EXHIBIT 10.4


                              ADVISORY AGREEMENT


          ADVISORY AGREEMENT (this "Agreement") dated as of the ____ day of
_________, 2004, by and among World Monitor Trust III- Series I, a Delaware
statutory trust (the "Trust"), Preferred Investment Solutions Corp., a
Connecticut corporation (the "Managing Owner") and Eagle Trading Systems,
Inc., a Delaware corporation (the "Advisor").

                             W I T N E S S E T H:


          WHEREAS, the Trust has been organized primarily for the purpose of
trading, buying, selling, spreading or otherwise acquiring, holding or
disposing of futures, forward and options contracts. Other transactions also
may be effected from time to time, including among others, those as more fully
identified in Exhibit A hereto. The foregoing commodities and other
transactions are collectively referred to as "Commodities"; and

          WHEREAS, the Managing Owner is authorized to utilize the services of
one or more professional commodity trading advisors in connection with the
Commodities trading activities of the various Series (as defined below) of the
Trust; and

          WHEREAS, the Advisor's present business includes the management of
Commodities accounts for its clients; and

          WHEREAS, the Advisor is registered as a commodity trading advisor
under the United States Commodity Exchange Act, as amended (the "CE Act"), and
is a member of the National Futures Association (the "NFA") as a commodity
trading advisor and will maintain such registration and membership for the
term of this Agreement; and


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          WHEREAS, the Initial Agreement was voluntarily terminated by its
terms on March 20, 2000; and

          WHEREAS, the Trust and the Advisor desire to enter into this
Agreement in order to set forth the modified terms and conditions upon which
the Advisor will continue to render and implement commodity advisory services
on behalf of the Trust during the term of this Agreement;

          NOW, THEREFORE, the parties agree as follows:

     1.   Duties of the Advisor.
          ---------------------

          (a) Appointment. The Trust hereby appoints the Advisor, and the
Advisor hereby accepts appointment, as its limited attorney-in-fact to
exercise discretion to invest and reinvest in Commodities during the term of
this Agreement the portion of the Trust's Net Asset Value (as defined in the
Prospectus) which is comprised of the assets attributable to the Trust's
Series I Interests allocated to the Advisor (the "Series I Allocated Assets")
on the terms and conditions and for the purposes set forth herein. This
limited power-of-attorney is a continuing power and shall continue in effect
with respect to the Advisor until terminated hereunder. The Advisor shall have
sole authority and responsibility for independently directing the investment
and reinvestment in Commodities of the Series I Allocated Assets for the term
of this Agreement pursuant to the trading programs, methods, systems,
strategies described in Exhibit A hereto, which the Trust and the Managing
Owner have selected to be utilized by the Advisor in trading the Series I
Allocated Assets (collectively referred to as the Advisor's "Trading
Approach"), subject to the trading policies and limitations as set forth in
the Trust's Prospectus and attached hereto as Exhibit B (the "Trading Policies
and Limitations"), as the same may be modified from


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time to time and provided in writing to the Advisor. The portion of the Series
I Allocated Assets to be allocated by the Advisor at any point in time to one
or more of the various trading strategies comprising the Advisor's Trading
Approach will be determined as set forth in Exhibit A hereto, as it may be
amended from time to time, with the consent of the parties, it being
understood that trading gains and losses automatically will alter the agreed
upon allocations. Upon receipt of a new allocation, the Advisor will determine
and, if required, adjust its trading in light of the new allocation.

          (b) Allocation of Responsibilities. The Managing Owner will have the
responsibility for the management of any portion of the Series I Allocated
Assets that are not invested in Commodities. The Advisor will use its good
faith and best efforts in determining the investment and reinvestment in
Commodities of the Series I Allocated Assets in compliance with the Trading
Policies and Limitations, and in accordance with the Advisor's Trading
Approach. In the event that the Managing Owner shall, in its sole discretion,
determine in good faith following consultation appropriate under the
circumstances with the Advisor that any trading instruction issued by the
Advisor violates the Trust's Trading Policies and Limitations, then the
Managing Owner, following reasonable notice to the Advisor appropriate under
the circumstances, may override such trading instruction and shall be
responsible therefor. Nothing herein shall be construed to prevent the
Managing Owner from imposing any limitation(s) on the trading activities of
the Trust beyond those enumerated in the Prospectus if the Managing Owner
determines that such limitation(s) are necessary or in the best interests of
the Trust, in which case the Advisor will adhere to such limitations following
written notification thereof.

