EXHIBIT 10.2
FORM OF SUBLICENSE
AGREEMENT
This Sublicense
Agreement (this ‘‘ Agreement ’’) is
entered into as of [ ], 2006 (the ‘‘
Effective Date ’’), by and between PADCO
Advisors II, Inc., a Maryland corporation (‘‘
Licensor ’’), and Rydex Specialized Products
LLC, a Delaware limited liability company wholly-owned by Licensor
(‘‘ Licensee ’’).
WHEREAS, Licensor and
The Bank of New York (‘‘ BONY ’’)
entered into a License Agreement, dated as of December 5, 2005 (the
‘‘ BONY License Agreement ’’),
whereby BONY granted Licensor a non-exclusive, non-transferable
(except as provided in Section 12.1 of the BONY License Agreement)
license (the ‘‘ BONY License ’’)
under the BONY Patent Rights (as defined herein) solely for the
purposes of establishing, operating and marketing Licensed Products
(as defined herein); the BONY License permits Licensor to grant
sublicenses to its partners, co-sponsors, joint venturers,
trustees, custodians and agents, in connection with their
establishment, operation and marketing of Licensed
Products;
WHEREAS, Licensor and
Licensee entered into a Sublicense Agreement, dated as of December
5, 2005 (the ‘‘ Former Sublicense
’’), whereby Licensor granted a sublicense to Licensee
a non-exclusive, personal and non-transferable license to BONY
Patent Rights in connection with the Euro Currency Trust; and
Licensor and Licensee intend for this Agreement to supersede the
Former Sublicense;
WHEREAS, the Euro
Currency Trust was established pursuant to the Depositary Trust
Agreement entered into by and between Licensee and BONY, dated as
of December 5, 2005, pursuant to which the Trust issues Euro
CurrencyShares which represent units of fractional undivided
beneficial interest in and ownership of the Euro Currency
Trust;
WHEREAS, the
CurrencyShares British Pound Sterling Trust was established
pursuant to the Depositary Trust Agreement entered into by and
between Licensee and BONY, dated as of
[ ], 2006, pursuant to which the Trust
will issue British Pound Sterling CurrencyShares which represent
units of fractional undivided beneficial interest in and ownership
of the CurrencyShares British Pound Sterling Trust;
WHEREAS, the
CurrencyShares Canadian Dollar Trust was established pursuant to
the Depositary Trust Agreement entered into by and between Licensee
and BONY, dated as of [ ], 2006,
pursuant to which the Trust will issue Canadian Dollar
CurrencyShares which represent units of fractional undivided
beneficial interest in and ownership of the CurrencyShares Canadian
Dollar Trust;
WHEREAS, the
CurrencyShares Australian Dollar Trust was established pursuant to
the Depositary Trust Agreement entered into by and between Licensee
and BONY, dated as of [ ], 2006,
pursuant to which the Trust will issue Australian Dollar
CurrencyShares which represent units of fractional undivided
beneficial interest in and ownership of the CurrencyShares
Australian Dollar Trust;
WHEREAS, the Swiss Franc
Trust was established pursuant to the Depositary Trust Agreement
entered into by and between Licensee and BONY, dated as of
[ ], 2006, pursuant to which the Trust
will issue Swiss Franc CurrencyShares which represent units of
fractional undivided beneficial interest in and ownership of the
CurrencyShares Swiss Franc Trust;
WHEREAS, the
CurrencyShares Swedish Krona Trust was established pursuant to the
Depositary Trust Agreement entered into by and between Licensee and
BONY, dated as of [ ], 2006, pursuant
to which the Trust will issue Swedish Krona CurrencyShares which
represent units of fractional undivided beneficial interest in and
ownership of the CurrencyShares Swedish Krona Trust;
WHEREAS, the
CurrencyShares Mexican Peso Trust was established pursuant to the
Depositary Trust Agreement entered into by ad between Licensee and
BONY, dated as of [ ],
2006,
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pursuant to which the
Trust will issue Mexican Person CurrencyShares which represent
units of fractional undivided beneficial interest in and ownership
