Exhibit 4.1

 
	
  

 	
  

 	
  

 
	
 DEPOSITARY TRUST AGREEMENT

 
	
  

 	
  

 	
  

 
	
 ETF SECURITIES USA LLC,

 
	
  

 	
  

 	
  

 
	
 as Sponsor

 
	
  

 	
  

 	
  

 
	
 and

 
	
  

 	
  

 	
  

 
	
 THE BANK OF NEW YORK MELLON,

 
	
  

 	
  

 	
  

 
	
 as Trustee

 
	
  

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 Depositary Trust Agreement

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 ETFS White Metals Basket Trust

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 Dated as of November 29, 2010

 	
  

 









TABLE OF CONTENTS


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 


 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Article I. DEFINITIONS AND RULES OF CONSTRUCTION

 	
  

 	
 1

 
	
  

 	
  

 	
  

 
	
  

 	
 Section 1.1

 	
  

 	
 Definitions

 	
  

 	
 1

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 1.2

 	
  

 	
 Rules of Construction

 	
  

 	
 6

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Article II. CREATION AND DECLARATION OF
 TRUSTS; FORM OF CERTIFICATES; DEPOSIT OF BULLION; DELIVERY, REGISTRATION OF
 TRANSFER AND SURRENDER OF SHARES

 	
  

 	
 6

 
	
  

 	
  

 	
  

 
	
  

 	
 Section 2.1

 	
  

 	
 Creation and Declaration of Trust; Business
 of the Trust

 	
  

 	
 6

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.2

 	
  

 	
 Form of Certificates; Book-Entry System;
 Transferability of Shares

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.3

 	
  

 	
 Deposit of Bullion

 	
  

 	
 8

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.4

 	
  

 	
 Delivery of Shares

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.5

 	
  

 	
 Registration and Registration of Transfer
 of Shares; Combination and Split-up of Certificates

 	
  

 	
 10

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.6

 	
  

 	
 Surrender of Shares and Withdrawal of Trust
 Property

 	
  

 	
 10

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.7

 	
  

 	
 Limitations on Delivery, Registration of
 Transfer and Surrender of Shares

 	
  

 	
 11

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.8

 	
  

 	
 Lost Certificates, Etc.

 	
  

 	
 12

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.9

 	
  

 	
 Cancellation and Destruction of Surrendered
 Certificates

 	
  

 	
 12

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 2.10

 	
  

 	
 Splits and Reverse Splits of Shares

 	
  

 	
 12

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Article III. CERTAIN OBLIGATIONS OF
 REGISTERED OWNERS OF SHARES

 	
  

 	
 12

 
	
  

 	
  

 	
  

 
	
  

 	
 Section 3.1

 	
  

 	
 Liability of Registered Owner for Taxes and
 Other Governmental Charges

 	
  

 	
 12

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 3.2

 	
  

 	
 Warranties on Deposit of Bullion

 	
  

 	
 13

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Article IV. ADMINISTRATION OF THE TRUST

 	
  

 	
 13

 
	
  

 	
  

 	
  

 
	
  

 	
 Section 4.1

 	
  

 	
 Evaluation of Bullion

 	
  

 	
 13

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.2

 	
  

 	
 Responsibility of the Trustee for
 Evaluations

 	
  

 	
 14

 


i









	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.3

 	
  

 	
 Trust Evaluation

 	
  

 	
 14

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.4

 	
  

 	
 Cash Distributions

 	
  

 	
 14

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.5

 	
  

 	
 Other Distributions

 	
  

 	
 15

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.6

 	
  

 	
 Fixing of Record Date

 	
  

 	
 15

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.7

 	
  

 	
 Payment of Expenses; Bullion Sales

 	
  

 	
 15

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.8

 	
  

 	
 Statements and Reports

 	
  

 	
 17

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.9

 	
  

 	
 Further Provisions for Bullion Sales

 	
  

 	
 17

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.10

 	
  

 	
 Counsel

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 4.11

 	
  

 	
 Grantor Trust

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Article V. THE TRUSTEE AND THE SPONSOR

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.1

 	
  

 	
 Maintenance of Office and Transfer Books by
 the Trustee

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.2

 	
  

 	
 Prevention or Delay in Performance by the
 Sponsor or the Trustee

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.3

 	
  

 	
 Obligations of the Sponsor and the Trustee

 	
  

 	
 19

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.4

 	
  

 	
 Resignation or Removal of the Trustee;
 Appointment of Successor Trustee

 	
  

 	
 23

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.5

 	
  

 	
 The Custodian

 	
  

 	
 24

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.6

 	
  

 	
 Indemnification

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.7

 	
  

 	
 Charges of Trustee

 	
  

 	
 26

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.8

 	
  

 	
 Charges of Sponsor

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.9

 	
  

 	
 Retention of Trust Documents

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.10

 	
  

 	
 Federal Securities Law Filings

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.11

 	
  

 	
 Prospectus Delivery

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.12

 	
  

 	
 Discretionary Actions by Trustee;
 Consultation

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 5.13

 	
  

 	
 Dissolution of the Sponsor Not to Terminate
 Trust

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Article VI. AMENDMENT AND TERMINATION

 	
  

 	
 29

 


ii









	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 6.1

 	
  

 	
 Amendment

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 6.2

 	
  

 	
 Termination

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Article VII. MISCELLANEOUS

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 7.1

 	
  

 	
 Counterparts

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 7.2

 	
  

 	
 Third-Party Beneficiaries

 	
  

 	
 32

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 7.3

 	
  

 	
 Severability

 	
  

 	
 32

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 7.4

 	
  

 	
 Certain Matters Relating to Beneficial
 Owners

 	
  

 	
 32

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 7.5

 	
  

 	
 Notices

 	
  

 	
 33

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 7.6

 	
  

 	
 Agent for Service; Submission to
 Jurisdiction

 	
  

 	
 34

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Section 7.7

 	
  

 	
 Governing Law

 	
  

 	
 34

 


iii





DEPOSITARY TRUST AGREEMENT


          THIS
DEPOSITARY TRUST AGREEMENT dated as of November 29, 2010, between ETF SECURITIES
    USA LLC, a Delaware limited liability company, as sponsor, and THE BANK OF
NEW YORK MELLON, a New York banking corporation, as trustee.


W I T N E S S E T H:


          WHEREAS the
Sponsor desires to establish a trust, to be known as the “ETFS White Metals
Basket Trust”, pursuant to the laws of the State of New York; and


          WHEREAS the
Sponsor desires to establish the terms on which Bullion (as herein defined) may
be deposited in the trust and provide for the creation of ETFS Physical WM
Basket Shares in Baskets (as herein defined) representing fractional undivided
interests in the net assets of the trust and the execution and delivery of
Certificates (as herein defined) evidencing the ETFS Physical WM Basket Shares;
and


          WHEREAS the
Sponsor desires to provide for other terms and conditions upon which the trust
shall be established and administered, as hereinafter provided;


          NOW,
THEREFORE, in consideration of the premises and of the mutual agreements herein
contained, the Sponsor and the Trustee hereby agree as follows:


ARTICLE I.

DEFINITIONS AND RULES OF CONSTRUCTION


          Section 1.1
Definitions.


          Except as
otherwise specified in this Depositary Trust Agreement or as the context may
otherwise require, the following terms have the respective meanings set forth
below for all purposes of this Depositary Trust Agreement.


          “Adjusted
Net Asset Value” means the adjusted net asset value of the Trust as determined
under Section 4.3.


          “Agreement”
means this Depositary Trust Agreement, as amended or supplemented in accordance
with its terms.


          “Authorized
Participant” means a Person that, at the time of submitting a Purchase Order or
a Redemption Order (i) is a registered broker-dealer, (ii) is a DTC Participant
or an Indirect Participant and (iii) has in effect a valid Authorized
Participant Agreement.


          “Authorized
Participant Agreement” means an agreement among the Trustee, the Sponsor and an
Authorized Participant that authorizes the Authorized Participant to submit
Purchase Orders and Redemption Orders under this Agreement.


          “Basket”
means 50,000 Shares, except that the Trustee, in consultation with the Sponsor,
may from time to time increase or decrease the number of Shares comprising a
Basket.


1





          “Basket
Bullion Amount” is the amount of Silver, Platinum and Palladium that must be
deposited for issuance of one Basket or that is deliverable upon Surrender of
one Basket. The Basket Bullion Amount will be determined as provided in Section
2.3(b) and shall always be in accordance with the Bullion Ratio.


          “Benchmark Price”
means, as of any day, as applicable (i) such day’s London PM Fix for Platinum
or Palladium or such day’s London Fix for Silver; or (ii) other publicly
available price as the Sponsor may determine fairly represents the commercial
value of Silver, Platinum or Palladium held by the Trust.


          “Beneficial
Owner” means any Person owning a beneficial interest in any Shares.


          “Bullion”
means Silver, Platinum or Palladium, or any combination thereof, as applicable.


          “Bullion
Ratio” means that ratio of Silver, Platinum and Palladium held in the initial
Basket of Shares, such that for every 50,000 Ounces of Silver there are 500
Ounces of Platinum and 400 Ounces of Palladium.


          “Business
Day” means any day other than (i) a Saturday or Sunday or (ii) a day on which
the Exchange is not open for regular trading.


          “Certificate”
means a certificate that is executed and delivered by the Trustee under this
Agreement evidencing Shares.


          “CFTC”
means the Commodity Futures Trading Commission or any successor governmental
agency in the United States.


          “Commission”
means the Securities and Exchange Commission of the United States or any
successor governmental agency in the United States.


          “Corporate
Trust Office” means the office of the Trustee at which its depositary receipt
business is administered which, at the date of this Agreement, is located at
101 Barclay Street, New York, New York 10286.


          “Custodian”
means the Initial Custodian and any substitute or additional Custodian
appointed by the Trustee at the direction of or as approved by the Sponsor as
provided in Section 5.5 and, where the context permits, any sub-custodians
employed by the Initial Custodian, including any Zurich Sub-Custodian, or any
such substitute or additional Custodian.


          “Custody
Agreements” shall mean the Trust Unallocated Account Agreement and the Trust
Allocated Account Agreement and any custody agreement entered into pursuant to
Section 5.5 with a substitute or additional Custodian.


          “Delivery”
means (a) when used with respect to Bullion, obtaining an acknowledgement from
the Custodian of a credit of Bullion on an Unallocated Basis to the account of
the Person entitled to that delivery and (b) when used with respect to Shares,
one or more book-entry 


2





transfers of those Shares to an account or accounts at the Depository
designated by the Person entitled to such delivery for further credit as
specified by that Person


          “Depositor”
means any Authorized Participant that deposits Bullion into the Trust, either
for its own account or on behalf of another Person that is the owner or
beneficial owner of that Bullion.


          “Depository”
means DTC and such other successor depository of Shares as may be selected by
the Sponsor and the Trustee as provided herein.


          “DTC” means
The Depository Trust Company, its nominees and their respective successors.


          “DTC
Participant” means a Person that, pursuant to DTC’s governing documents, is
entitled to deposit securities with DTC in its capacity as a “participant”.


          “Exchange”
means the exchange or other securities market on which the Shares are
principally traded, as specified from time to time by the Sponsor.


          “Exchange
Act” has the meaning ascribed to such term in Section 4.8(b) hereof.


          “Indirect
Participant” means a Person that, by clearing securities through, or
maintaining a custodial relationship with, a DTC participant, has access to the
DTC clearing system.


          “Initial
Custodian” means JPMorgan Chase Bank, N.A., as Custodian under the Custody
Agreements.


          “Initial
Zurich Sub-Custodian” means UBS AG, as the initial Zurich Sub-Custodian under
the Trust Allocated Account Agreement.


          “Internal Control
Over Financial Reporting” has the meaning ascribed to such term in Rules
13a-15(f) and 15(d)-15(f) adopted by the Commission under the Exchange Act.


          “LBMA”
means the London Bullion Market Association.


          “London
Fix” means the price of an ounce of Silver as set by the three market members
of the LBMA at approximately 12:00 noon, London time, on each working day. 


          “London PM
Fix” means, as applicable, the afternoon session of the twice daily fix of the
price of an ounce of (i) Platinum which starts at 2:00 PM London, England time
and is performed in London by the four members of the London platinum fix, or
(ii) Palladium which starts at 2:00 PM London, England time and is performed in
London by the four members of the London palladium fix.


          “LPPM”
means the London Platinum and Palladium Market.


          “Net Asset
Value” means the net value of the Trust determined under Section 4.3.


          “Net Asset
Value per Share” means the value of a Share determined under Section 4.3.


3





          “Order
Cutoff Time” means, with respect to any Business Day, (i) 4:00 p.m. (New York
time) on such Business Day or (ii) another time agreed to by the Sponsor and
the Trustee and of which Registered Owners and all existing Authorized
Participants have been notified by the Trustee.