          (c) Gains From Trading Approach. The Advisor agrees that at least
90% of the annual gross income and gain, if any, generated by its Trading
Approach for Series I


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Allocated Assets will be "qualifying income" within the meaning of Section
7704(d) of theCode (it being understood that such income will largely result
from buying and selling Commodities.) The Advisor also agrees that it will
attempt to trade in such a manner as to allow non-U.S. Limited Owners to
qualify for the safe harbors found in Section 864(b)(2) of the Code and as
interpreted in the regulations promulgated or proposed thereunder.

          (d) Modification of Trading Approach. In the event the Advisor
requests to use, or the Managing Owner requests the Advisor to use, a trading
program, system, method or strategy other than or in addition to the trading
programs, systems, methods or strategies comprising the Trading Approach in
connection with trading for the Trust (including, without limitation, the
deletion or addition of an agreed upon trading program, system, method or
strategy to the then agreed upon Trading Approach), either in whole or in
part, the Advisor may not do so and/or shall not be required to do so, as
appropriate, unless both the Managing Owner and the Advisor consent thereto in
writing.

          (e) Notification of Material Changes. The Advisor also agrees to
give the Trust prior written notice of any proposed material change in its
Trading Approach, and agrees not to make any material change in such Trading
Approach (as applied to the Trust) over the objection of the Managing Owner,
it being understood that the Advisor shall be free to institute non-material
changes in its Trading Approach (as applied to the Trust) without prior
written notification. Without limiting the generality of the foregoing,
refinements to the Advisor's Trading Approach, the deletion (but not the
addition) of commodities (other than the addition of commodities then being
traded (i) on organized domestic commodities exchanges, (ii) on foreign
commodities exchanges recognized by the Commodity Futures Trading Commission
as providing customer protections comparable to those provided on domestic
exchanges, or (iii) in


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the interbank foreign currency market) to or from the Advisor's Trading
Approach, and variations in the leverage principles and policies utilized by
the Advisor, shall not be deemed a material change in the Advisor's Trading
Approach, and prior approval of the Managing Owner shall not be required
therefor. The utilization of forward markets in addition to those enumerated
in Exhibit D hereto would be deemed a material change to the Advisor's Trading
Approach and prior approval shall be required therefor.

          Subject to adequate assurances of confidentiality, the Advisor
agrees that it will discuss with the Managing Owner upon request any trading
methods, programs, systems or strategies used by it for trading customer
accounts which differ from the Trading Approach used for the Trust, provided,
that nothing contained in this Agreement shall require the Advisor to disclose
what it deems to be proprietary or confidential information.

          (f) Request for Information. The Advisor agrees to provide the Trust
with any reasonable information concerning the Advisor that the Trust may
reasonably request (other than the identity of its customers or proprietary or
confidential information concerning the Trading Approach), subject to receipt
of adequate assurances of confidentiality by the Trust, including, but not
limited to, information regarding any change in control, key personnel,
Trading Approach and financial condition which the Trust reasonably deems to
be material to the Trust; the Advisor also shall notify the Trust of any such
matters the Advisor, in its reasonable judgment, believes may be material to
the Trust relating to the Advisor and its Trading Approach. During the term of
this Agreement, the Advisor agrees to provide the Trust with updated monthly
information related to the Advisor's performance results within a reasonable
period of time after the end of the month to which it relates.


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          (g) Notice of Errors. The Advisor is responsible for promptly
reviewing all oral and written confirmations it receives to determine that the
Commodities trades were made in accordance with the Advisor's instructions. If
the Advisor determines that an error was made in connection with a trade or
that a trade was made other than in accordance with the Advisor's
instructions, the Advisor shall promptly notify the Managing Owner of this
fact, and shall utilize its best efforts to cause the error or discrepancy to
be corrected.

          (h) Liability. Neither the Advisor nor any employee, director,
officer or shareholder of the Advisor, nor any person who controls the
Advisor, shall be liable to the Managing Owner, its officers, directors,
shareholders or employees, or any person who controls the Managing Owner, or
the Trust or the owners of Series I Interests ("Limited Owners"), or any of
their respective successors or assignees under this Agreement, except by
reason of acts or omissions in material breach of this Agreement or due to
their misconduct or negligence or by reason of their not having acted in good
faith in the reasonable belief that such actions or omissions were in the best
interests of the Trust and the Limited Owners; it being understood that the
Advisor makes no guarantee of profit nor offers any protection against loss,
and that all purchases and sales of Commodities shall be for the account and
risk of the Trust, and the Advisor shall incur no liability for trading
profits or losses resulting therefrom provided the Advisor would not otherwise
be liable to the Trust under the terms hereof.

