of the Fund except as otherwise directed by the Fund. |
| Section 11. | Duties of Custodian with Respect to the Books of Account and Calculation of Net Asset Value and Net Income |
The Custodian shall cooperate with and supply necessary information to the entity or entities appointed by the Fund or Sponsor on the Fund’s behalf to keep the books of account of each Fund and/or compute the net asset value per share of the outstanding shares or, if directed in writing to do so by the Fund on behalf of a Fund, shall itself keep such books of account and/or compute such net asset value per share. The Custodian shall transmit the net asset value per share of theFund to the Transfer Agent, the Distributor, the NYSE and such other entities as directed in writing by the Fund. If and as so directed, the Custodian shall also calculate daily the net income of the Fund as described in the Prospectus and shall advise the Fund and the Transfer Agent daily of the total amounts of such net income and, if instructed in writing by an officer of the Fund to do so, shall advise the Transfer Agent periodically of the division of such net income among its various components. The calculations of the net asset value per Share and the daily income of the Fund shall be made at the time or times described from time to time in the Prospectus. The Custodian shall on each day a Fund is open for the purchase or redemption of shares of the Fund compute the number of shares of each Deposit Security (as defined in the Prospectus) to be included in the current Fund Deposit (as defined in the Prospectus) and the Fund Securities (as defined in the Prospectus) and shall transmit such information to the NSCC.
The Fund acknowledges and agrees that, with respect to investments maintained with the Underlying Transfer Agent, the Underlying Transfer Agent is the sole source of information on the number of shares of a fund held by it on behalf of the Fund and that the Custodian has the right to rely on holdings information furnished by the Underlying Transfer Agent to the Custodian in performing its duties under this Agreement, including without limitation, the duties set forth in this Section 11 and in Section 12 hereof; provided, however, that the Custodian shall be obligated to reconcile information as to purchases and sales of Underlying Shares contained in trade instructions and confirmations received by the Custodian and to report promptly any discrepancies to the Underlying Transfer Agent.
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Section 12. Records
The Custodian shall with respect to the Fund create and maintain all records relating to its activities and obligations under this Agreement. All such records shall be the property of the Fund, copies shall be furnished promptly to the Fund or any successor custodian upon request and shall at all times during the regular business hours of the Custodian be open for inspection by duly authorized officers, employees or agents of the Fund and employees and agents of the SEC. The Custodian shall, at the Fund’s request, supply the Fund with a tabulation of securities owned by the Fund and held by the Custodian and shall, when requested to do so by the Fund and for such compensation as shall be agreed upon between the Fund and the Custodian, include certificate numbers in such tabulations. In the event that the Custodian is requested or authorized by the Fund, or required by subpoena, administrative order, court order or other legal process, applicable law or regulation, or required in connection with any investigation, examination or inspection of the Fund by state or federal regulatory agencies, to produce the records of the Fund or the Custodian’s personnel as witnesses or deponents, the Fund agrees to pay the Custodian for the Custodian’s time and reasonable expenses, as well as the reasonable fees and expenses of the Custodian’s counsel, incurred in such production.
Section 13. Opinion of Fund’s Independent Accountant
The Custodian shall cooperate reasonably with the the Fund’s independent accountants.
Section 14. Reports to Fund by Independent Public Accountants
The Custodian shall provide the Fund at such times as the Fund may reasonably require, with reports by independent public accountants on the accounting system, internal accounting control and procedures for safeguarding securities, futures contracts and options on futures contracts, including securities deposited and/or maintained in a U.S. Securities System or a Foreign Securities System (either, a “Securities System”), relating to the services provided by the Custodian under this Agreement; such reports, shall be of sufficient scope and in sufficient detail, as may reasonably be required by the Fund to provide reasonable assurance that any material inadequacies would be disclosed by such examination, and, if there are no such inadequacies, the reports shall so state.
Section 15. Compensation of Custodian
The Custodian shall be entitled to reasonable compensation for its services and reasonable expenses as Custodian, as agreed upon from time to time between the Fund and the Custodian.
Section 16. Responsibility of Custodian
Section 16.1 Standard of Care. In performing the services hereunder, the Custodian shall act without negligence, willful misconduct, willful misfeasance, fraud, bad faith, reckless disregard of its duties and obligations under this Agreement and with the reasonable care, prudence,
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diligence, and skill that may be reasonably expected of a leading provider of custody services in carrying out all of its duties and obligations under this Agreement. The Custodian shall be kept indemnified by and shall be without liability to the Fund for any action taken or omitted by it in good faith without negligence; provided that, the Custodian shall not be indemnified against any liability (or any expenses incident to such liability) arising out of the Custodian’s failure to exercise its standard of care set out in this Section 16.1.
Except as may arise from the Custodian’s failure to exercise its standard of care, the Custodian shall be without liability to the Fund for any loss or expense resulting from or caused by: (i) events or circumstances beyond the reasonable control of the Custodian or any sub-custodian or Securities System or any agent or nominee of any of the foregoing, including, without limitation, the interruption, suspension or restriction of trading on or the closure of any securities market, power or other mechanical or technological failures or interruptions, computer viruses or communications disruptions, work stoppages, natural disasters, or other similar events or acts; (ii) errors by the Fund or its duly authorized investment manager or Sponsor in their instructions to the Custodian provided such instructions have been in accordance with this Agreement; (iii) any delay or failure of any broker, agent or intermediary, central bank or other commercially prevalent payment or clearing system to deliver to the Custodian’s sub-custodian or agent securities purchased or in the remittance or payment made in connection with securities sold; (iv) any delay or failure of any company, corporation, or other body in charge of registering or transferring securities in the name of the Custodian, the Fund, the Custodian’s sub-custodians, nominees or agents or any consequential losses arising out of such delay or failure to transfer such securities including non-receipt of bonus, dividends and rights and other accretions or benefits; (v) delays or inability to perform its duties due to any disorder in market infrastructure with respect to any particular security or Securities System; and (vi) any provision of any present or future law or regulation or order of the United States of America, or any state thereof, or any foreign country, or political subdivision thereof or of any court of competent jurisdiction. The Custodian shall be without liability to the Fund for any loss or expense resulting from or caused by anything that is part of Country Risk.
Section 16.2 Disaster Recovery/Business Continuity. The Custodian shall, at no additional expense to the Fund, take reasonable steps to minimize service interruptions in the event of equipment failure, work stoppage, governmental action, communication disruption or other impossibility of performance beyond the Custodian’s control. The Custodian shall enter into and shall maintain in effect at all times during the term of this Agreement with appropriate parties one or more agreements making reasonable provision for (i) periodic back-up of the computer files and data with respect to the Fund and (ii) emergency use of electronic data processing equipment to provide services under this Agreement. Upon reasonable request, the Custodian shall discuss with the Fund any business continuity/disaster recovery plan of the Custodian and/or provide a high-level presentation summarizing such plan. The Custodian represents that its business continuity plan is appropriate for its business as a provider of custodian services to a registered commodity pool.
Section 16.3 Special or Consequential Damages. Notwithstanding anything contained herein to the contrary, neither party shall be liable for any indirect, special or consequential damages; provided that the foregoing limitation shall not apply with respect to damages or claims arising out of or relating to that party’s fraud or willful misconduct.
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Section 16.4 Payment of Money. If the Fund requires the Custodian to take any action with respect to securities, which action involves the payment of money or which action may, in the opinion of the Custodian, result in the Custodian or its nominee assigned to the Fund being liable for the payment of money or incurring liability of some other form, the Fund, as a prerequisite to requiring the Custodian to take such action, shall provide indemnity to the Custodian in an amount and form satisfactory to it.
Section 16.5 Mitigation by Custodian. Upon the occurrence of any event which causes or may cause any loss, damage or expense to the Fund, (i) the Custodian shall promptly notify the Fund of the occurrence of such event, (ii) the Custodian shall cause any applicable sub-custodian to, and (iii) the Custodian shall use its best efforts to cause any applicable sub-custodian or Eligible Securities Depository to, use all commercially reasonable efforts and take all reasonable steps under the circumstances to mitigate the effects of such event and to avoid continuing harm to the Fund.
Section 16.6. Advice of Counsel. The Custodian shall be entitled to rely on and may act upon advice of counsel (who may be counsel for the Fund) on all matters, and shall be without liability for any action reasonably taken or omitted pursuant to such advice provided however, with respect to the performance of any action or omission of any action upon such advice, the Custodian shall be acting within the standard of care set forth in Section 16.1. The Custodian shall promptly notify the Fund of the receipt of such advice.
Section 16.7. Lien If the Custodian, its affiliates, subsidiaries or agents advances cash or securities to the Fund for any purpose (including but not limited to securities settlements, foreign exchange contracts and assumed settlement), or in the event that the Custodian or its nominee shall incur or be assessed any taxes, charges, expenses, assessments, claims or liabilities in connection with the performance of this Agreement, except such as may arise from its or its nominee’s own negligent action, negligent failure to act or willful misconduct, or if the Fund fails to compensate the Custodian pursuant to Section 15 hereof, any property at any time held for the account of the Fund shall be security therefor and should the Fund fail to pay or reimburse the Custodian promptly, the Custodian shall be entitled to utilize available cash and to dispose of such Fund’s assets to the extent necessary to obtain payment or reimbursement. The Custodian may at any time decline to follow Proper Instructions to deliver out to the Fund cash or securities if the Custodian determines in its reasonable discretion that, after giving effect to the Proper Instructions, the cash or securities remaining will not have sufficient value fully to secure the Fund's payment or reimbursement obligations, whether contingent or otherwise, and Custodian shall promptly notify the Fund of such action.
Section 17. Liability of Custodian for Actions of Other Persons.
Section 17.1 Domestic Sub-Custodians, Foreign Sub-Custodians. The Custodian shall be liable for the actions or omissions of any domestic sub-custodian or any foreign sub-custodian to the same extent as if such action or omission was performed by the Custodian itself, taking into account established market practices and local laws prevailing in the jurisdiction in which the acts and omissions of such sub-custodian occur. In the event of any loss, damage or expense suffered or
| -17- |
incurred by the Fund caused by or resulting from the actions or omissions of any domestic sub-custodian or foreign sub-custodian for which the Custodian would otherwise be liable, the Custodian shall promptly reimburse the Fund in the amount of any such loss, damage or expense. The Custodian shall be without liability for any loss, damage or expense caused by or resulting from the insolvency of any domestic sub-custodian or foreign sub-custodian that is not a wholly-owned subsidiary of the Custodian; provided, however, that the foregoing exculpation of the Custodian with respect to the insolvency of a particular foreign sub-custodian shall not be applicable if the Custodian fails to comply with its obligations under this Agreement or as a Foreign Custody Manager pursuant to Rule 17f-5 with respect to such foreign sub-custodian. For the avoidance of doubt, if the Custodian has met its standard of care hereunder and has fulfilled its obligations as a Foreign Custody Manager pursuant to Rule 17f-5 with respect to a foreign sub-custodian, then the Custodian shall be without liability for any loss, damage or expense caused by or resulting from the insolvency of such foreign sub-custodian.
Section 17.2 Special Sub-Custodians And Additional Custodians. Except as otherwise provided in any sub-custodian agreement to which the Custodian, the Fund and any Special Sub-Custodian or additional custodian are parties, the Custodian shall not be liable to the Fund for any loss, damage or expense suffered or incurred by the Fund resulting from the actions or omissions of a Special Sub-Custodian or additional custodian, unless such loss, damage or expense is caused by, or arises from, the failure of the Custodian to meet its standard of care as set out in Section 16.1 of this Agreement; provided however, that in the event of any such loss, damage or expense, the Custodian shall take all reasonable steps to enforce such rights as it may have against any Special Sub-Custodian or additional custodian to protect the interests of the Fund. The Custodian shall be without liability for any loss, damage or expense caused by or resulting from the insolvency of any Special Sub-Custodian or additional custodian.
Section 17.3 Securities Systems. The Custodian shall not be liable to the Fund for any loss, damage or expense suffered or incurred by the Fund resulting from the use by the Custodian of a Securities System, unless such loss, damage or expense is caused by, or arises from the failure of the Custodian to meet its standard of care as set out in Section 16.1 of this Agreement; provided however, that in the event of any such loss, damage or expense, the Custodian shall take all reasonable steps to enforce such rights as it may have against the Securities System to protect the interests of the Fund. Notwithstanding the foregoing, the Custodian shall be without liability for any loss, damage or expense caused by or resulting from the insolvency of any Securities System.
Section 18. Effective Period, Termination and Amendment.
This Agreement shall remain in full force and effect for an initial term ending March 31, 2019 (the “Initial Term”). After the expiration of the Initial Term, this Agreement shall automatically renew for successive one-year terms (each, a “Renewal Term”) unless a written notice of non-renewal is delivered by the non-renewing party no later than ninety (90) days prior to the expiration of the Initial Term or any Renewal Term, as the case may be. During the Initial Term and thereafter, either party may terminate this Agreement: (i) in the event of the other party’s material breach of a material provision of this Agreement that the other party has either (a) failed to cure or (b) failed to establish a remedial plan to cure that is reasonably acceptable, within 60 days’ written notice of such breach,
| -18- |
(ii) in the event of the appointment of a conservator or receiver for the other party or upon the happening of a like event to the other party at the direction of an appropriate agency or court of competent jurisdiction, or (iii) based upon the Fund’s determination that there is a reasonable basis to conclude that the Custodian is insolvent or that the financial condition of the Custodian is deteriorating in any material respect.
Upon termination of this Agreement pursuant to this Section with respect to the Fund, the Fund shall pay Custodian its compensation due and shall reimburse Custodian for its costs, expenses and disbursements except, if termination is based on termination for a material breach of this Agreement coupled with the Custodian’s failure to meet its standard of care under this Agreement, less any losses or damages caused by such event.
The provisions of Sections 6, 15, 16, 17 and 22.10 of this Agreement shall survive termination of this Agreement for any reason.
This Agreement may be amended by a written agreement executed by both parties.
Section 19. Successor Custodian
If a successor custodian for the Fund shall be appointed by the Fund, the Custodian shall, upon termination, deliver to such successor custodian at the office of the Custodian, duly endorsed and in the form for transfer, all securities, funds and other properties of the Fund then held by it hereunder and shall transfer to an account of the successor custodian all of the securities of the Fund held in a Securities System or at the Underlying Transfer Agent. If directed by the Fund, the Custodian will provide the services hereunder until a replacement custodian is in place, for a reasonable period of time not to exceed nine months, subject to the terms of this Agreement, including compensation. The Custodian will also provide reasonable assistance to its successor, for such transfer, subject to the payment of such reasonable expenses and charges as the Custodian customarily charges for such assistance.
If no such successor custodian shall be appointed, the Custodian shall, in like manner, upon receipt of a Proper Instruction, deliver at the office of the Custodian and transfer such securities, funds and other properties in accordance with such Proper Instruction.
In the event that no Proper Instruction designating a successor custodian or alternative arrnagments shall have been delivered to the Custodian on or before the date when such termination shall become effective, then the Custodian shall have the right to deliver to a bank or trust company, doing business in Boston, Massachusetts, or New York, New York and providing custody services to registered commodity pools, of its own selection, all securities, funds and other properties held by the Custodian hereunder and all instruments held by the Custodian relative thereto and all other property held by it under this Agreement on behalf of the Fund, and to transfer to an account of such successor custodian all of the Fund’s securities held in any Securities System or at the Underlying Transfer Agent. Thereafter, such bank or trust company shall be the successor of the Custodian under this Agreement.
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In the event that securities, funds and other properties remain in the possession of the Custodian after the date of termination hereof owing to failure of the Fund to to provide Proper Instructions as aforesaid, the Custodian shall be entitled to fair compensation for its services during such period as the Custodian retains possession of such securities, funds and other properties and the provisions of this Agreement relating to the duties and obligations of the Custodian shall remain in full force and effect.
Section 20. Remote Access Services Addendum. The Custodian and the Fund agree to be bound by the terms of the Remote Access Services Addendum hereto.
Section 21. Loan Services Addendum. In the event the Fund directs Custodian in writing to perform loan services, Custodian and the Fund hereby agree to be bound by the terms of the Loan Services Addendum attached hereto and the Fund shall reimburse Custodian for its fees and expenses related thereto as agreed upon from time to time in writing by the Fund and Custodian.
Section 22. General.
Section 22.1 Governing Law. This Agreement shall be construed and the provisions thereof interpreted under and in accordance with laws of state of New York.
Section 22.2 Prior Agreements. This Agreement supersedes and terminates, as of the date hereof, all prior agreements between the Fund and the Custodian relating to the custody of the Fund’s assets.
Section 22.3 Assignment. This Agreement may not be assigned by (a) the Fund without the written consent of the Custodian or (b) by the Custodian without the written consent of the Fund, except that the Custodian may assign this Agreement to a successor of all or a substantial portion of its business, or to a party controlling, controlled by or under common control with the Custodian.
Section 22.4 Interpretive and Additional Provisions. In connection with the operation of this Agreement, the Custodian and the Fund, may from time to time agree on such provisions interpretive of or in addition to the provisions of this Agreement as may in their joint opinion be consistent with the general tenor of this Agreement. Any such interpretive or additional provisions shall be in a writing signed by all parties, provided that no such interpretive or additional provisions shall contravene any applicable laws or regulations or any provision of the Fund’s articles of organization and by-laws or agreement or declaration of trust, as applicable, and Prospectus (collectively, “Governing Documents”). No interpretive or additional provisions made as provided in the preceding sentence shall be deemed to be an amendment of this Agreement.
Section 22.5 Additional Funds. In the event that any commodity pool entity in addition to those listed on the Schedule A hereto desires to have the Custodian render services as custodian under the terms hereof, it shall so notify the Custodian in writing, and if the Custodian agrees in writing to provide such services, which shall not be unreasonably withheld, such commodity pool entityshall become a Fund hereunder and be bound by all terms and conditions and provisions hereof including, without limitation, the representations and warranties set forth in Section 22.6 below.
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Section 22.6 The Parties. In the case of a series corporation, trust or other entity, all references herein to the “Fund” are to the individual series or portfolio of such corporation, trust or other entity, or to such corporation, trust or other entity on behalf of the individual series or portfolio, as appropriate. Any reference in this Agreement to “the parties” shall mean the Custodian and the Fund. The Fund hereby represents and warrants that (a) it is a statutory trust, duly organized, existing and in good standing under the laws of its state of formation; (b) it has the requisite power and authority under applicable laws and by its Declaration of Trust and By-laws to enter into and perform this Agreement; (c) all requisite proceedings have been taken to authorize it to enter into and perform this Agreement; (d) it is a commodity pool that has properly registered its securities with the SEC under the applicable U.S. securities laws; (e) the Registration Statement been filed and will be effective and remain effective during the term of this Agreement; the Fund also warrants to the Custodian that as of the effective date of this Agreement, all necessary filings under the securities laws of the states in which the Trust offers or sells its shares have been made; (f) no legal or administrative proceedings have been instituted or threatened which would impair the Fund’s ability to perform its duties and obligations under this Agreement; (g) its entrance into this Agreement will not cause a material breach or be in material conflict with any other agreement or obligation of the Fund or any law or regulation applicable to it; (h) as of the close of business on the date of this Agreement, the Fund is authorized to issue unlimited shares of beneficial interest; and (i) it has all necessary right, title, intellectual property, licenses, consents and content as may be necessary for the Fund to operate as presently contemplated. The Custodian hereby represents and warrants that (a) it is a Massachusetts trust company, duly organized and existing under the laws of The Commonwealth of Massachusetts; (b) it has the organizational power and authority to carry on its business in The Commonwealth of Massachusetts; (c) all requisite organizational proceedings have been taken to authorize it to enter into and perform this Agreement; (d) no legal or administrative proceedings have been instituted or threatened which would materially impair the Custodian’s ability to perform its duties and obligations under this Agreement; (e) its entrance into this Agreement shall not cause a material breach or be in material conflict with any other agreement or obligation of the Custodian or any law or regulation applicable to it; (f) it has and will continue to have access to the necessary facilities, equipment and personnel to perform its duties and obligations under this Agreement; (g) it will promptly notify the Fund in the event that the Custodian is for any reason unable to perform any of its obligations under this Agreement;(h) it will promptly notify the Fund, except as may be prohibited by applicable law, of any legal, regulatory or administrative proceedings that have been instituted, which would materially impair the Custodian’s ability to perform its duties and obligations under this Agreement; and (i) the various procedures and systems which it has implemented with regard to safeguarding from loss or damage attributable to fire, theft or any other cause, the Fund’s records and other data and the Custodian’s records, data equipment facilities and other property used in the performance of its obligations hereunder are adequate and it will make such changes therein from time to time as it may deem reasonably necessary for the secure performance of its obligations hereunder. Each of the Fund and the Custodian further represents and warrants that it will promptly notify the other party if any of the above representations and warranties applicable to it ceases to be true or if it is unable to perform its obligations under this Agreement for any reason.
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Section 22.7 Notices. All notices, requests, claims, demands and other communications required or permitted to be given under this agreement shall be in writing and shall be delivered by hand or sent by an internationally recognized overnight courier service with signature required for delivery, by facsimile where a confirmation of receipt is obtained, provided, however, that if sent by facsimile the written communication must also be sent by next business day delivery via an internationally recognized overnight courier service with signature required for delivery, or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties hereto at the following addresses:
| To the Fund: | WisdomTree Commodity Pool |
| 245 Park Avenue, 35th Floor | |
| New York, NY 10167 | |
| Attn: Legal Department | |
| Facsimile: 917-267-3851 | |
| To the Custodian: | State Street Bank and Trust Company |
| 1200 Crown Colony Drive | |
| Quincy, MA 02169 | |
| Attention: Matthew H. Malkasian | |
| Telephone: 617-537-4685 | |
| Facsimile: 617-451-4786 | |
| with a copy to: | State Street Bank and Trust Company |
| 2 Avenue de Lafayette | |
| Boston, MA 02111 | |
| Attention: US Investor Services Legal Team, Senior Managing Counsel | |
| Telephone: (617) 662-1783 | |
| Facsimile: (617) 662-2702 |
All such communications so addressed shall be deemed given (i) when delivered, if delivered personally to the intended recipient, or if sent by an internationally recognized courier service with signature required for delivery, or if sent by facsimile and a confirmation of receipt is obtained, and the written communication has also be sent for next business day delivery via a internationally recognized courier service with signature required for delivery (ii) three business days after being mailed if sent by certified or registered mail, postage prepaid, return receipt requested, or upon delivery if actual delivery occurs earlier.
Section 22.8 Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, and all such counterparts taken together shall constitute one and the same Agreement. Counterparts may be executed in either original or electronically transmitted form (e.g., faxes or emailed portable document format (PDF) form), and the parties hereby adopt as original any signatures received via electronically transmitted form.
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Section 22.9 Severability. If any provision or provisions of this Agreement shall be held to be invalid, unlawful or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired. The failure of a party hereto to insist upon strict adherence to any term of this Agreement on any occasion or the failure of a party hereto to exercise or any delay in exercising any right or remedy under this Agreement shall not constitute a waiver of any such term, right or remedy or a waiver of any other rights or remedies, and no single or partial exercise of any right or remedy under this Agreement shall prevent any further exercise of the right or remedy or the exercise of any other right or remedy. Any waiver must be in writing signed by the waiving party.
Section 22.10 Confidentiality. The parties hereto agree that each shall treat confidentially all information provided by each party to the other party regarding its business and operations, including information related to the development of new Funds(“Confidential Information”). All Confidential Information provided by a party hereto shall be used by any other party hereto solely for the purpose of rendering or receiving services pursuant to this Agreement and, except as may be required in carrying out this Agreement, shall not be disclosed to any third party. The foregoing shall not be applicable to any information (i) that is publicly available when provided or thereafter becomes publicly available, other than through a breach of this Agreement, (ii) that is independently derived by any party hereto without the use of any information provided by the other party hereto in connection with this Agreement, (iii) that is disclosed, upon prior notice to the party whose information is being disclosed (to the extent that such notice is permissible), in the manner and to the extent required in any legal or regulatory proceeding, investigation, audit, examination, subpoena, civil investigative demand or other similar process, or by operation of law or regulation, or (iv) where the party seeking to disclose has received the prior written consent of the party providing the information, which consent shall not be unreasonably withheld. Notwithstanding anything herein to the contrary, the Custodian and its affiliates may report and use nonpublic portfolio holdings information of its clients, including the Fund, on an aggregated basis with all or substantially all other client information and without specific reference to any Fund, provided that the Custodian shall be acting within the standard of care set forth in Section 16.1. Notwithstanding the foregoing, each party acknowledges that the other party may provide access to and use of confidential information relating to the other party to the disclosing party’s employees, affiliates, contractors, agents, professional advisors, auditors or persons performing similar functions, as necessary solely for the purpose of rendering services under this Agreement , provided that each person or entity shall be subject to confidentiality obligations substantially similar to those set forth herein. Further, each party agrees and represents that in no case would information it receives under this Agreement be used against the other party in a manner that is adverse to the other party’s interests (including the other party’s interests in competitive businesses). Nothing herein shall prohibit or restrict the right of each party (or its affiliates) to develop, use or market products or services similar to or competitive with those of the other party (or its affiliates) provided that any such development, use or marketing does not violate the confidentiality obligations set forth herein. Additionally, each party acknowledges that the other party (or its affiliates) may already possess or have developed products or services similar to or competitive with those of the other party.
The Custodian will employ reasonable safeguards designed to protect the Fund’s Confidential Information, which may include but are not limited to the use of encryption
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technologies, passwords and any other safeguards the Custodian may choose to employ. To the extent that Custodian’s affiliates or other permitted agents or subcontractors have access to Confidential Information, Custodian shall require that such entities are subject to terms governing confidentiality and security of such information that are substantially similar to those set forth in this Agreement. At all times, Custodian shall remain responsible and liable for such entities’ compliance with the terms of Section 22.13.