          “Order
Date” means, with respect to a Purchase Order, the date specified in Section
2.3(a) and, with respect to a Redemption Order, the date specified in Section
2.6(a).


          “Ounce”
means one troy ounce, equal to 31.103 grams (1.0971428 ounces avoirdupois),
with a minimum fineness of 999.5 parts per 1,000 Platinum or Palladium or 999.0
parts per 1,000 Silver, as applicable.


          “Palladium”
means (a) palladium that meets the requirements of “good delivery” under the
rules of the LPPM and (b) credit to an account on an Unallocated Basis
representing the right to receive palladium that meets the requirements of part
(a) of this definition.


          “Person”
means any natural person or any limited liability company, corporation,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.


          “Platinum”
means (a) platinum that meets the requirements of “good delivery” under the
rules of the LPPM and (b) credit to an account on an Unallocated Basis
representing the right to receive platinum that meets the requirements of part
(a) of this definition.


          “Procedures”
means the procedures for Purchase Orders and Redemption Orders attached to the
Authorized Participant Agreement, as modified by the Trustee from time to time.


          “Purchase
Order” is defined in Section 2.3.


          “Qualified
Bank” means a bank, trust company, corporation or national banking association
organized and doing business under the laws of the United States or any State
of the United States that is authorized under those laws to exercise corporate
trust powers and that (i) is a DTC Participant or a participant in such other
Depository as is then acting with respect to the Shares; (ii) unless counsel to
the Sponsor, the appointment of which is acceptable to the Trustee, determines
that the following requirement is not necessary for the exception under Section
408(m) of the Internal Revenue Code of 1986, as amended (the “Code”), to apply,
is a banking institution as defined in Section 408(n) of the Code and (iii)
had, as of the date of its most recent annual financial statements, an
aggregate capital, surplus and undivided profits of at least $150,000,000.


          “Redemption
Order” is defined in Section 2.6.


          “Registered
Owner” means the Person in whose name Shares are registered on the books of the
Trustee maintained for that purpose.


          “Registrar”
means any bank or trust company that is appointed to register Shares and
transfers of Shares as herein provided.


4






          “Shares”
means ETFS Physical WM Basket Shares created under this Agreement, each
representing a fractional undivided ownership interest in the net assets of the
Trust, which interest shall equal a fraction, the numerator of which is 1 and
the denominator of which is the total number of Shares outstanding. 


          “Silver”
means (a) silver that meets the requirements of “good delivery” under the rules
of the LBMA and (b) credit to an account on an Unallocated Basis representing
the right to receive silver that meets the requirements of part (a) of this
definition. 


          “Sponsor”
means ETF Securities USA LLC, a Delaware limited liability company, or its
successor. 


          “Surrender”
means, when used with respect to Shares, one or more book-entry transfers of
Shares to the Depository account of the Trustee. 


          “Trust”
means the ETFS White Metals Basket Trust, the trust entity created by this
Agreement. 


          “Trust
Allocated Account” shall mean the loco London account or the loco Zurich
account maintained for the Trust by the Initial Custodian pursuant to the Trust
Allocated Account Agreement, or another account maintained for the Trust by a
successor Custodian on an allocated basis, as the case may be. 


          “Trust
Allocated Account Agreement” shall mean the Allocated Account Agreement of even
date herewith between the Custodian and the Trustee the form of which is
attached as Exhibit B. 


          “Trust
Unallocated Account” shall mean the loco London account or the loco Zurich
account maintained for the Trust by the Initial Custodian pursuant to the Trust
Unallocated Account Agreement, or another account maintained for the Trust by a
successor Custodian on an Unallocated Basis, as the case may be. 


          “Trust
Unallocated Account Agreement” shall mean the Unallocated Account Agreement of
even date herewith between the Custodian and the Trustee the form of which is
attached as Exhibit C. 


          “Trustee”
means The Bank of New York Mellon, a New York banking corporation, in its
capacity as trustee under this Agreement, or any successor as trustee under
this Agreement. 


          “Trust
Property” means the Bullion that the Custodian credits to the Trust Allocated
Account and the Trust Unallocated Account in accordance with the Custody
Agreements, all other property held by the Custodian for the account of the
Trust and any cash or other property that is received by the Trustee in respect
thereof or which is otherwise being held by or for it under this Agreement. 


          “Unallocated
Basis” means that the Person in whose name Bullion is so held is entitled to
receive delivery of Bullion standing to the credit of that Person’s account,
but that Person has no 


5





ownership interest in any particular Bullion that the custodian
maintaining that account owns or holds. 


          “Zurich
Sub-Custodian” means any firm, including the Initial Zurich Sub-Custodian,
selected by the Custodian to hold Platinum and Palladium on behalf of the
Custodian in such firm’s Zurich vault premises on a segregated basis in the
manner provided for in the Trust Allocated Account Agreement. 


          Section 1.2
Rules of Construction. 


          Unless the
context otherwise requires: 


                              (i)
a term has the meaning assigned to it; 


                              (ii)
an accounting term not otherwise defined has the meaning assigned to it in
accordance with generally accepted accounting principles as in effect in the
United States; 


                              (iii)
“or” is not exclusive; 


                              (iv)
the words “herein,” “hereof,” “hereunder” and other words of similar import
refer to this Agreement as a whole and not to any particular Article, Section
or other subdivision; 


                              (v)
“including” means including without limitation; 


                              (vi)
words in the singular include the plural and words in the plural include the
singular; and 


                              (vii)
a term defined in any part of speech shall have the corresponding meaning when
capitalized and used herein in another part of speech. 


ARTICLE II.


CREATION AND DECLARATION OF TRUSTS;

FORM OF CERTIFICATES; DEPOSIT OF BULLION; 

DELIVERY, REGISTRATION OF TRANSFER AND SURRENDER OF SHARES


             Section 2.1
Creation and Declaration of Trust; Business of the Trust. 


                        (a)
The Trustee acknowledges that it has received confirmation from the Custodian
that the Custodian has received an initial deposit of Bullion from JPMorgan Chase Bank, N.A., London Branch,
the initial purchaser of the first Basket of Shares, and has credited such deposit
to the Trust Allocated Account and Trust Unallocated Account. The Trustee declares
that the initial deposit and all other Trust Property shall be owned by the Trust
and the Trustee as trustee thereof for the benefit of the Registered Owners for
the purposes of, and subject to and limited by the terms and conditions set forth
in, this Agreement. The trust created by this Agreement shall be known as the “ETFS
White Metals Basket Trust”. 


6





                        (b)
The Trust shall not engage in any business or activities other than those
authorized by this Agreement or incidental and necessary to carry out the
duties and responsibilities set forth in this Agreement. Other than issuance of
the Shares, the Trust shall not issue or sell any certificates or other
obligations or, except as provided in this Agreement, otherwise incur, assume
or guarantee any indebtedness for money borrowed. 


          Section
2.2 Form of Certificates; Book-Entry System; Transferability of Shares.


                        (a)
The Certificates evidencing Shares shall be substantially in the form set forth
in Exhibit A annexed to this Agreement, with appropriate insertions,
modifications and omissions, as hereinafter provided. No Shares shall be
entitled to any benefits under this Agreement or be valid or obligatory for any
purpose unless a Certificate evidencing those Shares has been executed by the
Trustee by the manual or facsimile signature of a duly authorized signatory of
the Trustee and, if a Registrar (other than the Trustee) for the Shares shall
have been appointed, countersigned by the manual signature of a duly authorized
officer of the Registrar. The Trustee shall maintain books on which the
registered ownership of each Share and transfers, if any, of such registered
ownership shall be recorded. Certificates evidencing Shares bearing the manual
or facsimile signature of a duly authorized signatory of the Trustee and the
manual signature of a duly authorized officer of the Registrar, if applicable,
who was, at the time such Certificates were executed, a proper signatory of the
Trustee or Registrar, if applicable, shall bind the Trustee, notwithstanding
that such signatory has ceased to hold such office prior to the delivery of
such Certificates. 


                        (b)
The Certificates may be endorsed with or have incorporated in the text thereof
such legends or recitals or modifications not inconsistent with the provisions
of this Agreement as may be required by the Trustee or required to comply with
any applicable law or regulations thereunder or with the rules and regulations
of any securities exchange upon which Shares may be listed or to conform with
any usage with respect thereto, or to indicate any special limitations or
restrictions to which the Shares evidenced by a particular Certificate are
subject. 


                        (c)
The Sponsor and the Trustee will apply to DTC for acceptance of the Shares in
its book-entry settlement system. Shares deposited with DTC shall be evidenced
by one or more global Certificates which shall be registered in the name of
Cede & Co., as nominee for DTC, and shall bear the following legend: 


	
  

 	
  

 
	
  

 	
 UNLESS THIS CERTIFICATE IS PRESENTED BY AN
 AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
 CORPORATION (“DTC”), TO THE AGENT AUTHORIZED BY THE ISSUER FOR REGISTRATION
 OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
 THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
 AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
 OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
 DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
 TO ANY PERSON IS WRONGFUL 

 


7









	
  

 	
  

 
	
  

 	
 INASMUCH AS THE REGISTERED OWNER HEREOF,
 CEDE & CO., HAS AN INTEREST HEREIN.

 


                        (d)
So long as the Shares are eligible for book-entry settlement with DTC and such
settlement is available, unless otherwise required by law, notwithstanding the
provisions of Sections 2.2(a) and (b), all Shares shall be evidenced by one or
more global Certificates the Registered Owner of which is DTC or a nominee of
DTC and (i) no Beneficial Owner of Shares will be entitled to receive a
separate Certificate evidencing those Shares, (ii) the interest of a Beneficial
Owner in Shares represented by a global Certificate will be shown only on, and
transfer of that interest will be effected only through, records maintained by
DTC or a DTC Participant or Indirect Participant through which the Beneficial
Owner holds that interest and (iii) the rights of a Beneficial Owner with
respect to Shares represented by a global Certificate will be exercised only to
the extent allowed by, and in compliance with, the arrangements in effect
between such Beneficial Owner and DTC or the DTC Participant or Indirect
Participant through which that Beneficial Owner holds an interest in Shares. So
long as DTC or another authorized Depository selected by the Sponsor or the
Trustee is the Registered Owner, the Trustee and the Sponsor may treat DTC or
such other Depository as the absolute owner of the Shares for all purposes
whatsoever, including without limitation, the payment of distributions, and the
giving of notices of redemption, tender and other matters with respect to the
Shares. 


                        (e)
If, at any time when Shares are evidenced by a global Certificate, DTC ceases
to make its book-entry settlement system available for such Shares, the Trustee
shall execute and deliver separate Certificates evidencing Shares to a
successor authorized Depository identified by the Sponsor and available to act,
or, if no successor Depository is identified and able to act, the Trustee shall
terminate the Trust in accordance with Section 6.2. 


                        (f)
Title to a Certificate evidencing Shares (and to the Shares evidenced thereby),
when properly endorsed or accompanied by proper instruments of transfer, shall
be transferable by delivery with the same effect as in the case of a negotiable
instrument under the laws of New York; provided, however, that the Trustee,
notwithstanding any notice to the contrary, may treat the Registered Owner of
Shares as the absolute owner thereof for the purpose of determining the person
entitled to any distribution or to any notice provided for in this Agreement
and for all other purposes. 


          Section 2.3
Deposit of Bullion. 


                        (a)
After the initial deposit of Bullion in the Trust, the issuance and Delivery of
Shares will take place only in integral numbers of Baskets and in compliance
with the provisions of this Agreement, as supplemented by the Procedures, to
the extent those Procedures are consistent with this Agreement. Authorized
Participants wishing to acquire from the Trustee one or more Baskets must place
an order with the Trustee (a “Purchase Order”) no later than 3:59:59 p.m. (New
York time) on any Business Day. Purchase Orders received by the Trustee prior
to the Order Cutoff Time on a Business Day on which the Benchmark Price is
announced will have that Business Day as the Order Date. Purchase Orders
received by the Trustee on or after the Order Cutoff Time on a Business Day, or
on a Business Day on which the Benchmark Price is not announced, will have as
their Order Date the next Business Day on which the Benchmark Price is
announced. As consideration for each Basket acquired, Authorized 


8





Participants must deposit with the Custodian, from an account of the
Authorized Participant maintained by the Custodian, or, if otherwise expressly
permitted by the Procedures, other LBMA- and LPPM-member custodian identified
by the Authorized Participant to the Custodian and the Trustee, the Basket
Bullion Amount determined by the Trustee on the Order Date of the corresponding
Purchase Order. Bullion must be Delivered to the Custodian by credit to the
Trust Unallocated Account only. 