          (i) Allocations. Subject to Section 10 below, the Trust may, on a
monthly basis during the Trust's Continuous Offering Period, as described in
the Prospectus, (i) allocate additional assets to the Advisor, (ii) reallocate
the Series I Allocated Assets away from the Advisor to another commodity
trading advisor (an "Other Advisor"), or (iii) reallocate assets to


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the Advisor from an Other Advisor or (iv) allocate additional capital with
respect to Series I Allocated Assets to an Other Advisor.

          (j) Delivery of Disclosure Document. The Advisor agrees to provide
to the Managing Owner any amendment, supplement, or update to the Disclosure
Document attached hereto as Exhibit D (an "Update") as soon as such Update is
available for distribution.

     2.   Indemnification.
          ---------------

          (a) The Advisor. Subject to the provisions of Section 3, the
Advisor, and each officer, director, shareholder and employee of the Advisor,
and each person who controls the Advisor, shall be indemnified, defended, and
held harmless by the Trust and the Managing Owner, from and against any and
all claims, losses, judgments, liabilities, damages, costs, expenses
(including, without limitation, reasonable investigatory and attorneys' fees)
and amounts paid in settlement of any claims in compliance with the conditions
specified below (collectively, "Losses") sustained by the Advisor (i) in
connection with any acts or omissions of the Advisor, or any of its officers,
directors or employees relating to its management of the Series I Allocated
Assets, including in connection with this Agreement or otherwise as a result
of the Advisor's performance of services on behalf of the Trust or its role as
trading advisor to Series I Allocated Assets and (ii) as a result of a
material breach of this Agreement by the Trust or the Managing Owner, provided
that, (1) such Losses were not the result of negligence, misconduct or a
material breach of this Agreement on the part of the Advisor, and its
officers, directors, shareholders and employees, and each person controlling
the Advisor, (ii) the Advisor, and its officers, directors, shareholders and
employees, and each person controlling the Advisor, acted in good faith and in
a manner reasonably believed by such person to be in or not opposed


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to the best interests of the Trust and the Limited Owners and (iii) any such
indemnification will only be recoverable from the Series I Allocated Assets
and the assets of the Managing Owner and not from any other assets of any
other Series of the Trust, provided further, that no indemnification shall be
permitted under this Section 2 for amounts paid in settlement if either (A)
the Advisor fails to notify the Trust of the terms of any settlement proposed,
at least fifteen (15) days before any amounts are paid, or (B) the Trust does
not approve the amount of the settlement within fifteen (15) days (such
approval not to be withheld unreasonably). Notwithstanding the foregoing, the
Trust shall, at all times, have the right to offer to settle any matter with
the approval of the Advisor (which approval shall not be withheld
unreasonably) and if the Trust successfully negotiates a settlement and
tenders payment therefor to the party claiming indemnification (the
"Indemnitee") the Indemnitee must either use its best efforts to dispose of
the matter in accordance with the terms and conditions of the proposed
settlement or the Indemnitee may refuse to settle the matter and continue its
defense in which latter event the maximum liability of the Trust to the
Indemnitee shall be the amount of said proposed settlement. Any
indemnification under this Section 2, unless ordered by a court, shall be made
by the Trust only as authorized in the specific case by the Managing Owner.

          (b) Default Judgments and Confessions of Judgment. None of the
foregoing provisions for indemnification shall be applicable with respect to
default judgments or confessions of judgment entered into by the Indemnitee,
with its knowledge, without the prior consent of the Trust.

          (c) Procedure. In the event that an Indemnitee under this Section 2
is made a party to an action, suit or proceeding alleging both matters for
which indemnification can be made hereunder and matters for which
indemnification may not be made hereunder, such


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Indemnitee shall be indemnified only for that portion of the Losses incurred
in such action, suit or proceeding which relates to the matters for which
indemnification can be made.

          (d) Expenses. Expenses incurred in defending a threatened or pending
civil, administrative or criminal action, suit or proceeding against an
Indemnitee shall be paid by the Trust in advance of the final disposition of
such action, suit or proceeding if (i) the legal action, suit or proceeding,
if sustained, would entitle the Indemnitee to indemnification pursuant to the
terms of this Section 2, and (ii) the Advisor undertakes to repay the advanced
funds to the Trust in cases in which the Indemnitee is not entitled to
indemnification pursuant to this Section 2, and (iii) in the case of
advancement of expenses by the Trust, the Managing Owner determines that the
Indemnitee is not likely not to be entitled to indemnification hereunder.

