FIRST AMENDMENT TO FULLY PAID SECURITIES LENDING AGREEMENT
Exhibit (h)(11)
FIRST AMENDMENT TO FULLY PAID SECURITIES LENDING
AGREEMENT
Wedbush Securities Inc., (”Wedbush”), and ETFMG Alternative Harvest ETF, a
series fund of the ETF Managers Trust (”ETFMG” or “you”) have entered into a
Fully Paid Securities Lending Agreement, Dated on or about
September 6, 2018 (as amended and restated, supplemented or
otherwise modified from time to time in accordance with its
provisions) (the “Existing
Agreement” a copy of
which is attached). ETFMG together with Wedbush, are referred to as
the “Parties”, and each, a “Party”.
WHEREAS, the Parties desire to amend the Existing Agreement to
permit a portion of any Collateral to be invested in a
certain qualified securities and/or FDIC Cash Sweep Program as agreed to
between the Parties;
NOW, THEREFORE, in consideration of the foregoing and other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties agree as follows:
1. Definitions.
Capitalized terms used and not defined in this amendment
(“Amendment”) have the respective meanings assigned to
them in the Existing Agreement.
2. Amendments to the
Existing Agreement. As of
October 10, 2019 (the
“Effective
Date”), the Existing
Agreement is hereby amended or modified as
follows:
(a) The section titled “Collateral” in the
Existing Agreement is hereby amended by deleting the following
words:
“You agree that you will not
remove the Collateral from your account, nor use it for any other
purpose, including the purchase of other shares or investments,
except in the case that Wedbush fails to return your loaned out
shares upon termination of the loan”
in the last paragraph of such section and substituting
it the following:
“You agree that you will not remove the
Collateral from your account, nor use it for any other purpose,
including the purchase of other shares or investments, except: (i)
in the case that Wedbush fails to return your loaned out shares
upon termination of the loan; (ii) to sweep available cash into
Wedbush’s FDIC Cash Sweep Program or (iii) for holding, or
creating certain qualified securities as agreed to between the
Parties and listed on Exhibit
A, as amended from time to time
(the “Permitted
Securities”), provided
that no more than 50% of the Collateral may be held in Permitted
Securities. You understand and agree that Wedbush shall have no
liability for any risk related to holding Collateral in the form of
Permitted Securities including without limitation any fluctuation
in the value of the Permitted Securities and that you solely bear
any such risks. The value of
the Permitted Securities will be monitored daily and adjusted up or
down depending on the market value, as determined in accordance
with daily xxxx to market. In the event that, upon the daily xxxx
to market, the value of the Permitted Securities is less than the
Cost Basis (as defined below), you hereby authorize Wedbush to
transfer cash from your primary account to your fully paid lending
account so that such transfer cures any such unrealized losses in
the Collateral. In the event that, upon the daily xxxx to market,
the value of the Permitted Securities is more than the Cost Basis,
you hereby authorize Wedbush to transfer cash from your fully paid
lending account to your primary account so that the value of the
Collateral does not exceed the amount of the Cost Basis.
“Cost Basis” means the value of the Permitted
Securities on the date such Permitted Securities were purchased,
created (in the case of Permitted Securities that are exchange
traded funds), or placed into your account where other Collateral
is held.”
(b) The
last sentence of the section titled “Termination of
Loan” in the Existing Agreement is hereby deleted in its
entirety and replaced with the following:
“You
understand that, upon the loan being terminated and the shares
being returned to your account, the corresponding Collateral will
be removed from your account. Wedbush has absolute discretion
whether to remove Collateral as cash and/or Permitted Securities or
any combination thereof. In the event a portion of the Collateral
is held as a Permitted Securities, Wedbush may in its sole
discretion either liquidate such Permitted Securities and remove
the proceeds from your account, or redeem the Permitted Securities
for cash or in kind from your account.”
3. Miscellaneous.
(a) Except as expressly provided in this Amendment, all of the
terms and provisions of the Existing Agreement are and will remain
in full force and effect and are hereby ratified and confirmed by
the Parties. On and after the Effective Date, each reference in the
Existing Agreement to “this Agreement,” “the
Agreement,” “hereunder,” “hereof,”
“herein,” or words of like import, will mean and be a
reference to the Existing Agreement as amended by this
Amendment.
(b) This Amendment may be executed in
counterparts, each of which is deemed an original, but all of which
constitute one and the same agreement. Delivery of an executed
counterpart of this Amendment electronically shall be effective as
delivery of an original executed counterpart of this
Amendment.
(d) This Amendment and Exhibit A
constitutes the sole and entire
agreement between the Parties with respect to the subject matter
contained herein, and supersedes all prior and contemporaneous
understandings, agreements, representations, and warranties, both
written and oral, with respect to such subject
matter.
IN WITNESS WHEREOF, the Parties have executed this
Amendment.
WEDBUSH SECURITIES INC.
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ETFMG Alternative Harvest ETF, a series fund
of the ETF
Managers Trust.
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/s/
Xxx Xxxxx
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/s/ Xxxxxx Xxxxxxx III
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Xxx Xxxxx, Executive Vice President
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Xxxxxx
Xxxxxxx, III, President
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EXHIBIT A
FIRST AMENDMENT TO FULLY PAID SECURITIES LENDING
AGREEMENT
PERMITTED
SECURITIES
●
ETFMG Sit Ultra
Short ETF – Ticker VALT
WEDBUSH SECURITIES INC.
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ETFMG Alternative Harvest Etf, a series fund
of the ETF Managers Trust.
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/s/
Xxx Xxxxx
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/s/ Xxxxxx Xxxxxxx III
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Xxx Xxxxx, Executive Vice President
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Xxxxxx
Xxxxxxx, III, President
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Date: October 10,
2019
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Date: October
10, 2019
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