                        (b)
The Trustee shall determine the Basket Bullion Amount for each Business Day,
and the Trustee’s determination of the Basket Bullion Amount and resolution of
questions concerning the composition of such Basket Bullion Amount shall be
final and binding on all persons interested in the Trust. The initial “Basket
Bullion Amount” is 50,000 Ounces of Silver, 500 Ounces of Platinum and 400
Ounces of Palladium. After the initial deposit, the “Basket Bullion Amount” for
each Business Day shall be an amount of Silver, Platinum and Palladium equal to
the result obtained by subtracting the number of Ounces of Silver, Platinum and
Palladium, in such ratio as to ensure the Bullion of the Trust is held in the
Bullion Ratio, constituting the unpaid expense accrual from the total Ounces of
Silver, Platinum and Palladium in the Trust and then dividing by the number of
Baskets outstanding. Fractions of an Ounce of Silver, Platinum or Palladium
included in the Basket Bullion Amount smaller than 0.001 Ounce shall be
disregarded. The Sponsor intends to publish, or may designate other persons to
publish, for each Business Day, the Basket Bullion Amount. 


                        (c)
If the Trust Property includes money or any property other than Bullion, no
deposits of Bullion will be accepted until after a record date for distribution
of that money or property, or proceeds of that property, has passed. 


                        (d)
All deposited Bullion shall be owned by the Trust and held for the Trust by the
Custodian. Pursuant to the Unallocated Account Agreement, the Custodian agrees
to use reasonable efforts to minimize the amount of Bullion held for the Trust
on an Unallocated Basis at all times and the Custodian must allocate ownership
of Silver bars or Platinum or Palladium plates or ingots to the Trust such that
no more than 1,100 Ounces of
Silver, 192 Ounces of Platinum and 192 Ounces of Palladium are held on an
Unallocated Basis for the Trust at the end of each business day of the
Custodian. Cash and any assets of the Trust other than Bullion shall be held by
the Trustee at such place and in such manner as the Trustee shall determine. 


          Section
2.4 Delivery of Shares. 


          Upon
receipt by the Trustee of a Purchase Order and the other documents required as
above specified, if any, and a confirmation from the Custodian that the Basket
Bullion Amount has been Delivered to the Custodian for each Basket of Shares
requested in such Purchase Order and the Custodian is holding that Bullion for
the account of the Trust, the Trustee, subject to the terms and conditions of
this Agreement and the Procedures, shall Deliver to the Depositor the number of
Baskets of Shares issuable in respect of such deposit as requested in the
corresponding Purchase Order, but only upon payment to the Trustee of the fees
and expenses of the Trustee as provided in Section 5.7 and of all taxes and
governmental charges and fees payable in connection with such deposit, the
transfer of the Bullion and the issuance and Delivery of the Shares. 


9





          Section 2.5
Registration and Registration of Transfer of Shares; Combination and
Split-up of Certificates. 


                        (a)
The Trustee shall keep or cause to be kept a register of Registered Owners of
Shares and shall provide for the registration of Shares and the registration of
transfers of Shares. 


                        (b)
The Trustee, subject to the terms and conditions of this Agreement, shall
register transfers of ownership of Shares on its transfer books from time to
time, upon any surrender of a Certificate evidencing such Shares, by the
Registered Owner in person or by a duly authorized attorney, properly endorsed
or accompanied by proper instruments of transfer, and duly stamped as may be
required by the laws of the State of New York and of the United States of
America. Thereupon, the Trustee shall execute a new Certificate or Certificates
evidencing such Shares, and deliver the same to or upon the order of the Person
entitled thereto. 


                        (c)
The Trustee, subject to the terms and conditions of this Agreement, shall, upon
surrender of a Certificate or Certificates evidencing Shares for the purposes
of effecting a split-up or combination of that certificate or certificates,
execute and deliver one or more new Certificates evidencing those Shares. 


                        (d)
The Trustee may, with the written approval of the Sponsor (which approval shall
not be unreasonably withheld), appoint one or more co-transfer agents for the
purpose of effecting registration of transfers of Shares and combinations and
split-ups of Certificates at designated transfer offices on behalf of the Trustee.
In carrying out its functions, a co-transfer agent may require evidence of
authority and compliance with applicable laws and other requirements by
Registered Owners or Persons entitled to Shares and will be entitled to
protection and indemnity to the same extent as the Trustee. 


                        (e)
The previous paragraphs of this Section notwithstanding, so long as the Shares
are eligible for deposit with a Depository, the sole Registered Owners shall be
such Depository or its nominee and transfer of Shares shall be effected solely
by the Depository in accordance with its customary practices in effect from
time to time. 


          Section 2.6
Surrender of Shares and Withdrawal of Trust Property. 


                        (a)
Upon Surrender of any integral number of Baskets for the purpose of withdrawal
of the amount of Trust Property represented thereby, and upon payment of the
fee of the Trustee in connection with the Surrender of Shares as provided in
Section 5.7 and payment of all taxes and charges payable in connection with
such Surrender and withdrawal of Trust Property, and subject to the terms and
conditions of this Agreement, the Procedures and the practices of the
Depository, an Authorized Participant acting on authority of the Registered
Owner of those Shares will be entitled to Delivery, in accordance with the
provisions of this Agreement, as supplemented by any procedures attached to an
applicable Authorized Participant Agreement, to the extent those procedures are
consistent with this Agreement, of the amount of Trust Property at the time
represented by such Baskets, including the Basket Bullion Amounts corresponding
to such Baskets on the applicable Order Date (determined as provided below).
Authorized Participants wishing to redeem one or more Baskets must place an
order with the 


10





Trustee (a “Redemption Order”) no later than 3:59:59 p.m. (New York
time) on any Business Day. Redemption Orders received by the Trustee prior to
the Order Cutoff Time on a Business Day on which the Benchmark Price is
announced will have that Business Day as the Order Date. Redemption Orders
received by the Trustee on or after the Order Cutoff Time on any Business Day,
or on a Business Day on which the Benchmark Price is not announced, will have
as their Order Date the next Business Day on which the Benchmark Price is
announced. Bullion will be Delivered by the Custodian only by credit to an
account of the Authorized Participant maintained by the Custodian or, if
otherwise expressly permitted by the Procedures, other LBMA- and LPPM-member
custodian identified by the Authorized Participant to the Custodian and the
Trustee on an Unallocated Basis. The Authorized Participant shall bear all risk
of any loss from the time the Bullion is paid from the Trust Unallocated Account
to the Authorized Participant and neither the Trustee nor the Trust shall have
any liability for any such loss. 


                        (b)
The Trustee may require that a Certificate evidencing Shares Surrendered for
the purpose of withdrawal is properly endorsed in blank or accompanied by
proper instruments of transfer in blank. Upon a Surrender of an integral number
of Baskets of Shares and satisfaction of all the conditions for withdrawal of
Trust Property, the Trustee shall instruct the Custodian to Deliver, as
provided in the preceding paragraph, to or to the order of the Surrendering
Authorized Participant the amount of Bullion represented by the Surrendered
Baskets of Shares and the Trustee shall pay or deliver to or to the order of
the Surrendering Authorized Participant the amount of any other Trust Property
represented by the Surrendered Baskets of Shares. Any Delivery of Bullion other
than by credit to an account of the Authorized Participant maintained by the
Custodian on an Unallocated Basis will be at the expense and risk of the
Authorized Participant. The Trustee is not required to effect any physical
movement of Bullion from one custody location to another to meet any request by
a Surrendering Authorized Participant as to where Bullion will be Delivered. 


                        (c)
The Sponsor and the Trustee may, but shall have no obligation to, amend this
Agreement to provide for redemption of any quantity of Shares for quantities of
Bullion that may be smaller or larger than a Basket Bullion Amount by
Beneficial Owners who are not Authorized Participants. 


                        (d)
The Sponsor and the Trustee may, but shall have no obligation to, amend this
Agreement to provide for the sale of Bullion to pay cash proceeds upon the
redemption of Shares. 


          Section 2.7
Limitations on Delivery, Registration of Transfer and Surrender of Shares.



                        (a)
As a condition precedent to the Delivery, registration of transfer, split-up,
combination or Surrender of any Shares or withdrawal of any Trust Property, the
Trustee or Registrar may require payment from the Depositor or the Authorized
Participant Surrendering the Shares of a sum sufficient to reimburse it for any
tax or other governmental charges and any stock transfer or registration fee
with respect thereto (including any such tax or charge and fee with respect to
any securities being withdrawn) and payment of any applicable fees as herein
provided, may require the production of proof satisfactory to it as to the
identity and genuineness of any signature and may also require compliance with
any regulations the Trustee may establish consistent with the provisions of
this Agreement, including, without limitation, this Section 2.7. 


11





                        (b)
The Delivery of Shares against deposits of Bullion and the registration of
transfer of Shares may be suspended generally, or refused with respect to
particular requested Deliveries, during any period when the transfer books of
the Trustee are closed or if any such action is deemed necessary or advisable
by the Trustee or the Sponsor for any reason at any time or from time to time.
Except as otherwise provided elsewhere in this Agreement, the Surrender of
Shares for purposes of withdrawing Trust Property may be suspended only (i)
during any period in which regular trading on the Exchange is suspended or
restricted or the Exchange is closed (other than scheduled holiday or weekend
closings), or (ii) during an emergency as a result of which Delivery, disposal
or evaluation of Bullion is not reasonably practicable. 


          Section 2.8
Lost Certificates, Etc. 


          The Trustee
shall execute and deliver a new Certificate of like tenor in exchange and
substitution for a mutilated Certificate upon cancellation thereof, or in lieu
of and in substitution for a destroyed, lost or stolen Certificate if the
Registered Owner thereof has (a) filed with the Trustee (i) a request for such
execution and delivery before the Trustee has notice that the Shares evidenced
by the Certificate have been acquired by a protected purchaser and (ii) a
sufficient indemnity bond, and (b) satisfied any other reasonable requirements
imposed by the Trustee. 


          Section 2.9
Cancellation and Destruction of Surrendered Certificates. 


          All Certificates
Surrendered to the Trustee shall be canceled by the Trustee. The Trustee is
authorized to destroy certificates so canceled. 


          Section
2.10 Splits and Reverse Splits of Shares. 


          If
requested in writing by the Sponsor, the Trustee shall effect a split or
reverse split of the Shares as of a record date set by the Trustee in
accordance with procedures determined by the Trustee and the Depository. 


          If so
directed by the Sponsor, the Trustee shall not distribute any fraction of a
Share in connection with a split or reverse split of the Shares. The Trustee
may sell the aggregated fractions of Shares that would otherwise be distributed
in a split or reverse split of the Shares or the amount of Trust Property that
would be represented by those Shares and distribute the net proceeds of those
Shares or that Trust Property to the Record Owners entitled to them. 


          The amount
of Trust Property represented by each Share and the Basket Bullion Amount shall
be adjusted as appropriate as of the open of business on the Business Day
following the record date for a split or reverse split of the Shares. 


ARTICLE III. 

CERTAIN OBLIGATIONS OF REGISTERED OWNERS OF SHARES


          Section 3.1
Liability of Registered Owner for Taxes and Other Governmental Charges. 


          If any tax
or other governmental charge shall become payable by the Trustee with respect
to any transfer or redemption of Shares, such tax or other governmental charge
shall be payable by the Registered Owner of such Shares to the Trustee. The
Trustee shall refuse to effect any 


12





registration of transfer of such Shares or any withdrawal of Trust
Property represented by such Shares until such payment is made, and may
withhold any distributions, or may sell for the account of the Registered Owner
thereof such Trust Property or Shares, and may apply such distributions or the
proceeds of any such sale in payment of such tax or other governmental charge,
and the Registered Owner of such Shares shall remain liable for any deficiency.
The Trustee shall distribute any net proceeds of a sale made under the
preceding sentence that remain, after payment of the tax or other governmental
charge, to the Registered Owners entitled thereto as in the case of a
distribution in cash. 


          Section 3.2
Warranties on Deposit of Bullion.


          Every
Person depositing Bullion under this Agreement shall be deemed thereby to
represent and warrant that the deposited Silver meets the requirements to be
Silver, deposited Platinum meets the requirements to be Platinum and deposited
Palladium meets the requirements to be Palladium and contains the required
number of Ounces of Silver, Platinum and Palladium, that the person making such
deposit is duly authorized to do so and that at the time of delivery, the
Bullion is free and clear of any lien, pledge, encumbrance, right, charge or
claim (other than the rights created by this Agreement). All representations
and warranties deemed made under this Section 3.2 shall survive the deposit of
Bullion, Delivery or Surrender of Shares or termination of this Agreement. 


ARTICLE IV. 

ADMINISTRATION OF THE TRUST


          Section
4.1 Evaluation of Bullion. 