Custodian agrees to notify promptly the Fund of any breach of this Section 22.10 or Section 22.13 and to provide the Fund with details as to the nature and extent of the breach, including, but not limited to, the type of confidential or personal information disclosed and the identity of the recipients of such information.
To the extent reasonably possible, shareholder information made available to third parties by Custodian will be provided on a non-disclosed basis (that is, without information disclosing the identity of the shareholder).
Section 22.11 Reproduction of Documents. This Agreement and all schedules, addenda, exhibits, appendices, attachments and amendments hereto may be reproduced by any photographic, photostatic, microfilm, micro-card, miniature photographic or other similar process. The parties hereto all/each agree that any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding, whether or not the original is in existence and whether or not such reproduction was made by a party in the regular course of business, and that any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence.
Section 22.12 Regulation GG. The Fund hereby represents and warrants that it does not engage in an “Internet gambling business,” as such term is defined in Section 233.2(r) of Federal Reserve Regulation GG (12 CFR 233) (“Regulation GG”). The Fund hereby covenants that it shall not engage in an Internet gambling business. In accordance with Regulation GG, the Fund is hereby notified that “restricted transactions,” as such term is defined in Section 233.2(y) of Regulation GG, are prohibited in any dealings with the Custodian pursuant to this Agreement or otherwise between or among any party hereto.
Section 22.13 Data Privacy. The Custodian will implement and maintain a written information security program that contains appropriate security measures to safeguard the personal information of the Fund’s shareholders, employees, directors and/or officers that the Custodian receives, stores, maintains, processes or otherwise accesses in connection with the provision of services hereunder. For these purposes, “personal information” shall mean (i) an individual’s name (first initial and last name or first name and last name), address or telephone number plus (a) Social Security number, (b) driver’s license number, (c) state identification card number, (d) debit or credit card number, (e) financial account number or (f) personal identification number or password that would permit access to a person’s account, or (ii) any combination of the foregoing that would allow a person to log onto or access an individual’s account. Notwithstanding the foregoing “personal information” shall not include information that is lawfully obtained from publicly available
| -24- |
information, or from federal, state or local government records lawfully made available to the general public.
Section 22.14 Shareholder Communications Election. SEC Rule 14b-2 requires banks which hold securities for the account of customers to respond to requests by issuers of securities for the names, addresses and holdings of beneficial owners of securities of that issuer held by the bank unless the beneficial owner has expressly objected to disclosure of this information. In order to comply with the rule, as may be applicable, the Custodian needs the Fund to indicate whether it authorizes the Custodian to provide the Fund’s name, address, and share position to requesting companies whose securities the Fund owns. If the Fund tells the Custodian “no,” the Custodian will not provide this information to requesting companies. If the Fund tells the Custodian “yes” or does not check either “yes” or “no” below, the Custodian is required by the rule, as applicable, to treat the Fund as consenting to disclosure of this information for all securities owned by the Fund or any funds or accounts established by the Fund. For the Fund’s protection, the rule, as applicable, prohibits the requesting company from using the Fund’s name and address for any purpose other than corporate communications. Please indicate below whether the Fund consents or objects by checking one of the alternatives below.
| YES ¨ | The Custodian is authorized to release the Fund’s name, address, and share positions. |
| NO x | The Custodian is not authorized to release the Fund’s name, address, and share positions. |
Section 22.15. Limitation of Liability of the Trustees and Shareholders. This Agreement is executed by the Sponsor on behalf of the Fund and the obligations hereunder are not binding upon any of the directors/trustees, officers or shareholders of the Fund (or its Sponsor) individually. Notwithstanding any other provision in this Agreement to the contrary, each and every obligation, liability or undertaking of the Fund under this Agreement shall constitute solely an obligation, liability or undertaking of, and be binding upon, the Fund and shall be payable solely from the available assets of such Fund and shall not be binding upon or affect any assets of any other Fund (or its Sponsor).
Section 22.16. Insurance. The Custodian shall at all times during the term of this Agreement maintain, at its cost, insurance coverage regarding its business in such amount and scope as it deems adequate in connection with the services provided by the Custodian under this Agreement. Upon the Fund’s reasonable request, which in no event shall be more than once annually, the Custodian shall furnish to the Fund a summary of the Custodian’s applicable insurance coverage.
Section 22.17. Liability of Fund. The use of a single form of agreement referring to multiple Funds listed on Appendix A is for ease of administrative purposes only. Custodian and each Fund listed on Appendix A to this Agreement shall be deemed for all purposes to have entered into and executed a separate Agreement. The assets and liabilities of each Fund listed on Appendix A are separate and distinct; the obligations of or arising out of this Agreement are binding solely upon the assets or property of each Fund, on whose behalf this Agreement has been executed.
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EXECUTION
Signature Page
In Witness Whereof, each of the parties has caused this instrument to be executed in its name and behalf by its duly authorized representative under seal as of the date first above-written.
| Each Commodity Pool Entity | ||
| Identified On Schedule A hereto | ||
| By its Managing Owner And/Or Sponsor | ||
| By: | ||
| Gregory Barton | ||
| President | ||
| State Street Bank and Trust Company | ||
| By: | ||
| Gunjan Kedia | ||
| Executive Vice President | ||
Master Custodian Agreement
Schedule A
to
Master Custodian Agreement
WisdomTree Continuous Commodity Index Fund (f/k/a GreenHaven Continuous Commodity Index Fund) and its master fund
WisdomTree Coal Fund (f/k/a GreenHaven Coal Fund)
| App-1 |
SCHEDULE D
to
Master Custodian Agreement
Special Sub-Custodians
None
| D-1 |
Exhibit 10.3
Form Of Administration Agreement
This Administration Agreement (“Agreement”) made as of January 4, 2016, and to have an effective date on January 1, 2016, is by and between each commodity pool entity set forth on Schedule A hereto (each such commodity pool entity and each commodity pool entity made subject to this Agreement in accordance with Section 18 below shall hereinafter be referred to as a “Trust”) and State Street Bank and Trust Company, a Massachusetts trust company (the “Administrator”).
WHEREAS, each Trust is operated as a commodity pool under the Commodity Exchange Act, and is registered with the U.S. Securities and Exchange Commission ("SEC") by means of a registration statement on Form S-1 or S-3, as applicable (each a "Registration Statement") under the Securities Act of 1933, as amended ("1933 Act");
WHEREAS, WisdomTree Commodity Services, LLC or WisdomTree Coal Services, LLC, as applicable, serves as the managing owner and/or sponsor, and commodity pool operator, of each Trust (the "Managing Owner" or “Sponsor”); and
WHEREAS, the Managing owner on behalf of the Trust desires to retain the Administrator to furnish certain administrative services to the Trust, and the Administrator is willing to furnish such services, on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:
| 1. | Appointment of Administrator |
The Sponsor on behalf of the Trust hereby appoints the Administrator to act as administrator to the Trust for purposes of providing certain administrative services for the period and on the terms set forth in this Agreement. The Administrator accepts such appointment and agrees to render the services stated herein.
| 2. | Delivery of Documents |
The Trust will promptly deliver to the Administrator copies of each of the following documents and all future amendments and supplements, if any:
| a. | The Trust’s Declaration of Trust and Trust Agreement, as may be amended from time to time (collectively, the “Charter Documents”); |
| b. | The Trust’s currently effective Registration Statement under the 1933 Act and each Prospectus (including any disclosure document and statement of additional information) relating to the Trust(s) and all amendments and supplements thereto as in effect from time to time; |
| c. | Certified copies of the resolutions of the Sponsor, on its behalf, authorizing (1) the Trust to enter into this Agreement and (2) certain individuals on behalf of the Trust to (a) give instructions to the Administrator pursuant to this Agreement and (b) sign checks and pay expenses; |
| d. | A copy of any investment management agreement between the Trust and its Sponsor; |
| e. | Copies of all of the Authorized Participant Agreements between the Trust, the Sponsor and any authorized participants named therein, including all amendments thereto; and |
| f. | Such other certificates, documents or opinions which the Administrator may, in its reasonable discretion, deem necessary or appropriate in the proper performance of its duties. |
| 3. | Representations and Warranties of the Administrator |
The Administrator represents and warrants to the Trust that:
| a. | It is a Massachusetts trust company, duly organized and existing under the laws of The Commonwealth of Massachusetts; |
| b. | It has the organizational power and authority to carry on its business in The Commonwealth of Massachusetts; |
| c. | All requisite organizational proceedings have been taken to authorize it to enter into and perform this Agreement; |
| d. | No legal or administrative proceedings have been instituted or threatened which would materially impair the Administrator’s ability to perform its duties and obligations under this Agreement; |
| e. | Its entrance into this Agreement shall not cause a material breach or be in material conflict with any other agreement or obligation of the Administrator or any law or regulation applicable to it; |
| f. | It has and will continue to have access to the necessary facilities, equipment and personnel to perform its duties and obligations under this Agreement; |
| g. | It will promptly notify the Trust in the event that the Administrator is for any reason unable to perform any of its obligations under this Agreement; |
| h. | It will promptly notify the Trust, except as may be prohibited by applicable law, of any legal, regulatory or administrative proceedings that have been instituted, |
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which would materially impair the Administrator’s ability to perform its duties and obligations under this Agreement; and
| i. | The various procedures and systems which it has implemented with regard to safeguarding from loss or damage attributable to fire, theft or any other cause, the Trust’s records and other data and the Administrator’s records, data equipment facilities and other property used in the performance of its obligations hereunder are adequate and it will make such changes therein from time to time as it may deem reasonably necessary for the secure performance of its obligations hereunder. |
The Administrator further represents and warrants that it will promptly notify the Trust if any of the above ceases to be true or if it is unable to perform its obligations under this Agreement for any reason.
| 4. | Representations and Warranties of the Trust |
The Trust represents and warrants to the Administrator that:
| a. | It is a statutory trust, duly organized, existing and in good standing under the laws of its state of formation; |
| b. | It has the requisite power and authority under applicable laws and by its Charter Documents to enter into and perform this Agreement; |
| c. | All requisite proceedings have been taken to authorize it to enter into and perform this Agreement; |
| d. | It has made all requisite filings, or is otherwise exempt from making filings, with the Commodity Futures Trading Commission ("CFTC") and National Futures Association ("NFA"); |
| e. | The Registration Statement been filed and will be effective and remain effective during the term of this Agreement. The Trust also warrants to the Administrator that as of the effective date of this Agreement, all necessary filings under the securities laws of the states in which the Trust offers or sells its shares have been made; |
| f. | No legal or administrative proceedings have been instituted or threatened which would impair the Trust’s ability to perform its duties and obligations under this Agreement; |
| g. | Its entrance into this Agreement will not cause a material breach or be in material conflict with any other agreement or obligation of the Trust or any law or regulation applicable to it; |
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| h. | As of the close of business on the date of this Agreement, the Trust is authorized to issue unlimited shares of beneficial interest, subject to its effective Registration Statement; |
| i. | It has all necessary right, title, intellectual property, licenses, consents and content as may be necessary for the Trust to operate as presently contemplated. |
The Trust further represents and warrants that it will promptly notify the Administrator if any of the above ceases to be true or if it is unable to perform its obligations under this Agreement for any reason.
| 5. | Administration Services |
The Administrator shall provide the services as listed on Schedule B, subject to the authorization and direction of the Sponsor and, in each case where appropriate, the review and comment by the Trust’s independent accountants and legal counsel and in accordance with procedures which may be established from time to time between the Trust and the Administrator.
The Administrator shall perform such other services for the Trust that are mutually agreed to by the parties from time to time, for which the Trust will pay such fees as may be mutually agreed upon, including the Administrator’s reasonable out-of-pocket expenses. The provision of such services shall be subject to the terms and conditions of this Agreement.
The Administrator shall provide the office facilities and the personnel determined by it to perform the services contemplated herein.
In performing the services hereunder, the Administrator shall comply with the applicable provisions of the Trust’s current Prospectus(es), and effective amendments thereto. The Trust shall promptly provide the Administrator with copies of such material as soon as available and, upon request, copies of any applicable resolutions by the Sponsor on behalf of the Trust which relate to the Trust’s shares.
| 6. | Fees; Expenses; Expense Reimbursement |
The Administrator shall receive from the Trust such compensation for the Administrator’s services provided pursuant to this Agreement as may be agreed to from time to time in a written Fee Schedule approved by the parties. The fees are accrued daily and billed monthly and shall be due and payable upon receipt of the invoice. Upon the termination of this Agreement before the end of any month, the fee for the part of the month before such termination shall be prorated according to the proportion which such part bears to the full monthly period and shall be payable upon the date of termination of this Agreement. In addition, the Trust agrees to reimburse the Administrator for its reasonable out-of-pocket costs set out in the fee schedule. All rights of compensation and expense reimbursement under this Agreement for services performed as of the termination date shall survive the termination of this Agreement.
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The Trust agrees promptly to reimburse the Administrator for any equipment and supplies specially ordered by or for the Trust through the Administrator and for any other expenses not contemplated by this Agreement that the Administrator may incur on the Trust’s behalf at the Trust’s or Sponsor’s request or with the Trust’s or Sponsor’s consent.
Each of the Trust and the Administrator will bear its own expenses. In particular, the Trust, will bear all Trust expenses that are incurred by the Trust, or by the Administrator on the Trust’s behalf (e.g., typesetting, XBRL-tagging, page changes and all other print vendor and EDGAR charges), in its operation unless otherwise assumed by the Administrator, including as part of the services or as otherwise mutually agreed in writing by the Trust and the Administrator.
From time to time, the Administrator is authorized to and may employ, associate or contract with such person or persons as the Administrator may deem desirable to assist it in performing its duties under this Agreement; provided, however, that the compensation of such person or persons shall be paid by the Administrator and that the Administrator shall be as fully responsible to the Trust for the acts and omissions of any such person or persons as it is for its own acts and omissions. As mutually agreed by the Trust and the Administrator, but in any event at least annually, the Administrator shall discuss with the Trust any assistance the Administrator has deemed desirable in performing its duties under this Agreement.
| 7. | Proper Instructions and Advice |
a. The Trust or any other person duly authorized by the Trust shall communicate to the Administrator by means of Proper Instructions (as defined in Section 7.a. below). Proper Instructions shall mean (i) a writing signed or initialed by one or more persons as an officer or trustee of the Trust (references to officers and/or trustees of the Trust as used herein shall be deemed to include officers and/or trustees/directors of the Sponsor), or the delegate thereof, shall have from time to time authorized or (ii) communication effected directly between the Trust or its third-party agents and the Administrator by electro-mechanical or electronic devices, provided that the Trust and the Administrator agree to security procedures. The Administrator may rely upon any Proper Instruction reasonably believed by it to be genuine and to have been properly issued by or on behalf of the Trust. Oral instructions shall be considered Proper Instructions if the Administrator reasonably believes them to have been given by a person authorized to give such instructions; provided, however, that the Trust shall cause all authorized oral instructions to be confirmed in accordance with clauses (i) or (ii) above, as appropriate.
b. At any time, the Administrator may apply to any officer of the Trust or his or her designee for instructions and may consult with the independent accountants for the Trust, with respect to any matter arising in connection with the services to be performed by the Administrator under this Agreement. Where circumstances arise that the Administrator believes advice from counsel may be necessary, the Administrator will notify the Trust. The Administrator shall be entitled to rely on and may act upon advice of counsel (who may be counsel for the Trust) on all matters, and shall be without liability for any action reasonably taken or omitted pursuant to such advice provided, however, with respect to the performance of any action or omission of any action upon such advice, the Administrator shall be acting within the standard of care set forth in Section 8. The Administrator shall promptly notify the Trust of the receipt of such advice. The
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Administrator shall not be held to have notice of any change of authority of any person until receipt of written notice thereof from the Trust. Nothing in this section shall be construed as imposing upon the Administrator any obligation to seek instructions or advice.
| 8. | Limitation of Liability and Indemnification |
The Administrator shall be responsible for the performance only of such duties as are set forth in this Agreement and, except as otherwise provided under Section 6, shall have no responsibility for the actions or activities of any other party, including other service providers. The Administrator shall at all times act in good faith and without negligence and agrees to exercise the care and expertise of a leading provider of fund administration and fund accounting services in carrying out the provisions of this Agreement and use all reasonable efforts in performing the services under this Agreement. The Administrator shall be kept indemnified by and shall be without liability to the Trust for any action taken or omitted by it in good faith without negligence, bad faith or willful misconduct in connection with the provision of services hereunder, provided that the Administrator shall not be indemnified against any liability (or any expenses incident to such liability) arising out of the Administrator’s own bad faith, negligence, willful misconduct or disregard of its duties and obligations under this Agreement. The Administrator shall have no liability in respect of any loss, damage or expense suffered by the Trust insofar as such loss, damage or expense arises directly from the performance of the Administrator’s duties hereunder in reliance upon records that were maintained for the Trust by entities other than the Administrator prior to the Administrator’s appointment as administrator for the Trust (“Prior Records”) except as may arise from Administrator’s own negligence, bad faith or willful misconduct or the negligence, bad faith or willful misconduct of an agent of the Administrator provided that the Administrator shall notify the Trust as soon as practicable after becoming aware in the course of performing its duties hereunder of an error or incomplete information in such Prior Records. For the avoidance of doubt, the Administrator shall have no responsibility to review, confirm or otherwise verify the accuracy or completeness of any Prior Records. The Administrator shall have no liability for any error of judgment or mistake of law or for any loss or damage resulting from the performance or nonperformance of its duties hereunder except to the extent arising directly from the failure to exercise the standard of care set out in this Section 8 or the bad faith, negligence or willful misconduct of the Administrator, its agents, officers or employees.
Except as may arise from the Administrator’s failure to exercise its standard of care, the Administrator shall not be responsible or liable for any failure or delay in performance of its obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its control, including without limitation, work stoppage, power or other mechanical failure, computer virus, natural disaster, governmental action or communication disruption.
The Administrator shall, at no additional expense to the Trust, take reasonable steps to minimize service interruptions in the event of equipment failure, work stoppage, governmental action, communication disruption or other impossibility of performance beyond the Administrator’s control. The Administrator shall enter into and shall maintain in effect at all times during the term of this Agreement with appropriate parties one or more agreements making reasonable provision, at a level the Administrator believes consistent with other similarly situated providers of fund administration services, for (i) periodic back-up of the computer files
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and data with respect to the Trust and (ii) emergency use of electronic data processing equipment to provide services under this Agreement. Upon reasonable request, the Administrator shall discuss with the Trust any business continuity/disaster recovery plan of the Administrator and/or provide a high-level presentation summarizing such plan.
Notwithstanding anything contained herein to the contrary, neither party shall be liable for any indirect, special or consequential damages; provided that the foregoing limitation shall not apply with respect to damages or claims arising out of or relating to that party’s fraud or willful misconduct.
In any event, except as otherwise agreed to in writing by the parties hereto, the Administrator’s cumulative liability for each calendar year (a “Liability Period”) with respect to the Trust under this Agreement regardless of the form of action or legal theory shall be limited to its total annual compensation earned and fees payable hereunder during the preceding Compensation Period, as defined herein, for any liability or loss suffered by the Trust including, but not limited to, any liability relating to qualification of the Trust as a regulated investment company or any liability relating to the Trust’s compliance with any federal or state tax or securities statute, regulation or ruling during such Liability Period. “Compensation Period” shall mean the calendar year ending immediately prior to each Liability Period in which the event(s) giving rise to the Administrator’s liability for that period have occurred. For any partial first year, the annual cumulative liability hereunder shall be the Administrator’s total compensation earned and fees payable hereunder during such partial first year on an annualized basis.
The limitation of liability and indemnification contained herein shall survive the termination of this Agreement.
| 9. | Confidentiality |
The parties hereto agree that each shall treat confidentially all information provided by each party to the other party regarding its business and operations, including information related to the development of new Trusts or new series. The Administrator shall treat confidentially all information obtained in the ordinary course of performing its duties hereunder about the Trust’s prior, present or potential shareholders or relative to the advisor or distributor and their prior, present or potential customers (including all “personal information” described in Section 17 of this Agreement). All confidential information provided by a party hereto shall be used by any other party hereto solely for the purpose of rendering or receiving services pursuant to this Agreement and, except as may be required in carrying out this Agreement, shall not be disclosed to any third party. The foregoing shall not be applicable to any information (i) that is publicly available when provided or thereafter becomes publicly available, other than through a breach of this Agreement, (ii) that is independently derived by either party hereto without the use of any information provided by the other party hereto in connection with this Agreement, (iii) that is disclosed, upon prior notice to the party whose information is being disclosed (to the extent such notice is permissible), in the manner and to the extent required in any legal or regulatory proceeding, investigation, audit, examination, subpoena, civil investigative demand or other similar process, or by operation of law or regulation, or (iv) where the party seeking to disclose has received the prior written consent of the party providing the information, which consent shall
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not be unreasonably withheld. Notwithstanding the foregoing, each party acknowledges that the other party may provide access to and use of confidential information relating to the other party to the disclosing party’s employees, contractors, agents, professional advisors, auditors or persons performing similar functions, as necessary solely for the purpose of rendering services under this Agreement, provided that each person or entity shall be subject to confidentiality obligations substantially similar to those set forth herein. Further, each party agrees and represents that in no case would information it receives under this Agreement be used against the other party in a manner that is adverse to the other party’s interests (including the other party’s interests in competitive businesses). Nothing herein shall prohibit or restrict the right of each party (or its affiliates) to develop, use or market products or services similar to or competitive with those of the other party (or its affiliates) provided that any such development, use or marketing does not violate the confidentiality obligations set forth herein. Additionally, each party acknowledges that the other party (or its affiliates) may already possess or have developed products or services similar to or competitive with those of the other party.
The Administrator will employ reasonable safeguards designed to protect the Trust’s confidential information, which may include but are not limited to the use of encryption technologies, passwords and any other safeguards the Administrator may choose to employ. If either party becomes aware of a breach of this confidentiality provision, it will notify promptly the other party of such breach and provide such details as it deems appropriate and in accordance with the standard of care hereunder regarding the extent of the breach of confidentiality.
To the extent reasonably possible, shareholder information made available to third parties by the Administrator will be provided on a non-disclosed basis (that is, without information disclosing the identity of the shareholder). The Administrator affirms that it has, and will continue to have throughout the term of this Agreement, procedures in place that are reasonably designed to protect the privacy of non-public personal consumer/customer financial information to the extent required by applicable laws, rules and regulations.
The undertakings and obligations contained in this Section shall survive the termination or expiration of this Agreement.
| 10. | Compliance with Governmental Rules and Regulations; Records |
The Administrator agrees to perform its duties hereunder in accordance with applicable law; however, the Administrator assumes no responsibility for ensuring that the Trust complies with all securities, tax, commodities and other laws, rules and regulations applicable to the Trust.
The Administrator agrees that all records which it maintains for the Trust shall at all times remain the property of the Trust, shall be readily accessible during normal business hours, and shall be promptly surrendered upon the termination of the Agreement or otherwise on written request except as otherwise provided in Section 12. Records may be surrendered in either written or machine-readable form, at the option of the Administrator. Upon the reasonable request of the Trust, copies of any such books and records shall be provided by the Administrator.
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| 11. | Services Not Exclusive |
The services of the Administrator are not to be deemed exclusive, and the Administrator shall be free to render similar services to others. The Administrator shall be deemed to be an independent contractor and shall, unless otherwise expressly provided herein or authorized by the Trust from time to time, have no authority to act or represent the Trust in any way or otherwise be deemed an agent of the Trust.
| 12. | Effective Period and Termination |
This Agreement shall remain in full force and effect for an initial term ending March 31, 2019 (the “Initial Term”). After the expiration of the Initial Term, this Agreement shall automatically renew for successive one-year terms (each, a “Renewal Term”) unless a written notice of non-renewal is delivered by the non-renewing party no later than ninety (90) days prior to the expiration of the Initial Term or any Renewal Term, as the case may be. During the Initial Term and thereafter, either party may terminate this Agreement: (i) in the event of the other party’s material breach of a material provision of this Agreement that the other party has either (a) failed to cure or (b) failed to establish a remedial plan to cure that is reasonably acceptable, within 60 days’ written notice of such breach, (ii) in the event of the appointment of a conservator or receiver for the other party or upon the happening of a like event to the other party at the direction of an appropriate agency or court of competent jurisdiction, or (iii) based upon the Trust’s determination that there is a reasonable basis to conclude that the Administrator is insolvent or that the financial condition of the Administrator is deteriorating in any material respect.
Upon termination of this Agreement pursuant to this Section with respect to the Trust, the Trust shall pay the Administrator its compensation due and shall reimburse the Administrator for its costs, expenses and disbursements except, if termination is based on termination for a material breach of this Agreement coupled with the Administrator’s failure to meet its standard of care under this Agreement, less any losses or damages caused by such event.
Termination of this Agreement with respect to any one particular Trust shall in no way affect the rights and duties under this Agreement with respect any other Trust.
As soon as reasonably practicable following the termination or expiration of this Agreement, the Administrator agrees to transfer such records and related supporting documentation as are held by it under this Agreement to any replacement provider of the services or to such other person as the Trust may direct. If directed by the Trust, the Administrator will provide the services hereunder until a replacement administrator is in place, for a reasonable period of time up to nine (9) months, subject to the terms of this Agreement, including compensation. The Administrator will also provide reasonable assistance to its successor, for such transfer, subject to the payment of such reasonable expenses and charges as the Administrator customarily charges for such assistance.