of the CurrencyShares Mexican Peso Trust;
WHEREAS, Licensee is
acting as the sponsor of all of the aforementioned trusts
(collectively, the ‘‘ Trusts ’’; the
associated agreements, the ‘‘ Trust Agreements
’’; and the associated shares, the ‘‘
Shares ’’) and is responsible for establishing
the Trusts, registering the Shares and overseeing the performance
of the trustee of the Trusts;
WHEREAS, pursuant to the
terms and conditions of the BONY License Agreement, Licensor
desires to grant a sublicense to Licensee under the BONY Patent
Rights, with the right to grant sublicenses, solely for
Licensee’s use as the sponsor of the Trusts;
WHEREAS, Licensor uses
in commerce and owns in the United States all domain names, trade
names and trademark rights and associated goodwill in the
designations specified on Schedule 1 attached hereto (the
‘‘ Licensor Marks ’’);
and
WHEREAS, Licensor
desires to grant a license to Licensee to the Licensor Marks, with
the right to grant sublicenses, solely for Licensee’s use as
the sponsor of the Trusts;
NOW THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Licensor and Licensee agree as
follows:
1.
DEFINITIONS.
For the purposes of this
Agreement, the following terms have the following
meanings:
(a.) ‘‘
Affiliate ’’ means, with respect to any Person,
any other Person that, directly or indirectly through one or more
intermediaries, Controls, or is Controlled by, or is under common
Control with, such Person.
(b.) ‘‘
BONY Patent Rights ’’ means any patents and
patent applications (and all related know-how and trade secrets) of
BONY, anywhere in the world, that cover an investment product that
is based solely on the securitization of a single non-U.S. currency
and that exist as of the effective date of the BONY License
Agreement or are filed or issued thereafter, including but not
limited to U.S. Patent Application No. 10/680,589 filed on October
6, 2003 entitled ‘‘Systems and Methods for Securitizing
a Commodity.’’
(c.) ‘‘
Control ’’ means, with respect to any Person,
the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person,
whether through the ownership of voting securities, by contract or
otherwise.
(d.) ‘‘
Licensed Products ’’ means any investment
product that is based solely on the securitization of a single
non-U.S. currency that is sold, sponsored or issued by Licensee or
any Affiliate of Licensee. For the purposes of clarity, the
Licensed Products do not include any products involving the
securitization of any commodity other than non-U.S.
currency.
(e.) ‘‘
Person ’’ shall be construed broadly and shall
include an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust,
a joint venture, an unincorporated organization or another entity,
including a governmental entity or any department, agency or
political subdivision thereof.
2.
LICENSE.
(a.) BONY
Patent Rights Sublicense . Pursuant to Section 2 of the BONY
License Agreement and subject to the terms and conditions of this
Agreement, Licensor hereby grants to Licensee a non-exclusive,
personal and non-transferable (except as provided in Section 10(a))
license for the term of this Agreement to use the BONY Patent
Rights solely in connection with Licensee’s performance of
its services as sponsor of the Trusts pursuant to the Trust
Agreements (the ‘‘ BONY Sublicense
’’).
(b.)
Licensee’s Limited Right to Sublicense . Each of the
Licenses granted herein shall include the limited right of Licensee
to grant sublicenses to its Affiliates, partners, co-sponsors,
joint
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venturers, trustees,
distributors, custodians and agents (each a ‘‘
Sublicensee ’’), subject to the restrictions of
this Agreement, and solely in connection with such
Sublicensee’s performance of services for Licensee related to
the activities of Licensee permitted hereunder. In addition,
Licensee shall include provisions in all such sublicenses that: (i)
are identical in substance to Sections 3, 4 and 5 herein (with the
references in such sublicenses to
‘‘Licensor’&rsqu