     3.   Limits on Claims.
          ----------------

          (a) Prohibited Acts. The Advisor agrees that it will not take any of
the following actions against the Trust: (i) seek a decree or order by a court
having jurisdiction in the premises (A) for relief in respect of the Trust in
an involuntary case or proceeding under the Federal Bankruptcy Code or any
other federal or state bankruptcy, insolvency, reorganization, rehabilitation,
liquidation or similar law or (B) adjudging the Trust a bankrupt or insolvent,
or seeking reorganization, rehabilitation, liquidation, arrangement,
adjustment or composition of or in respect of the Trust under the Federal
Bankruptcy Code or any other applicable federal or state law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of the Trust or of any substantial part of any of its
properties, or ordering the winding up or liquidation of any of its affairs,
or (ii) seek a petition for relief, reorganization or


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to take advantage of any law referred to in the preceding clause or (iii) file
an involuntary petition for bankruptcy (collectively, "Bankruptcy or
Insolvency Action").

          (b) Limited Assets Available. In addition, the Advisor agrees that
for any obligations due and owing to it by the Trust, the Advisor will look
solely and exclusively to Series I Allocated Assets or to the assets of the
Managing Owner, if it has liability in its capacity as Managing Owner, to
satisfy its claims and will not seek to attach or otherwise assert a claim
against the other assets of the Trust, whether there is a Bankruptcy or
Insolvency Action taken or otherwise. The parties agree that this provision
will survive the termination of this Agreement, whether terminated in a
Bankruptcy or Insolvency Action or otherwise.

          (c) No Limited Owner Liability. This Agreement has been made and
executed by and on behalf of the Trust and the Managing Owner for the benefit
of the Series I Interests of the Trust and the obligations of the Trust and/or
the Managing Owner set forth herein are not binding upon any of the Limited
Owners individually but are binding only upon the assets and property
identified above and no resort shall be had to the assets of other Series
issued by the Trust or the Limited Owners' personal property for the
satisfaction of any obligation or claim hereunder.

          (d) Subordination Agreement. The Advisor agrees and consents (the
"Consent") to look solely to each Series for which brokerage and clearing
services are being performed ("Series I") and assets of Series I (the "Series
I Assets") and to the Managing Owner and its assets for payment. The Series I
Assets include only those funds and other assets that are paid, held or
distributed to the Trust on account of and for the benefit of Series I,
including, without limitation, funds delivered to the Trust for the purchase
of interests in Series I. In


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furtherance of the Consent, the Advisor agrees that (i) any debts,
liabilities, obligations, indebtedness, expenses and claims of any nature and
of all kinds and descriptions (collectively, "Claims") incurred, contracted
for or otherwise existing arising from, related to or in connection with the
Trust and its assets and Series I and the Series I Assets, shall be subject to
the following limitations:

               (1) Subordination of certain claims and rights. (i) except
     as set forth below, the Claims, if any, of the Advisor (the "Subordinated
     Claims") shall be expressly subordinate and junior in right of payment to
     any and all other Claims against the Trust and any Series thereof, and
     any of their respective assets, which may arise as a matter of law or
     pursuant to any contract; provided, however, that the Advisor's Claims
     (if any) against Series I shall not be considered Subordinated Claims
     with respect to enforcement against and distribution and repayment from
     Series I, the Series I Assets and the Managing Owner and its assets; and
     provided further that the Advisor's valid Claims, if any, against Series
     I shall be pari passu and equal in right of repayment and distribution
     with all other valid Claims against Series I and (ii) the Advisor will
     not take, demand or receive from any Series or the Trust or any of their
     respective assets (other than Series I, the Series I Assets and the
     Managing Owner and its assets) any payment for the Subordinated Claims;

               (2) the Claims of the Advisor with respect to Series I shall
     only be asserted and enforceable against Series I, the Series I Assets
     and the Managing Owner and its assets; and such Claims shall not be
     asserted or enforceable for any reason whatsoever against any other
     Series, the Trust generally or any of their respective assets;


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               (3) if the Claims of the Advisor against Series I or the Trust
     are secured in whole or in part, the Advisor hereby waives (under section
     1111(b) of the Bankruptcy Code (11 U.S.C. ss. 1111(b)) any right to have
     any deficiency Claims (which deficiency Claims may arise in the event
     such security is inadequate to satisfy such Claims) treated as unsecured
     Claims against the Trust or any Series (other than Series I), as the case
     may be;

               (4) in furtherance of the foregoing, if and to the extent that
     the Advisor receives monies in connection with the Subordinated Claims
     from a Series or the Trust (or their respective assets), other than
     Series I, the Series I Assets and the Managing Owner and its assets, the
     Advisor shall be deemed to hold such monies in trust and shall promptly
     remit such monies to the Series or the Trust that paid such amounts for
     distribution by the Series or the Trust in accordance with the terms
     hereof; and

               (5) the foregoing Consent shall apply at all times
     notwithstanding that the Claims are satisfied, and notwithstanding that
     the agreements in respect of such Claims are terminated, rescinded or
     canceled.