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| 13. | Notices |
All notices, requests, claims, demands and other communications required or permitted to be given under this agreement shall be in writing and shall be delivered by hand or sent by an internationally recognized overnight courier service with signature required for delivery, by facsimile where a confirmation of receipt is obtained, provided, however, that if sent by facsimile the written communication must also be sent by next business day delivery via an internationally recognized overnight courier service with signature required for delivery, or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties hereto at the following addresses:
If to the Trust:
WisdomTree Commodity Pools
245 Park Ave, 35th Floor
New York, NY 10167
Attn: Legal Department
Facsimile: 917-267-3851
If to the Administrator:
State Street Bank and Trust Company
P.O. Box 5049
Boston, MA 02206-5049
Attn: US Investor Services Legal Team, Senior Managing Counsel
Facsimile: 617-662-2702
All such communications so addressed shall be deemed given (i) when delivered, if delivered personally to the intended recipient, or if sent by an internationally recognized courier service with signature required for delivery, or if sent by facsimile and a confirmation of receipt is obtained, and the written communication has also be sent for next business day delivery via a internationally recognized courier service with signature required for delivery (ii) three business days after being mailed if sent by certified or registered mail, postage prepaid, return receipt requested, or upon delivery if actual delivery occurs earlier.
| 14. | Amendment |
This Agreement may be amended by a written agreement executed by both parties.
| 15. | Assignment |
This Agreement may not be assigned by (a) the Trust without the written consent of the Administrator or (b) by the Administrator without the written consent of the Trust, except that the Administrator may assign this Agreement to a successor of all or a substantial portion of its business, or to a party controlling, controlled by or under common control with the Administrator.
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| 16. | Successors |
This Agreement shall be binding on and shall inure to the benefit of the Trust and the Administrator and their respective successors and permitted assigns.
| 17. | Data Protection |
The Administrator shall implement and maintain a comprehensive written information security program that contains appropriate security measures to safeguard the personal information of the Trust’s shareholders, employees, directors and/or officers that the Administrator receives, stores, maintains, processes or otherwise accesses in connection with the provision of services hereunder. For these purposes, “personal information” shall mean (i) an individual’s name (first initial and last name or first name and last name), address or telephone number plus (a) social security number, (b) driver’s license number, (c) state identification card number, (d) debit or credit card number, (e) financial account number or (f) personal identification number or password that would permit access to a person’s account or (ii) any combination of the foregoing that would allow a person to log onto or access an individual’s account. Notwithstanding the foregoing “personal information” shall not include information that is lawfully obtained from publicly available information, or from federal, state or local government records lawfully made available to the general public.
| 18. | Additional Trusts |
In the event that any trust in addition to those listed on Schedule A hereto desires to have the Administrator render services as administrator under the terms hereof, it shall so notify the Administrator in writing, and if the Administrator agrees in writing to provide such services, which shall not be unreasonably withheld, trust shall become a Trust hereunder and be bound by all terms and conditions and provisions hereof.
| 19. | Entire Agreement |
This Agreement contains the entire understanding between the parties hereto with respect to the subject matter hereof and supersedes all previous representations, warranties or commitments regarding the services to be performed hereunder whether oral or in writing.
| 20. | Waiver |
The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver nor shall it deprive such party of the right thereafter to insist upon strict adherence to that term or any term of this Agreement. Any waiver must be in writing signed by the waiving party.
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| 21. | Severability |
If any provision of this Agreement is invalid or unenforceable, the balance of the Agreement shall remain in effect, and if any provision is inapplicable to any person or circumstance it shall nevertheless remain applicable to all other persons and circumstances.
Each party agrees to perform such further acts and execute such further documents as are necessary to effectuate the purposes hereof.
| 22. | Governing Law |
This Agreement shall be construed and the provisions thereof interpreted under and in accordance with the laws of the state of New York.
| 23. | Reproduction of Documents |
This Agreement and all schedules, exhibits, attachments and amendments hereto may be reproduced by any photographic, xerographic, photostatic, microfilm, micro-card, miniature photographic or other similar process. The parties hereto all/each agree that any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding, whether or not the original is in existence and whether or not such reproduction was made by a party in the regular course of business, and that any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence.
| 24. | Counterparts |
This Agreement may be executed by the parties hereto on any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.
| 25. | Limitation of Liability of the Trustees and Shareholders |
This Agreement is executed by the Sponsor on behalf of the Trust and the obligations hereunder are not binding upon any of the directors/trustees, officers or shareholders of the Trust (or its Sponsor) individually. Notwithstanding any other provision in this Agreement to the contrary, each and every obligation, liability or undertaking of the Trust under this Agreement shall constitute solely an obligation, liability or undertaking of, and be binding upon, the Trust and shall be payable solely from the available assets of such Trust and shall not be binding upon or affect any assets of any other Trust (or its Sponsor).
| 26. | SSAE 16 Reports |
The Administrator will furnish to the Trust, on a semi-annual basis, a report in accordance with Statements on Standards for Attestation Engagements No. 16 (the “SSAE Report”) as well as such other reports and information relating to the Administrator’s policies
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and procedures and its compliance with such policies and procedures and with the laws applicable to its business and its services, as the parties may mutually agree upon.
| 27. | Cooperation with Accountants |
The Administrator shall cooperate with the Trust’s independent public accountants and shall take all reasonable actions in the performance of its obligations under this Agreement to provide such information, as may be reasonably requested by the Trust from time to time, to such accountants for the expression of their opinion.
| 28. | Insurance |
The Administrator shall at all times during the term of this Agreement maintain, at its cost, insurance coverage regarding its business in such amount and scope as it deems adequate in connection with the services provided by the Administrator under this Agreement. Upon the Trust’s reasonable request, which in no event shall be more than once annually, the Administrator shall furnish to the Trust a summary of the Administrator’s applicable insurance coverage.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their officers designated below as of the date first written above.
Each Commodity pool entity
Identified on Schedule A Hereto
by its managing owner and/or Sponsor
| By: | ||
| Name: | Gregory Barton | |
| Title: | President |
STATE STREET BANK AND TRUST COMPANY
| By: | ||
| Name: | Gunjan Kedia | |
| Title: | Executive Vice President |
Administration Agreement
ADMINISTRATION AGREEMENT
SCHEDULE A
Listing of Trust(s)
WisdomTree Continuous Commodity Index Fund (f/k/a GreenHaven Continuous Commodity Index Fund) and its master fund
WisdomTree Coal Fund (f/k/a GreenHaven Coal Fund)
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ADMINISTRATION AGREEMENT
Schedule B
LIST OF SERVICES
| I. | Fund Administration Treasury Services as described in Schedule B1 attached hereto; |
| II. | [Reserved]; and |
| III. | Fund Administration Legal Services as described in Schedule B3 attached hereto. |
Schedule B1
Fund Administration Treasury Services
| a. | Prepare for the review by designated officer(s) of the Sponsor on behalf of each Trust, financial information regarding each Trust that will be included in each Trust's quarterly and annual reports on Form 10-Q and 10-K, respectively, such reports to be prepared and filed by the Sponsor or designee; |
| b. | Coordinate the audit of each Trust's annual financial statements by each Trust's independent accountants to be included in each Trust's Form 10-K, including the preparation of supporting audit work papers and other schedules; |
| c. | Prepare for the review by designated officer(s) of the Sponsor on behalf of each Trust, monthly Account Statements required pursuant to Rule 4.22(a) of the Commodity Exchange Act; |
| d. | Prepare such other reports, forms or filings as may be mutually agreed upon; |
| e. | Prepare for the review by designated officer(s) of the Sponsor on behalf of each Trust, annual expense budgets, perform accrual analyses and recommend changes to expense accruals on a periodic basis, arrange for payment of each Trust's expenses, review calculations of fees paid to each Trust's Sponsor, custodian, accounting agent, distributor and transfer agent, and obtain authorization of accrual changes and expense payments; |
| f. | Provide periodic testing of each Trust with respect to compliance with limitations for each Trust contained in the Registration Statement, as may be mutually agreed upon; |
| g. | Prepare and furnish total return performance information for each Trust, calculated in accordance with applicable U.S. securities and commodities laws and regulations, as may be reasonably requested by designated officer(s) of the Sponsor on behalf of such Trust; |
| h. | Provide sub-certificates in connection with the certification requirements of the Sarbanes-Oxley Act of 2002 with respect to the services provided by the Administrator; and |
B1-1
SCHEDULE B3
Fund Administration Legal Services
Subject to the authorization and direction of the Sponsor or Sponsor, and, in each case where appropriate, the review and comment by such Sponsor’s or Sponsor’s independent accountants and legal counsel and in accordance with procedures which may be established from time to time between such Sponsor or Sponsor:
| a. | State Street will assist in an administrative capacity only with the preparation, coordination, proofreading and filing of any amendments and/or updates to the Registration Statements (including S-1, S-3, 424(b)(3) and Free Writing Prospectus (FWP) filings) and proxy statements. This includes distributing drafts, incorporating data and comments received by outside parties and proofreading the same, as well as assistance with the filing of such documents and coordinating the EDGAR conversion with outside printers. In acting solely in an administrative capacity, State Street will not make determinations with respect to the suitability of any documents for which it will provide assistance, including with respect to legal and regulatory requirements governing any such filings, or otherwise act in a discretionary capacity. |
B3-1
Exhibit 10.4
FORM OF DISTRIBUTION
SERVICES AGREEMENT
Registered Commodity Pools
This Distribution Services Agreement (the “Agreement”) is made this 4th day of January 2016, effective as of January 1, 2016, by and among WisdomTree Continuous Commodity Index Fund, a Delaware statutory trust (the “Fund” or the “Trust”), having its principal place of business at 245 Park Avenue, 35th Floor, New York, New York 10167, Foreside Fund Services, LLC, a Delaware limited liability company (the “Distributor” or “Foreside”), having its principal place of business at Three Canal Plaza, Suite 100, Portland, ME 04101, and WisdomTree Commodity Services, LLC, a Delaware limited liability company (the “Sponsor” or “Managing Owner”), with its principal place of business at 245 Park Avenue, 35th Floor, New York, New York 10167.
WHEREAS, the Sponsor is registered with the Commodity Futures Trading Commission (the “CFTC”) as a commodity pool operator, is a member of the National Futures Association (“NFA”), and is subject to the Commodity Exchange Act, as amended (the “CEA”), and all of the relevant rules and regulations promulgated thereunder (collectively, the “Commodities Rules”) and serves as the commodity pool operator of the Trust; and
WHEREAS, the Trust is a statutory trust organized under the laws of the State of Delaware, and may have separate series (each a “Fund” and collectively, the “Funds”), each of which may issue common units representing fractional individual beneficial interests in such Fund (“Shares”, and aggregations thereof, “Baskets”);
WHEREAS, the Sponsor desires to retain Foreside to serve as the distributor of certain Funds as listed on Exhibit A hereto (as amended from time to time); and
WHEREAS, the Sponsor, on behalf of the Trust, has filed, or will file, with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-1 under the Securities Act of 1933, as amended (the “1933 Act”);
WHEREAS, the Distributor is a registered broker-dealer under the Securities Exchange Act of 1934, as amended (the “1934 Act”), and a member of the Financial Industry Regulatory Authority (“FINRA”);
WHEREAS, the Distributor desires to serve as distributor of the Funds and to provide the services described herein to the Funds.
NOW THEREFORE, in consideration of the mutual promises and undertakings herein contained, the parties agree as follows:
1. Appointment.
The Sponsor, on behalf of the Trust, hereby appoints the Distributor as the exclusive distributor of the Funds in accordance with this Agreement, on the terms and for the period set forth in this Agreement and subject to the registration requirements of the federal securities laws
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and of the laws governing the sale of securities in the various states, and the Distributor hereby accepts such appointment and agrees to act in such capacity hereunder.
2. Definitions.
Wherever they are used herein, the following terms have the following meanings:
(a) “Prospectus” means the prospectus which constitutes part of the Registration Statement(s) of the Trust under the 1933 Act as such Prospectus may be amended or supplemented and filed with the SEC from time to time;
(b) “Registration Statement” means the registration statement most recently filed from time to time by the Trust with the SEC and effective under the 1933 Act, as such registration statement(s) is amended by any amendments thereto at the time in effect;
(c) All capitalized terms used but not defined in this Agreement shall have the meanings ascribed to such terms in the Registration Statement and the Prospectus.
3. Duties of the Distributor
(a) The Distributor agrees to act as agent of the Funds and to work with the Funds’ transfer agent (the “Transfer Agent”) in connection with the receipt and processing of all orders for purchases and redemptions of Shares of each Fund in aggregations of a predetermined number of Shares specified in the Fund’s Prospectus (“Baskets”) from DTC Participants or participants in the Continuous Net Settlement System of the National Securities Clearing Corporation (the “NSCC Participants”) that have executed a Participant Agreement (the “Authorized Participants”), as defined in paragraph 3(b) hereof, with the Funds and the Sponsor. The Funds acknowledge that the Distributor shall be obligated to accept all good orders for Baskets, subject to the terms and conditions of the applicable Participant Agreement and guidelines established by the Sponsor from time to time. Nothing herein contained shall prevent the Distributor from entering into like distribution service arrangements with other exchange-traded funds.
(b) The Distributor agrees to use commercially reasonable efforts to act as agent of the Funds with respect to the continuous distribution of Baskets of the Funds as set forth in each Registration Statement and in accordance with the provisions thereof. The Distributor further agrees as follows: (i) at the request of the Sponsor, the Distributor shall coordinate the process, including negotiation, by which Authorized Participants, the Funds, the Distributor and the Sponsor enter into participant agreements (“Participant Agreements”) for transactions in Baskets of the Funds, in accordance with the Registration Statement and Prospectus; (ii) the Distributor shall generate, transmit and maintain copies of confirmations of Basket purchase and redemption order acceptances to the purchaser or redeemer (such confirmations will indicate the time such orders were accepted and will be made available to the Sponsor promptly upon request; (iii) the Distributor shall deliver copies of the Prospectus to Authorized Participants who have purchased Baskets in accordance with the Participant Agreements; and (iv) the Distributor shall maintain telephonic, facsimile and/or access to direct computer communications links with the Transfer Agent.
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(c) The Sponsor, on behalf of the Funds, reserves the right to suspend the right of redemption, or postpone the redemption settlement date, (1) for any period during which the NYSE Arca or any exchange on which the Funds’ assets are regularly traded is closed other than for customary weekend or holiday closings, or trading is suspended or restricted, (2) for any period during which an emergency exists as a result of which the delivery, disposal or evaluation of a Fund’s assets is not reasonably practicable, or (3) for such other period as the Sponsor determines to be necessary for the protection of the Shareholders.
(d) The Distributor is not authorized by the Sponsor or the Trust to give any information or to make any representations other than those contained in the Registration Statement or Prospectus or contained in shareholder reports or other material that may be prepared by or on behalf of the Funds for the Distributor’s use. All activities by the Distributor and its agents and employees that are primarily intended to result in the sale of shall comply with the Registration Statement, the instructions of the Managing Owner and all applicable laws, rules and regulations.
(e) The Distributor shall be entitled to rely on and shall not be responsible in any way for information provided to it by the Sponsor with respect to the Funds and their service providers and shall not be liable or responsible for the errors and omissions of such service providers, provided that the foregoing shall not be construed to protect the Distributor against any liability to the Funds or the Funds’ shareholders to which the Distributor would otherwise be subject by reason of willful misfeasance, bad faith or negligence in the performance of its duties or by reason of its reckless disregard of its obligations and duties under this Agreement.
(f) The Distributor shall ensure that all direct requests by Authorized Participants for Prospectuses, product descriptions and periodic fund reports, as applicable, are fulfilled. The Distributor will generally make it known in the brokerage community that Prospectuses and product descriptions are available, including by (i) advising the Listing Exchange on which the Shares are listed on behalf of its member firms of the same, (ii) making such disclosure in all marketing and advertising materials prepared and/or filed by the Distributor with FINRA, and (iii) as may otherwise be required by the SEC. The Distributor shall not bear any costs associated with printing Prospectuses and all other such materials.
(g) The Distributor agrees to provide information to the Sponsor with regard to the ongoing distribution process and for such other purposes as may be requested by the Sponsor from time to time.
(h) The Distributor shall review and approve all sales and marketing materials for compliance with applicable securities laws and regulations, and file such materials with FINRA, as required under the 1933 Act, and the rules promulgated thereunder. Notwithstanding the foregoing, the Distributor shall not be responsible for the compliance of sales and marketing materials with the CEA or the Commodities Rules, and the Sponsor shall be responsible for ensuring that all sales and marketing materials have been reviewed for compliance with the CEA and the Commodities Rules and filed with the CFTC or NFA, if applicable.
(i) The Distributor shall provide training to employees of the Sponsor with respect to the marketing material review process for which the Distributor is responsible, the SEC and FINRA regulations, and the applicability of these regulations as they relate to sales and
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marketing materials. Such training shall be provided on-site if requested by the Sponsor, provided that the Sponsor pay all reasonable travel expenses associated therewith.
(i) The Distributor shall work with the Transfer Agent to review and accept or reject orders placed by Authorized Participants and transmitted to the Distributor by the Transfer Agent.
(j) The Distributor agrees to maintain and preserve records of its activities and obligations under this Agreement unless any such records are earlier surrendered as provided below. The Distributor agrees that all records which it maintains for the Trust shall at all times remain the property of the Trust, shall be readily accessible during normal business hours, and shall be promptly surrendered upon the termination of the Agreement or otherwise on written request; provided that Distributor may retain all records, or if permissible, copies of all records that it is required to maintain as a broker-dealer pursuant to applicable FINRA and SEC rules and regulations. Records may be surrendered in either written or machine-readable form, at the option of the Trust. Upon the reasonable request of the Trust, copies of any such books and records shall be provided by the Distributor. The Distributor shall assist the Trust and its agents or, upon approval of the Trust, any regulatory or self-regulatory body, in any requested review of the Trust’s books and records, and reports by the Distributor, its independent accountants or other independent reviewer concerning its ETP order processing system and such books, records, reports and system will be open to such entities for audit or inspection upon reasonable request.
(k) The Distributor shall take reasonable steps to minimize service interruptions in the event of equipment failure, work stoppage, governmental action, communication disruption or other impossibility of performance beyond the Distributor’s control. The Distributor shall enter into and shall maintain in effect at all times during the term of this Agreement a business continuity plan, including internal systems or arrangements with appropriate parties making reasonable provision for (i) periodic back-up of the computer files and data with respect to the Trust and (ii) emergency use of electronic data processing equipment to provide services under this Agreement. Upon reasonable request, the Distributor shall discuss with the Trust any business continuity/disaster recovery plan of the Distributor and/or provide presentations regarding such plan.
(l) The Distributor shall at all times act in good faith and without negligence and agrees to exercise the care and expertise of a leading provider of distribution services in carrying out the provisions of this Agreement and use all reasonable efforts (or such higher standard set forth herein) in performing the services under this Agreement.
4. Duties of the Funds.
(a) The Sponsor, on behalf of the Trust, agrees that it will take all reasonable action necessary to monitor available Shares registered by each Fund and to register additional Shares of a Fund pursuant to the 1933 Act as may be required from time to time. The Sponsor will make available to the Distributor such number of copies of the Funds’ then currently effective Prospectus and product description as the Distributor may reasonably request. The Sponsor will furnish to the Distributor copies of annual audited reports of each Fund made by independent public accountants regularly retained by the Funds and such other publicly available information that the Distributor may reasonably request for use in connection with the distribution of Baskets.
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The Sponsor shall keep the Distributor informed of the jurisdictions in which it has filed notice filings for Shares for sale on behalf of each Fund under the securities laws thereof and shall promptly notify the Distributor of any change in this information. The Distributor shall not be liable for damages resulting from the sale of Shares in jurisdictions where the Distributor had no information from the Sponsor that such sale or sales were unauthorized at the time of such sale or sales.
5. Fees and Expenses.
(a) The Distributor shall be entitled to receive compensation from the Trust related to its services hereunder or for additional services as may be agreed to between the Sponsor, on behalf of the Trust, and the Distributor, in accordance with the Fee Schedule attached hereto as Exhibit B;
(b) The Trust shall bear the cost and expenses of: (i) the registration of Shares for sale under the Securities Act; and (ii) the registration or qualification of the Shares for sale under the securities laws and/or the costs related to any filings pursuant to the Commodities Rules, as applicable;
(c) The Distributor shall pay all of its own costs and expenses, including (i) all expenses relating to Distributor’s broker-dealer qualification and registration under the 1934 Act; and (ii) the expenses incurred by the Distributor in connection with routine FINRA filing fees. In addition, the Distributor shall bear all other expenses incurred in connection with the services contemplated herein, except as specifically provided in this Agreement;
(d) Notwithstanding anything in this Agreement to the contrary, the Distributor and its affiliates may receive compensation or reimbursement from the Trust with respect to any services not included under this Agreement, as may be agreed upon by the parties from time to time;
(e) The payments to the Distributor under this Agreement and under any other agreement between the Distributor or any of its affiliates and the Funds or the Sponsor with respect to the Funds, will not, in the aggregate, exceed 10% of the aggregate dollar amount of the offering. The Trust will advise the Distributor if the payments described hereunder must be limited, when combined with selling commissions charged by other FINRA members and other payments that would constitute underwriting compensation as defined in FINRA Rule 2310, in order to comply with the 10% limitation on total underwriters’ compensation pursuant to FINRA Rule 2310; and
(f) The Sponsor shall provide to the Distributor on an on-going basis information sufficient to enable Distributor to ensure compliance with FINRA Rule 2310, including calculations of underwriting compensation and total offering and operating expenses.
6. Indemnification.
(a) The Trust agrees to indemnify and hold harmless the Distributor, its affiliates and each of their respective directors, officers and employees and agents and any person who controls the Distributor within the meaning of Section 15 of the 1933 Act (any of the Distributor, its officers, employees, agents and directors or such control persons, for purposes of
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this paragraph, a “Distributor Indemnitee”) against any loss, liability, claim, damages or expense (including the reasonable cost of investigating or defending any alleged loss, liability, claim, damages or expense and reasonable counsel fees incurred in connection therewith) (“Losses”) arising out of or based upon (i) the Distributor providing services to the Funds pursuant to this Agreement; (ii) any claim that the Registration Statement, Prospectus, product description, shareholder reports, sales literature and advertisements specifically approved by the Funds and the Sponsor or other information filed or made public by the Funds (as from time to time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein (and in the case of the Prospectus and product description, in light of the circumstances under which they were made) not misleading under the 1933 Act, or any other statute or the common law; (iii) the breach by the Trust or any Fund of any obligation, representation or warranty contained in this Agreement; or (iv) the Trust’s or any Fund’s failure to comply in any material respect with applicable securities or commodities laws.
The Trust does not agree to indemnify the Distributor or hold it harmless to the extent that the statement or omission was made in reliance upon, and in conformity with, information furnished to the Funds by or on behalf of the Distributor. The Trust will also not indemnify any Distributor Indemnitee with respect to any untrue statement or omission made in the Registration Statement, Prospectus or product description that is subsequently corrected in such document (or an amendment thereof or supplement thereto) if a copy of the Prospectus (or such amendment or supplement) was not sent or given to the person asserting any such loss, liability, claim, damage or expense at or before the written confirmation to such person in any case where such delivery is required by the 1933 Act and the Trust had notified the Distributor of the amendment or supplement prior to the sending of the confirmation. In no case (i) is the indemnity of the Trust in favor of any Distributor Indemnitee to be deemed to protect the Distributor Indemnitee against any liability to the Trust, the Funds or their respective shareholders to which the Distributor Indemnitee would otherwise be subject by reason of willful misfeasance, bad faith or negligence in the performance of its duties or by reason of its reckless disregard of its obligations under this Agreement and no Distributor Indemnitee shall be indemnified or held harmless for any Losses arising out of the Distributor’s own bad faith, negligence, willful misconduct or disregard of its duties and obligations under this Agreement,, or (ii) is the Trust to be liable under the indemnity agreement contained in this Section with respect to any claim made against any Distributor Indemnitee unless the Distributor Indemnitee shall have pursuant to Section 9 notified the Trust in writing of the claim at its principal offices in 245 Park Avenue, 35th Floor, New York, New York 10167 within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon Distributor Indemnitee (or after Distributor Indemnitee shall have received notice of service on any designated agent).
Failure to notify the Trust of any claim shall not relieve the Trust from any liability that it may have to any Distributor Indemnitee against whom such action is brought unless failure or delay to so notify the Trust prejudices the Trust’s ability to defend against such claim. The Trust shall be entitled to participate at its own expense in the defense, or, if it so elects, to assume the defense of any suit brought to enforce any claims, but if the Trust elects to assume the defense, the defense shall be conducted by counsel chosen by the Trust and satisfactory to Distributor Indemnitee, defendant or defendants in the suit. In the event the Trust elects to assume the defense of any suit and retain counsel, Distributor Indemnitee, defendant or defendants in the suit, shall
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bear the fees and expenses of any additional counsel retained by them. If the Trust does not elect to assume the defense of any suit, it will reimburse the Distributor Indemnitee, defendant or defendants in the suit, for the reasonable fees and expenses of any counsel retained by them. The Distributor agrees to notify the Sponsor and the Trust promptly of the commencement of any litigation or proceedings against it or any of its officers or directors in connection with the issuance or sale of any of the Baskets or the Shares.
(b) The Distributor agrees to indemnify and hold harmless the Trust, the Sponsor and each of their managers, directors and officers, employees and agents and any person who controls the Trust or the Sponsor within the meaning of Section 15 of the 1933 Act (for purposes of this Section, the Funds, the Sponsor and each of their managers and officers and their controlling persons are collectively referred to as the “Trust Affiliates”) against any Losses arising out of or based upon (i) the allegation of any wrongful act of the Distributor or any of its directors, officers, employees or affiliates in connection with its activities as Distributor pursuant to this Agreement; (ii) the breach of any obligation, representation or warranty contained in this Agreement by the Distributor; (iii) the Distributor’s failure to comply in any material respect with applicable securities laws, including applicable FINRA regulations; or (iv) any allegation that the Registration Statement, Prospectus, product description, shareholder reports, any information or materials relating to the Funds (as described in section 3(g)) or other information filed or made public by the Trust (as from time to time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements not misleading, insofar as such statement or omission was (x) made in reliance upon, and in conformity with information furnished to the Trust by or on behalf of the Distributor or (y) otherwise approved by the Distributor in the performance of its duties under this Agreement..