          As promptly
as practicable after 4:00 p.m. (New York time), on each Business Day, the Trustee
shall determine the value of the Bullion held or receivable by the Trust on the
basis of the Benchmark Price for each metal for that day. If no Benchmark Price
for Silver, Platinum or Palladium is announced on a Business Day, the Trustee
shall determine the value of such Silver, Platinum or Palladium held or
receivable by the Trust for that day on the basis of the most recently
announced Benchmark Price for such metal prior to the evaluation time. However,
if the Sponsor determines that the price specified in the two preceding
sentences is inappropriate as a basis for evaluation, it shall identify an
alternative basis for evaluation to be employed by the Trustee. Bullion
deliverable under a Purchase Order shall be included in the evaluation
beginning on the Order Date. Bullion deliverable under a Redemption Order shall
not be included in the evaluation on and after the Order Date. Neither the
Trustee nor the Sponsor shall be liable to any Person for the determination
that the most recently announced Benchmark Price is not appropriate as a basis
for evaluation of the Bullion held or receivable by the Trust or for any
determination as to the alternative basis for evaluation, provided that such
determination is made in good faith. 


          If the
Sponsor determines that Benchmark Price will have the meaning set forth in part
(ii) of the definition of that term, the Trustee shall give notice to the
Registered Owners, and the 


13





Trustee shall not apply the new definition of Benchmark Price until 60
days after the date of that notice. 


          Section 4.2
Responsibility of the Trustee for Evaluations. 


          The
Sponsor, Depositors, Registered Owners and Beneficial Owners may rely on any
evaluation or determination of any amount made by the Trustee, and the Sponsor
shall have no responsibility for the accuracy thereof. The determinations made
by the Trustee under this Agreement shall be made in good faith upon the basis
of, and the Trustee shall not be liable for any errors contained in,
information reasonably available to it. The Trustee shall be under no liability
to the Sponsor, or to Depositors, Registered Owners or Beneficial Owners, for
errors in judgment; provided, however, that this provision shall not protect
the Trustee against any liability to which it would otherwise be subject by
reason of gross negligence or bad faith in the performance of its duties. 


          Section 4.3
Trust Evaluation. 


          As promptly
as practicable after completion of the evaluation required under Section 4.1 on
each Business Day, the Trustee shall subtract all accrued fees (other than the
fees accruing for such Business Day computed by reference to the value of the
Trust or its assets), expenses and other liabilities of the Trust from the
total value of the deposited Bullion determined by the Trustee pursuant to
Section 4.1 and all other assets of the Trust. The resulting figure is the
“Adjusted Net Asset Value” of the Trust. All fees accruing for any Business Day
computed by reference to the value of the Trust or its assets shall be
calculated on the Adjusted Net Asset Value calculated for such Business Day.
The Trustee shall subtract from the Adjusted Net Asset Value the amount of
accrued fees so computed and the resulting figure is the “Net Asset Value” of the
Trust. The Trustee shall also divide the Net Asset Value of the Trust by the
number of Shares outstanding as of the close of business on the date of the
evaluation then being made, which figure is the “Net Asset Value per Share.”
All fees, expenses and other liabilities of the Trust that are or will be
incurred or accrued through the close of business on a Business Day shall be
included in the calculations required by this Section 4.3 for that Business
Day. Shares deliverable under a Purchase Order shall be considered to be
outstanding for purposes of this Section 4.3 beginning on the Order Date.
Shares deliverable under a Redemption Order shall not be considered to be
outstanding for purposes of this Section 4.3 on and after the Order Date. 


          Adjusted
Net Asset Value, Net Asset Value and Net Asset Value per Share shall be
computed in accordance with generally accepted accounting principles in the
United States. Any estimate of the expenses and liabilities of the Trust for
purposes of the computations required by this Section made by the Trustee in
good faith shall be conclusive upon all Persons interested in the Trust, and no
revision or correction in any computation made under this Agreement will be
required by reason of any difference in amounts estimated from those actually
paid. 


          Section 4.4
Cash Distributions. 


          Whenever
the Trustee distributes any cash, the Trustee shall distribute the amount
available for the distribution to the Registered Owners entitled thereto, in
proportion to the number of Shares held by them respectively; provided,
however, that in the event that the 


14





Trustee shall be required to withhold and does withhold from such cash
an amount on account of taxes, the amount distributed to the Registered Owners
shall be reduced accordingly. The Trustee shall distribute only such amount,
however, as can be distributed without attributing to any Registered Owner a
fraction of one cent. Any such fractional amounts shall be rounded down to the
nearest whole cent and so distributed to Registered Owners entitled thereto. 


          Section 4.5
Other Distributions.


          Whenever
the Trustee receives any property in respect of Trust Property other than cash
proceeds of a sale of Trust Property (including any claim that accrues in favor
of the Trust on account of any loss of deposited Bullion or other Trust
Property), the Trustee shall cause the securities or other property received by
it to be distributed to the Registered Owners entitled thereto, in proportion
to the number of Shares held by them respectively, after deduction or upon
payment of the expenses of the Trustee, in any manner that the Trustee may deem
lawful, equitable and feasible for accomplishing such distribution; provided,
however, that if in the opinion of the Trustee such distribution cannot be made
proportionately among the Registered Owners entitled thereto, or if for any
other reason (including, but not limited to, any requirement that the Trustee
withhold an amount on account of taxes or other governmental charges or that
securities must be registered under the Securities Act of 1933 in order to be
distributed to Registered Owners) the Trustee deems such distribution not to be
lawful and feasible, the Trustee shall adopt such method as it deems lawful,
equitable and feasible for the purpose of effecting such distribution, after
deduction or upon payment of the expenses of the Trustee, including, but not
limited to, the public or private sale of the securities or property thus
received, or any part thereof, and the net proceeds of any such sale shall be
distributed by the Trustee to the Registered Owners entitled thereto as in the
case of a distribution received in cash. The Trustee shall not be liable for
any loss or depreciation resulting from any sale or other disposition of
property made by the Trustee pursuant to the Sponsor’s instruction or otherwise
made by the Trustee in good faith. 


          Section 4.6
Fixing of Record Date. 


          Whenever
any distribution will be made, or whenever the Trustee receives notice of any
solicitation of proxies or consents from Registered Owners, or whenever for any
reason there is split, reverse split or other change in the outstanding Shares,
or whenever the Trustee shall find it necessary or convenient in respect of any
matter, the Trustee, in consultation with the Sponsor, shall fix a record date
for the determination of the Registered Owners who shall be (i) entitled to
receive such distribution or the net proceeds of the sale thereof, (ii)
entitled to give such proxies or consents in respect of any such solicitation
or (iii) entitled to act in respect of any other matter for which the record
date was set. 


          Section 4.7
Payment of Expenses; Bullion Sales. 


                        (a)
The following charges are or may be accrued and paid by the Trust: 


                              (i)
the service fee payable to the Sponsor as set forth in Section 5.8; 


                              (ii)
expenses of the Trust not assumed by the Sponsor pursuant to Section 5.3(g); 


15





                              (iii)
taxes and other governmental charges; 


                              (iv)
expenses and costs of any extraordinary services performed by the Trustee or
the Sponsor on behalf of the Trust or action taken by the Trustee or the
Sponsor to protect the Trust or the interests of Registered Owners; 


                              (v)
indemnification of the Trustee as provided in Section 5.6(a); and 


                              (vi)
indemnification of the Sponsor as provided in Section 5.6(b). 


                    (b)
Subject to paragraph (d) of this Section, the Trustee will endeavor to sell the
smallest amounts of Bullion needed to pay expenses in order to minimize the
Trust’s holdings of assets other than Bullion. 


          The Trustee
shall, when directed by the Sponsor, and, in the absence of such direction,
may, in its discretion, sell Bullion in such quantity and at such times, as may
be necessary to permit payment of expenses under this Agreement. The Trustee
shall endeavor to sell Bullion at such times and in the smallest amounts
required to permit payment of expenses as they come due without producing sale
proceeds in excess of the amount required for payment of expenses, it being the
intention to avoid or minimize the Trust’s holdings of assets other than
Bullion. If the Trustee cannot sell Bullion in the precise amount required for
the payment of expenses as they come due, and the Sponsor shall have agreed to
advance funds for such expenses as authorized hereby, the Trustee shall sell
the maximum amount of Bullion which it can sell without producing excess
proceeds. The Sponsor is authorized and may, but is not required to, pay on
behalf of the Trust the amount of such expenses remaining unpaid immediately
after such Bullion sale; provided, however, that the Trust shall accrue a
liability, without interest, to the Sponsor for reimbursement of such expense
amounts so paid by the Sponsor until such amounts can be wholly repaid in
Ounces of Bullion delivered to the Sponsor in the same manner as, together
with, and in addition to, the next payment of the fees of the Sponsor pursuant
to paragraph (d) of this Section. In the event such reimbursement of the
Sponsor cannot be wholly repaid in Ounces of Bullion at the next payment of the
Sponsor’s fee, the Trust shall continue to accrue, without interest, the amount
of its reimbursement obligation to the Sponsor (together with any other
reimbursement obligations to the Sponsor) until such reimbursement amounts can
be wholly repaid in Ounces of Bullion on a payment date for the Sponsor’s fee.
Neither the Trustee nor the Sponsor shall have any liability for loss or
depreciation resulting from sales of Bullion so made. Any sale of Bullion
hereunder shall be made in Silver, Platinum and Palladium in such ratio as to
ensure that the Bullion of the Trust is held in the Bullion Ratio. The Trustee
shall not be liable or responsible in any way for depreciation or loss incurred
by reason of any sale made pursuant to the Sponsor’s direction or otherwise in
accordance with this Section. 


                    (c)
If at any time and from time to time, the Trustee and Sponsor determine that
the amount of cash included in the Trust Property exceeds the anticipated
expenses of the Trust during the following month, the Trustee shall distribute
the excess to the Registered Owners under Section 4.4. 


                    (d)
Payment of the fees of the Sponsor provided in Section 5.8(a) hereof and the
reimbursement of expenses paid by the Sponsor pursuant to paragraph (b) of this
Section 


16





shall be made by delivery to an account maintained by the Custodian for
the Sponsor on an Unallocated Basis, monthly on the first Business Day of the
month in respect of fees payable in respect of the prior month, of that number
of Ounces of Bullion which shall equal (i) the daily accrual of the Sponsor’s
fee for such prior month calculated at the Benchmark Price for the day of
accrual and (ii) the amount of any outstanding expense reimbursement obligation
calculated at the Benchmark Price available on the date of the Trust’s payment
of such reimbursement obligation. Any payment of the fees of the Sponsor in
Bullion hereunder shall be made in Silver, Platinum and Palladium, in such
ratio as to ensure that the Bullion of the Trust
is held in the Bullion Ratio. 


          Section 4.8
Statements and Reports. 


                    (a)
After the end of each fiscal year and within the time period required by
applicable laws, rules and regulations, at the Sponsor’s expense, the Trustee
shall send to the Registered Owners at the end of such fiscal year, an annual
report of the Trust containing financial statements that will be prepared by
the Trustee and audited by independent accountants designated by the Sponsor and
such other information as may be required by such laws, rules and regulations
or otherwise, or which the Sponsor determines shall be included. The Trustee
may distribute the annual report by any means acceptable to the Registered
Owners. 


                    (b)
The Trustee shall provide the Sponsor with such certifications, supporting
documents and other evidence regarding the Internal Control Over Financial
Reporting established and maintained by the Trust, and used by the Trustee in
connection with its preparation of the financial statements of the Trust, as
may be reasonably necessary in order to enable the Sponsor to prepare and file
or furnish to the Commission any certifications regarding such matters which
may be required to be included with the Trust’s periodic reports under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”). 


                    (c)
The fiscal year of the Trust shall initially be the period ending December 31
of each year. The Sponsor shall have the continuing right to select an
alternate fiscal year. 


          Section 4.9
Further Provisions for Bullion Sales. 


          In addition
to selling Bullion in accordance with Section 4.7, the Trustee shall sell
Silver, Platinum and Palladium, in such ratio as to ensure that the Bullion of
the Trust, if any, is held in the Bullion Ratio after the completion of such
sale, whenever any one or more of the following conditions exists: 


                    (a)
the Sponsor has notified the Trustee that such sale is required by applicable
law or regulation; or 


                    (b)
this Agreement has been terminated and the Trust Property is to be liquidated
in accordance with Section 6.2. 


          When
selling Bullion, the Trustee shall endeavor to place orders with dealers (which
may include the Custodian) as directed by the Sponsor, or in the absence of
such direction, with dealers through which the Trustee may reasonably expect to
obtain a favorable price and good execution of orders. The Custodian may be the
purchaser at the Benchmark Price. 


17






          The Trustee
and the Sponsor shall not be liable or responsible in any way for depreciation
or loss incurred by reason of any sale made pursuant to this Section 4.9. 


          Section
4.10 Counsel. 


          The Sponsor
may from time to time employ counsel to act on behalf of the Trust and perform
any legal services in connection with the Bullion and the Trust, including any
legal matters relating to the possible disposition or acquisition of any
Bullion. The fees and expenses of such counsel shall be paid by the Sponsor. 


          Section
4.11 Grantor Trust. 