     4.   Obligations of the Trust, the Managing Owner and the Advisor.
          ------------------------------------------------------------

          (a) The Registration Statement and Prospectus. Each of the Trust and
the Managing Owner agrees to cooperate and use its good faith, or and best
efforts in connection with the taking of such actions not inconsistent with
this Agreement as the Managing Owner may determine to be necessary or
advisable in order to comply with applicable regulatory requirements. The
Advisor agrees to make all necessary disclosures regarding itself, its
officers and principals, trading performance, Trading Approach, customer
accounts (other than the names


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of customers, unless such disclosure is required by law or regulation) and
otherwise as may be requested, in the reasonable judgment of the Managing
Owner, to be made in order to manage the Trust and correspond with the
Interestholders. No description of, or other information relating to, the
Advisor may be distributed by the Managing Owner without the prior written
consent of the Advisor; provided that, distribution of performance information
relating to Series I's account shall not require consent of the Advisor, which
consent shall not be unreasonably withheld or delayed.

          (b) Road Shows. The Advisor agrees to make representatives of its
marketing department available to participate in "road show" and similar
presentations in connection with the offering of the Series I Interests to the
extent reasonably requested by the Managing Owner, on the following
conditions: (i) all expenses incurred by the Advisor in the course of such
participation will be shared between and among the Advisor, the Managing Owner
and/or the Selling Agent, in such amounts as shall be agreed among the
parties, (ii) the Advisor shall not be obligated to take any action which
might require registration as a broker-dealer or investment adviser under any
applicable federal or state law and (iii) the Advisor shall not be required to
assist in "road show" or similar presentations to the extent that it
reasonably believes that doing so would interfere with its trading, marketing
or other activities.

          (c) Advisor Not A Promoter. The parties acknowledge that the Advisor
has not been, either alone or in conjunction with [Name of Selling Agent] (the
"Selling Agent") or its affiliates, an organizer or promoter of the Trust, and
it is not intended by the parties that the Advisor shall have any liability as
such.


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          (d) Filings. the Trust may at any time determine not to file the
Registration Statement with the SEC or withdraw the Registration Statement
from the SEC or any other governmental or self-regulatory authority with which
it is filed or otherwise terminate the Registration Statement or the offering
of Interests. Upon any such withdrawal or termination, or if the "minimum" (i)
aggregate number of Interests or (ii) Series I Interests required to be sold
pursuant to the Prospectus is not sold, this Agreement shall terminate and,
except for the payment of expenses as set forth in subparagraph4(b) above and
in paragraph 2, neither the Trust nor the Managing Owner shall have any
obligations to the Advisor with respect to this Agreement nor shall the
Advisor have any obligations to the Trust or the Managing Owner with respect
to this Agreement.

          (e) Representation Agreement. The parties agree that the
Representation Agreement relating to the offering of the Series I Interests
which was executed simultaneous to the Initial Agreement (a copy of which is
attached as Exhibit C) remains in full force and effect notwithstanding the
termination of the Initial Agreement.

     5.   Advisor Independence.
          --------------------

          (a) Independent Contractor. The Advisor shall for all purposes
herein be deemed to be an independent contractor with respect to the Trust,
the Managing Owner and each other commodity trading advisor that may in the
future provide commodity trading advisory services to the Trust and the
Managing Owner and its affiliates, and shall, unless otherwise expressly
authorized, have no authority to act for or to represent the Trust, the
Managing Owner, any other commodity trading advisor or the Selling Agent in
any way or otherwise be deemed to be a general agent, joint venturer or
partner of the Trust, the Managing Owner, any other


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commodity trading advisor, or in any way be responsible for the acts or
omissions of the Trust, the Managing Owner, any other commodity trading
advisor as long as it is acting independently of such persons.

          (b) Unauthorized Activities. Without limiting the obligations of the
Trust set forth under this Agreement, nothing herein contained shall be deemed
to require the Trust to take any action contrary to its Declaration of Trust
and Trust Agreement or Certificate of Trust or any applicable statute,
regulation or rule of any exchange or self-regulatory organization.

          (c) Purchase of Interests. Any of the Advisor, its principals, and
employees may, in its discretion, purchase Interests in the Trust.