In no case (i) is the indemnity of the Distributor in favor of any Trust Affiliate to be deemed to protect any Trust Affiliate against any liability to the Funds or its security holders to which such Trust Affiliate would otherwise be subject by reason of willful misfeasance, bad faith or negligence in the performance of its duties or by reason of its reckless disregard of its obligations and duties under this Agreement, or (ii) is the Distributor to be liable under its indemnity agreement contained in this Section with respect to any claim made against any Trust Affiliate unless the Trust Affiliate shall have notified the Distributor in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon the Trust Affiliate (or after the Trust Affiliate shall have received notice of service on any designated agent).
Failure to notify the Distributor of any claim shall not relieve the Distributor from any liability that it may have to the Trust Affiliate against whom such action is brought on account of its indemnity agreement contained in this Section unless failure or delay to so notify the Distributor prejudices the Distributor’s ability to defend against such claim. The Distributor shall be entitled to participate at its own expense in the defense or, if it so elects, to assume the defense of any suit brought to enforce the claim, but if the Distributor elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the Funds, the Sponsor and the Trust Affiliates, and to any controlling person or persons, defendant or defendants in the suit. In the event that Distributor elects to assume the defense of any suit and retain counsel, the Funds or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional counsel retained by them. If the Distributor does not elect to assume the defense of any suit, it will reimburse the Funds, the Sponsor, their officers and managers or
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controlling person or persons, defendant or defendants in the suit, for the reasonable fees and expenses of any counsel retained by them. The Trust and the Sponsor agrees to notify the Distributor promptly of the commencement of any litigation or proceedings against them or any of their officers in connection with the issuance or sale of any of the Baskets or the Shares.
(c) No indemnified party shall settle any claim against it for which it intends to seek indemnification from the indemnifying party, under the terms of section 6(a) or 6(b) above, without prior written notice to and consent from the indemnifying party, which consent shall not be unreasonably withheld. No indemnified or indemnifying party shall settle any claim unless the settlement contains a full release of liability with respect to the other party in respect of such action. This section 6 shall survive the termination of this Agreement.
(d) Notwithstanding anything contained herein to the contrary, no party shall be liable for any indirect, special or consequential damages; provided that the foregoing limitation shall not apply with respect to damages or claims arising out of or relating to that party’s fraud or willful misconduct.
7. Representations.
(a) The Distributor represents and warrants that (i) it is duly organized as a Delaware limited liability company and is and at all times will remain duly authorized and licensed under applicable law to carry out its services as contemplated herein; (ii) the execution, delivery and performance of this Agreement are within its power and have been duly authorized by all necessary action; (iii) its entering into this Agreement or providing the services contemplated hereby does not conflict with or constitute a default or require a consent under or breach of any provision of any agreement or document to which the Distributor is a party or by which it is bound; (iv) it is registered as a broker-dealer under the 1934 Act and is a member of FINRA, a(v) it is in material compliance with all laws, rules and regulations applicable to it, including but not limited to the rules and regulations promulgated by FINRA, (vi) it has and will continue to have access to the necessary facilities, equipment and personnel to perform its duties and obligations under this Agreement; (vii) it will promptly notify the Trust in the event it is for any reason unable to perform any of its obligations under this Agreement; (viii) it shall perform its duties hereunder in accordance with applicable law; (ix) it will promptly notify the Trust, except as may be prohibited by applicable law, of any legal, regulatory or administrative proceedings that have been instituted, which would materially impair the Distributor’s ability to perform its duties and obligations under this Agreement; and (x) the various procedures and systems which it has implemented in safeguarding from loss or damage attributable to fire, theft or any other cause, the Trust’s records and other data and the Distributor’s records, data equipment facilities and other property used in the performance of its obligations hereunder are adequate and it will make such changes therein from time to time as it may deem reasonably necessary for the secure performance of its obligations hereunder.
(b) The Distributor acknowledges that it is a financial institution subject to the USA Patriot Act of 2001 and the Bank Secrecy Act (collectively, the “AML Acts”), which require, among other things, that financial institutions adopt compliance programs to guard against money laundering. The Distributor represents and warrants that it is in compliance with and will continue to comply with the AML Acts and applicable regulations in all relevant respects. The Distributor agrees that it will take such further steps, and cooperate with the other as may be reasonably
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necessary, to facilitate compliance with the AML Acts, including but not limited to the provision of copies of its written procedures, policies and controls related thereto (“AML Operations”). Notwithstanding the foregoing, it is expressly understood and agreed that neither the Sponsor nor any of its directors, officers, employees or agents, on its own behalf or on behalf of the Funds, shall have access to any of Distributor’s AML Operations, books or records pertaining to other clients or services of Distributor.
(c) The Distributor and the Sponsor, on behalf of the Trust, each individually represent and warrant that it has in place and will maintain physical, electronic and procedural safeguards reasonably designed to protect the security, confidentiality and integrity of, and to prevent unauthorized access to or use of, records and information relating to consumers and customers of the Funds. The Sponsor, on behalf of the Trust, further represents to the Distributor that it has adopted, to the extent required under applicable law, a statement of its privacy policies and practices as required by Securities and Exchange Commission Regulation S-P and agrees to provide to the Distributor a copy of that statement annually.
(d) The Sponsor, on its own behalf and on behalf of the Trust, represents and warrants that (i) the Trust is duly organized as a Delaware statutory trust and is and at all times will remain duly authorized to carry out its obligations as contemplated herein; (ii) the execution, delivery and performance of this Agreement are within the power of the Sponsor and the Trust and have been duly authorized by all necessary action; (iii) entering into this Agreement by the Sponsor and the Trust does not conflict with or constitute a default or require a consent under or breach of any provision of any agreement or document to which the Trust or the Sponsor is a party or by which either is bound; (iv) the Sponsor is duly registered with the NFA as a Commodity Pool Operator and the Sponsor will use commercially reasonable efforts in seeking to ensure compliance by the Trust with the CEA and all of the relevant Commodities Rules; (v) the Registration Statement and the Prospectus have been prepared, and all sales literature and advertisements (“Sales Literature and Advertisements”) approved by the Sponsor with respect to the Funds or other materials prepared by or on behalf of the Funds shall be prepared, in all material respects, in conformity with the CEA, the Commodities Rules, the 1933 Act and the rules and regulations of the SEC (the “SEC Rules and Regulations”); (vi) the Registration Statement and the Prospectus contain, and all Sales Literature and Advertisements shall contain, all statements required to be stated therein in accordance with the CEA, the Commodities Rules, the 1933 Act, the SEC Rules and Regulations, and FINRA Rules and Regulations; and (vii) all statements of fact contained therein, or to be contained in all Sales Literature and Advertisements, are or will be true and correct in all material respects at the time indicated or the effective date, as the case may be, and none of the Registration Statement, any Fund’s Prospectus, nor any Sales Literature and Advertisements shall include any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the case of the Prospectus in light of the circumstances in which made, not misleading. The Trust shall, from time to time, file such supplement, amendment or amendments to the Registration Statement and the Prospectus as, in the light of future developments, shall, in the opinion of counsel to the Sponsor, be necessary in order to have the Registration Statement and the Prospectus at all times contain all material facts required to be stated therein or necessary to make the statements therein, in the case of the Prospectus in light of the circumstances in which made, not misleading. The Trust shall not file any amendment to the Registration Statement or the Prospectus without giving the Distributor reasonable notice thereof in advance and the Sponsor shall promptly notify the Distributor of any
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stop order suspending the effectiveness of the Registration Statement. Notwithstanding the foregoing, the Trust shall not be deemed to make any representation or warranty as to any information or statement provided by the Distributor for inclusion in the Registration Statement or any Fund’s Prospectus.
8. Duration, Termination and Amendment.
(a) This Agreement shall be effective on the date set forth above, and unless terminated as provided herein, shall continue until December 31, 2016, and thereafter from year to year, unless earlier terminated, without the payment of any penalty, as to each individual Fund by the Sponsor or by the Distributor, on at least sixty (60) days’ prior written notice.
(b) As soon as reasonably practicable following the termination or expiration of this Agreement, the Distributor agrees to transfer such records and related supporting documentation as are held by it under this Agreement to any replacement provider of the services or to such other person as the Trust may direct. If directed by the Trust, the Distributor will provide the services hereunder until a replacement distributor is in place, for a reasonable period of time up to nine (9) months, subject to the terms of this Agreement, including compensation. The Distributor will also provide reasonable assistance to its successor, for such transfer, subject to the payment of such reasonable expenses and charges as the Distributor customarily charges for such assistance.
(c) Termination of this Agreement with respect to any one particular Fund shall in no way affect the rights and duties under this Agreement with respect to the Trust or any other Fund.
(d) No provision of this Agreement may be changed, waived, discharged or terminated except by an instrument in writing signed by the party against which an enforcement of the change, waiver, discharge or termination is sought.
9. Notice.
All notices, requests, claims, demands and other communications required or permitted to be given under this agreement shall be in writing and shall be delivered by hand or sent by an internationally recognized overnight courier service with signature required for delivery, by facsimile where a confirmation of receipt is obtained, provided, however, that if sent by facsimile the written communication must also be sent by next business day delivery via an internationally recognized overnight courier service with signature required for delivery, or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties hereto at the following addresses:
If to the Distributor:
Foreside Fund Services, LLC
ATTN: Legal Department
Three Canal Plaza, Suite 100
Portland, ME 04101
Telephone: (207) 553-7110
Facsimile: (207) 553-7151
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If to the Sponsor:
WisdomTree Commodity Services, LLC
ATTN: Legal
245 Park Avenue, 35th Floor
New York, New York 10167
Facsimile: 917-267-2721
If to the Trust:
WisdomTree Continuous Commodity Index Fund
ATTN: Ben Slavin
245 Park Avenue, 35th Floor
New York, New York 10167
Facsimile: 917-267-2721
All such communications so addressed shall be deemed given (i) when delivered, if delivered personally to the intended recipient, or if sent by an internationally recognized courier service with signature required for delivery, or if sent by facsimile and a confirmation of receipt is obtained, and the written communication has also been sent for next business day delivery via an internationally recognized courier service with signature required for delivery, or (ii) three business days after being mailed if sent by certified or registered mail, postage prepaid, return receipt requested, or upon delivery if actual delivery occurs earlier.
10. Choice of Law.
This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to the choice of laws provisions thereof.
11. Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
12. Severability.
If any provisions of this Agreement shall be held or made invalid, in whole or in part, then the other provisions of this Agreement shall remain in force. Invalid provisions shall, in accordance with this Agreement’s intent and purpose, be amended, to the extent legally possible, in order to effectuate the intended results of such invalid provisions.
13. Insurance.
The Distributor will maintain at its expense an errors and omissions insurance policy adequate to cover services provided by the Distributor hereunder. Upon the Trust’s or Sponsor’s reasonable request, which in no event shall be more than once annually, the Distributor shall furnish to the Trust or Sponsor a summary of the Distributor’s applicable insurance coverage. The Distributor shall notify the Trust and Sponsor of any material claims against it which would
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materially impair Distributor’s ability to perform its duties and obligations under this Agreement, whether or not covered by insurance.
14. Confidentiality.
During the term of this Agreement, the Distributor and the Sponsor, on its own behalf and on behalf of the Trust, may have access to confidential information relating to such matters as either party’s business, trade secrets, systems, procedures, manuals, products, contracts, personnel, and clients. As used in this Agreement, “Confidential Information” means information belonging to one of the parties that is of value to such party and the disclosure of which could result in a competitive or other disadvantage to such party. Confidential Information includes, without limitation, transaction information with Authorized Participants (which is the Trust’s and Sponsor’s Confidential Information), financial information, proposal and presentations, reports, forecasts, inventions, improvements and other intellectual property; trade secrets; know-how; designs, processes or formulae; software; market or sales information or plans; customer lists; and business plans, prospects and opportunities (such as possible acquisitions or dispositions of businesses or facilities). Confidential Information includes information developed by either party in the course of engaging in the activities provided for in this Agreement, unless: (i) the information is or becomes publicly known through lawful means; (ii) the information is disclosed to the other party without a confidential restriction by a third party who rightfully possesses the information and did not obtain it, either directly or indirectly, from one of the parties, as the case may be, or any of their respective principals, employees, affiliated persons, or affiliated entities. The parties understand and agree that all Confidential Information shall be kept confidential by the other both during and after the term of this Agreement. Each party shall maintain commercially reasonable information security policies and procedures for protecting Confidential Information. The parties further agree that they will not, without the prior written approval by the other party, disclose such Confidential Information, or use such Confidential Information in any way, either during the term of this Agreement or at any time thereafter, except as required in the course of this Agreement and as provided by the other party or as required by law. Upon termination of this Agreement for any reason, or as otherwise requested by the Sponsor, all Confidential Information held by or on behalf of Sponsor or the Trust shall be promptly returned to the Sponsor, or an authorized officer of the Distributor will certify to the Sponsor in writing that all such Confidential Information has been destroyed, provided that Distributor may retain Confidential Information to the extent required by regulatory record retention requirements applicable to it. This section 13 shall survive the termination of this Agreement. Notwithstanding the foregoing, a party may disclose the other’s Confidential Information if (i) required by law, regulation or legal process or if requested by the SEC, CFTC, NFA, FINRA or other governmental regulatory agency with jurisdiction over the parties hereto or (ii) requested to do so by the other party; provided that in the event of (i), the disclosing party shall give the other party reasonable prior notice of such disclosure to the extent reasonably practicable and shall reasonably cooperate with the other party (at such other party’s expense) in any efforts to prevent such disclosure.
15. Limitation of Liability.
This Agreement is executed by or on behalf of the Trust with respect to each Fund and the obligations hereunder are not binding upon any of the trustees, officers or shareholders of a Fund individually but are binding only upon each Fund to which such obligations pertain and the assets and property of such Fund. Separate and distinct records are maintained for each Fund and the
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assets associated with any such Fund are held and accounted for separately from the other assets of any other Fund. The debts, liabilities, obligations, and expenses incurred, contracted for, or otherwise existing with respect to a particular Fund shall be enforceable against the assets of that Fund only, and not against the assets of any other Fund, and none of the debts, liabilities, obligations, and expenses incurred, contracted for, or otherwise existing with respect to any other Fund shall be enforceable against the assets of that Fund. The Trust’s Agreement and Declaration of Trust, as may be amended form time to time, is on file with the Sponsor.
16. Use of Names; Publicity.
The Funds shall not use the Distributor’s name, or any trade or service mark owned by or licensed to the Distributor, in any offering material, shareholder report, advertisement or other material relating to the Funds, other than for the purpose of merely identifying and describing the functions of the Distributor hereunder, in a manner not approved by the Distributor in writing prior to such use, such approval not to be unreasonably withheld. The Distributor hereby consents to all uses of its name required by the SEC, the CFTC, any state securities commission, or any federal or state regulatory authority.
The Distributor or its affiliates shall not use the name of the Trust or the Sponsor in any offering material, shareholder report, advertisement or other material relating to the Distributor, other than for the purpose of merely identifying and describing the functions of the Funds hereunder, in a manner not approved by the Sponsor in writing prior to such use, provided that in no case shall such approval be unreasonably withheld. The Sponsor and the Trust hereby consent to all uses of their names required by FINRA, the SEC, the CFTC or any state securities commission, or any federal or state regulatory authority. The Sponsor and the Trust also hereby consent to the inclusion of the Sponsor’s and/or Trust’s names on the Distributor’s website noting such parties as clients of the Distributor.
None of the Sponsor, the Trust or the Distributor will disclose any of the economic terms of this Agreement, except as may be required by law.
17. Regulatory Updates; Management Access and Engagement.
Foreside shall maintain awareness of significant emerging regulatory, self-regulatory and legislative developments that may affect the distribution services provided to the Trust or the Sponsor, update the Trust and the Sponsor on those developments and provide related planning assistance where requested or appropriate.
Foreside and the Sponsor will appoint one or more senior representatives that will meet from time to time to monitor the quality of the Services, evaluate any remedial action to address any failure to meet contractual obligations, and address strategic aspects of the Services. The meetings are intended to foster collaboration and transparency. At the request of the Sponsor, senior executives of Foreside will be available to meet with such frequency as the parties may agree to address issues that have not been resolved. The strategic meetings will be held to review and address strategic aspects of the Services, including: (i) planned upgrades by Foreside to Foreside technology; (ii) changes to the Services in order to offer Foreside’s customers more efficient or improved services or functionality; (iii) location strategy for non-core service team
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support services; (iv) any new products or services that Foreside intends to make available as part of its services offerings; and (v) the strategic direction of the Trust.
18. Personnel.
Foreside shall appoint individuals with suitable training and skills and in sufficient numbers to perform the Services. The Sponsor or the Trust may request that Foreside reassign any employee from the team that provides Services (“Foreside Personnel”) to the Trust. Any such request for Foreside to reassign any employee that provides Services will be discussed by senior team management and escalated as appropriate. Foreside will consider the input of the Trust or Sponsor. The timing for transfer, reassignment or replacement, if any, of Foreside Personnel will be closely coordinated with the requirements for timing and other elements of the Services so as to maintain continuity in the performance of the Services.
19. Notice of Service Location Change.
Foreside shall provide the Trust and Sponsor reasonable notice of any material change in the location of the core service team.
20. Technology Access and Upgrades.
Foreside shall provide the Trust, the Sponsor and their authorized designees with access to Foreside’s core platforms related to the Services, including, without limitation, Foreside’s proprietary internet-based marketing/advertising web portal or such other web portal with no less capability and functionality than the proprietary Foreside portal. If, in the ordinary course of its business, Foreside enhances the foregoing technologies or any other core system processing functionality that it uses in connection with the Services, Foreside shall promptly inform the Trust and Sponsor of such enhancements. If the Trust and/or Sponsor, as the case may be, agrees to use the enhancements, the parties will agree to a reasonable timetable for the rollout of the enhancements. Foreside shall not charge the Trust or Sponsor for technology changes that it ordinarily provides at no charge to any other customers.
21. Site Visits and Inspections; Regulatory Examinations.
During the term of the Agreement, authorized representatives of the Sponsor or the Trust may conduct periodic site visits of Foreside’s facilities and inspect Foreside’s records and as they pertain to Foreside’s services for the Trust under or pursuant to the Distribution Agreement or otherwise to the Sponsor. Such inspections shall occur during Foreside’s regular business hours and, except as otherwise agreed to by the parties, no more frequently than twice a year. Site visits as may be scheduled in the ordinary course of business are not restricted in frequency.
22. Service Level Standards.
The parties agree to negotiate in good faith for service level standards and operating procedures associated with the Services.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their officers designated below as of the date first set forth above.
| WISDOMTREE COMMODITY SERVICES, LLC | ||
| on behalf of the Trust | ||
| By: | ||
| Name: Gregory Barton | ||
| Title: President | ||
| WISDOMTREE COMMODITY SERVICES, LLC | ||
| By: | ||
| Name: Gregory Barton | ||
| Title: President | ||
| FORESIDE FUND SERVICES, LLC | ||
| By: | ||
| Name: Mark Fairbanks | ||
| Title: President | ||
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EXHIBIT A
List of Funds
WisdomTree Continuous Commodity Index Fund
| Ex. A-1 |
Exhibit 10.5
Form Of Transfer Agency and Service Agreement
This Agreement made as of January 4, 2016, and to have an effective date on January 1, 2016, by and between each commodity pool entity set forth on Schedule A hereto (each such commodity pool entity and each commodity pool entity made subject to this Agreement in accordance with Section 12 below shall hereinafter be referred to as a “Trust”) and State Street Bank and Trust Company, a Massachusetts trust company (the “State Street” or the “Transfer Agent”).
WHEREAS, the Trust is authorized to issue common units of beneficial interest (“Shares”);
WHEREAS, the Trust is operated as a commodity pool under the Commodity Exchange Act, and is registered with the U.S. Securities and Exchange Commission ("SEC") by means of a registration statement on Form S-1 or Form S-3, as applicable (each, a "Registration Statement") under the Securities Act of 1933, as amended ("1933 Act");
WHEREAS, WisdomTree Commodity Services, LLC or WisdomTree Coal Services, LLC, as applicable, serves as the managing owner and/or sponsor, and commodity pool operator, of the Trust (the “Managing Owner” or “Sponsor”);
WHEREAS, the Trust will issue and redeem Shares only in aggregations of Shares known as “Baskets” as described in the currently effective prospectus and statement of additional information of the Trust (collectively, the “Prospectus”);
WHEREAS, only those entities (“Authorized Participants”) that have entered into an Authorized Participant Agreement with the distributor of the Trust, currently Foreside Fund Services LLC (the “Distributor”), are eligible to place orders for Baskets with the Distributor;
WHEREAS, the Depository Trust Company, a limited purpose trust company organized under the laws of the State of New York (“DTC”) or its nominee will be the record or registered owner of all outstanding Shares;
WHEREAS, the Trust desires to appoint Transfer Agent to act as its transfer agent, dividend disbursing agent and agent in connection with certain other activities; and Transfer Agent is willing to accept such appointment.
NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto, agree as follows:
| 1. | TERMS OF APPOINTMENT |
| 1.1 | Subject to the terms and conditions set forth in this Agreement, the Trust hereby employs and appoints the Transfer Agent to act as, and the Transfer Agent agrees to act as, transfer agent for the Baskets and dividend disbursing agent of the Trust. In the event that the Sponsor establishes one or more additional Trust(s) with |
respect to which such Trust desires to retain the Transfer Agent to act as transfer agent, dividend disbursing agent and agent in connection with certain other activities hereunder, the Trust(s) shall notify the Transfer Agent in writing. Upon written acceptance by the Transfer Agent, such Trust(s) shall become subject to the provisions of this Agreement to the same extent as the existing Trusts, except to the extent that such provisions (including those relating to compensation and expenses payable) may be modified with respect to such Trust in writing by such Trust and the Transfer Agent at the time of the addition of such Trust.
| 1.2 | Transfer Agency Services. In accordance with procedures established from time to time by agreement between the Trust and the Transfer Agent, the Transfer Agent shall: |
| (i) | establish each Authorized Participant’s account in the Trust on the Transfer Agent’s recordkeeping system and maintain such account for the benefit of such Authorized Participant; |
| (ii) | receive and process orders for the purchase of Baskets from the Distributor or the Trust, and promptly deliver payment and appropriate documentation thereof to the custodian of the Trust as identified by the Trust (the “Custodian”); |
| (iii) | generate or cause to be generated and transmitted confirmation of receipt of such purchase orders to the Authorized Participants and, if applicable, transmit appropriate trade instruction to the National Securities Clearance Corporation (“NSCC”); |
| (iv) | receive and process redemption requests and redemption directions from the Distributor or the Trust and deliver the appropriate documentation thereof to the Custodian; |
| (v) | with respect to items (i) through (iv) above, the Transfer Agent may execute transactions directly with Authorized Participants; |
| (vi) | at the appropriate time as and when it receives monies paid to it by the Custodian with respect to any redemption, pay over or cause to be paid over in the appropriate manner such monies, if any, to the redeeming Authorized Participant as instructed by the Distributor or the Trust ; |
| (vii) | prepare and transmit by means of DTC’s book-entry system payments for any dividends and distributions declared by the Trust; |
| (viii) | record the issuance of Shares of the Trust and maintain a record of the total number of Shares of the Trust which are issued and outstanding; and provide the Trust on a regular basis with the total number of Shares of the Trust which are issued and outstanding but Transfer Agent shall have no obligation, when recording the issuance of Shares, to monitor the issuance of such Shares to determine if there are authorized Shares available for |
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| issuance or to take cognizance of any laws relating to, or corporate actions required for, the issue or sale of such Shares, which functions shall be the sole responsibility of the Trust; and, excluding DTC or its nominee as the record or registered owner, the Transfer Agent shall have no obligations or responsibilities to account for, keep records of, or otherwise related to, the beneficial owners of the Shares; |
| (ix) | maintain and manage, as agent for the Trust, such bank accounts as the Transfer Agent shall deem necessary for the performance of its duties under this Agreement, including but not limited to, the processing of Basket purchases and redemptions and the payment of a Trust’s dividends and distributions. The Transfer Agent may maintain such accounts at the bank or banks deemed appropriate by the Transfer Agent in accordance with applicable law; |
| (x) | process any request from an Authorized Participant to change its account registration; and |
| (xi) | except as otherwise instructed by the Trust, the Transfer Agent shall process all transactions in the Trust in accordance with the procedures mutually agreed upon by the Trust and the Transfer Agent with respect to the proper net asset value to be applied to purchase orders received in good order by the Transfer Agent or by the Trust or any other person or firm on behalf of the Trust or from an Authorized Participant before cut-offs established by the Trust. The Transfer Agent shall report to the Trust any known exceptions to the foregoing. |
| 1.3 | Additional Services. In addition to, and neither in lieu of nor in contravention of the services set forth in Section 1.2 above, the Transfer Agent shall perform the following services: |
| (i) | Perform certain customary services of a transfer agent and dividend disbursing agent. |
| (ii) | The Transfer Agent shall perform such other services for the Trust that are mutually agreed to by the parties from time to time, for which the Trust will pay such fees as may be mutually agreed upon, including the Transfer Agent’s reasonable out-of-pocket expenses. The provision of such services shall be subject to the terms and conditions of this Agreement. |
| (iii) | DTC and NSCC. The Transfer Agent shall: (a) accept and effectuate the registration and maintenance of accounts, and the purchase and redemption of Baskets in such accounts, in accordance with instructions transmitted to and received by the Transfer Agent by transmission from DTC or NSCC on behalf of Authorized Participants; and (b) issue instructions to a Trust’s banks for the settlement of transactions between |
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the Trust and DTC or NSCC (acting on behalf of the applicable Authorized Participant).