          Nothing in
this Agreement, any agreement with a Custodian, or otherwise, shall be
construed to give the Trustee the power to vary the investment of the
Beneficial Owners within the meaning of Section 301.7701-4(c) under the Code or
any similar or successor provision of the regulations under the Code, nor shall
the Sponsor give the Trustee any direction that would vary the investment of
the Beneficial Owners. However, the Trustee shall not be liable to any Person
for any failure of the Trust to qualify as a grantor trust under the Code or
any comparable provision of the laws of any State or other jurisdiction where
that treatment is sought, except that this sentence shall not limit the
Trustee’s responsibility for the administration of the Trust in accordance with
this Agreement. 


ARTICLE V. 

THE TRUSTEE AND THE SPONSOR


          Section 5.1
Maintenance of Office and Transfer Books by the Trustee. 


                    (a)
Until termination of this Agreement in accordance with its terms, the Trustee
shall maintain facilities for the execution and Delivery, registration,
registration of transfers and Surrender of Shares in accordance with the
provisions of this Agreement. 


                    (b)
The Trustee shall keep a copy of this Agreement and books for the registration
of Shares and registration of transfers of Shares which at all reasonable times
shall be open for inspection by the Registered Owners. 


                    
(c) The Trustee may, and at the reasonable written request of the Sponsor
shall, close the transfer books at any time or from time to time if such action
is deemed necessary or advisable in the reasonable judgment of the Trustee or
the Sponsor. 


                    
(d) If any Shares are listed on one or more stock exchanges in the United
States, the Trustee shall act as Registrar or, with the written approval of the
Sponsor (which approval shall not be unreasonably withheld), appoint a
registrar or one or more co-registrars for registry of such Shares in
accordance with any requirements of such exchange or exchanges. 


          Section 5.2
Prevention or Delay in Performance by the Sponsor or the Trustee. 


          Neither the
Sponsor nor the Trustee nor any of their respective directors, employees,
agents or affiliates shall incur any liability to any Registered Owner,
Beneficial Owner or 


18





Depositor if, by reason of any provision of any present or future law
or regulation of the United States or any other country, or of any governmental
or regulatory authority or stock exchange, or by reason of any act of God or
war or terrorism or other circumstances beyond its control, the Sponsor or the
Trustee is prevented or forbidden from, or would be subject to any civil or
criminal penalty on account of, or is delayed in, doing or performing any act
or thing which by the terms of this Agreement it is provided shall be done or
performed and accordingly the Sponsor or the Trustee does not do that thing or
does that thing at a later time than would otherwise be required. The Sponsor
and the Trustee will not incur any liability to any Registered Owner or
Beneficial Owner or Depositor by reason of any non-performance or delay in the
performance of any act or thing which by the terms of this Agreement it is
provided may be done or performed, or by reason of any exercise of, or failure
to exercise, any discretion provided for in this Agreement. 


          Section 5.3
Obligations of the Sponsor and the Trustee. 


                    (a)
Neither the Sponsor nor the Trustee assumes any obligation nor shall either of
them be subject to any liability under this Agreement to any Registered Owner
or Beneficial Owner or Depositor (including, without limitation, liability with
respect to the worth of the Trust Property), except that each of them agrees to
perform its obligations specifically set forth in this Agreement without gross
negligence, willful misconduct or bad faith. 


                    
(b) Neither the Sponsor nor the Trustee shall be under any obligation to
prosecute any action, suit or other proceeding in respect of any Trust Property
or in respect of the Shares on behalf of a Registered Owner, Beneficial Owner,
Depositor or other Person. 


                    
(c) Neither the Sponsor nor the Trustee shall be liable for any action or
non-action by it in reliance upon the advice of or information from legal
counsel, accountants, any Depositor, any Registered Owner or any other person
believed by it in good faith to be competent to give such advice or
information. 


                    (d)
(i) The Trustee shall not be liable for any acts or omissions made by a
successor Trustee whether in connection with a previous act or omission of the
Trustee or in connection with any matter arising wholly after the resignation
of the Trustee, provided that in connection with the issue out of which such
potential liability arises the Trustee performed its obligations without gross
negligence, willful misconduct or bad faith while it acted as Trustee. 


                          (ii)
The Sponsor is authorized to negotiate the terms of the Authorized Participant
Agreement to be entered into with each Authorized Participant and shall have no
liability for any loss or damage incurred by the Trust resulting from any such
agreement negotiated in good faith. The Trustee shall have no liability with
respect to the negotiation of the terms of any Authorized Participant Agreement
or the form of any Authorized Participant Agreement (other than the Trustee’s
due execution, delivery and performance thereof). The terms of an Authorized
Participant Agreement shall not adversely affect the duties, rights and
responsibilities of the Trustee unless the Trustee expressly consents thereto,
which consent shall be evidenced by the Trustee’s execution and delivery of
such Authorized Participant Agreement. 


19





                    
(e) The Trustee and the Sponsor shall have no obligation to comply with any
direction or instruction from any Registered Owner or Beneficial Owner or
Depositor regarding Shares except to the extent specifically provided in this
Agreement. 


                    
(f) The Trustee shall be a fiduciary under this Agreement; provided, however,
that the fiduciary duties and responsibilities and liabilities of the Trustee
shall be limited by, and shall be only those specifically set forth in, this
Agreement. Without limiting the foregoing, all duties, rights, privileges and
liabilities of the Trustee set forth in this Agreement are subject to the
following: 


                              
(i) The Trustee shall not be under any obligation to appear in, prosecute or defend
any action that in its opinion may involve it in expense or liability, unless
it shall be furnished with reasonable security and indemnity against such
expense or liability. Subject to the foregoing, the Trustee shall, in its
discretion, undertake such action as it may deem necessary at any and all times
to protect the Trust and the rights and interest of all Beneficial Owners
pursuant to the terms of this Agreement. 


                              
(ii) Trust Assets of the Trust, exclusive of Bullion or cash, shall be held by
the Trustee either directly or through the Federal Reserve/ Treasury Book Entry
System for United States and federal agency securities (the “Book Entry
System”), DTC, or through any other clearing agency or similar system (a
“Clearing Agency”), if available. The Trustee shall have no responsibility and
shall not be liable for ascertaining or acting upon any calls, conversions,
exchange offers, tenders, interest rates changes, or similar matters relating
to securities held at the Depository or with any Clearing Agency unless the
Trustee shall have received actual and timely written notice of the same, nor
shall the Trustee have any responsibility or liability for the actions or
omissions to act of the Book Entry System, the Depository or any Clearing
Agency. All moneys held by the Trustee hereunder shall be held by it, without
interest thereon or investment thereof, as a deposit for the account of the
Trust. Such monies held hereunder shall be deemed segregated by maintaining
such monies in an account or accounts for the exclusive benefit of the Trust.
The Trustee may also employ custodians for Trust assets other than Bullion, agents,
attorneys, accountants, auditors and other professionals and shall not be
answerable for the default or misconduct of any such custodians, agents,
attorneys, accountants, auditors and other professionals if such custodians,
agents, attorneys, accountants, auditors or other professionals shall have been
selected with reasonable care. 


                              
(iii) If at any time the Trustee is served with any judicial or administrative
order, judgment, decree, writ or other form of judicial or administrative
process that in any way affects the Trust or its property (including but not
limited to orders of attachment or garnishment or other forms of levies or
injunctions or stays relating to the transfer of any assets of the Trust), the
Trustee is authorized to comply therewith in any manner that it or legal
counsel of its own choosing deems appropriate; however, the Trustee to the
extent practicable will inform the Sponsor of such order, judgment, decree,
writ or other form of judicial or administrative process that in any way
affects the Trust and consult in good faith with the Sponsor as to the course
of action by the Trustee. If the Trustee complies with any such judicial or
administrative order, judgment, decree, writ or other form of judicial or
administrative process, the Trustee shall not be liable to any of the parties
hereto or to any other person or entity 


20





even though such order, judgment, decree, writ or process may be
subsequently modified or vacated or otherwise determined to have been without
legal force or effect. 


                              
(iv) In no event shall the Trustee be liable for acting in accordance with or
conclusively relying upon any instruction, notice, demand, certificate or
document (a) from the Sponsor or a Custodian, or any entity acting on behalf of
either, which the Trustee believes is given pursuant to or is authorized by
this Agreement or a Custody Agreement, respectively; or (b) from or on behalf
of any Authorized Participant which the Trustee believes is given pursuant to
or is authorized by an Authorized Participant Agreement (provided that the
Trustee has complied with the verification procedures specified in the
Authorized Participant Agreement); for any indirect, consequential, punitive or
special damages, regardless of the form of action and whether or not any such
damages were foreseeable or contemplated; or for an amount in excess of the
value of the assets of the Trust. The Trustee may consult with legal counsel of
its own choosing as to any matter relating to this Agreement and the Trustee
shall not incur any liability in acting in good faith in accordance with any
advice from such counsel. The expense of such counsel shall be paid as provided
in Section 5.7(b) and (c), as applicable. 


                              
(v) The Trustee shall be entitled to rely conclusively upon any order,
judgment, certification, demand, notice, instrument or other writing delivered
to it under this Agreement without being required to determine the authenticity
or the correctness of any fact stated therein or the propriety or validity or
the service thereof. The Trustee may act in conclusive reliance upon any
instrument or signature reasonably believed by it to be genuine and may assume
that any person purporting to give receipt or advice or to make any statement
or execute any document in connection with the provisions of this Agreement or
any Authorized Participant Agreement has been duly authorized to do so,
provided, however, that where a list of authorized officials of a person and
their signatures are on file with the Trustee, the Trustee shall compare such
manual signatures to the signature on any such documents. Such requirement
shall not apply to “personal identification numbers” or “PINS” or other forms
of electronic security devices which function as a proxy for a manual
signature. 


                              
(vi) The Trustee shall not be responsible for or in respect of the recitals
herein, the validity or sufficiency of this Agreement, the Custody Agreements,
any Authorized Participant Agreement or any other custody or other agreement
entered into by the Trustee at the direction or with the approval of the
Sponsor or otherwise in connection with the Trustee’s administration of the
Trust, or for the due execution hereof by the Sponsor or of the Custody
Agreements by the Initial Custodian, or for the due execution of any other
agreement entered into by the Trustee in connection with the administration of
the Trust by any party thereto other than the Trustee. 


                              
(vii) The Trustee shall not be responsible in any respect for the form, execution,
validity, value, collectability or genuineness of documents, instruments or
securities deposited with or delivered to or held by it under this Agreement,
or for any description therein, or for the identity, authority or rights of
persons executing or delivering or purporting to execute or deliver any such
document, instrument or security. 


                              
(viii) At any time the Trustee may request an instruction in writing in English
from the Sponsor or an Authorized Participant with respect to any action which
the 


21





Sponsor or an Authorized Participant is authorized to direct the
Trustee hereunder, or under the Custody Agreements, any Authorized Participant
Agreement or any other agreement entered into by the Trustee in connection with
the Trustee’s administration of the Trust, and may, at its own option, include
in such request the course of action it proposes to take and the date on which
it proposes to act, regarding any matter arising in connection with its duties
and obligations under any such agreement. The Trustee shall not be liable for
acting in accordance with such a proposal on or after the date specified
therein, provided that the specified date shall be at least three (3) Business
Days after the Sponsor or Authorized Participant receives the Trustee’s request
for instructions and its proposed course of action, and provided further that,
prior to so acting, the Trustee has not received the written instructions
requested. 


                              
(ix) When the Trustee acts on any information, instructions, communications
(including communications with respect to the delivery of securities or the
wire transfer of funds) sent by telex, facsimile, email or other form of
electronic or data transmission, the Trustee, absent gross negligence, shall
not be responsible or liable in the event such communication is not an
authorized or authentic communication of the party sending it or is not in the
form the party sent or intended to send (whether due to fraud, distortion or
otherwise), provided that this paragraph shall not limit the Trustee’s
obligation to obtain such confirmations as may be specified in this Agreement
or any Authorized Participant Agreement. The Trustee shall be indemnified as
provided in Section 5.6 hereof against any loss, liability, claim or expense
(including legal fees and expenses) it may incur in acting in accordance with
any such communication. 


                              
(x) The Trustee may construe any provision of this Agreement that it believes
to be ambiguous or inconsistent with any other provisions hereof, and any
reasonable construction of any such provision hereof by the Trustee in good faith
shall be binding upon the parties hereto, each Authorized Participant and all
Beneficial Owners. In the event of any ambiguity or inconsistency or any other
uncertainty in any notice, instruction or other communication received by the
Trustee under this Agreement, the Trustee shall notify the Sponsor and the
giver thereof, and may, in its sole discretion, refrain from taking any action
other than to retain possession of the property of the Trust, unless the
Trustee receives such further written instructions, from the Sponsor or
otherwise, that eliminate such ambiguity, inconsistency or uncertainty. 


                              
(xi) The Trustee shall have no responsibility for the contents of any writing
of the arbitrators or any third party that may be used as a means to resolve
disputes among third parties with respect to their interest in the Trust, Trust
Property or Shares and may conclusively rely without any liability upon the
contents thereof. 