          (d) Confidentiality. The Trust and the Managing Owner acknowledge
that the Trading Approach of the Advisor is the confidential property of the
Advisor. Nothing in this Agreement shall require the Advisor to disclose the
confidential or proprietary details of its Trading Approach. The Trust and the
Managing Owner further agree that they will keep confidential and will not
disseminate the Advisor's trading advice to the Trust, except as, and to the
extent that, it may be determined by the Managing Owner to be (i) necessary
for the monitoring of the business of the Trust, including the performance of
brokerage services by the Trust's commodity broker(s) or (ii) expressly
required by law or regulation.

     6.   Commodity Broker.
          ----------------

          All Commodities trades for the account of the Trust shall be made
through such commodity broker or brokers as the Managing Owner directs or
otherwise as may be agreed upon in accordance with such order execution
procedures as are agreed upon between the


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Advisor and the Managing Owner. The Advisor shall not have any authority or
responsibility in selecting or supervising any broker for execution of
Commodities trades of the Trust or for negotiating commission rates to be
charged therefor. The Advisor shall not be responsible for determining that
any such bank or broker used in connection with any Commodities transactions
meets the financial requirements or standards imposed by the Trust's Trading
Policies and Limitations. At the present time it is contemplated that the
Trust will execute and clear all Commodities trades through UBS Securities
LLC. The Advisor may, however, with the consent of the Managing Owner, execute
transactions at such other broker(s), and upon such terms and conditions, as
the Advisor and the Managing Owner agree if such broker(s) agree to "give up"
all such transactions to UBS Securities LLC for clearance. To the extent that
the Trust determines to utilize a broker or brokers other than the Selling
Agent, it will consult with the Advisor prior to directing it to utilize such
broker(s), and will not retain the services of such broker(s) over the
reasonable objection of the Advisor.

     7.   Fees.
          ----

          In consideration of and in compensation for the performance of the
Advisor's services under this Agreement, the Advisor shall receive from Series
I a weekly management fee (the "Management Fee") and a quarterly incentive fee
(the "Incentive Fee") based on Series I's Allocated Assets, as follows:

          (a)  Management Fee [RESERVED]

          (b)  Incentive Fee [RESERVED]

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          (c) Timing of Parent. Management Fees and Incentive Fees shall be
paid within fifteen (15) business days following the end of the period for
which they are payable. The first incentive fee which may be due and owing to
the Advisor in respect of any New Trading Profits will be due and owing as of
the last Friday of the first calendar quarter during which the Trading Advisor
managed the Allocated Assets for at least forty five (45) days. If an
Incentive Fee shall have been paid by the Trust to the Advisor in respect of
any calendar quarter and the Advisor shall incur subsequent losses on the
Series I Allocated Assets the Advisor shall nevertheless be entitled to retain
amounts previously paid to it in respect of New High Net Trading Profits.

          (d) Fee Data. The Advisor will be provided by the Managing Owner
with the data used by the Managing Owner to compute the foregoing fees within
ten (10) business days of the end of the relevant period.

          (e) Third Party Payments. Neither the Advisor, nor any of its
officers, directors, employees or stockholders, shall receive any commissions,
compensation, remuneration or payments whatsoever from any broker with which
the Trust carries an account for transactions executed in the Trust's account.
The parties acknowledge that a spouse of any of the foregoing persons may
receive floor brokerage commissions in respect of trades effected pursuant to
the Advisor's Trading Approach on behalf of the Trust, which payment shall not
violate the preceding sentence.

     8.   Term and Termination.
          --------------------

          (a) Term. This Agreement shall commence on the date hereof and,
unless sooner terminated, shall continue in effect until the close of business
on December 31, 2000.



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Thereafter, unless this Agreement is terminated pursuant to paragraphs (b),
(c) or (d) of this Section 8, this Agreement shall be renewed automatically on
the same terms and conditions set forth herein for successive additional
one-year terms, each of which shall commence on the first day of the month
subsequent to the conclusion of the preceding twelve (12) month term. Subject
to Section 8(d)(iv) hereof, the automatic renewal(s) set forth in the
preceding sentence hereof shall not be affected by (i) any reallocation of the
Series I Allocated Assets away from the Advisor pursuant to this Agreement, or
(ii) the retention of Other Advisors following a reallocation, or otherwise.

          (b) Automatic Termination. This Agreement shall terminate
automatically in the event that the Trust is terminated. In addition, this
Agreement shall terminate automatically in the event that the Series I
Allocated Assets declines as of the end of any business day by 33 1/3% from
the Series I Allocated Assets (i) as of the first day of this Agreement, or
(ii) as of the first day of any calendar year, as adjusted on an ongoing basis
by (A) any decline(s) in the Series I Allocated Assets caused by distributions,
redemptions, permitted reallocations, and withdrawals, and (B) additions to
the Series I Allocated Assets caused by additional allocations to the
Advisor's management.