| 1.4 | Authorized Persons. The Trust hereby agrees and acknowledges that the Transfer Agent may rely on the current list of authorized persons of the Sponsor and other persons authorized by the Sponsor, including the Distributor, as provided or agreed to by the Sponsor on behalf of the Trust and as may be amended from time to time, in receiving instructions to issue or redeem Baskets. The Trust agrees and covenants for itself and each such authorized person that any order or sale of or transaction in Baskets received by it after the order cut-off time as set forth in the Prospectus or such earlier time as designated by the Trust (the “Order Cut-Off Time”), shall be effectuated at the net asset value determined on the next business day or as otherwise required pursuant to the applicable Trust’s then-effective Prospectus, and the Trust or such authorized person shall so instruct the Transfer Agent of the proper effective date of the transaction. |
| 1.5 | Anti-Money Laundering and Client Screening. With respect to the Trust’s offering and sale of Baskets at any time, and for all subsequent transfers of such interests, the Trust or its delegate shall, to the extent applicable, directly or indirectly and to the extent required by law: (i) conduct know your customer/client identity due diligence with respect to potential investors and transferees in the Shares and Baskets and shall obtain and retain due diligence records for each investor and transferee; (ii) use its best efforts to ensure that each investor’s and any transferee’s funds used to purchase Baskets or Shares shall not be derived from, nor the product of, any criminal activity; (iii) if requested, provide periodic written verifications that such investors/transferees have been checked against the United States Department of the Treasury Office of Foreign Assets Control database for any non-compliance or exceptions; and (iv) perform its obligations under this Section in accordance with all applicable anti-money laundering laws and regulations. In the event that the Transfer Agent has received advice from counsel that access to underlying due diligence records pertaining to the investors/transferees is necessary to ensure compliance by the Transfer Agent with relevant anti-money laundering (or other applicable) laws or regulations, the Trust shall, upon receipt of written request from the Transfer Agent, provide the Transfer Agent copies of such due diligence records. |
| 1.6 | State Transaction (“Blue Sky”) Reporting. If applicable, the Trust shall be solely responsible for its “blue sky” compliance and state registration requirements. |
| 1.7 | Tax Law. The Transfer Agent shall have no responsibility or liability for any obligations now or hereafter imposed on the Trust, any Baskets, any Shares, a beneficial owner thereof, an Authorized Participant or the Transfer Agent in connection with the services provided by the Transfer Agent hereunder by the tax laws of any country or of any state or political subdivision thereof. It shall be the responsibility of the Trust to notify the Transfer Agent of the obligations imposed on the Trust, the Baskets, the Shares, or the Transfer Agent in connection with the services provided by the Transfer Agent hereunder by the tax law of countries, |
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states and political subdivisions thereof, including responsibility for withholding and other taxes, assessments or other governmental charges, certifications and governmental reporting.
| 1.8 | The Transfer Agent shall provide the office facilities and the personnel determined by it to perform the services contemplated herein. |
| 2. | FEES AND EXPENSES |
| 2.1 | Fee Schedule. For the performance by the Transfer Agent of services provided pursuant to this Agreement, the Transfer Agent shall be entitled to receive the fees and expenses set forth in a written fee schedule. Such fees and any out of pocket expenses and advances identified under Section 2.2 below may be changed from time to time, subject to mutual written agreement between the Trust and the Transfer Agent. The parties agree that the fees set forth in the fee schedule shall apply with respect to each Trust listed on Schedule A hereto as of the date hereof and to any newly created Trusts added to this Agreement that have requirements consistent with services then being provided by the Transfer Agent under this Agreement. In the event that a Trust is to become a party to this Agreement as a result of an acquisition or merger, then the parties shall confer diligently and negotiate in good faith, and agree upon fees applicable to such Trust. |
| 2.2 | Out of Pocket Expenses. In addition to the fees paid under Section 2.1 above, the Trust agrees to reimburse the Transfer Agent for reasonable out of pocket expenses set out in the fee schedule. In addition, any other reasonable expenses incurred by the Transfer Agent at the request or with the consent of the Trust, will be reimbursed by the Trust. |
| 3. | REPRESENTATIONS AND WARRANTIES OF THE TRANSFER AGENT |
The Transfer Agent represents and warrants to the Trust that:
| 3.1 | It is a trust company duly organized and existing under the laws of the Commonwealth of Massachusetts. |
| 3.2 | It is duly registered as a transfer agent under Section 17A(c)(2) of the Securities Exchange Act of 1934, as amended (the “1934 Act”), it will remain so registered for the duration of this Agreement, and it will promptly notify the Trust in the event of any material change in its status as a registered transfer agent. |
| 3.3 | It is duly qualified to carry on its business in the Commonwealth of Massachusetts. |
| 3.4 | It is empowered under applicable laws and by its organizational documents to enter into and perform the services contemplated in this Agreement. |
| 3.5 | All requisite organizational proceedings have been taken to authorize it to enter into and perform this Agreement. |
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| 3.6 | It has and will continue to have access to the necessary facilities, equipment and personnel to perform its duties and obligations under this Agreement. |
| 3.7 | It will promptly notify the Trust in the event that the Transfer Agent is for any reason unable to perform any of its obligations under this Agreement. |
| 3.8 | It will promptly notify the Trust, except as may be prohibited by applicable law, of any legal, regulatory or administrative proceedings that have been instituted, which would materially impair the Transfer Agent’s ability to perform its duties and obligations under this Agreement. |
| 3.9 | The various procedures and systems which it has implemented with regard to safeguarding from loss or damage attributable to fire, theft or any other cause, the Trust’s records and other data and the Transfer Agent’s records, data equipment facilities and other property used in the performance of its obligations hereunder are adequate and it will make such changes therein from time to time as it may deem reasonably necessary for the secure performance of its obligations hereunder. |
The Transfer Agent will notify the Trust promptly if any of the representations and warranties above cease to be true.
| 4. | REPRESENTATIONS AND WARRANTIES OF THE TRUST |
The Trust represents and warrants to the Transfer Agent that:
| 4.1 | The Trust is a statutory trust duly organized, existing and in good standing under the laws of the state of its formation. |
| 4.2 | The Trust is empowered under applicable laws and by its organizational documents to enter into and perform this Agreement. |
| 4.3 | All requisite proceedings have been taken to authorize the Trust to enter into, perform and receive services pursuant to this Agreement. |
| 4.4 | A registration statement under the Securities Act of 1933, as amended (the “Securities Act”), is currently effective and will remain effective, and all appropriate state securities law filings have been made and will continue to be made, with respect to all Shares of the Trust being offered for sale. |
| 4.5 | It has all necessary right, title, intellectual property, licenses, consents and content as may be necessary for the Trust to operate as presently contemplated. |
The Trust will notify the Transfer Agent promptly if any of the representations and warranties above cease to be true.
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| 5. | DATA ACCESS AND PROPRIETARY INFORMATION |
| 5.1 | The Trust acknowledges that the databases, computer programs, screen formats, report formats, interactive design techniques, and documentation manuals furnished to the Trust by the Transfer Agent as part of the Trust’s ability to access certain Trust-related data maintained by the Transfer Agent or another third party on databases under the control and ownership of the Transfer Agent (“Data Access Services”) constitute copyrighted, trade secret, or other proprietary information (collectively, “Proprietary Information”) of substantial value to the Transfer Agent or another third party. In no event shall Proprietary Information be deemed Authorized Participant information or the confidential information of the Trust. The Trust agrees to treat all Proprietary Information as proprietary to the Transfer Agent and further agrees that it shall not divulge any Proprietary Information to any person or organization except as may be provided hereunder. Without limiting the foregoing, the Trust agrees for itself and its officers and trustees (references to officers and/or trustees of the Trust as used herein shall be deemed to include officers and/or trustees/directors of the Sponsor) and their agents, to: |
| (i) | use such programs and databases solely on the Trust’s, or such agents’ computers, or solely from equipment at the location(s) agreed to between the Trust and the Transfer Agent, and solely in accordance with the Transfer Agent’s applicable user documentation; |
| (ii) | refrain from copying or duplicating in any way the Proprietary Information; |
| (iii) | refrain from obtaining unauthorized access to any portion of the Proprietary Information, and if such access is inadvertently obtained, to inform the Transfer Agent in a timely manner of such fact and dispose of such information in accordance with the Transfer Agent’s instructions; |
| (iv) | refrain from causing or allowing Proprietary Information transmitted from the Transfer Agent’s computers to the Trust’s, or such agents’ computer to be retransmitted to any other computer facility or other location, except with the prior written consent of the Transfer Agent; |
| (v) | allow the Trust or such agents to have access only to those authorized transactions agreed upon by the Trust and the Transfer Agent; |
| (vi) | honor all reasonable written requests made by the Transfer Agent to protect at the Transfer Agent’s expense the rights of the Transfer Agent in Proprietary Information at common law, under federal copyright law and under other federal or state law. |
| 5.2 | Proprietary Information shall not include all or any portion of any of the foregoing items that are or become publicly available without breach of this Agreement; that are released for general disclosure by a written release by the |
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Transfer Agent; or that are already in the possession of the receiving party at the time of receipt without obligation of confidentiality or breach of this Agreement.
| 5.3 | If the Trust notifies the Transfer Agent that any of the Data Access Services do not operate in material compliance with the most recently issued user documentation for such services, the Transfer Agent shall endeavor in a timely manner to correct such failure. Organizations from which the Transfer Agent may obtain certain data included in the Data Access Services are solely responsible for the contents of such data, and the Trust agrees to make no claim against the Transfer Agent arising out of the contents of such third-party data, including, but not limited to, the accuracy thereof. DATA ACCESS SERVICES AND ALL COMPUTER PROGRAMS AND SOFTWARE SPECIFICATIONS USED IN CONNECTION THEREWITH ARE PROVIDED ON AN “AS IS, AS AVAILABLE” BASIS. THE TRANSFER AGENT EXPRESSLY DISCLAIMS ALL WARRANTIES EXCEPT THOSE EXPRESSLY STATED HEREIN INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. |
| 5.4 | If the transactions available to the Trust include the ability to originate electronic instructions to the Transfer Agent in order to effect the transfer or movement of cash or Baskets or transmit Authorized Participant information or other information, then in such event the Transfer Agent shall be entitled to rely on the validity and authenticity of such instruction without undertaking any further inquiry as long as such instruction is undertaken in conformity with security procedures established by the Transfer Agent from time to time. |
| 5.5 | Each party shall take reasonable efforts to advise its employees of their obligations pursuant to this Section. The obligations of this Section shall survive any earlier termination of this Agreement. |
| 6. | RESERVED |
| 7. | STANDARD OF CARE / INDIRECT DAMAGES |
| 7.1 | Standard of Care. The Transfer Agent shall at all times act in good faith and without negligence and agrees to exercise the care and expertise of a leading provider of transfer agency services and use all reasonable efforts in performing the services under this Agreement, but assumes no responsibility and shall not be liable for loss or damage due to errors unless said errors are caused by its bad faith, negligence, or willful misconduct or that of its employees or agents. The parties agree that any encoding or payment processing errors shall be governed by this standard of care, and that Section 4-209 of the Uniform Commercial Code is superseded by this Section. |
| 7.2 | Indirect Damages. Other than damages arising from a party’s fraud, neither party shall be liable for any special, indirect or consequential damages under any |
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provision of this Agreement or for any special, indirect or consequential damages arising out of any act or failure to act hereunder.
| 7.3 | In any event, except as otherwise agreed to in writing by the parties hereto, the Transfer Agent’s cumulative liability for each calendar year (a “Liability Period”) with respect to the services provided pursuant to this Agreement regardless of the form of action or legal theory shall be limited to its total annual compensation earned and fees payable hereunder during the preceding Compensation Period, as defined herein, for any liability or loss suffered by the Trust including, but not limited to, any liability relating to qualification of the Trust as a regulated investment company or any liability relating to the Trust’s compliance with any federal or state tax or securities statute, regulation or ruling during such Liability Period. “Compensation Period” shall mean the calendar year ending immediately prior to each Liability Period in which the event(s) giving rise to the Transfer Agent’s liability for that period have occurred. For any partial first year, the annual cumulative liability hereunder shall be the Transfer Agent’s total compensation earned and fees payable hereunder during such partial first year on an annualized basis. |
| 8. | INDEMNIFICATION |
| 8.1 | The Transfer Agent shall not be responsible for, and the Trust shall indemnify and hold the Transfer Agent harmless, from and against, any and all losses, damages, costs, charges, reasonable counsel fees (including the defense of any lawsuit solely in connection with services under this Agreement in which the Transfer Agent or its affiliate is a named party), payments, expenses and liability directly arising out of or directly attributable to the following; provided, however, that the Trust shall not be obligated to indemnify the Transfer Agent hereunder if such loss, damage or liability is due to the Transfer Agent’s (i) breach of its standard of care as set forth in Section 7.1 or (ii) violation of applicable law or regulation pertaining to the transfer agency services: |
| (a) | All actions of the Transfer Agent required to be taken pursuant to this Agreement, provided that such actions are taken in good faith and without negligence or willful misconduct; |
| (b) | The Trust’s lack of good faith, negligence or willful misconduct; |
| (c) | The reasonable reliance upon, and any subsequent reasonable use of or action taken or omitted, by the Transfer Agent, or its agents or subcontractors on: any information, records, documents, data, stock certificates or services, which are received by the Transfer Agent, including those received by machine readable input, facsimile, electronic instructions, or other similar means authorized by the Trust, and which have been prepared, maintained or performed by the Trust or any other person or firm on behalf of the Trust including but not limited to any broker-dealer, third party administrator or previous transfer agent; any |
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instructions or requests of the Trust or any of its officers; or any paper or document, reasonably believed to be genuine, authentic, or signed by the proper person or persons;
| (d) | The offer or sale of Baskets in violation of federal or state securities laws or regulations requiring that such Baskets be registered, or in violation of any stop order or other determination or ruling by any federal or any state agency with respect to the offer or sale of such Baskets (except to the extent that such violation resulted directly from the Transfer Agent’s failure to comply with the instructions of the Trust or the Administrator identifying the states and countries where the Shares of the Trust or the Funds are registered or exempt, and the number of Shares of each class registered with respect to each such state or country, as applicable. |
| (e) | The negotiation and processing of any checks, wires and ACH transmissions including without limitation for deposit into, or credit to, the Trust’s demand deposit accounts maintained by the Transfer Agent; the Transfer Agent shall assist the Trust and work with the Trust and the depositing and/or originating bank to mitigate the losses where possible; however, the Trust acknowledges that such mitigation is not a condition of this indemnity obligation; |
| (f) | Upon the Trust’s request, entering into any agreements required by the NSCC for the transmission of Trust or Shareholder data through the NSCC clearing systems; or |
| (g) | any tax obligations under the tax laws of any country or of any state or political subdivision thereof, including taxes, withholding and reporting requirements, claims for exemption and refund, additions for late payment, interest, penalties and other expenses (including legal expenses) that may be assessed, imposed or charged against the Transfer Agent as transfer agent hereunder. |
| 8.2 | At any time the Transfer Agent may apply to any officer of the Trust for instructions, and may consult with legal counsel with respect to any matter arising in connection with the services to be performed by the Transfer Agent under this Agreement, and the Transfer Agent and its agents or subcontractors shall not be liable and shall be indemnified by the Trust for any action taken or omitted by it in reliance upon such instructions or upon the opinion of such counsel, provided however, with respect to the performance of any action or omission of any action upon such advice, the Transfer Agent shall be acting within the standard of care set forth in Section 7.1. The Transfer Agent shall promptly notify the Trust of the receipt of such advice. The Transfer Agent, its agents and subcontractors shall be protected and indemnified in acting upon any paper or document furnished by or on behalf of the Trust reasonably believed to be genuine and to have been signed by the proper person or persons, or upon any instruction, information, data, |
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records or documents provided the Transfer Agent or its agents or subcontractors by machine readable input, electronic data entry or other similar means authorized by the Trust, and shall not be held to have notice of any change of authority of any person, until receipt of written notice thereof from the Trust.
| 9. | ADDITIONAL COVENANTS OF THE TRUST AND THE TRANSFER AGENT |
| 9.1 | Delivery of Documents. The Trust shall promptly furnish to the Transfer Agent the following: |
| (i) | A copy of the resolution of the Sponsor of the Trust certified by an officer authorizing the appointment of the Transfer Agent and the execution and delivery of this Agreement. |
| (ii) | A copy of the Declaration of Trust and By-Laws of the Trust and all amendments thereto. |
| 9.2 | Certificates, Checks, Facsimile Signature Devices. The Transfer Agent hereby agrees to establish and maintain facilities and procedures for safekeeping of any stock certificates, check forms and facsimile signature imprinting devices; and for the preparation or use, and for keeping account of, such certificates, forms and devices. |
| 9.3 | Records. The Transfer Agent shall keep records relating to the services to be performed hereunder, in the form and manner as it may deem advisable. The Transfer Agent agrees that all such records prepared or maintained by the Transfer Agent relating to the services to be performed by the Transfer Agent hereunder are the property of the Trust and will be and will be surrendered promptly to the Trust on and in accordance with its request. Records may be surrendered in either written or machine-readable form, at the option of the Transfer Agent. |
| 9.4 | In performing the services hereunder, the Transfer Agent shall comply with the applicable provisions of the Trust’s current prospectus(es) and statement(s) of additional information, and effective amendments thereto. The Trust shall promptly provide the Transfer Agent with copies of such material as soon as available and, upon request, copies of any applicable resolutions by the Trust’s Board of Trustees which relate to the Shares. |
| 9.5 | SSAE16 Reports. The Transfer Agent will furnish to the Trust, on a semi-annual basis, a report in accordance with Statements on Standards for Attestation Engagements No. 16 (the “SSAE Report”) as well as such other reports and information relating to the Transfer Agent’s policies and procedures and its compliance with such policies and procedures and with the laws applicable to its business and its services, as the parties may mutually agree upon. |
| 9.6 | Business Continuity. The Transfer Agent shall, at no additional expense to the Trust, take reasonable steps to minimize service interruptions in the event of |
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equipment failure, work stoppage, governmental action, communication disruption or other impossibility of performance beyond the Transfer Agent’s control. The Transfer Agent shall enter into and shall maintain in effect at all times during the term of this Agreement with appropriate parties one or more agreements making reasonable provision, at a level the Transfer Agent believes consistent with other similarly situated providers of transfer agency services, for (i) periodic back-up of the computer files and data with respect to the Trust and (ii) emergency use of electronic data processing equipment to provide services under this Agreement. Upon reasonable request, the Transfer Agent shall discuss with the Trust any business continuity/disaster recovery plan of the Transfer Agent and/or provide a high-level presentation summarizing such plan.
| 9.7 | Cooperation with Accountants. The Transfer Agent shall cooperate with the Trust’s independent public accountants and shall take all reasonable actions in the performance of its obligations under this Agreement to provide such information, as may be reasonably requested by the Trust from time to time, to such accountants for the expression of their opinion. |
| 9.8 | Insurance. The Transfer Agent shall at all times during the term of this Agreement maintain, at its cost, insurance coverage regarding its business in such amount and scope as it deems adequate in connection with the services provided by the Transfer Agent under this Agreement. Upon the Trust’s reasonable request, which in no event shall be more than once annually, the Transfer Agent shall furnish to the Trust a summary of the Transfer Agent’s applicable insurance coverage. |
| 10. | CONFIDENTIALITY |
| 10.1 | The parties hereto agree that each shall treat confidentially all information provided by each party to the other party regarding its business and operations, including information related to the development of new Trusts or new series. The Transfer Agent shall treat confidentially all information obtained in the ordinary course of performing its duties hereunder about the Trust’s prior, present or potential shareholders or relative to the advisor or distributor and their prior, present or potential customers (including all “personal information” described in Section 15.4 of this Agreement). All confidential information provided by a party hereto shall be used by any other party hereto solely for the purpose of rendering or receiving services pursuant to this Agreement and, except as may be required in carrying out this Agreement, shall not be disclosed to any third party. The foregoing shall not be applicable to any information (i) that is publicly available when provided or thereafter becomes publicly available, other than through a breach of this Agreement, (ii) that is independently derived by either party hereto without the use of any information provided by the other party hereto in connection with this Agreement, (iii) that is disclosed, upon prior notice to the party whose information is being disclosed (to the extent such notice is permissible), in the manner and to the extent required in any legal or regulatory proceeding, investigation, audit, examination, subpoena, civil investigative |
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demand or other similar process, or by operation of law or regulation, or (iv) where the party seeking to disclose has received the prior written consent of the party providing the information, which consent shall not be unreasonably withheld. Notwithstanding the foregoing, each party acknowledges that the other party may provide access to and use of confidential information relating to the other party to the disclosing party’s employees, contractors, agents, professional advisors, auditors or persons performing similar functions, as necessary solely for the purpose of rendering services under this Agreement, provided that each person or entity shall be subject to confidentiality obligations substantially similar to those set forth herein. Further, each party agrees and represents that in no case would information it receives under this Agreement be used against the other party in a manner that is adverse to the other party’s interests (including the other party’s interests in competitive businesses). Nothing herein shall prohibit or restrict the right of each party (or its affiliates) to develop, use or market products or services similar to or competitive with those of the other party (or its affiliates) provided that any such development, use or marketing does not violate the confidentiality obligations set forth herein. Additionally, each party acknowledges that the other party (or its affiliates) may already possess or have developed products or services similar to or competitive with those of the other party.
The undertakings and obligations contained in this Section 10.1 shall survive the termination of this Agreement.
| 10.2 | The Transfer Agent affirms that it has, and will continue to have throughout the term of this Agreement, procedures in place that are reasonably designed to protect the privacy of non-public personal consumer/customer financial information to the extent required by applicable laws, rules and regulations. The Transfer Agent will employ reasonable safeguards designed to protect the Trust’s confidential information, which may include but are not limited to the use of encryption technologies, passwords and any other safeguards the Transfer Agent may choose to employ. If either party becomes aware of a breach of this confidentiality provision, it will notify promptly the other party of such breach and provide such details as it deems appropriate and in accordance with the standard of care hereunder regarding the extent of the breach of confidentiality. |
| 11. | Effective Period and Termination |
This Agreement shall remain in full force and effect for an initial term ending March 31, 2019 (the “Initial Term”). After the expiration of the Initial Term, this Agreement shall automatically renew for successive one-year terms (each, a “Renewal Term”) unless a written notice of non-renewal is delivered by the non-renewing party no later than ninety (90) days prior to the expiration of the Initial Term or any Renewal Term, as the case may be. During the Initial Term and thereafter, either party may terminate this Agreement: (i) in the event of the other party’s material breach of a material provision of this Agreement that the other party has either (a) failed to cure or (b) failed to establish a remedial plan to cure that is reasonably acceptable, within 60 days’ written notice of such breach, (ii) in the event of the appointment of a
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conservator or receiver for the other party or upon the happening of a like event to the other party at the direction of an appropriate agency or court of competent jurisdiction, or (iii) based upon the Trust’s determination that there is a reasonable basis to conclude that the Administrator is insolvent or that the financial condition of the Transfer Agent is deteriorating in any material respect. Termination of this Agreement with respect to any one particular Trust shall in no way affect the rights and duties under this Agreement with respect to the Trust.
As soon as reasonably practicable following the termination or expiration of this Agreement, the Transfer Agent agrees to transfer such records and related supporting documentation as are held by it under this Agreement to any replacement provider of the services or to such other person as the Trust may direct. If directed by the Trust, the Transfer Agent will provide the services hereunder until a replacement transfer agent is in place, for a reasonable period of time up to nine (9) months, subject to the terms of this Agreement, including compensation. The Transfer Agent will also provide reasonable assistance to its successor, for such transfer, subject to the payment of such reasonable expenses and charges as the Transfer Agent customarily charges for such assistance.
| 12. | Additional TRUSTS |
In the event that any entity in addition to those listed on Schedule A hereto desires to have the Transfer Agent render services as transfer agent under the terms hereof, it shall so notify the Transfer Agent in writing, and if the Transfer Agent agrees in writing to provide such services, which shall not be unreasonably withheld, such entity shall become a Trust hereunder and be bound by all terms and conditions and provisions hereof.
| 13. | assignment |
This Agreement may not be assigned by (a) the Trust without the written consent of the Transfer Agent or (b) by the Transfer Agent without the written consent of the Trust, except that the Transfer Agent may assign this Agreement to a successor of all or a substantial portion of its business, or to a party controlling, controlled by or under common control with the Transfer Agent.
| 14. | subcontractors |
| 14.1 | The Transfer Agent may, without further consent on the part of the Trust, subcontract for the performance hereof with each of the following entities provided it is duly registered pursuant to Section 17A(c)(2) of the 1934 Act: (i) Boston Financial Data Services, Inc., a Massachusetts corporation (“BFDS”); (ii) a BFDS subsidiary; (iii) a BFDS affiliate; or (iv) another affiliated third party duly registered as a transfer agent; provided, however, that the Transfer Agent shall remain liable to the Trust for the acts and omissions of any subcontractor under this Section as it is for its own acts and omissions under this Agreement. |
| 14.2 | For purposes of this Agreement, unaffiliated third parties such as, by way of example and not limitation, Airborne Services, Federal Express, United Parcel Service, the U.S. Mails, the NSCC and telecommunication companies, shall not be deemed to be subcontractors of the Transfer Agent. |
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| 15. | miscellaneous |
| 15.1 | Amendment. This Agreement may be amended by a written agreement executed by both parties. |
| 15.2 | New York Law to Apply. This Agreement shall be construed and the provisions thereof interpreted under and in accordance with the laws of the state of New York. |
| 15.3 | Force Majeure. |
(a) Except as may arise from the Transfer Agent’s failure to exercise its standard of care, the Transfer Agent shall not be responsible or liable for any failure or delay in performance of its obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its control, including without limitation, work stoppage, power or other mechanical failure, computer virus, natural disaster, governmental action or communication disruption.