                              
(xii) In no event shall the Trustee be personally liable for any taxes or other
governmental charges imposed upon or in respect of the Bullion or its custody,
moneys or other assets from time to time held hereunder, or on the income
therefrom or the sale or proceeds of sale thereof, or upon it as Trustee
hereunder or upon or in respect of the Trust or the Shares, which it may be
required to pay under any present or future law of the United States of America
or of any other taxing authority having jurisdiction in the premises. For all
such taxes and charges and for any expenses, including counsel’s fees, which
the Trustee may sustain or incur with respect to such taxes or charges, the
Trustee shall be reimbursed and indemnified out of the 


22





assets of the Trust and the payment of such amounts shall be secured by
a lien on the Trust. This paragraph shall survive notwithstanding any
termination of this Agreement and the Trust or the resignation or removal of
the Trustee. 


                              
(xiii) The Trustee shall not be answerable for the default of the Initial
Custodian or any Custodian employed at the direction of the Sponsor or selected
by the Trustee with reasonable care. The Trustee may also employ custodians for
Trust assets other than Bullion, agents, attorneys, accountants, auditors and
other professionals and shall not be answerable for the default or misconduct
of any such custodians, agents, attorneys, accountants, auditors and other
professionals if such custodians, agents, attorneys, accountants, auditors or
other professionals shall have been selected with reasonable care. The fees and
expenses charged by such agents, attorneys, accountants, auditors or other
professionals, exclusive of fees for services to be performed by the Trustee,
shall be paid as provided in Section 5.7(b) and 5.7(c), as applicable. Fees
paid for custody of assets other than Bullion shall be an expense of the
Trustee. 


                              
(xiv) The Trustee in its individual or any other capacity may own or hold
Shares, or be an underwriter or dealer in respect of Shares, and may deal in
any manner with the same with the same rights and powers as if it were not the
Trustee hereunder. 


                    (g)
The Sponsor shall be responsible for all organizational expenses of the Trust,
and for the following administrative and marketing expenses of the Trust: fees
for the Trustee’s ordinary services and reimbursement of its out-of-pocket
expenses as provided in Section 5.7(b), the Custodian’s fee and expenses
reimbursable to a Custodian pursuant to a Custody Agreement (including, for
avoidance of doubt, any fees paid to the Initial Custodian under the Trust
Allocated Account Agreement and Trust Unallocated Account Agreement but
excluding taxes, other governmental charges and Custodian indemnification
obligations assumed by the Trustee in the Custody Agreements), listing fees of
the Exchange, registration fees charged by the Commission, printing and mailing
costs, audit fees and expenses and legal fees and expenses not in excess of
$100,000 per year. 


          Section 5.4
Resignation or Removal of the Trustee; Appointment of Successor Trustee.



                    (a)
The Trustee may at any time resign as Trustee hereunder by written notice of
its election so to do, delivered to the Sponsor, and such resignation shall
take effect upon the appointment of a successor Trustee and its acceptance of
such appointment as hereinafter provided. 


                    (b)
The Sponsor may remove the Trustee in its discretion by written notice
delivered to the Trustee in the manner provided in Section 7.5 at least 90 days
prior to the fifth anniversary of the date of this Agreement or, thereafter, by
written notice delivered to the Trustee at least 90 days prior to the last day
of any subsequent three-year period. 


                    (c)
If at any time the Trustee 


                              (i)
ceases to be a Qualified Bank, 


                              (ii)
is in material breach of its obligations under this Agreement and fails to cure
such breach within 30 days after receipt of written notice from the Sponsor or 


23





Registered Owners acting on behalf of at least 25% of the outstanding
Shares specifying such default and requiring the Trustee to cure such default,
or 


                              
(iii) fails to consent to the implementation of an amendment to the Trust’s
initial Internal Control Over Financial Reporting deemed necessary by the
Sponsor and, after consultations with the Sponsor, the Sponsor and the Trustee
fail to resolve their differences regarding such proposed amendment, the
Sponsor, acting on behalf of the Registered Owners, may remove the Trustee by
written notice delivered to the Trustee in the manner provided in Section 7.5,
and such removal shall take effect upon the appointment of a successor Trustee
and its acceptance of such appointment as hereinafter provided. 


                    (d)
If the Trustee acting hereunder resigns or is removed, the Sponsor, acting on
behalf of the Registered Owners, shall use its reasonable efforts to appoint a
successor Trustee, which shall be a Qualified Bank. Every successor Trustee
shall execute and deliver to its predecessor and to the Sponsor, acting on
behalf of the Registered Owners, an instrument in writing accepting its appointment
hereunder, and thereupon such successor Trustee, without any further act or
deed, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor; but such predecessor, nevertheless, upon
payment of all sums due it and on the written request of the Sponsor, acting on
behalf of the Registered Owners, shall execute and deliver an instrument
transferring to such successor all rights and powers of such predecessor
hereunder, shall duly assign, transfer and deliver all right, title and
interest in the Trust Property to such successor, and shall deliver to such
successor a list of the Registered Owners of all outstanding Shares. The
Sponsor or any such successor Trustee shall promptly mail notice of the
appointment of such successor Trustee to the Registered Owners. 


                    (e)
Any corporation into which the Trustee may be merged, consolidated or converted
in a transaction in which the Trustee is not the surviving corporation shall be
the successor of the Trustee without the execution or filing of any document or
any further act. During the 90-day period following the effectiveness of a
merger, consolidation or conversion described in the preceding sentence, the
Sponsor may, by written notice to the Trustee, remove the Trustee and designate
a successor Trustee in compliance with the provisions of subsection (c) above. 


          Section 5.5
The Custodian. 


                    (a)
The Trustee is hereby directed to enter into the Trust Allocated Account
Agreement and the Trust Unallocated Account Agreement with the Initial
Custodian. The Initial Custodian will be subject to the directions of the
Trustee as provided in such Custody Agreements, and will be responsible solely
to it and to Beneficial Owners to the extent UK law requires. If upon the
resignation of any Custodian there would be no Custodian acting hereunder, the
Trustee shall, promptly after receiving such notice of such resignation,
appoint a substitute custodian or custodians selected by the Sponsor pursuant
to custody agreements approved by the Sponsor (provided, however, that the
rights and duties of the Trustee hereunder and under the Custody Agreements
shall not be materially altered without its consent), each of which shall
thereafter be a Custodian hereunder. When directed by the Sponsor or if the
Trustee in its discretion determines that it is in the best interest of the
Registered Owners to do so and with the written approval of the Sponsor (which
approval shall not be unreasonably withheld or 


24





delayed), the Trustee shall appoint a substitute or additional
custodian or custodians, which shall thereafter be one of the Custodians
hereunder. After the date of this Agreement, the Trustee shall not enter into
or amend any Custody Agreement with a Custodian without the written approval of
the Sponsor (which approval shall not be unreasonably withheld or delayed).
When instructed by the Sponsor, the Trustee shall demand that a Custodian
deliver such of the Bullion held by it as is requested of it to any other
Custodian or such substitute or additional custodian or custodians directed by
the Sponsor. In connection with such delivery the Trustee will, solely if and
in the manner directed by the Sponsor, cause the Bullion to be weighed or
assayed and any such weighing and assay shall be an expense of the Trust
pursuant to Section 4.7(a)(ii) hereof. The Trustee shall have no liability for
any delivery of Bullion or weighing or assaying of delivered Bullion directed
by the Sponsor pursuant to the preceding provisions of this paragraph and in
the absence of such direction shall have no obligation to effect such a
delivery or to cause the delivered Bullion to be weighed, assayed or otherwise
validated. Each such substitute or additional custodian shall, forthwith upon
its appointment, enter into a Custody Agreement in form and substance approved
by the Sponsor. 


                    (b)
The Trustee shall have no obligation to monitor the activities of any Custodian
other than to receive and review such reports of the Bullion held for the Trust
by such Custodian and of transactions in Bullion held for the account of the
Trust made by such Custodian pursuant to the Custody Agreements. The accounts
and operations of each Custodian shall be audited or examined by accountants or
other inspectors selected by the Sponsor at such times as directed by the
Sponsor as permitted by the Custody Agreements. In no event shall the Trustee
be liable for (i) any loss or damage resulting from the actions or omissions of
any Custodian or loss or damage to the Bullion while in the possession of, or
in transit to or from, any Custodian, (ii) the amount, validity or adequacy of
insurance maintained by any Custodian, (iii) any defect in Bullion held by a
Custodian, (iv) any failure of Bullion to conform to the requirements of “good
delivery” under the rules of the LBMA or the LPPM, as applicable, or (v) any
failure of Bullion to conform to a description thereof provided by the
Custodian to the Trustee. 


                    (c)
Upon the appointment of any successor Trustee hereunder, each Custodian then
acting hereunder shall forthwith become, without any further act or writing,
the agent hereunder of such successor Trustee and the appointment of such
successor Trustee shall in no way impair the authority of each Custodian
hereunder; but the successor Trustee so appointed shall, nevertheless, on the
written request of any Custodian, execute and deliver to such Custodian all
such instruments as may be proper to give to such Custodian full and complete
power and authority as agent hereunder of such successor Trustee. 


          Section 5.6
Indemnification. 


                    (a)
The Trustee, its directors, employees and agents (each, a “Trustee Indemnified
Party”) shall be indemnified from the Trust and held harmless against any loss,
liability or expense (including, but not limited to, the reasonable fees and
expenses of counsel) arising out of or in connection with the performance of
its obligations under this Agreement and under each other agreement entered
into by the Trustee in furtherance of the administration of the Trust
(including, without limiting the scope of the foregoing, the Custody Agreements
and any Authorized Participant Agreement, including the Trustee’s
indemnification obligations 


25





thereunder) or by reason of the Trustee’s acceptance of the Trust
incurred without (1) gross negligence, bad faith, willful misconduct or willful
malfeasance on the part of such Trustee Indemnified Party in connection with
the performance of its obligations under this Agreement or any such other
agreement or any actions taken in accordance with the provisions of this
Agreement or any such other agreement or (2) reckless disregard on the part of
such Trustee Indemnified Party of its obligations and duties under this
Agreement or any such other agreement. Such indemnity shall include payment
from the Trust of the costs and expenses incurred by such Trustee Indemnified
Party in defending itself against any claim or liability in its capacity as
Trustee. Any amounts payable to a Trustee Indemnified Party under this Section
5.6(a) may be payable in advance or shall be secured by a lien on the Trust. 


                    (b)
The Sponsor and its members, managers, directors, officers, employees,
affiliates (as such term is defined under the Securities Act of 1933, as
amended) and subsidiaries (each, a “Sponsor Indemnified Party”) shall be
indemnified from the Trust and held harmless against any loss, liability or
expense (including, but not limited to, the reasonable fees and expenses of
counsel) arising out of or in connection with the performance of its
obligations under this Agreement and under each other agreement entered into by
the Sponsor, in furtherance of the administration of the Trust (including,
without limiting the scope of the foregoing, Authorized Participant Agreements
to which the Sponsor is a party, including the Sponsor’s indemnification
obligations thereunder) or any actions taken in accordance with the provisions
of this Agreement incurred without (1) gross negligence, bad faith, willful
misconduct or willful malfeasance on the part of such Sponsor Indemnified Party
in connection with the performance of its obligations under this Agreement or
any such other agreement or any actions taken in accordance with the provisions
of this Agreement or any such other agreement or (2) reckless disregard on the
part of such Sponsor Indemnified Party of its obligations and duties under this
Agreement. Such indemnity shall include payment from the Trust of the costs and
expenses incurred by such Sponsor Indemnified Party in defending itself against
any claim or liability in its capacity as Sponsor. Any amounts payable to a
Sponsor Indemnified Party under this Section 5.6(b) may be payable in advance
or shall be secured by a lien on the Trust. The Sponsor may, in its discretion,
undertake any action which it may deem necessary or desirable in respect of
this Agreement and the rights and duties of the parties hereto and the
interests of the Registered Owners and, in such event, the legal expenses and
costs of any such actions shall be expenses and costs of the Trust and the
Sponsor shall be entitled to be reimbursed therefor by the Trust. 


                    (c)
The indemnities provided by this section shall survive notwithstanding any
termination of this Agreement and the Trust or the resignation or removal of
the Trustee or the Sponsor, respectively. 


          Section 5.7
Charges of Trustee. 


                    (a)
Each Depositor, and each person surrendering Shares for the purpose of
withdrawing Trust Property, shall pay to the Trustee a fee of $500 per
transaction for the Delivery of Shares pursuant to Section 2.4 and the
Surrender of Baskets of Shares pursuant to Section 2.6 or 6.2 (or such other
fee as the Trustee, with the prior written consent of the Sponsor, may from
time to time announce). 