          (c) Optional Termination Right of Trust. This Agreement may be
terminated at any time at the election of the Managing Owner in its sole
discretion upon at least thirty (30) days' prior written notice to the
Advisor. The Managing Owner will use its best efforts to cause any termination
to occur as of a month-end. This Agreement also may be terminated upon prior
written notice, appropriate under the circumstances, to the Advisor in the
event that: (A) the Managing Owner determines in good faith following
consultation appropriate under the circumstances with the Advisor that the
Advisor is unable to use its agreed upon Trading


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Approach to any material extent, as such Trading Approach may be refined or
modified in the future in accordance with the terms of this Agreement for the
benefit of the Trust; (B) the Advisor's registration as a commodity trading
advisor under the CE Act, or membership as a commodity trading advisor with
the NFA is revoked, suspended, terminated or not renewed; (C) the Managing
Owner determines in good faith following consultation appropriate under the
circumstances with the Advisor that the Advisor has failed to conform, and
after receipt of written notice, continues to fail to conform in any material
respect, to (i) any of the Trust's Trading Policies and Limitations, or (ii)
the Advisor's Trading Approach; (D) there is an unauthorized assignment of
this Agreement by the Advisor; (E) the Advisor dissolves, merges or
consolidates with another entity or sells a substantial portion of its assets,
any portion of its Trading Approach utilized by the Trust or its business
goodwill, in each instance without the consent of the Managing Owner; (F)
either Menachem Sternberg or Liora Sternberg is not in control of the
Advisor's trading activities for the Trust; (G) the Advisor becomes bankrupt
(admitted or decreed) or insolvent, (H) for any other reason, the Managing
Owner determines in good faith that such termination is essential for the
protection of the Trust and the Series I Interests, including, without
limitation a good faith determination by the Managing Owner that the Advisor
has breached a material obligation to the Trust under this Agreement relating
to the trading of the Series I Allocated Assets.

          (d) Optional Termination Right of Advisor. The Advisor shall have
the right to terminate this Agreement at any time upon written notice to the
Trust, appropriate under the circumstances, in the event (i) of the receipt by
the Advisor of an opinion of independent counsel satisfactory to the Advisor
and the Trust that by reason of the Advisor's activities with respect to the
Trust, it is required to register as an investment adviser under the
Investment Advisers Act of


                                      19
<PAGE>

1940 and it is not so registered; (ii) that the registration of the Managing
Owner as a commodity pool operator under the CE Act, or its NFA membership as
a commodity pool operator is revoked, suspended, terminated or not renewed;
(iii) the Managing Owner (x) imposes additional trading limitation(s) pursuant
to Section 1 of this Agreement which the Advisor does not agree to follow in
its management of the Series I Allocated Assets, or (y) overrides trading
instructions of the Advisor or does not consent to a material change to the
Trading Approach requested by the Advisor; (iv) if the amount of the Series I
Allocated Assets decreases to less than $1 million as the result of
redemptions, but not trading losses, as of the close of business on any
Friday; (v) the Managing Owner elects (pursuant to Section 1 of this
Agreement) to have the Advisor use a different Trading Approach in the
Advisor's management of Trust assets from that which the Advisor is then using
to manage such assets and the Advisor objects to using such different Trading
Approach; (vi) there is an unauthorized assignment of this Agreement by the
Trust or the Managing Owner; (vii) there is a material breach of this Agreement
by the Trust and/or the Managing Owner after giving written notice to the
Managing Owner which identifies such breach and such material breach has not
been cured within 10 days following receipt of such notice by the Managing
Owner; (viii) an Other Advisor is allocated a portion of the Series I Assets;
or (ix) other good cause is shown and the written consent of the Managing Owner
is obtained (which shall not be withheld unreasonably).

          (e) Termination Fees. In the event that this Agreement is terminated
with respect to, or by, the Advisor pursuant to this Section 8 or the Managing
Owner allocates the Trust's assets to Other Advisors, the Advisor shall be
entitled to, and the Trust shall pay, the Management Fee and the Incentive
Fee, if any, which shall be computed (i) with respect to the Management Fee,
on a pro rata basis, based upon the portion of the month for which the Advisor

                                      20
<PAGE>


had the Series I Allocated Assets under management, and (ii) with respect to
the Incentive Fee, if any, as if the effective date of termination was the
last day of the then current calendar quarter. The rights of the Advisor to
fees earned through the earlier to occur of the date of expiration or
termination shall survive this Agreement until satisfied.