(b) The Trust shall not be responsible or liable for any failure or delay in performance of its obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its control, including without limitation, work stoppage, power or other mechanical failure, computer virus, natural disaster, governmental action or communication disruption.
| 15.4 | Data Protection. The Transfer Agent will implement and maintain a comprehensive written information security program that contains appropriate security measures to safeguard the personal information of the Trust’s shareholders, employees, directors and/or officers that the Transfer Agent receives, stores, maintains, processes or otherwise accesses in connection with the provision of services hereunder. For these purposes, “personal information” shall mean (i) an individual’s name (first initial and last name or first name and last name), address or telephone number plus (a) social security number, (b) drivers license number, (c) state identification card number, (d) debit or credit card number, (e) financial account number or (f) personal identification number or password that would permit access to a person’s account or (ii) any combination of the foregoing that would allow a person to log onto or access an individual’s account. Notwithstanding the foregoing “personal information” shall not include information that is lawfully obtained from publicly available information, or from federal, state or local government records lawfully made available to the general public. |
| 15.5 | Survival. All provisions regarding indemnification, warranty, liability, and limits thereon, and confidentiality and/or protections of proprietary rights and trade secrets shall survive the termination of this Agreement. |
| 15.6 | Severability. If any provision or provisions of this Agreement shall be held invalid, unlawful, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired. |
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| 15.7 | Priorities Clause. In the event of any conflict, discrepancy or ambiguity between the terms and conditions contained in this Agreement and any schedules or attachments hereto, the terms and conditions contained in this Agreement shall take precedence. |
| 15.8 | Waiver. No waiver by either party or any breach or default of any of the covenants or conditions herein contained and performed by the other party shall be construed as a waiver of any succeeding breach of the same or of any other covenant or condition. Any waiver must be in writing signed by the waiving party. |
| 15.9 | Entire Agreement. This Agreement and any schedules, exhibits, attachments or amendments hereto constitute the entire agreement between the parties hereto and supersedes any prior agreement with respect to the subject matter hereof whether oral or written. |
| 15.10 | Counterparts. This Agreement may be executed by the parties hereto on any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. |
| 15.11 | Reproduction of Documents. This Agreement and all schedules, exhibits, attachments and amendments hereto may be reproduced by any photographic, photostatic, microfilm, micro-card, miniature photographic or other similar process. The parties hereto all/each agree that any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding, whether or not the original is in existence and whether or not such reproduction was made by a party in the regular course of business, and that any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence. |
| 15.12 | Notices. All notices, requests, claims, demands and other communications required or permitted to be given under this agreement shall be in writing and shall be delivered by hand or sent by an internationally recognized overnight courier service with signature required for delivery, by facsimile where a confirmation of receipt is obtained, provided, however, that if sent by facsimile the written communication must also be sent by next business day delivery via an internationally recognized overnight courier service with signature required for delivery, or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties hereto at the following addresses: |
| (a) | If to Transfer Agent, to: |
State Street Bank and Trust Company
200 Clarendon Street, 16th Floor
Boston, Massachusetts 02116
Attention: Sheila McClorey, Transfer Agent Vice President
Telephone: (617) 662-9681
Facsimile: (617) 956-5648
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With a copy to:
State Street Bank and Trust Company
2 Avenue de Lafayette, 2nd Floor (LCC/2)
Boston, MA 02110
Attn: US Investor Services Legal Team, Senior Managing Counsel
Telephone: (617) 662-1783
Facsimile: (617) 662-2702
| (b) | If to the Trust, to: |
WisdomTree Commodity Pool
245 Park Avenue, 35th Floor
New York, NY 10167
Attn: Legal Department
Facsimile: 917-267-3851
All such communications so addressed shall be deemed given (i) when delivered, if delivered personally to the intended recipient, or if sent by an internationally recognized courier service with signature required for delivery, or if sent by facsimile and a confirmation of receipt is obtained, and the written communication has also be sent for next business day delivery via a internationally recognized courier service with signature required for delivery (ii) three business days after being mailed if sent by certified or registered mail, postage prepaid, return receipt requested, or upon delivery if actual delivery occurs earlier.
| 15.13 | Limitation of Liability of the Trustees and Shareholders. This Agreement is executed by the Sponsor on behalf of the Trust and the obligations hereunder are not binding upon any of the directors/trustees, officers or shareholders of the Trust (or its Sponsor) individually. Notwithstanding any other provision in this Agreement to the contrary, each and every obligation, liability or undertaking of a particular Trust under this Agreement shall constitute solely an obligation, liability or undertaking of, and be binding upon, the Trust and shall be payable solely from the available assets of such particular Trust and shall not be binding upon or affect any assets of any other Trust (or its Sponsor). |
| 15.14 | Liability of Trust. The use of a single form of agreement referring to multiple Trusts listed on Schedule A hereto is for ease of administrative purposes only. Transfer Agent and each Trust listed on Schedule A to this Agreement shall be deemed for all purposes to have entered into and executed a separate Agreement. The assets and liabilities of each Trust listed on Schedule A are separate and distinct; the obligations of or arising out of this Agreement are binding solely upon the assets or property of each Trust, on whose behalf this Agreement has been executed. |
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their names and on their behalf by and through their duly authorized officers, as of the day and year first above written.
State Street Bank and Trust Company
| By: | |||
| Name: | Gunjan Kedia | ||
| Title: | Executive Vice President | ||
Each COMMODITY POOL Entity
Identified on Schedule A Hereto
BY ITS MANAGING OWNER AND/OR SPONSOR
| By: | |||
| Name: | Gregory Barton | ||
| Title: | President | ||
TRANSFER AGENCY AND SERVICE AGREEMENT
TRANSFER AGENCY AND SERVICE AGREEMENT
SCHEDULE A
Listing of Fund(s)
WisdomTree Continuous Commodity Index Fund (f/k/a GreenHaven Continuous Commodity Index Fund) and its master fund
WisdomTree Coal Fund (f/k/a GreenHaven Coal Fund)
A-1
Exhibit 10.6
FORM OF AUTHORIZED PARTICIPANT AGREEMENT
FOR
WISDOMTREE CONTINUOUS COMMODITY INDEX FUND
This Authorized Participant Agreement (this “Agreement”) is entered into by and among WisdomTree Continuous Commodity Index Fund (“Fund”), WisdomTree Commodity Services, LLC, the Fund’s managing owner (the “Managing Owner”), Foreside Fund Services, LLC (the “Distributor”) and _______________________________________ (the “Authorized Participant” and together with the Fund, the Managing Owner and the Distributor, the “Parties”), and is subject to acceptance by State Street Bank and Trust Company (the “Transfer Agent”). The Transfer Agent serves as an agent for the Fund and is an “Index Receipt Agent” as that term is defined in the rules of the National Securities Clearing Corporation (“NSCC”).
As described in the Fund’s Trust Agreement (as amended or supplemented from time to time, the “Trust Agreement”) and in the Prospectus (as defined below), the Fund will issue its shares representing units of fractional undivided beneficial interest in and ownership of the Fund (the “Shares”). The Shares may be created or redeemed by the Managing Owner for an Authorized Participant in aggregations of Shares as set forth in the Prospectus (e.g., 50,000 Shares) (each aggregation, a “Creation Basket” or “Redemption Basket,” respectively, and collectively, the “Baskets”). Creation Baskets are offered only pursuant to the registration statement of the Fund on Form S-1, as declared effective by the Securities and Exchange Commission (the “SEC”) and as amended and supplemented from time to time, or any successor registration statement for the Shares (the “Registration Statement”), including the prospectus of the Fund a part thereof (the “Prospectus”). Under the Trust Agreement, only Authorized Participants may place orders to create and redeem Baskets. The Prospectus provides that the Authorized Participant will pay a transaction fee of two hundred dollars ($200) per order to create or redeem Baskets (the “Transaction Fee”). See Section 5. The Transaction Fee may be adjusted from time to time as set forth in the Prospectus.
To the extent there is a conflict between any provision of this Agreement, other than the indemnities provided in Section 9 herein, and the provisions of the Trust Agreement or the Prospectus, the Trust Agreement or the Prospectus, as applicable, shall control. Capitalized terms not otherwise defined herein are used herein as defined in the Trust Agreement or the Prospectus, as applicable.
This Agreement is intended to set forth certain premises and the procedures by which the Authorized Participant may purchase and/or redeem Shares (i) through the Continuous Net Settlement (“CNS”) clearing processes of NSCC as such processes have been enhanced to effect purchases and redemptions of Shares (such processes being referred to herein as the “CNS Clearing Process”), or (ii) outside the CNS Clearing Process (i.e., through the manual process of The Depository Trust Company (“DTC”)) (the “DTC Process”). The procedures (the “Procedures”) for processing an order to purchase Baskets (each a “Purchase Order”) and an order to redeem Baskets (each a “Redemption Order” and together with a Purchase Order, an “Order”) are described in the Prospectus, the Trust Agreement, this Agreement and in Attachment A to this Agreement, as each may be amended from time to time. A copy of the Fund’s Order Form (as amended from time to time, the “Order Form”) has been made available to the Authorized Participant by the Transfer Agent, as may be revised from time to timeAll Orders must be made pursuant to the Procedures.
To give effect to the foregoing premises and in consideration of the mutual covenants and agreements set forth below, the Parties hereby agree as follows:
Section 1. Representations, Warranties and Covenants of the Authorized Participant.
(a) The Authorized Participant hereby represents, warrants and covenants that:
(i) it is a DTC Participant and, only with respect to Orders through the CNS Clearing Process, it is a member of NSCC and an authorized participant in the CNS System of NSCC (a “Participating Party”); provided, that any change in the foregoing status of the Authorized Participant shall terminate this Agreement and the Authorized Participant shall give prompt written notice to the Distributor, the Fund and the Transfer Agent of such change;
(ii) unless Section 1(a)(v) is applicable, it (A) is registered as a broker-dealer under the Securities Exchange Act of 1934, as amended (the “1934 Act”) and is a member in good standing of the Financial Industry Regulatory Authority (“FINRA”), or (B) is exempt from being, or otherwise is not required to be, licensed as a broker-dealer or a member of FINRA, and in either case is qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires;
(iii) it will maintain registrations, qualifications, membership, or, if applicable, exempt status described in Section 1(a)(ii) in good standing and in full force and effect throughout the term of this Agreement;
(iv) it will comply with all applicable United States federal laws, the laws of the states or other jurisdictions concerned and the rules and regulations promulgated thereunder and with the FINRA By-Laws and NASD Conduct Rules (or with comparable FINRA Conduct Rules, if such NASD Conduct Rules are subsequently renamed, repealed, rescinded or are otherwise replaced by FINRA Conduct Rules) if it is a FINRA Member, to the extent the foregoing relates to the Authorized Participant’s transactions in, and activities with respect to, the Shares, and that it will not offer or sell Shares of the Fund in any state or jurisdiction where they may not lawfully be offered and/or sold;
(v) if the Authorized Participant is offering or selling Shares in jurisdictions outside the several states, territories and possessions of the United States and is not otherwise required to be registered, qualified or a member of FINRA as set forth above, the Authorized Participant will, in connection with such offers and sales, (A) observe the applicable laws of the jurisdiction in which such offer and/or sale is made, (B) comply with the prospectus delivery and other requirements of the Securities Act of 1933, as amended (the “1933 Act”) and the regulations promulgated thereunder, and (C) conduct its business in accordance with the NASD Conduct Rules (or with comparable FINRA Conduct Rules, if such NASD Conduct Rules are subsequently renamed, repealed, rescinded, or are otherwise replaced by FINRA Conduct Rules), to the extent the foregoing relates to the Authorized Participant’s transactions in, and activities with respect to, the Shares;
(vi) it has established and presently maintains an anti-money laundering program (the “Program”) reasonably designed to prevent the Authorized Participant from being used as a conduit for money laundering or other illicit purposes or the financing of terrorist activities and is in compliance with the Program and all anti-money laundering laws, regulations and rules now or hereafter in effect that are applicable to it, including, without limitation, the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act); and
(vii) it has the capability to send and receive communications via authenticated telecommunication facility to and from the Distributor, the Transfer Agent and the Authorized
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Participant’s custodian, and it shall confirm such capability to the satisfaction of the Distributor and the Transfer Agent prior to placing its first Order with the Fund acting through the Transfer Agent.
(b) The Authorized Participant understands and acknowledges that the method by which Shares will be created and traded may raise certain issues under applicable securities laws. For example, because new Shares may be issued and sold by the Fund on an ongoing basis, at any point a “distribution,” as such term is used in the 1933 Act, may be occurring. The Authorized Participant further understands and acknowledges that some of its activities may result in its being deemed a participant in a distribution in a manner that could render it a statutory underwriter and subject it to the prospectus delivery and liability provisions of the 1933 Act. The Authorized Participant should review the “Plan of Distribution” section of the Prospectus and consult with its own counsel in connection with entering into this Agreement and placing Orders. The Authorized Participant also understands and acknowledges that dealers who are not “underwriters” but are effecting transactions in the Shares, whether or not participating in the distribution of the Shares, are generally required to deliver a Prospectus.
Section 2. Execution of Orders.
(a) All Orders shall be made in accordance with the terms of the Trust Agreement, the Prospectus and the Procedures. Each Party agrees to comply with the provisions of such documents to the extent applicable to it. The Managing Owner may issue, or caused to be issued, additional or other procedures from time to time relating to the manner of creating or redeeming Baskets that are not related to the Procedures, and the Authorized Participant will comply with such procedures in placing Orders hereunder.
(b) The Authorized Participant acknowledges and agrees on behalf of itself and any party for which it is acting (whether as a customer or otherwise) that delivery of an Order shall be irrevocable.
(c) The Authorized Participant acknowledges and agrees that:
(i) the Managing Owner, or its designee, may, in its discretion, suspend the right of purchase, or postpone the purchase settlement date, (A) for any period during which the NYSE Arca is closed other than customary weekend or holiday closings, or trading on the NYSE Arca is suspended or restricted; (B) for any period during which an emergency exists as a result of which the processing of Purchase Orders is not reasonably practicable; or (C) for such other period as the Managing Owner determines to be necessary for the protection of the Fund’s Shareholders;
(ii) the Managing Owner, or its designee, shall have the absolute right, but shall have no obligation, to reject any Purchase Order (A) determined by the Managing Owner, or its designee, not to be submitted in compliance with the Procedures; (B) that the Managing Owner, or its designee, has determined would have adverse tax consequences to the Fund or to its Shareholders; (C) if circumstances outside the control of the Managing Owner, or its designee, make it, for all practical purposes, not feasible to process Creation Baskets; or (D) the Managing Owner, or its designee, believes that it or the Fund would be in violation of any securities or commodities rules or regulations regarding position limits or otherwise by accepting a Creation Order;
(iii) the Managing Owner, or its designee, may, in its discretion, suspend the right of redemption, or postpone the redemption settlement date, (A) for any period during which the NYSE Arca is closed other than customary weekend or holiday closings, or trading on the NYSE Arca is suspended or restricted; (B) for any period during which an emergency exists as a result of which the processing of Redemption Orders is not reasonably practicable; or (C) for such other period as the Managing Owner determines to be necessary for the protection of the Fund’s Shareholders; and
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(iv) the Managing Owner, or its designee, may reject a Redemption Order if the Redemption Order is not submitted in compliance with the Procedures or if the fulfillment of the Redemption Order, in the opinion of counsel, might be illegal under applicable laws and regulations.
None of the Fund, the Managing Owner, the Distributor or the Transfer Agent will be liable to any person or in any way for any liability, loss or damages that may result from any rejection, suspension or postponement of an Order.
(d) The Authorized Participant hereby consents to the use of recorded telephone lines whether or not such use is reflected in the Procedures.
Section 3. NSCC. Solely with respect to Orders effected through the CNS Clearing Process, the Authorized Participant, as a Participating Party, hereby authorizes the Transfer Agent to transmit to the NSCC on behalf of the Authorized Participant such instructions consistent with the instructions issued by the Authorized Participant to the Transfer Agent. The Authorized Participant agrees to be bound by the terms of such instructions issued by the Transfer Agent and reported to NSCC as though such instructions were issued by the Authorized Participant directly to NSCC.
Section 4. Marketing Materials; Representations Regarding Shares; Identification in Registration Statement.
(a) The Authorized Participant represents, warrants and covenants that (i) it will not, in connection with any sale or solicitation of a sale of Shares, make, or permit any of its representatives to make, any representations concerning the Shares or any AP Indemnified Party (as defined below) other than representations not inconsistent with (A) the then-current Prospectus of the Fund, (B) printed information approved by the Managing Owner as information supplemental to such Prospectus or (C) any promotional materials or sales literature furnished to the Authorized Participant by the Managing Owner, and (ii) the Authorized Participant will not furnish or cause to be furnished to any person or display or publish any information or material relating to the Shares or any AP Indemnified Party that are inconsistent with the Fund’s then-current Prospectus. Copies of the then-current Prospectus and any such printed supplemental information will be supplied by the Managing Owner, or its designee, to the Authorized Participant in reasonable quantities upon request. The Managing Owner represents, warrants, and agrees that it will notify the Authorized Participant when a revised, supplemented, or amended Prospectus for the Fund is available and deliver or otherwise make available to the Authorized Participant copies of such revised, supplemented, or amended Prospectus at such time and in such numbers as to enable the Authorized Participant to comply with any obligation it may have to deliver such Prospectus to its customers. The Managing Owner will make such revised, supplemented, or amended Prospectus available to the Authorized Participant no later than its effective date.
(b) The Managing Owner and the Fund represent and warrant that (i) the Registration Statement and the Prospectus contained therein conforms in all material respects to the requirements of the 1933 Act and the rules and regulations of the SEC thereunder and do not and will not, as of the applicable effective date as to the Registration Statement and any amendment thereto and as of the applicable filing date as to the Prospectus and any amendment or supplement thereto, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the sale and distribution of the Shares as contemplated herein will not conflict with or result in a breach or violation of any statute or any order, rule, or regulation of any court or governmental agency or body having jurisdiction over the Managing Owner or the Fund, and (iii) no consent, approval, authorization, order, registration, or qualification of or with any such court or governmental agency or body is required for the issuance and sale of the Shares, except registration under the 1933 Act.
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(c) Notwithstanding the foregoing or anything to the contrary in this Agreement, the Authorized Participant and its affiliates may, without the written approval of the Managing Owner or the Fund, prepare and circulate in the regular course of their businesses research, sales literature, reports and other similar materials that include information, opinions or recommendations relating to the Shares; provided, that such research, sales literature, reports, and other similar materials comply with applicable NASD rules (or with comparable FINRA rules, if such NASD rules are subsequently repealed, rescinded, or are otherwise replaced by FINRA rules).
(d) The Authorized Participant hereby agrees that, for the term of this Agreement, the Managing Owner or its designee may deliver the then-current Prospectus, and any revisions, supplements or amendments thereto or recirculation thereof, to the Authorized Participant in Portable Document Format (“PDF”) via electronic mail to (or to such other address as may be provided by the Authorized Participant from time to time) in lieu of delivering the Prospectus in paper form. The Authorized Participant may revoke the foregoing agreement at any time by delivering written notice to the Managing Owner, or the Managing Owner’s designee, and, whether or not such agreement is in effect, the Authorized Participant may, at any time, request reasonable quantities of the Prospectus, and any revisions, supplements or amendments thereto or recirculation thereof, in paper form from the Managing Owner or its designee. The Authorized Participant acknowledges that it has the capability to access, view, save and print material provided to it in PDF and that it will incur no appreciable extra costs by receiving the Prospectus in PDF instead of in paper form. The Managing Owner will, when requested by the Authorized Participant, make available, or cause to be made available, at no cost the software and technical assistance necessary to allow the Authorized Participant to access, view and print the PDF version of the Prospectus.
(e) For as long as this Agreement is effective, if required by the SEC, the Authorized Participant agrees to be identified as an authorized participant of the Fund in the Prospectus and on the Fund’s website.
Section 5. Fees. To compensate State Street Bank and Trust Company for its services as Transfer Agent in connection with the processing of the creation and redemption of Baskets, the Fund shall charge, and the Authorized Participant shall pay (which may be from its DTC account to the Fund), the Transaction Fee described in the Prospectus. The current Transaction Fee shall be two hundred dollars ($200) per order. The Transaction Fee may be adjusted from time to time as set forth in the Prospectus.
Section 6. Authorized Persons. Concurrently with the execution of this Agreement and from time to time thereafter as may be requested by the Managing Owner, the Fund or the Distributor, the Authorized Participant shall deliver to such parties, with copies to the Transfer Agent, at the address specified herein, duly certified as appropriate by its Secretary or other duly authorized official, a certificate in the form attached hereto as Attachment B setting forth the names and signatures of all persons authorized to give instructions relating to any activity contemplated hereby or any other notice, request or instruction on behalf of the Authorized Participant (each such person an “Authorized Person”). Such certificate may be accepted and relied upon by the Managing Owner, the Fund, the Distributor and the Transfer Agent as conclusive evidence of the facts set forth therein and shall be considered to be in full force and effect until delivery to such parties of a superseding certificate in a form approved by the Managing Owner bearing a subsequent date and duly certified as described above. Upon the termination or revocation of authority of such Authorized Person by the Authorized Participant, the Authorized Participant shall give immediate written notice of such fact to the Managing Owner, the Fund, the Distributor and the Transfer Agent, and such notice shall be effective upon receipt by each of such parties.
Section 7. Redemption. The Authorized Participant represents and warrants that it will not attempt to place a Redemption Order for the purpose of redeeming any Basket unless (i) it owns outright or has the
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right or authority to tender for redemption the Baskets to be redeemed and to receive the entire proceeds of the redemption, and (ii) such Baskets have not been loaned or pledged to another party and are not the subject of a repurchase agreement, securities lending agreement or any other arrangement that, under the circumstances, would preclude the delivery of such Baskets to the Transfer Agent on behalf of the Fund in accordance with the Procedures or as otherwise required by the Fund.
Section 8. Role of Authorized Participant.
(a) The Authorized Participant acknowledges and agrees that for all purposes of this Agreement and the Trust Agreement, the Authorized Participant will have no authority to act as an agent for the Managing Owner, the Fund, the Distributor, the Transfer Agent or the Authorized Participant’s custodian in any matter or in any respect.
(b) The Authorized Participant covenants and agrees to make itself and its employees available, upon request, during normal business hours to consult with the Managing Owner, the Fund, the Distributor, the Transfer Agent or the Authorized Participant’s custodian or their designees concerning the performance of the Authorized Participant’s responsibilities under this Agreement.
(c) The Authorized Participant, as a DTC Participant, covenants and agrees that it shall be bound by all of the obligations of a DTC Participant in addition to any obligations that it undertakes hereunder or in accordance with the Prospectus.
(d) The Authorized Participant agrees, subject to any privacy, confidentiality or other obligations it may have to its customers arising under federal or state securities laws or the applicable rules of any self-regulatory organization, to assist, upon request, the Managing Owner, the Fund, the Distributor and the Transfer Agent in ascertaining certain information that the Authorized Participant may possess regarding sales of Shares made by or through the Authorized Participant that is necessary for the Fund to comply with its obligations to distribute information to its Shareholders under applicable state or federal securities laws or as set forth in the Prospectus.
Section 9. Indemnification.
(a) The Authorized Participant hereby agrees to indemnify and hold harmless the Managing Owner, the Transfer Agent, the Distributor and the Fund, and their respective subsidiaries, affiliates, directors, officers, employees and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each an “AP Indemnified Party”) from and against any loss, liability, damage, reasonable cost and expense (including reasonable attorneys’ fees and the reasonable cost of investigation) incurred by such AP Indemnified Party as a result of (i) any material breach by the Authorized Participant of any provision of this Agreement that relates to the Authorized Participant, including its representations, warranties and covenants made herein; (ii) any failure on the part of the Authorized Participant to perform any of its obligations set forth in this Agreement except to the extent that such failure was directly caused by the Authorized Participant’s reasonable reliance on instructions given or representations made by one or more AP Indemnified Parties; (iii) any failure by the Authorized Participant to comply with applicable laws and rules and regulations of self-regulatory organizations to the extent the foregoing relates to the Authorized Participant’s transactions in, and activities with respect to, Shares under this Agreement, except that the Authorized Participant shall not be required to indemnify an AP Indemnified Party to the extent that such failure was caused by the Authorized Participant’s adherence to instructions given or representations made by the Managing Owner or any AP Indemnified Party, as applicable; (iv) any actions of such AP Indemnified Party in reliance upon any instructions issued by the Authorized Participant in accordance with the Procedures that are reasonably believed by such AP Indemnified Party to be genuine and to have been given by the Authorized Participant; or (v) (A) any representation by the Authorized Participant, its
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employees or its agents or other representatives about the Shares, any AP Indemnified Party or the Fund that is not consistent with the Fund’s then-current Prospectus made in connection with the offer or the solicitation of an offer to buy or sell the Shares and (B) any untrue statement or alleged untrue statement of a material fact contained in any research reports, marketing material and sales literature described herein or any alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading to the extent that such statement or omission relates to the Shares or any AP Indemnified Party, unless, in either case, such representation, statement or omission was made or included by an AP Indemnified Party at the written direction of the Managing Owner, the Fund or the Distributor or is based upon any omission or alleged omission by the Managing Owner, the Fund or the Distributor to state a material fact in connection with such representation, statement or omission necessary to make such representation, statement or omission not misleading. The Authorized Participant and the Distributor understand and agree that the Fund as a third-party beneficiary to this Agreement is entitled and intends to proceed directly against the Authorized Participant in the event that the Authorized Participant fails to honor any of its obligations pursuant to this Agreement that benefit the Fund. The Authorized Participant shall not be liable to an AP Indemnified Party for any damages arising out of mistakes or errors in data provided to the Authorized Participant, or mistakes or errors by, or out of interruptions or delays of communications with the AP Indemnified Parties due to any action of a service provider to the Fund. The Authorized Participant shall not be liable under its indemnity agreement contained in this subsection with respect to any claim made against any AP Indemnified Party unless the AP Indemnified Party shall have notified the Authorized Participant in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon the AP Indemnified Party (or after the AP Indemnified Party shall have received notice of service on any designated agent). However, failure to notify the Authorized Participant of any claim shall not relieve the Authorized Participant from any liability that it may have to any AP Indemnified Party against whom such action is brought otherwise than on account of its indemnity agreement contained in this subsection and shall only release it from such liability under this subsection to the extent it has been materially prejudiced by such failure to give notice. The Authorized Participant shall be entitled to participate at its own expense in the defense, or, if it so elects, to assume the defense of any suit brought to enforce any claims, but if the Authorized Participant elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the AP Indemnified Party in the suit, and who shall not, except with the consent of the AP Indemnified Parties, be counsel to the Authorized Participant. If the Authorized Participant does not elect to assume the defense of any suit, it will reimburse the AP Indemnified Party for the reasonable fees and expenses of any counsel retained by them.