26





                    (b)
The Trustee is entitled to receive from the Sponsor fees for its ordinary
services and reimbursement for its out-of-pocket expenses in accordance with
written agreements between the Sponsor and the Trustee. Should the Sponsor fail
to pay the same, the Trustee shall be authorized to charge the same to the
Trust to the extent of amounts which could be charged to the Trust under
Section 5.8(a) hereof in respect of the Sponsor’s fee (and the Trustee may
charge the same to the Trust to such extent without regard to whether, because
of the Sponsor’s default, fee waiver or other reason, the Sponsor may not then
be entitled to payment pursuant to Section 5.8(a)), and any amount paid to the
Sponsor pursuant to Section 5.8(a) shall be net of amounts so withheld. The
Trustee’s right of reimbursement shall be secured by a lien on amounts
chargeable to the Trust under Section 5.8(a), without giving effect to any fee
waiver then in effect, prior to the interest of the Sponsor, the Beneficial
Owners and any other Person. 


                    (c)
The Trustee is entitled to charge the Trust for all expenses and disbursements
incurred by it hereunder exclusive of amounts specified in the preceding
Section 5.7(b), including the fees and disbursements of its legal counsel and
those expenses identified in any Custody Agreement as payable by the Trustee,
except that the Trustee is not entitled to charge the Trust for (i) expenses
and disbursements incurred by it prior to the commencement of trading of Shares
on the Exchange and (ii) fees of agents for performing services the Trustee is
required to perform under this Agreement. The Trustee’s right of reimbursement
for expenses and disbursements under this paragraph shall be deductible from,
and constitute a lien against, the assets of the Trust. 


                    (d)
Any pecuniary cost of the Trustee resulting from actions taken to protect the
Trust and the rights and interest of the Registered Owners pursuant to the
terms of this Agreement, including, without limitation, the Trustee’s
appearance in, prosecution of or defense of any action that it considers
necessary or desirable to protect the Trust or the interests of the Beneficial
Owners, shall be deductible from, and constitute a lien against, the assets of
the Trust. 


          Section 5.8
Charges of Sponsor. 


                    (a)
The Sponsor is entitled to receive from the Trust, chargeable as an expense of
the Trust, a fee for services that will accrue daily and be paid monthly in
arrears in the manner provided in Section 4.7(d) at an annualized rate of 0.60%
of Adjusted Net Asset Value. The Sponsor may, at its sole discretion and from
time to time, waive all or a portion of its fee payable under this Section
5.8(a) for such periods of time as shall be specified in the Sponsor’s written
notice of such fee waiver to the Trustee. The Sponsor is under no obligation to
waiver its fees hereunder, and any such waiver shall create no obligation to
waive fees during any period not covered by the applicable waiver. Any fee
waiver by the Sponsor shall not operate to reduce Sponsor’s obligations
hereunder, including, but not limited to, the Sponsor’s obligations under Section
5.3(g). 


                    (b)
The Sponsor is entitled to receive reimbursement from the Trust for all
expenses and disbursements incurred by it under the last sentence of Section
5.6(b) or that are of the type described in Sections 4.7(a)(ii), (iii), (iv),
and (vi) of this Agreement, except that the Sponsor is not entitled to charge
the Trust for (i) expenses and disbursements incurred by it prior 


27





to the commencement of trading of Shares on the Exchange and (ii) fees
of agents for performing services the Sponsor is required to perform under this
Agreement. 


          Section 5.9
Retention of Trust Documents. 


          The Trustee
is authorized to destroy those documents, records, bills and other data
compiled during the term of this Agreement at the times permitted by the laws
or regulations governing the Trustee, unless the Sponsor reasonably requests
the Trustee in writing to retain those items for a longer period. 


          Section
5.10 Federal Securities Law Filings. 


                    (a)
The Sponsor shall (i) prepare and file a registration statement with the
Commission and take such action as is necessary from time to time to qualify
the Shares for offering and sale under the federal securities laws of the
United States, including the preparation and filing of amendments and
supplements to such registration statement, (ii) promptly notify the Trustee of
any amendment or supplement to the registration statement or prospectus, of any
order preventing or suspending the use of any prospectus, of any request for
the amending or supplementing of the registration statement or prospectus or if
any event or circumstance occurs which is known to the Sponsor as a result of
which the registration statement or prospectus, as then amended or supplemented,
would include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, (iii) provide the
Trustee from time to time with copies, including copies in electronic form, of
the prospectus, as amended and supplemented, in such quantities as the Trustee
may reasonably request and (iv) prepare and file any periodic reports or
updates that may be required under the Exchange Act. The Trustee shall furnish
to the Sponsor any information from the records of the Trust that the Sponsor
reasonably requests in writing that is needed to prepare any filing or
submission that the Sponsor or the Trust is required to make under the federal
securities laws of the United States, and the Sponsor is entitled to rely on
such information so furnished by the Trustee. 


                    (b)
The Sponsor shall have all necessary and exclusive power and authority to (i)
from time to time adopt, implement or amend such disclosure controls and
procedures as are necessary or desirable, in the Sponsor’s reasonable judgment,
to ensure compliance with the disclosure and ongoing reporting obligations
under any applicable securities laws; (ii) appoint and remove the auditors of
the Trust; and (iii) seek from the relevant securities or other regulatory
authorities such relief, clarification or other action as the Sponsor shall
deem necessary or desirable regarding the disclosure or financial reporting
obligations of the Trust. 


                    (c)
The policies and procedures comprising the Trust’s initial Internal Control
Over Financial Reporting have been adopted as of the date of this Agreement and
copies thereof have been delivered to the appropriate officers of the Sponsor
and the Trustee. Amendments to such initial Internal Control Over Financial
Reporting may be proposed from time to time by the Sponsor, but such amendments
may not be adopted in connection with the preparation of the Trust’s financial
statements without the Trustee’s consent (which consent will not be
unreasonably withheld or delayed). 


28





          Section
5.11 Prospectus Delivery. 


          The Trustee
shall, if required by the federal securities laws of the United States, in any
manner permitted by such laws, deliver at the time of issuance of Shares, a
copy of the relevant prospectus, as most recently furnished to the Trustee by
the Sponsor, to each Depositor. 


          Section
5.12 Discretionary Actions by Trustee; Consultation. 


                    (a)
The Trustee may, in its discretion, undertake any action that it considers
necessary or desirable to protect the Trust or the interests of the Registered
Owners. The expenses incurred by the Trustee in connection with taking any
action under the preceding sentence (including the fees and disbursements of
legal counsel) shall be expenses of the Trust, and the Trustee shall be
entitled to be reimbursed for those expenses by the Trust. 


                    (b)
The Trustee shall notify and consult with the Sponsor before undertaking any
action under subsection (a) above or if the Trustee becomes aware of any
development or event that affects the administration of the Trust but is not
contemplated or provided for in this Agreement. 


                    (c)
The Sponsor shall notify and consult with the Trustee before undertaking any
action under the last sentence of Section 5.6(b) or if the Sponsor becomes
aware of any development or event that affects the administration of the Trust
but is not contemplated or provided for in this Agreement. 


          Section
5.13 Dissolution of the Sponsor Not to Terminate Trust. 


          The
dissolution of the Sponsor, or its ceasing to exist as a legal entity from, or
for, any cause, shall not operate to terminate this Agreement insofar as the
duties and obligations of the Trustee are concerned unless the Trust is
terminated pursuant to Section 6.2. 


ARTICLE VI. 

AMENDMENT AND TERMINATION


          Section 6.1
Amendment. 


          Subject to
Section 4.11 hereof, the Trustee and the Sponsor may amend any provisions of
this Agreement without the consent of any Registered Owner. Any amendment that
imposes or increases any fees or charges (other than taxes and other
governmental charges, registration fees or other such expenses), or that
otherwise prejudices any substantial existing right of the Registered Owners
will not become effective as to outstanding Shares until 30 days after notice
of such amendment is given to the Registered Owners. Amendments pursuant to
Sections 2.6(c) or (d) shall not require notice pursuant to the preceding
sentence. Every Registered Owner and Beneficial Owner, at the time any
amendment so becomes effective, shall be deemed, by continuing to hold any
Shares or an interest therein, to consent and agree to such amendment and to be
bound by this Agreement as amended thereby. In no event shall any amendment
impair the right of the Registered Owner of Shares to Surrender Baskets of
Shares and receive therefor the amount of Trust Property represented thereby,
except in order to comply with mandatory provisions of applicable law. 


29





          Section 6.2
Termination. 


                    (a)
The Trustee shall set a date on which this Agreement will terminate and mail
notice of that termination to the Registered Owners at least 30 days prior to
the date set for termination if any of the following occurs: 


                              
(i) The Trustee is notified that the Shares are delisted from a national securities
exchange and are not approved for listing on another national securities
exchange within five business days of their delisting; 


                              
(ii) Registered Owners acting in respect of at least 75% of the outstanding
Shares notify the Trustee that they elect to terminate the Trust; 


                              
(iii) 60 days have elapsed since the Trustee notified the Sponsor of the Trustee’s
election to resign and a successor trustee has not been appointed and accepted
its appointment as provided in Section 5.4; 


                              
(iv) the Commission determines that the Trust is an investment company under
the Investment Company Act of 1940, as amended, and the Trustee has actual
knowledge of such Commission determination; 


                              
(v) the aggregate market capitalization of the Trust, based on the closing
price for the Shares, was less than $350 million (as adjusted for inflation by
reference to the Consumer Price Index as published by the Bureau of Labor
Statistics) at any time after the first anniversary after the Trust’s formation
and the Trustee receives, within six months after the last of those trading
days, notice from the Sponsor of its decision to terminate the Trust; 


                              
(vi) the CFTC determines that the Trust is a commodity pool under the Commodity
Exchange Act of 1936, as amended, and the Trustee has actual knowledge of that
determination; 


                              
(vii) the Trust fails to qualify for treatment, or ceases to be treated, for
United States federal income tax purposes, as a grantor trust, and the Trustee
receives notice from the Sponsor that the Sponsor determines that, because of
that tax treatment or change in tax treatment, termination of the Trust is
advisable; 


                              
(viii) 60 days have elapsed since DTC ceases to act as depository with respect
to the Shares and the Sponsor has not identified another Depository which is
willing to act in such capacity; or 


                              
(ix) as provided in paragraph (c) of this Section 6.2. 


                    (b)
On and after the date of termination of this Agreement, the Registered Owner of
Shares will, upon (i) Surrender of those Shares, (ii) payment of the fee of the
Trustee for the Surrender of Shares provided in Section 5.7, and (iii) payment
of any applicable taxes or other governmental charges, be entitled to Delivery,
to him or upon his order, of the amount of Trust Property represented by those
Shares. The Trustee shall not accept any deposits of Bullion after the date of
termination of this Agreement. If any Shares remain outstanding after the date
of 


30






termination of this Agreement, the Trustee thereafter shall discontinue
the registration of transfers of Shares, shall not make any distributions to
Registered Owners, and shall not give any further notices or perform any
further acts under this Agreement, except that the Trustee shall continue to
collect distributions pertaining to Trust Property and hold the same uninvested
and without liability for interest, pay the Trust’s expenses and sell Bullion
as necessary to meet those expenses and shall continue to deliver Trust
Property, together with any distributions received with respect thereto and the
net proceeds of the sale of any other property, in exchange for Shares
Surrendered to the Trustee (after deducting or upon payment of, in each case,
the fee of the Trustee set forth in 5.7 for the Surrender of Shares, any
expenses for the account of the Registered Owner of such Shares in accordance
with the terms and conditions of this Agreement, and any applicable taxes or
other governmental charges). At any time after the expiration of 90 days
following the date of termination of this Agreement, the Trustee may sell the
Trust Property then held under this Agreement and may thereafter hold the net
proceeds of any such sale, together with any other cash then held by it under
this Agreement, without liability for interest, for the pro rata benefit of the
Registered Owners of Shares that have not theretofore been Surrendered. After
making such sale, the Trustee shall be discharged from all obligations under
this Agreement, except to account for such net proceeds and other cash (after
deducting, in each case, any fees, expenses, taxes or other governmental
charges payable by the Trust, the fee of the Trustee for the Surrender of
Shares and any expenses for the account of the Registered Owner of such Shares
in accordance with the terms and conditions of this Agreement, and any
applicable taxes or other governmental charges). Upon the termination of this
Agreement, the Sponsor shall be discharged from all obligations under this
Agreement except for its obligations to the Trustee under Sections 5.6, 5.7 and
5.8 shall survive termination of this Agreement.


                    (c)
If the Sponsor shall be adjudged bankrupt or insolvent, or a receiver of the
Sponsor or of its property shall be appointed, or a trustee or liquidator or
any public officer shall take charge or control of the Sponsor or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then in any such case the Sponsor shall be deemed conclusively to
have resigned with such resignation being effective immediately upon the
occurrence of any of the specified events, and the Trustee may terminate and
liquidate the Trust and distribute its remaining assets pursuant to this Section
6.2. The Trustee shall have no obligation to appoint a successor Sponsor or to
assume the duties of the Sponsor and shall have no liability to any person
because the Trust is or is not terminated pursuant to this paragraph.