(b) The Distributor hereby agrees to indemnify and hold harmless the Authorized Participant, its respective subsidiaries, affiliates, directors, officers, employees and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each a “Distributor Indemnified Party”) from and against any loss, liability, damage, cost and expense (including attorneys’ fees) incurred by such Distributor Indemnified Party as a result of (i) any breach by the Distributor of any provision of this Agreement that relates to the Distributor; (ii) any failure on the part of the Distributor to perform any of its obligations set forth in this Agreement; (iii) any failure by the Distributor to comply with applicable laws, including rules and regulations of self-regulatory organizations; (iv) actions of a Distributor Indemnified Party in reliance upon any instructions issued or representations made in accordance with the Procedures reasonably believed by a Distributor Indemnified Party to be genuine and to have been given by the Distributor; or (v) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement of the Fund or in any amendment thereof, or in any Prospectus or any statement of additional information, or any amendment thereof or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in connection with the Authorized Participant’s acting in its capacity as an Authorized Participant. The Distributor shall not be liable under its indemnity agreement contained in this subsection with respect to any claim made against any Distributor Indemnified Party unless
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the Distributor Indemnified Party shall have notified the Distributor in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon the Distributor Indemnified Party (or after the Distributor Indemnified Party shall have received notice of service on any designated agent). However, failure to notify the Distributor of any claim shall not relieve the Distributor from any liability that it may have to any Distributor Indemnified Party against whom such action is brought otherwise than on account of its indemnity agreement contained in this subsection and shall only release it from such liability under this subsection to the extent it has been materially prejudiced by such failure to give notice. The Distributor shall be entitled to participate at its own expense in the defense, or, if it so elects, to assume the defense of any suit brought to enforce any claims, but if the Distributor elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the Distributor Indemnified Party in the suit and who shall not, except with the consent of the Distributor Indemnified Party, be counsel to the Distributor. If the Distributor does not elect to assume the defense of any suit, it will reimburse the Distributor Indemnified Party in the suit for the reasonable fees and expenses of any counsel retained by them.
(c) The Managing Owner hereby agrees to indemnify and hold harmless the Authorized Participant, and its respective subsidiaries, affiliates, directors, officers, employees and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each a “Managing Owner Indemnified Party”) from and against any loss, liability, damage, cost and expense (including reasonable attorneys’ fees and the reasonable cost of investigation) incurred by such Managing Owner Indemnified Party as a result of (i) any breach by the Managing Owner of any provision of this Agreement that relates to the Managing Owner; (ii) any failure on the part of the Managing Owner to perform any of its obligations set forth in this Agreement; (iii) any failure by the Managing Owner to comply with applicable laws, including rules and regulations of self-regulatory organizations; (iv) any untrue statements or omissions made in any promotional material or sales literature furnished to the Authorized Participant or otherwise approved in writing by the Managing Owner or its designee; (v) actions of such Managing Owner Indemnified Party in reliance upon any instructions issued or representations made by the Managing Owner or the Fund in accordance with this Agreement (including the attachments hereto) reasonably believed by the Authorized Participant to be genuine and to have been given by the Managing Owner or the Fund, or (vi) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement of the Fund as originally filed with the SEC or in any amendment thereof, or in the Prospectus, or in any amendment thereof or supplement thereto, or arising out of or based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except those statements in the Registration Statement or the Prospectus based on information furnished in writing by or on behalf of the Authorized Participant expressly for use in the Registration Statement or the Prospectus. The Managing Owner shall not be liable under its indemnity agreement contained in this subsection with respect to any claim made against any Managing Owner Indemnified Party unless the Managing Owner Indemnified Party shall have notified the Managing Owner in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon the Managing Owner Indemnified Party (or after the Managing Owner Indemnified Party shall have received notice of service on any designated agent). However, failure to notify the Managing Owner of any claim shall not relieve the Managing Owner from any liability that it may have to any Managing Owner Indemnified Party against whom such action is brought otherwise than on account of its indemnity agreement contained in this subsection and shall only release it from such liability under this subsection to the extent it has been materially prejudiced by such failure to give notice. The Managing Owner shall be entitled to participate at its own expense in the defense, or, if it so elects, to assume the defense of any suit brought to enforce any claims, but if the Managing Owner elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the Managing Owner Indemnified Party in the suit and who shall not, except with the consent of the Managing Owner Indemnified Party, be counsel to the Managing Owner. If the
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Managing Owner does not elect to assume the defense of any suit, it will reimburse the Managing Owner Indemnified Party in the suit for the reasonable fees and expenses of any counsel retained by them.
(d) This Section 9 shall not apply to the extent any such losses, liabilities, damages, costs and expenses are incurred as a result or in connection with any gross negligence, bad faith or willful misconduct on the part of an AP Indemnified Party, a Distributor Indemnified Party or a Managing Owner Indemnified Party, as the case may be. The term “affiliate” in this Section 9 shall include, with respect to any person, entity or organization, any other person, entity or organization which directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such person, entity or organization.
(e) No indemnifying party, as described in subsections (a), (b) or (c) above, shall, without the written consent of the AP Indemnified Party, Distributor Indemnified Party or Managing Owner Indemnified Party, as the case may be, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the AP Indemnified Party, Distributor Indemnified Party or Managing Owner Indemnified Party, as the case may be, from all liability arising out of such action or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any AP Indemnified Party, Distributor Indemnified Party or Managing Owner Indemnified Party, as the case may be.
Section 10. Liability.
(a) The Distributor, the Transfer Agent, the Managing Owner and the Fund, whether acting directly or through agents (including the Transfer Agent), undertake to perform such duties and only such duties as are expressly set forth herein, or expressly incorporated herein by reference, and no implied covenants or obligations shall be read into this Agreement against the Distributor, the Transfer Agent, the Managing Owner, or the Fund.
(b) In the absence of bad faith, gross negligence or willful misconduct on its part, neither the Distributor, the Transfer Agent, the Managing Owner nor the Fund, whether acting directly or through agents (including the Transfer Agent), shall be liable for any action taken, suffered or omitted or for any error of judgment made by any of them in the performance of their duties hereunder. Neither the Distributor, the Transfer Agent, the Managing Owner nor the Fund, whether acting directly or through agents (including the Transfer Agent), shall be liable for any error of judgment made in good faith unless the party exercising such shall have been grossly negligent in ascertaining the pertinent facts necessary to make such judgment. In no event shall the Distributor, the Transfer Agent, the Managing Owner, or the Fund, whether acting directly or through agents (including the Transfer Agent), be liable for special, indirect or consequential losses or damages of any kind whatsoever (including but not limited to lost profit), even if such parties have been advised of the likelihood of such loss or damage and regardless of the form of action. In no event shall the Distributor, the Transfer Agent, the Managing Owner, or the Fund, whether acting directly or through agents (including the Transfer Agent), be liable for the acts or omissions of DTC or any other securities depository or clearing corporation.
(c) Neither the Distributor, the Transfer Agent, the Managing Owner nor the Fund, whether acting directly or through agents (including the Transfer Agent), shall be responsible or liable for any failure or delay in the performance of their obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including without limitation: acts of God; earthquakes; fires; floods; wars; civil or military disturbances; terrorism; sabotage; epidemics; riots;
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interruptions; loss or malfunction of utilities, computer (hardware or software) or communications service; accidents; labor disputes; acts of civil or military authority or governmental actions.
(d) The Distributor, the Transfer Agent, the Managing Owner, the Fund and the Transfer Agent may conclusively rely upon, and shall be fully protected in acting or refraining from acting upon, any communication authorized hereby and upon any written or oral instruction, notice, request, direction or consent reasonably believed by them to be genuine.
(e) This Agreement has been entered into by the Fund and was executed and delivered by an officer of its Managing Owner, on behalf of the Fund, which officer was acting solely in his capacity as an officer of the Managing Owner and not in his individual capacity and which Managing Owner was acting solely in its capacity as sponsor/managing owner of the Fund and not in its individual capacity. The obligations of this Agreement are not binding on such officer, the Managing Owner or any Shareholder individually. The obligations of this Agreement are binding only upon the assets and property of the Fund.
(f) The Authorized Participant shall be responsible for the payment of any transfer tax, sales or use tax, stamp tax, recording tax, value added tax and any other similar tax or government charge applicable to the creation or redemption of any Basket made pursuant to this Agreement, regardless of whether or not such tax or charge is imposed directly on the Authorized Participant. To the extent the Managing Owner or the Fund is required by law to pay any such tax or charge, the Authorized Participant agrees to promptly indemnify such party for any such payment, together with any applicable penalties, additions to tax or interest thereon, upon reasonable notice thereof.
Section 11. Acknowledgment. The Authorized Participant acknowledges receipt of a (i) copy of the Trust Agreement and (ii) the current Prospectus of the Fund, and represents that it has reviewed and understands such documents.
Section 12. Effectiveness and Termination. Upon the execution of this Agreement by the Parties, this Agreement shall become effective in this form as of the date first set forth above, and may be terminated at any time by any Party upon five (5) days prior written notice to the other Parties unless earlier terminated: (i) in accordance with Section 1(a)(i); (ii) upon written notice to the Authorized Participant by the Managing Owner in the event of a material breach by the Authorized Participant of this Agreement or the procedures described or incorporated herein; (iii) immediately in the circumstances described in Section 23; or (iv) at such time as the Fund is terminated pursuant to the Trust Agreement.
Section 13. Ambiguous Instructions. If an Order Form contains order terms that differ from the information provided in the telephone call at the time of issuance of the applicable order number, the Managing Owner or its designee will attempt to contact one of the Authorized Persons of the Authorized Participant to request confirmation of the terms of the Order. If an Authorized Person confirms the terms as they appear in the Order Form, then the Order will be accepted and processed. If an Authorized Person contradicts the terms of the Order Form, the Order will be deemed invalid, and a corrected Order Form must be received by the Managing Owner or its designee in the time period designated. If the Managing Owner or its designee is not able to contact an Authorized Person, then the Order shall be accepted and processed in accordance with the terms of the Order Form notwithstanding any inconsistency from the terms of the telephone information. In the event that an Order Form contains terms that are not complete or are illegible, the Order will be deemed invalid and the Managing Owner will attempt to contact one of the Authorized Persons of the Authorized Participant to request retransmission of the Order Form.
Section 14. Amendment. This Agreement, the Procedures and the attachments hereto may be amended, modified or supplemented by the Fund, the Managing Owner and the Distributor, without consent of the Authorized Participant, from time to time by the following procedure. After the amendment,
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modification or supplement has been agreed to, the Distributor will mail a copy of the proposed amendment, modification or supplement to the Authorized Participant in accordance with the terms hereof. For the purposes of this Agreement, mail will be deemed received by the recipient thereof on the third (3rd) day following the deposit of such mail into the United States postal system. If the Authorized Participant does not object in writing to the amendment, modification, or supplement within fifteen (15) calendar days after its deemed receipt, the amendment, modification or supplement will become part of this Agreement in accordance with its terms.
Section 15. Waiver of Compliance. Any failure of any of the Parties to comply with any obligation, covenant, agreement or condition herein may be waived by the Party entitled to the benefits thereof only by a written instrument signed by the Party granting such waiver, but any such written waiver, or the failure to insist upon strict compliance with any obligation, covenant, agreement or condition herein, shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.
Section 16. Notices. Except as otherwise specifically provided in this Agreement, all notices required or permitted to be given pursuant to this Agreement shall be given in writing and delivered by personal delivery, by postage prepaid registered or certified United States first class mail, return receipt requested, by nationally recognized overnight courier (delivery confirmation received) or by telex, telegram or telephonic facsimile or similar means of same day delivery (transmission confirmation received), with a confirming copy regular mail, postage prepaid. For avoidance of doubt, notices may not be given or transmitted by electronic mail. Unless otherwise notified in writing, all notices to the Fund shall be sent to the Managing Owner. All notices shall be directed to the address or facsimile numbers indicated below the signature line of the Parties on the signature page hereof, unless otherwise notified in writing.
Section 17. Successors and Assigns. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.
Section 18. Governing Law; Consent to Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of New York (regardless of the laws that might otherwise govern under applicable New York conflict of laws principles) as to all matters, including matters of validity, construction, effect, performance and remedies. Each Party irrevocably consents to the jurisdiction of the courts of the State of New York and of any federal court located in the Borough of Manhattan in such State in connection with any action, suit or other proceeding arising out of or relating to this Agreement or any action taken or omitted hereunder, and waives any claim of forum non conveniens and any objections as to laying of venue. Each Party further waives personal service of any summons, complaint or other process and agrees that service thereof may be made by certified or registered mail directed to such Party at such Party’s address for purposes of notices hereunder. Each Party hereby irrevocably waives any and all rights to trial by jury in any legal proceeding arising under or in connection with this Agreement.
Section 19. Assignment. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any Party without the prior written consent of the other Parties, which shall not be unreasonably withheld, except that any entity into which a Party may be merged or converted or with which it may be consolidated or any entity resulting from any merger, conversion, or consolidation to which such Party hereunder shall be a party, or any entity succeeding to all or substantially all of the business of the Party, shall be the successor of the Party under this Agreement. The party resulting from any such merger, conversion, consolidation or succession shall notify the other Parties of the change. Any purported assignment in violation of the provisions hereof shall be null and void. Notwithstanding the foregoing, this Agreement shall be automatically assigned to any successor trustee or sponsor of the Fund at such time such successor qualifies as a successor trustee or sponsor under the terms of the Trust Agreement.
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Section 20. Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement.
Section 21. Interpretation. The article and section headings contained in this Agreement are solely for the purpose of reference, are not part of the agreement of the Parties and shall not in any way affect the meaning or interpretation of this Agreement.
Section 22. Entire Agreement. This Agreement and the Trust Agreement, along with any other agreement or instrument delivered pursuant to this Agreement or the Trust Agreement, supersede all prior agreements and understandings between the Parties with respect to the subject matter hereof; provided, however, that the Authorized Participant shall not be deemed by this provision to be a party to the Trust Agreement.
Section 23. Severance. If any provision of this Agreement is held by any court or any act, regulation, rule or decision of any other governmental or supra national body or authority or regulatory or self-regulatory organization to be invalid, illegal or unenforceable for any reason, it shall be invalid, illegal or unenforceable only to the extent so held and shall not affect the validity, legality or enforceability of the other provisions of this Agreement so long as this Agreement as so modified continues to express, without material change, the original intentions of the Parties as to the subject matter of this Agreement and the deletion of such portion of this Agreement will not substantially impair the respective benefits, obligations, or expectations of the Parties. If this Agreement as so modified substantially impairs the respective benefits, obligations, or expectations of the Parties, it shall be subject to immediate termination upon written notice by the terminating Party delivered in accordance with terms hereof.
Section 24. No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the Parties to express their mutual intent, and no rule of strict construction will be applied against any Party.
Section 25. Survival. Section 9 (Indemnification) shall survive the termination of this Agreement.
Section 26. Other Usages. The following usages shall apply in interpreting this Agreement: (i) references to a governmental or quasigovernmental agency, authority or instrumentality shall also refer to a regulatory body that succeeds to the functions of such agency, authority or instrumentality; and (ii) “including” means “including, but not limited to.”
12
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and delivered as of __________, 20__.
| THE FUND: | THE SPONSOR: | |||
| WisdomTree Continuous Commodity Index Fund | WisdomTree Commodity Services, LLC | |||
| By: | WisdomTree Commodity Services, LLC, its Managing Owner | By: | ||
| Name: | ||||
| By: | Title: | |||
| Name: | Address: | 245 Park Avenue, 35th Floor | ||
| Title: | New York, NY 10167 | |||
| Address: | 245 Park Avenue, 35th Floor | |||
| New York, NY 10167 | ||||
| DISTRIBUTOR: | THE AUTHORIZED PARTICIPANT: | ||||
| Foreside Fund Services, LLC | |||||
| By: | By: | ||||
| Name: | Name: | ||||
| Title: | Title: | ||||
| Address: | Address: | ||||
| Telephone: | Telephone: | ||||
| Facsimile: | Facsimile: | ||||
| ACCEPTED BY THE TRANSFER AGENT: | |||
| State Street Bank and Trust Company | |||
| By: | |||
| Name: | |||
| Title: | |||
| Address: | |||
| Telephone: | |||
| Facsimile: | |||
| WisdomTree Continuous Commodity Index Fund | Execution Page |
| Form of Authorized Participant Agreement |
Attachment A
Defined terms used herein that are not defined herein shall have the meaning as set forth in the Authorized Participant Agreement (the “AP Agreement”)
This document supplements the Prospectus with respect to the procedures to be used by (i) the Transfer Agent and Distributor in processing orders for the purchase of Creation Baskets of a Fund (“Creation Orders”) and (ii) the Transfer Agent in processing orders redeeming Redemption Baskets of a Fund (“Redemption Orders,” and together with Creation Orders, “Orders”). The Authorized Participant (sometimes referred to herein as the “Participant”) acknowledges and agrees that the Prospectus for the Fund may contain, among other matters, procedures relating to the creation and redemption of Shares and in the event of a conflict, the Prospectus shall control.
The Participant is required to have signed the Authorized Participant Agreement (sometimes referred to herein as the “Participant Agreement”). Upon acceptance by the Trust of the Participant Agreement, the Transfer Agent or Distributor, as the case may be, will assign a personal identification number (“PIN”) to each Authorized Person authorized to act for the Participant. This will allow a Participant through its Authorized Person(s) to place an order with respect to Baskets.
TO PLACE AN ORDER FOR PURCHASE OR REDEMPTION OF BASKETS
1. Orders by Telephone.
a. Order Number. Call to Receive an Order Number. An Authorized Person for the Participant will call the telephone representative at the number listed on the applicable Fund’s order form (“Order Form”) not later than the cut-off time for placing Orders with the applicable Fund as set forth in the Order Form (the “Order Cut-Off Time”) to receive an Order Number. Non-standard Orders generally must be arranged with the Managing Owner in advance of Order placement. The Order Form (as may be revised from time to time) is incorporated into and made a part of this Agreement.
Upon verifying the authenticity of the caller (as determined by the use of the appropriate PIN) and the terms of the Order, the telephone representative will issue a unique Order Number. All Orders with respect to the purchase or redemption of Baskets are required to be in writing and accompanied by the designated Order Number. Incoming telephone calls are queued and will be handled in the sequence received. Calls placed before the Order Cut-Off Time will be processed even if the call is taken after this cut-off time. ACCORDINGLY, DO NOT HANG UP AND REDIAL. INCOMING CALLS THAT ARE ATTEMPTED LATER THAN THE Order Cut-Off Time WILL NOT BE ACCEPTED.
NOTE THAT THE TELEPHONE CALL IN WHICH THE ORDER NUMBER IS ISSUED INITIATES THE ORDER PROCESS BUT DOES NOT ALONE CONSTITUTE THE ORDER. AN ORDER IS ONLY COMPLETED AND PROCESSED UPON RECEIPT OF WRITTEN INSTRUCTIONS VIA THE ORDER FORM CONTAINING THE DESIGNATED ORDER NUMBER, AUTHORIZED INDIVIDUALS’ SIGNATURES AND TRANSMITTED BY FACSIMILE.
| b. Place the Order. An Order Number is only valid for a limited time. The Order Form |
A-1
for purchase or redemption of Baskets must be sent by facsimile to the telephone representative within 20 minutes of the issuance of the Order Number. In the event that the Order Form is not received within such time period, the telephone representative will attempt to contact the Participant to request immediate transmission of the Order. Unless the Order Form is received by the telephone representative upon the earlier of (i) within 15 minutes of contact with the Participant or (ii) 45 minutes after the Order Cut-Off Time, the Order will be deemed invalid.
c. Await Receipt of Confirmation.
| (i) | Clearing Process. The Transfer Agent shall issue a confirmation of Order acceptance within approximately 15 minutes of its receipt of an Order Form received in good form. In the event the Participant does not receive a timely confirmation from the Transfer Agent, it should contact the telephone representative at the business number indicated. |
| (ii) | Outside the Clearing Process. In lieu of receiving a confirmation of Order acceptance, the DTC Participant will receive an acknowledgment of Order acceptance. The DTC Participant shall deliver on settlement date the Deposit Securities and/or cash (in the case of purchases) or the Creation Unit size aggregation of Shares on trade date plus one (in the case of redemptions) to the Fund through DTC. The Fund shall settle the transaction on the prescribed settlement date. |
| d. Ambiguous Instructions. In the event that an Order Form contains terms that differ from the information provided in the telephone call at the time of issuance of the Order Number, the telephone representative will attempt to contact the Participant to request confirmation of the terms of the Order. If an Authorized Person confirms the terms as they appear in the Order Form then the Order will be accepted and processed. If an Authorized Person contradicts its terms, the Order will be deemed invalid and a corrected Order Form must be received by the telephone representative not later than the earlier of (i) within 15 minutes of such contact with the Participant or (ii) 45 minutes after the Order Cut-Off Time. |
| In the event that an Order Form contains terms that are illegible, as determined in the sole discretion of the Transfer Agent, the Order will be deemed invalid and will not be processed. A telephone representative will attempt to contact the Participant to request retransmission of the Order Form, and a corrected Order Form must be received by the telephone representative not later than the earlier of (i) within 15 minutes of such contact with the Participant or (ii) 45 minutes after the Order Cut-Off Time. If the telephone representative is not able to contact an Authorized Person, the Order will be deemed invalid. |
2. Election to Place Orders by Internet.
a. General. Notwithstanding the foregoing provisions, Orders may be submitted through the Internet (“Web Order Site” or “Fund Connect”), to the extent such Web Order Site is made available, but must be done so in accordance with the terms of this Agreement, the Prospectus, the Web Order Site, the State Street Fund Connect Buy-Side User Agreement (which must be separately entered into by the Participant) (the “Fund Connect Agreement”) and the applicable Fund Connect User Guide (or any successor documents).
A-2
To the extent that any provision of this Agreement is inconsistent with any provision of any Fund Connect Agreement, the Fund Connect Agreement shall control with respect to State Street’s provision of the Web Order Site; provided, however, it is not the intention of the parties to otherwise modify the rights, duties and obligations of the parties under the Agreement, which shall remain in full force and effect until otherwise expressly modified or terminated in accordance with its terms. Notwithstanding the forgoing, the Participant acknowledges that references to the applicable Fund Connect User Guide (or any successor documents) contained herein are for instructional purposes only, and such Fund Connect User Guide (or any successor documents) does not contain any additional representations, warranties or obligations by the Fund, the Managing Owner, the Transfer Agent, the Distributor or their respective agents.
b. Certain Acknowledgements. The Participant acknowledges and agrees (i) that the Fund, the Managing Owner, the Transfer Agent, the Distributor and their respective agents may elect to review any Order placed through the Web Order Site manually before it is executed and that such manual review may result in a delay in execution of such Order; (ii) that during periods of heavy market activity or other times, it may be difficult to place Orders via the Web Order Site and the Participant may place Orders as otherwise set forth in Attachment A; and (iii) that any access, transaction information, content, or data downloaded or otherwise obtained through the use of the Web Order Site may be recorded and are done at the Participant’s own discretion and risk
EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED IN THE FUND CONNECT AGREEMENT AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTICIPANT ACKNOWLEDGES AND AGREES THAT THE WEB ORDER SITE IS PROVIDED “AS IS,” “AS AVAILABLE” WITH ALL FAULTS AND WITHOUT ANY WARRANTY OF ANY KIND. SPECIFICALLY, WITHOUT LIMITING THE FOREGOING, ALL WARRANTIES, CONDITIONS, OTHER CONTRACTUAL TERMS, REPRESENTATIONS, INDEMNITIES AND GUARANTEES WITH RESPECT TO THE WEB ORDER SITE, WHETHER EXPRESS, IMPLIED OR STATUTORY, ARISING BY LAW, CUSTOM, PRIOR ORAL OR WRITTEN STATEMENTS BY THE FUND, THE SPONSOR, THE TRANSFER AGENT, THE DISTRIBUTOR OR THEIR RESPECTIVE AGENTS, AFFILIATES, LICENSORS OR OTHERWISE (INCLUDING, BUT NOT LIMITED TO AS TO TITLE, SATISFACTORY QUALITY, ACCURACY, COMPLETENESS, UNINTERRUPTED USE, NON-INFRINGEMENT, TIMELINESS, TRUTHFULNESS, SEQUENCE, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE AND ANY IMPLIED WARRANTIES, CONDITIONS AND OTHER CONTRACTUAL TERMS ARISING FROM TRADE USAGE, COURSE OF DEALING OR COURSE OF PERFORMANCE) ARE HEREBY OVERRIDDEN, EXCLUDED AND DISCLAIMED.
c. Election to Terminate Placing Orders by Internet. The Participant may elect at any time to discontinue placing Orders through the Web Order Site without providing notice under the Agreement.
| 3. | Acknowledgment Regarding Telephone and Internet Transactions. During periods of heavy market activity or other times, the Participant acknowledges it may be difficult to reach the Transfer Agent by telephone or to transact business over the Internet via the Web Order Site. Technological irregularities may also make the use of the Internet and Web Order Site slow or unavailable at times. The Transfer Agent may terminate the receipt of redemption or exchange Orders by telephone or the Internet at any time, in which case you may redeem or exchange Shares by other means. |
A-3
Attachment B
WISDOMTREE CONTINUOUS COMMODITY INDEX FUND
AUTHORIZED PERSONS
The following individuals are Authorized Persons pursuant to the Authorized Participant Agreement with respect to the WisdomTree Continuous Commodity Index Fund as entered into by the Participant named below:
| , | ||||
| Participant Name | NSCC # |
| NAME | TITLE | SIGNATURE | TELEPHONE NUMBER |
E-MAIL ADDRESS |
CITY OF BIRTH | |||||
Signed on behalf of the Authorized Participant:
| By: | |||
| Name: | |||
| Title: | |||
| Date: |
B-1
Exhibit 10.7
EXECUTION VERSION
AMENDED AND RESTATED LICENSE AGREEMENT
THIS AMENDED AND RESTATED LICENSE AGREEMENT (the “Agreement”), dated as of November 12, 2015 and effective as of the Effective Date (as defined below), is made and entered into by and between Thomson Reuters (Markets) LLC (f/k/a Reuters America LLC), a Delaware limited liability company having an office at Three Times Square, New York, NY 10036 (“Licensor”) and GreenHaven Commodity Services, LLC, a Delaware limited liability company having an office at 245 Park Avenue, 35th Floor, New York, New York 10136 as of the Effective Date (“Licensee”).