ARTICLE VII.

MISCELLANEOUS


          Section
7.1 Counterparts.


          This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original and all of such counterparts shall constitute one and the
same instrument. Copies of this Agreement shall be filed with the Trustee and
shall be open to inspection by any Registered Owner during the Trustee’s
business hours.




31







          Section 7.2
Third-Party Beneficiaries.


          This
Agreement is for the exclusive benefit of the parties hereto, any Sponsor Indemnified
Party or any Trustee Indemnified Party and the Beneficial Owners, and shall not
be deemed to give any legal or equitable right, remedy or claim whatsoever to
any other person.


          Section
7.3 Severability.


          In case any
one or more of the provisions contained in this Agreement should be or become
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions of this Agreement shall in no way be
affected, prejudiced or disturbed thereby.


          Section 7.4
Certain Matters Relating to Beneficial Owners.


                    (a)
By the purchase and acceptance or other lawful delivery and acceptance of
Shares, each Beneficial Owner thereof shall be deemed to be a beneficiary of
the Trust created by this Agreement and vested with beneficial undivided
interest in the Trust to the extent of the Shares owned beneficially by such
Beneficial Owner, subject to the terms and conditions of this Agreement. Upon
issuance as provided herein, Shares shall be fully paid and non-assessable.


                    (b)
Subject to and in accordance with Section 2.6, Shares may at any time prior to
the date specified by the Trustee in connection with the termination of the
Trust be tendered to the Trustee for redemption.


                    (c)
The death or incapacity of any Beneficial Owner shall not operate to terminate
this Agreement or the Trust, nor entitle such Beneficial Owner’s legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them. Each Beneficial Owner expressly waives any right such
Beneficial Owner may have under any rule of law, or the provisions of any
statute, or otherwise, to require the Trustee at any time to account, in any
manner other than as expressly provided in the Agreement, in respect of the
Trust Property from time to time received, held and applied by the Trustee
hereunder.


                    (d)
No Beneficial Owner shall have any right to vote or in any manner otherwise to
control the operation and management of the Trust, or the obligations of the
parties hereto. Nothing set forth in this Agreement shall be construed so as to
constitute the Beneficial Owners from time to time as partners or members of an
association; nor shall any Beneficial Owner ever be liable to any third person
by reason of any action taken by the parties to this Agreement, or for any
other cause whatsoever.


                    (e)
The rights of Beneficial Owners must be exercised by DTC Participants or
Participants of any successor Depository acting on their behalf in accordance
with its rules and procedures


32





          Section
7.5 Notices.


                    (a)
All notices given under this Agreement must be in writing.


                    (b)
Any and all notices to be given to the Trustee or the Sponsor shall be deemed
to have been duly given (i) when it is actually delivered by a messenger or
recognized courier service, (ii) five days after it is mailed by registered or
certified mail, postage paid or (iii) when receipt of a facsimile transmission
is acknowledged via a return receipt or receipt confirmation as requested by
the original transmission, in each case to or at the address set forth below:


	
  

 	
  

 
	
 To the
 Trustee:

 
	
  

 
	
  

 	
 THE BANK OF
 NEW YORK MELLON

 
	
  

 	
 2 Hanson
 Place

 
	
  

 	
 Brooklyn,
 New York 11217

 
	
  

 	
 Attention:
 Donald Guire

 
	
  

 	
 Telephone:
 718-315-4927

 
	
  

 	
 Facsimile:
 718-315-4850

 
	
  

 	
  

 
	
 or any other
 place to which the Trustee may have transferred its Corporate Trust Office
 with notice to the Sponsor.

 
	
  

 
	
 To the
 Sponsor:

 
	
  

 
	
  

 	
 ETF
 SECURITIES USA LLC

 
	
  

 	
 Ordnance
 House

 
	
  

 	
 31 Pier Road

 
	
  

 	
 St. Helier,
 Jersey JE48PW

 
	
  

 	
 Channel
 Islands

 
	
  

 	
 Telephone:
 011 44 207 448-4330

 
	
  

 	
 Attention:
 President

 
	
  

 	
  

 
	
           with
 a copy to:

 
	
  

 
	
  

 	
 Katten
 Muchin Rosenman LLP

 
	
  

 	
 575 Madison
 Avenue

 
	
  

 	
 New York,
 New York 10022

 
	
  

 	
 Attention:
 Peter J. Shea, Esq.

 



or any other
place to which the Sponsor may have transferred its principal office with
notice to the Trustee.


                    (c)
Any and all
notices to be given to a Registered Owner shall be deemed to have been duly
given (i) when actually delivered by messenger or a recognized courier service,
(ii) when mailed, postage prepaid or (iii) when sent by facsimile
transmission confirmed by letter, in each case at or to the address of such
Registered Owner as it appears on the transfer books of the Trustee, or, if
such Registered Owner shall have filed with the Trustee a written 


33





request that any notice or communication intended for such Registered
Owner be delivered to some other address, at the address designated in such
request. Notices to Beneficial Owners shall be delivered to Authorized
Participants and DTC Participants designated by DTC or any successor
Depository.


          Section 7.6
Agent for Service; Submission to Jurisdiction.


          The Sponsor
hereby (i) irrevocably designates and appoints Katten Muchin Rosenman LLP,
located at 575 Madison Avenue, New York, New York 10022, in the State of New
York, as the Sponsor’s authorized agent upon which process may be served in any
suit or proceeding arising out of or relating to the Shares, the Trust Property
or this Agreement, (ii) consents and submits to the jurisdiction of any state
or federal court in The City of New York, State of New York, in which any such
suit or proceeding may be instituted, and (iii) agrees that service of process
upon said authorized agent shall be deemed in every respect effective service
of process upon the Sponsor in any such suit or proceeding. The Sponsor agrees
to deliver, upon the execution and delivery of this Agreement, a written
acceptance by such agent of its appointment as such agent. The Sponsor further
agrees to take any and all action, including the filing of any and all such
documents and instruments, as may be necessary to continue such designation and
appointment in full force and effect for so long as any Shares remain
outstanding or this Agreement remains in force. In the event the Sponsor fails
to continue such designation and appointment in full force and effect, the
Sponsor hereby waives personal service of process upon it and consents that any
such service of process may be made by certified or registered mail, return
receipt requested, directed to the Sponsor at its address last specified for
notices hereunder, and service so made shall be deemed completed five (5) days
after the same shall have been so mailed.


          Each party
hereto, each Authorized Participant by its delivery of an Authorized
Participant Agreement and each Beneficial Owner by the acceptance of a Share,
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 person at such person’s address for purposes of notices
hereunder.


          Section 7.7
Governing Law.


          This
Agreement shall be interpreted under, and all rights and duties under this
Agreement shall be governed by, the internal substantive laws (but not the
choice of law rules) of the State of New York.


34





          IN WITNESS
WHEREOF, ETF SECURITIES USA LLC and THE BANK OF NEW YORK MELLON have duly
executed this Depositary Trust Agreement as of the day and year first set forth
above.


	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 ETF
 SECURITIES USA LLC

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 By: 

 	
 /s/ Graham Tuckwell

 	
  

 
	
  

 	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
 Name:  Graham Tuckwell 

 
	
  

 	
  

 	
 Title:    President & Chief Executive Officer 

 






	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 WITNESSED: 

 	
  

 	
 WITNESSED:

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 By: 

 	
 /s/ R. Tuckwell

 	
  

 	
 By: 

 	
 /s/ L. Tuckwell

 	
  

 
	
  

 	

 


 	
  

 	
  

 	

 


 	
  

 
	
 Name:  R. Tuckwell 

 	
  

 	
 Name:  L. Tuckwell

 	
  

 






	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 THE BANK OF
 NEW YORK MELLON,

 
	
  

 	
  

 	
  

 	
 as Trustee

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 By:

 	
 /s/ Andrew Pfeifer

 	
  

 
	
  

 	
  

 	
  

 	
  

 	

 


 	
  

 
	
  

 	
  

 	
  

 	
 Name:  Andrew Pfeifer

 	
  

 
	
  

 	
  

 	
  

 	
 Title:    Vice President

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  [Signature Page to ETFS White Metals Basket
 Trust Depositary Trust Agreement]

 









 [Depositary Trust Agreement acknowledgment,
Trustee]


	
  

 	
  

 
	
 STATE OF NEW
 YORK

 	
 )

 
	
  

 	
 ) ss.:

 
	
 COUNTY OF
 NEW YORK 

 	
 )

 


On the 22nd day of November,
2010 before me, the undersigned, personally appeared Andrew Pfeifer, personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual whose name is subscribed to the within instrument and acknowledged
to me that he executed the same in his capacity, and that by his signature on
the instrument, the individual, or the person upon behalf of which the
individual acted, executed the instrument.


	
  
 	
  
 	
  
 
	 
	/s/ S. Lappert
	 

	
  
 	
 Notary
 Public
 	
  
 
	
  
 	
  
 	
  
 
	
 (Notarial
 Seal)
 	
  
 	
  
 









EXHIBIT
A


 [Form
of Certificate]


THE SHARES EVIDENCED HEREBY REPRESENT RIGHTS WITH RESPECT TO UNDERLYING
TRUST PROPERTY (AS DEFINED IN THE DEPOSITARY TRUST AGREEMENT REFERRED TO
HEREIN) HELD BY THE TRUST AND DO NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST
IN, AND ARE NOT GUARANTEED BY THE SPONSOR OR THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE SHARES NOR THE UNDERLYING TRUST PROPERTY ARE
INSURED UNDER ANY AGREEMENT THAT DIRECTLY BENEFITS THE TRUST OR GUARANTEED BY
ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.


UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE AGENT
AUTHORIZED BY THE ISSUER FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.


A-1









	
  

 	
  

 
	
 ETFS PHYSICAL WM BASKET SHARES

 
	
 ISSUED BY

 
	
 ETFS WHITE METALS BASKET TRUST

 
	
 REPRESENTING

 
	
 FRACTIONAL INTERESTS IN DEPOSITED SILVER, PLATINUM, PALLADIUM AND

 
	
 ANY OTHER TRUST PROPERTY

 
	
 
THE BANK OF NEW YORK MELLON, as Trustee

 
	
  

 	
  

 
	
           No.

 	
 * Shares

 



          CUSIP:
26923B 104


          THE BANK OF
NEW YORK MELLON, as Trustee (hereinafter called the Trustee), hereby certifies
that CEDE & CO., as nominee of The Depository Trust Company, or registered
assigns, is the owner of * Shares issued by ETFS White Metals Basket Trust,
each representing a fractional undivided interest in the net assets of the
Trust, as provided in the Agreement referred to below. At the time of delivery
of the Agreement, each 50,000 Shares represented an interest in 50,000 Ounces
of Silver, 500 Ounces of Platinum and 400 Ounces of Palladium that are
deposited under the Agreement and held by the Custodian referred to in the
Agreement. The amount of Silver, Platinum and Palladium in which each 50,000
Shares represents an interest will decline over time as provided in the
Agreement. The Trustee’s Corporate Trust Office is located at a different
address than its principal executive office. Its Corporate Trust Office is
located at 2 Hanson Place, Brooklyn, New York 11217, and its principal
executive office is located at One Wall Street, New York, New York 10286.


          This
Certificate is issued upon the terms and conditions set forth in the Depositary
Trust Agreement dated as of [●] , 2010 (the “Agreement”) between
ETF Securities USA LLC (herein called the Sponsor), and the Trustee. By
becoming a Registered Owner or Beneficial Owner, or by depositing Bullion, a
Person is bound by all the terms and conditions of the Agreement. The Agreement
sets forth the rights of Depositors and Registered Owners and the rights and
duties of the Trustee and the Sponsor. Copies of the Agreement are on file at
the Trustee’s Corporate Trust Office in New York City.


	
  

 	
  

 
	

 


 	
  

 
	
  

 	
  

 
	
 *   That
 number of Shares held at The Depository Trust Company at any given point in
 time.

 


A-2





          The
Agreement is hereby incorporated by reference into and made a part of this
Certificate as if set forth in full in this place. Capitalized terms not
defined herein shall have the meanings set forth in the Agreement.


          This
Certificate shall not be entitled to any benefits under the Agreement or be
valid or obligatory for any purpose unless it is executed by the Trustee by the
manual or facsimile signature of a duly authorized signatory of the Trustee
and, if a Registrar (other than the Trustee) for the Shares shall have been
appointed, countersigned by the manual signature of a duly authorized officer
of the Registrar.


	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Dated: 

 	
  

 	
  

 	
 THE BANK OF
 NEW YORK MELLON,

 
	
  

 	

 


 	
  

 	
 as Trustee

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 By: 

 	
  

 
	
  

 	
  

 	
  

 	
  

 	

 


 


THE
TRUSTEE’S CORPORATE TRUST OFFICE ADDRESS IS

2 HANSON PLACE, BROOKLYN, NEW YORK 11217


A-3