WHEREAS, Licensor compiles, calculates, maintains and owns rights in and to the Continuous Commodity Index, also known as the CCI (the “Index”) (as well as the Subindices to that Index, and Total Return and Excess Return, as specified in Exhibit C), and to the proprietary data contained therein;
WHEREAS, Licensor and GreenHaven, LLC entered into that certain License Agreement, dated as of July 19, 2006 (as amended from time to time and as assigned by GreenHaven, LLC to Licensee on September 18, 2007, the “Original License Agreement”), pursuant to which Licensor licensed to Licensee the Index name (the “Marks”) and the use of the Index in connection with the product(s) described in Exhibit A hereto (the “Product(s)”); and
WHEREAS, Licensor and Licensee desire to amend and restate the Original License Agreement in its entirety, on the terms and conditions hereinafter set forth.
NOW, THEREFORE, the parties hereto agree as follows:
| 1. | Grant and Scope of License. |
(a) Subject to the terms and conditions of this Agreement, Licensor hereby grants Licensee a worldwide, non-transferable, exclusive, limited license, with no right to sublicense (other than as detailed below), (i) to use the calculated values for the Index, Subindex, Total Return and Excess Returns specified in Exhibit C as a component of the Product(s) described in Exhibit A to be created, issued, offered, written and/or sold by Licensee and (ii) to use and refer to the Marks in connection with the marketing and promotion of such Product(s), management, administration, listing of the Products (including, without limitation, the cross-listing of the Products on exchanges and/or qualifying such Products for promotion/sale outside of those specified on Exhibit A), and in connection with making such disclosure about the Product(s) whichever is relevant as Licensee deems necessary or desirable under any applicable law, rules or regulations, but, in each case, only to the extent necessary to indicate the Products are based upon the Index and to indicate that Licensor is the source of the Index and subject to Section 4. It is expressly agreed and understood by Licensee that no rights to use the Index or the Marks are granted hereunder other than those specifically described and expressly granted herein. Licensee may sublicense the right to use and refer to the Marks as detailed in (ii) above to those who promote, market, maintain, manage and sell the Products on behalf of Licensee for the sole purpose of enabling such entities to promote, market, maintain, manage and sell the Products;
provided, however, that no such sublicense shall be made except with respect to the Products and then only to the extent of the rights expressly granted to Licensee pursuant to this Agreement.
(b) The parties agree that this Agreement does not obligate Licensor to provide or deliver the Index values and/or related data directly to Licensee and Licensee shall be required to obtain such Index values and/or related data from an authorized distributor of such Index values and/or related data.
| 2. | Term and Termination. |
(a) This Agreement shall commence upon the closing of the transactions (the “Effective Date”) contemplated by that certain Unit Purchase Agreement, by and among the Licensee, WisdomTree Investments, Inc. and the other parties thereto (the “Unit Purchase Agreement”) and shall continue in effect until December 31, 2020 (“Initial Term”); provided, however, that if the Unit Purchase Agreement terminates pursuant to its terms and no closing occurs, this Agreement shall automatically terminate and not become effective and the Original License Agreement shall continue in full force and effect.
(b) After the Initial Term, this Agreement shall automatically renew for successive two (2) year periods (each a “Renewal Term”) unless and until (i) Licensor or Licensee terminates this Agreement at the expiration of the Initial Term or any Renewal Term by giving at least one hundred eighty (180) days’ prior written notice to the other parties; provided, however, Licensor only shall be allowed to provide such notice of termination if the U.S. dollar, or foreign currency equivalent, invested in the Products based upon the average daily official closing amount of invested assets as specified in Section 3(b)(iii) of this Agreement is less than US$500,000,000 for two (2) consecutive calendar quarters, or (ii) terminated as set forth below.
(c) Licensor shall have the right to terminate this Agreement in the event of any material breach of this Agreement by Licensee, which breach is not cured within thirty (30) days following Licensee’s receipt of written notice from Licensor of such breach.
(d) Licensor shall have the right to terminate this Agreement one hundred eighty (180) days following the date upon which Licensor provides written notice to Licensee that Licensor is suspending offering the Index to licensees in general.
| 3. | License Fees and Reporting. |
(a) As consideration for the license granted under this Agreement, Licensee shall pay to Licensor the fees (“License Fees”) calculated as set forth on Exhibit B hereto. Licensee shall pay the License Fees within ten (10) business days after the end of the calendar quarter of Licensee’s receipt of Licensor’s invoice to which the License Fees relate. All amounts shall be paid in cash and shall be non-refundable. All amounts stated are net of any withholding taxes, such that the amounts due and payable to Licensor under this Agreement, after any applicable deduction or withholding for or on account of any present or future taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed, will not be less than the amounts set forth on Exhibit B (as applicable in accordance with its terms and the terms of this Agreement).
| 2 |
(b) Licensee shall deliver to Licensor, within ten (10) business days after each calendar quarter during the Initial Term or the applicable Renewal Term, a written report, upon which Licensor’s invoice referenced in Section 3(a) will be based, detailing (i) maximum daily total assets, (ii) minimum daily total assets, and (iii) average daily official closing amount of total assets, invested in the Products during the preceding calendar quarter, based upon business days during which any of the trading venues upon which the Products may be traded having been open for trading.
(c) Upon reasonable notice and reasonable request, Licensor or its agents shall have the right to audit on a confidential basis the relevant books and records of Licensee to confirm the accuracy of any one or more calculations of License Fees. Licensor shall bear its own costs of any such audit unless it is determined that Licensor has been underpaid by 5% or more with respect to the payments being audited, in which case Licensor’s costs of such audit shall be paid by Licensee.
(d) Licensee shall be responsible for all costs associated with the receipt of the Index.
| 4. | Informational Materials Review. |
(a) Licensee shall use its commercially reasonable best efforts to protect the goodwill and reputation of the Index and of the Marks in connection with its use of the Marks under this Agreement.
(b) Licensee shall submit to Licensor for its review and approval 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) relating to the Product(s) and that in any way use or refer to Licensor or the Index and that are used in connection with the Products (the “Informational Materials”); provided, however, that the foregoing shall not include regulatory filings required to be made by Licensee under applicable law and/or Licensee’s governing documents. Licensor will use commercially reasonable best efforts to provide approval or comments within ten (10) business days. In any event, approval by Licensor hereunder shall not be unreasonably withheld or delayed. Once Informational Materials have been approved by Licensor, subsequent Informational Materials that do not alter the use or description of Licensor and the Index need not be submitted for review and approval by Licensor.
(c) In each item of Informational Material, Licensee shall use only the full name of the Index, and shall not use any abbreviation therefor.
| 5. | Proprietary Rights. |
(a) Licensee acknowledges that the Index is selected, coordinated, arranged and prepared by Licensor through the application of methods and standards of judgment used and developed through the expenditure of considerable work, time and money by Licensor. Licensee also acknowledges that, as between Licensee and Licensor, the Marks are the exclusive property of Licensor, that Licensor has and retains all proprietary rights therein (including, but not limited to, trademarks and copyrights) and that the Index and its compilation and composition and changes therein are in the control and sole discretion of Licensor.
| 3 |
(b) Thomson Reuters and its licensors reserve all rights with respect to the Index and the Marks except those expressly licensed to Licensee hereunder. Licensee shall not modify any Mark or use any Mark, or the designations “Thomson Reuters” or any other Mark, in conjunction with Licensee’s own trademark(s) or the marks of any third party, except that Licensee may use “Thomson Reuters” or any other Mark solely as part of the Product name as approved in writing by Thomson Reuters and which name shall not be modified without Thomson Reuters prior written consent. To the extent the Product name includes “Thomson Reuters” or any other Mark in accordance with this Section 6(b), Licensee shall ensure that each time it uses the Product name it shall include the following attribution language: “Thomson Reuters is a registered trademark of Thomson Reuters and its affiliates.”
(c) Licensor reserves all rights with respect to the Index and the Marks except those expressly licensed to Licensee hereunder.
(d) The following notice will appear at the foot of any list or table which reproduces in whole or substantial part the Index: “Copyright 20[ ]. Thomson Reuters or its affiliates. Used with permission.”
| 6. | Warranties; Disclaimers; Indemnification. |
(a) Licensee agrees expressly to be bound itself by and furthermore to include all of the following disclaimers and limitations in its Informational Materials and any contract(s) relating to the Product(s) and upon request to furnish a copy (copies) thereof to Licensor:
“THE [NAME OF THE PRODUCT(S)] (THE “PRODUCT(S)”) IS NOT SPONSORED, ENDORSED, SOLD OR PROMOTED BY THOMSON REUTERS (MARKETS) LLC (“THOMSON REUTERS”), OR ANY OF ITS SUBSIDIARIES OR AFFILIATES (COLLECTIVELY, “LICENSOR”). LICENSOR 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 OR COMMODITIES GENERALLY OR IN THE PRODUCT(S) PARTICULARLY OR THE ABILITY OF THE INDEX TO TRACK GENERAL COMMODITY MARKET PERFORMANCE. LICENSOR’S ONLY RELATIONSHIP TO [LICENSEE NAME] (“LICENSEE”) IS THE LICENSING OF THE INDEX, WHICH IS DETERMINED, COMPOSED AND CALCULATED BY LICENSOR WITHOUT REGARD TO LICENSEE OR THE PRODUCT(S). LICENSOR HAS NO OBLIGATION TO TAKE THE NEEDS OF LICENSEE OR THE OWNERS OF THE PRODUCT(S) INTO CONSIDERATION IN DETERMINING COMPOSING OR CALCULATING THE INDEX. LICENSOR 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) IS TO BE CONVERTED INTO CASH. LICENSOR HAS NO OBLIGATION OR LIABILITY IN CONNECTION WITH THE ADMINISTRATION, MARKETING OR TRADING OF THE PRODUCT(S).
LICENSOR AND ITS AFFILIATES AND THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS MAY BUY OR SELL SECURITIES OR
| 4 |
COMMODITIES MENTIONED OR CONTEMPLATED HEREIN AS AGENT OR AS PRINCIPAL FOR THEIR OWN ACCOUNTS AND MAY HAVE POSITIONS OR ENGAGE IN TRANSACTIONS BASED ON OR INDEXED TO THE INDEX. IT IS POSSIBLE THAT LICENSOR’S TRADING ACTIVITY WILL AFFECT THE VALUE OF THE INDEX. LICENSOR MAY OPERATE AND MARKET OTHER INDICES THAT MAY COMPETE WITH THE INDEX.
LICENSOR DOES NOT GUARANTEE THE QUALITY, ACCURACY AND/OR THE COMPLETENESS OF THE INDEX OR ANY DATA INCLUDED THEREIN. LICENSOR MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE PRODUCT(S), OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDEX OR ANY DATA INCLUDED THEREIN IN CONNECTION WITH THE RIGHTS LICENSED HEREUNDER OR FOR ANY OTHER USE. LICENSOR MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL LICENSOR HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING WITHOUT LIMITATION, LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.”
Any changes in the foregoing disclaimers and limitations must be approved in advance in writing by an authorized officer of Licensor.
(b) Licensee represents and warrants to Licensor, and Licensor represents and warrants to Licensee, that it has the authority to enter into this Agreement according to its terms.
(c) Licensee represents and warrants to Licensor that the Product(s) shall at all times comply with the relevant descriptions in Exhibit A and shall not violate any of the restrictions set forth therein.
(d) Licensee represents and warrants to Licensor that the Product(s) shall not violate any applicable law, including but not limited to banking, commodities and securities laws.
(e) LICENSOR, ITS AFFILIATES, EMPLOYEES AND AGENTS, SHALL HAVE NO LIABILITY, CONTINGENT OR OTHERWISE, TO LICENSEE OR TO THIRD PARTIES, FOR THE ACCURACY, COMPLETENESS OR CURRENCY OF THE INDEX OR FOR DELAYS OR OMISSIONS THEREIN, OR FOR INTERRUPTIONS IN THE DELIVERY OF THE INDEX. IN NO EVENT WILL LICENSOR BE LIABLE FOR ANY SPECIAL, PUNITIVE, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING WITHOUT LIMITATION, LOST PROFITS) WHICH MAY BE INCURRED OR EXPERIENCED ON ACCOUNT OF LICENSEE ENTERING INTO OR RELYING ON THIS AGREEMENT, EVEN IF LICENSOR HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. WITHOUT DIMINISHING THE DISCLAIMERS AND LIMITATIONS SET FORTH IN THIS SECTION 7, IN NO EVENT SHALL THE CUMULATIVE LIABILITY OF LICENSOR TO LICENSEE UNDER THIS AGREEMENT EXCEED THE LICENSE FEES
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ACTUALLY PAID TO LICENSOR HEREUNDER FOR THE FULL CALENDAR YEAR IMMEDIATELY PRECEDING THE FINDING OF SUCH LIABILITY.
(f) Licensee shall indemnify, protect, and hold harmless Licensor, its affiliates, employees and agents from and against any and all losses, liabilities, judgments, suits, actions, proceedings, claims, damages, costs (including reasonable attorneys’ fees and disbursements) resulting from or arising out of failure to fulfill its obligations under this Agreement with respect to the use by Licensee of the Index in connection with the Product(s) or otherwise arising out of Licensee’s breach of this Agreement.
(g) Licensor represents and warrants that (i) Licensor is the sole owner of the Marks and the Index (and subindices named in Exhibit C) and the rights granted to Licensee herein, free and clear of any lien, license or other restriction or limitation regarding use or disclosure and (ii) use of the Marks and the Index (and subindices named in Exhibit C) as provided herein shall not infringe any trademark, service mark, copyright, patent, other proprietary right or contractual right of any person not a party to this Agreement.
(h) Licensor shall indemnify and hold harmless Licensee, its direct or indirect parent entities, subsidiaries, affiliates and their respective officers, directors, employees and agents against any and all claims, judgments, damages, costs or losses of any kind (including reasonable attorneys’ and experts’ fees) as a result of claims or actions brought by third parties against Licensee alleging that the Products’ use of the Marks or the Index violates or infringes any trademark, service mark, copyright, patent or other proprietary right, of any person not a party to this Agreement; provided, however, that (i) Licensee notifies Licensor promptly of any such claim or action and (ii) Licensor shall have no liability to Licensee if such judgments, damages, costs or losses are wholly attributable to Licensee’s breach of this Agreement. Licensor shall bear all expenses in connection with the defense and/or settlement of any such claim or action. Licensee shall have the right, at its own expense, to participate in the defense of any claim or action against which it is indemnified hereunder. Licensor, in the defense of any such claim, except with the written consent of Licensee, shall not consent to entry of any judgment or enter into any settlement which (A) does not include, as an unconditional term, the grant by the claimant to Licensee of a release of all liabilities in respect of such claims or (B) otherwise adversely affects the rights of Licensee other than with respect to the rights granted Licensee under this Agreement.
| 7. | Exclusivity. |
During the Initial Term and each Renewal Term, Licensor agrees not to license to any entity or person the right to use the Index or any Subindices for any Product.
| 8. | Confidentiality. |
Each of Licensor and Licensee acknowledges that it or its employees may in the course of performing their responsibilities under this Agreement, be exposed to or acquire information which is proprietary to or confidential to the other party or its affiliates or clients or to third parties to whom the other party owes a duty of confidentiality. Any and all non-public information of any form obtained by one party or its employees regarding the other party,
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including without limitation information related to the calculation of the Index, shall be deemed to be confidential and proprietary information. The recipient of such confidential and proprietary information agrees to hold such information in confidence and not to use or disclose such information for any purpose whatsoever other than as contemplated by this Agreement and to advise each of its employees who may be exposed to such proprietary and confidential information of their obligations hereunder; provided, however, that Licensee may share such confidential and proprietary information with its direct or indirect parent entities, subsidiaries, affiliates and subadvisors who need-to-know such information to enable Licensee to perform under this Agreement. Notwithstanding anything to the contrary set forth herein, Licensee may disclose such confidential or proprietary information to the extent required by applicable law, subpoena or order of a governmental or regulatory agency, provided that Licensee furnishes Licensor with prompt written notice of such request so that the Licensor may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Agreement. If Licensor seeks such an order, Licensee will provide such commercially reasonable cooperation as Licensor reasonably requests at the expense of Licensor. Licensee agrees to furnish, disclose or describe only that portion of the confidential information which is legally required (in the opinion of its external counsel). The obligations of confidentiality and non-use set forth in this Section 8 shall not apply to information that: (a) is already in the possession of Licensee at the time of disclosure hereunder, as evidenced by Licensee’s internal records, (b) is or becomes generally available to the public through no breach of this Agreement by Licensee, (c) is obtained by Licensee from any third party not under an obligation of confidentiality to Licensor with respect to such disclosure, or (d) independently developed by Licensee without access to or use of such confidential or proprietary information.
9. No Promotion.
Except as specifically provided herein, Licensee agrees that it will not, without the prior written consent of Licensor in each instance, (i) use in advertising, publicity, or otherwise the name of Licensor, or any affiliate of Licensor, or any employee of Licensor, nor any trade name, trademark, trade device, service mark, symbol or any abbreviation, contraction or simulation thereof owned by Licensor or its affiliates, or (ii) represent, directly or indirectly, that any product or any service provided by Licensee has been approved or endorsed by Licensor.
10. Force Majeure.
No party shall be liable or deemed to be in default for any delay or failure to perform under this Agreement or for interruption of the services resulting directly or indirectly from any cause beyond such party’s reasonable control.
11. General.
(a) Licensee acknowledges that it has not been induced to enter into this Agreement by any representation or warranty not set forth in this Agreement. This Agreement (including all exhibits hereto) contains the entire agreement of the parties with respect to its subject matter and supersedes all existing and all other oral, written or other communications between them concerning this subject matter. This Agreement shall not be modified in any way except by a writing signed by all parties.
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(b) Except in connection with the Unit Purchase Agreement or, with notice to Licensor (but without need for prior written consent) in connection with a transfer of rights and obligations to an affiliate of Licensee, this Agreement may not be assigned by Licensee without the prior written consent of Licensor. This Agreement shall be binding upon and shall inure to the benefit of the parties and their respective successors and permitted assigns.
(c) If any provision of this Agreement (or any portion thereof) shall be invalid, illegal or unenforceable, the validity, legality or enforceability of the remainder of this Agreement shall not in any way be affected or impaired thereby.
(d) All notices and other communications under this Agreement shall be (i) in writing, (ii) delivered by hand, by registered or certified mail, return receipt requested, by overnight delivery service, or by facsimile transmission to the address set forth below or such address as a party shall specify by a written notice to the other parties and (iii) deemed given upon receipt.
Notice to Licensor:
Thomson Reuters (Markets) LLC
3 Times Square
New York, New York 10036
ATTN: Head of Business Operations Indices
With a copy to: Index_Queries@thomsonreuters.com
Thomson Reuters (Markets) LLC
3 Times Square
New York, New York 10036
ATTN: General Counsel
Notice to Licensee:
GreenHaven Commodity Services, LLC
245 Park Avenue, 35th Floor
New York, NY 10167
ATTN: Ben Slavin
FAX: 212-697-1847
With a copy to:
WisdomTree Investments, Inc.
245 Park Avenue, 35th Floor
New York, NY 10167
ATTN: Chief Legal Officer
FAX: 212-697-1847
(e) The headings in this Agreement are intended for convenience of reference and shall not affect its interpretation.
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(f) Each of Licensor and Licensee acknowledges that a breach of any provision of Section 8 of this Agreement will cause the applicable party irreparable injury and damage and therefore may be enjoined through injunctive proceedings in addition to any other rights and remedies which may be available to the applicable party at law or in equity. Licensee consents to jurisdiction in the State or Federal courts located in New York County, State of New York, for enforcement of this provision.
(g) This Agreement and all matters relating to or arising under this Agreement shall be governed in all respects by the laws of the State of New York, without giving effect to principles of conflicts of law, and any litigation arising out of or connected in any way with this Agreement shall take place in a State or Federal court of competent jurisdiction in New York County, State of New York.
(h) The following Sections shall survive termination of this Agreement: 5, 6, 8, 9 and 11.
(i) Where a Product is traded in a currency other than U.S. dollars, the U.S. dollar equivalent, for purposes of Section 2(b), Section 3 and Exhibit B hereunder, will be calculated using the fixing rate of exchange displayed on the BCE’s screen on the valuation date which, for the avoidance of doubt, can be found at http://www.ecb.int/stats/exchange/eurofxref/html/index.en.html.
[Remainder of Page Intentionally Left Blank]
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EXECUTION VERSION
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.
| LICENSOR: | |||
| THOMSON REUTERS (MARKETS) LLC | |||
| By: | /s/ John J. Menne | ||
| Name: John J. Menne | |||
| Title: Head of Customer Administration | |||
| LICENSEE: | |||
| GREENHAVEN COMMODITY SERVICES, LLC | |||
| By: | /s/ Ashmead Pringle | ||
| Name: Ashmead Pringle | |||
| Title: President | |||
[Signature Page to Amended and Restated License Agreement]
EXECUTION VERSION
EXHIBIT A
PRODUCTS
“Products” means any financial product, which is linked, directly or indirectly, to the performance of the Index or any Subindices listed in Exhibit C, including, without limitation, over-the-counter products, privately placed debt obligations, publicly offered debt obligations, certificates of deposit, index warrants, exchange traded products and funds, exchange traded notes, commodity pools, UCITS, collective investment bank trusts/funds, other pooled investment vehicles and depository receipts. For avoidance of doubt, Products include those that are unlisted or are listed and/or cross-listed for trading on any U.S. and/or foreign securities exchange, including, without limitation, the New York Stock Exchange, NASDAQ, BATS, Toronto Stock Exchange, London Stock Exchange, Tokyo Stock Exchange, Deutsche Borse, Borsa Italiana and the Mexican Stock Exchange.
EXECUTION VERSION
EXHIBIT B
LICENSE FEES
| A. | License Fee |
| (i) | 0.100% (10 basis points) per annum of the first US$325,000,000, or foreign currency equivalent, invested in the Products based upon the average daily official closing amount of invested assets as specified in Section 3(b)(iii); |
| (ii) | 0.080% (8 basis points) per annum of US$, or foreign currency equivalent, invested in the Products based upon the average daily official closing amount of invested assets as specified in Section 3(b)(iii) for assets which are greater than US$325,000,000, but US$500,000,000 or less; |
| (iii) | 0.040% (4 basis points) per annum of US$, or foreign currency equivalent, invested in the Products based upon the average daily official closing amount of invested assets as specified in Section 3(b)(iii) for assets which are greater than US$500,000,000, but US$750,000,000 or less; or |
| (iv) | 0.030% (3 basis points) per annum of US$, or foreign currency equivalent, invested in the Products based upon the average daily official closing amount of invested assets as specified in Section 3(b)(iii) for assets which are greater than US$750,000,000. |
| B. | Minimum License Fee |
| (i) | The license fee described above is subject to a minimum annual fee of US$90,000. |
EXECUTION VERSION
EXHIBIT C
INDEX, SUBINDICES, and TOTAL and EXCESS RETURNS
Index
Continuous Commodity Index (CCI)
Subindices
CCI Energy Sub-index,
CCI Grains and Oilseeds Sub-index
CCI Industrials Sub-index
CCI Livestock Sub-index
CCI Precious Metals Sub-index
CCI Softs Sub-index
Total Returns
Continuous Commodity Index Excess Return (RIC: <.CCITR>)
Should Licensor commence the calculation, and publication of, total return values for certain CCI Subindices, Licensee may use such Subindex total return values subject to the terms of this Agreement.
Excess Returns
Continuous Commodity Index Excess Return (RIC: <.CI>).
Should Licensor commence the calculation, and publication of, excess return values for certain CCI Subindices, Licensee may use such Subindex excess return values subject to the terms of this Agreement.