          (f) Termination and Open Positions. Once terminated, the Advisor
shall have no responsibility for existing positions, including delivery
issues, if any, which may result from such positions.

     9.   Liquidation of Positions.
          ------------------------

          The Advisor agrees to liquidate open positions in the amount that
the Managing Owner informs the Advisor, in writing via telecopy or other
equivalent means, that the Managing Owner considers necessary or advisable to
liquidate in order to (i) effect any termination or reallocation pursuant to
Sections 1 or 8, respectively, or (ii) fund its pro rata share of any
redemption, distribution or Trust expense. The Managing Owner shall not,
however, have authority to instruct the Advisor as to which specific open
positions to liquidate, except as provided in Section 1 hereof. The Managing
Owner shall provide the Advisor with such reasonable prior notice of such
liquidation as is practicable under the circumstances and will endeavor to
provide at least three (3) days' prior notice. In the event that losses
incurred by the Advisor exceed the amount of the Series I Allocated Assets,
the Managing Owner agrees to cover such excess losses from its assets, but in
no event from the assets of the other Series issued by the Trust.


                                      21
<PAGE>

     10.  Other Accounts off the Advisor.
          ------------------------------

          (a) Management of Other Accounts. Subject to paragraph (c) of this
Section 10, the Advisor shall be free to manage and trade accounts for other
investors (including other public and private commodity pools) during the term
of this Agreement and to use the same or other information and Trading
Approach utilized in the performance of services for the Trust for such other
accounts so long as the Advisor's ability to carry out its obligations and
duties to the Trust pursuant to this Agreement is not materially impaired
thereby. In addition, the Advisor, and its shareholders, directors, officers
and employees, as applicable, also will be permitted to trade in Commodities
using the Trading Approach or otherwise for their own accounts, so long as the
Advisor's ability to carry out its obligations and duties to the Trust
pursuant to this Agreement is not materially impaired thereby.

          (b) Acceptance of Additional Capital. Furthermore, so long as the
Advisor is performing services for the Trust, it agrees that it will not
accept additional capital for management in the Commodities markets if doing
so would have a reasonable likelihood of resulting in the Advisor having to
modify materially its agreed upon Trading Approach being used for the Trust in
a manner which might reasonably be expected to have a material adverse effect
on the Trust. Without limiting the generality of the foregoing, it is
understood that this paragraph shall not prohibit the acceptance of additional
capital, which acceptance requires only routine adjustments to trading
patterns in order to comply with speculative position limits or daily trading
limits.

          (c) Equitable Treatment of Accounts. The Advisor agrees, in its
management of accounts other than the account of the Trust, that it will not
knowingly or deliberately favor


                                      22
<PAGE>

any other account managed or controlled by it or any of its principals or
affiliates (in whole or in part) over the Trust. The preceding sentence shall
not be interpreted to preclude (i) the Advisor from charging another client
fees which differ from the fees to be paid to it hereunder, or (ii) an
adjustment by the Advisor in the implementation of any agreed upon Trading
Approach in accordance with the procedures set forth in Section 1 hereof which
is undertaken by the Advisor in good faith in order to accommodate additional
accounts. The Advisor, upon reasonable request and receipt of adequate
assurances of confidentiality, shall provide the Managing Owner with an
explanation of the differences, if any, in performance between the Trust and
any other similar account pursuant to the same Trading Approach for which the
Advisor or any of its principals or affiliates acts as a commodity trading
advisor (in whole or in part), provided, however, that the Advisor may, in its
discretion, withhold from any such inspection the identity of the client for
whom any such account is maintained.

          (d) Inspection of Records. Upon the reasonable request of, and upon
reasonable notice from, the Managing Owner, the Advisor shall permit the
Managing Owner to review at the Advisor's offices during normal business hours
such trading records as it reasonably may request for the purpose of
confirming that the Trust has been treated equitably with respect to advice
rendered during the term of this Agreement by the Advisor for other accounts
managed by the Advisor, which the parties acknowledge to mean that the
Managing Owner may inspect, subject to such restrictions as the Advisor may
reasonably deem necessary or advisable so as to preserve the confidentiality
of proprietary information and the identity of its clients, all trading
records of the Advisor as it reasonably may request during normal business
hours. The Advisor may, in its discretion, withhold from any such report or
inspection the identity of the client for whom any such account is maintained
and in any event, the Trust and


                                      23
<PAGE>

the Managing Owner shall keep all such information obtained by them from
the Advisor confidential unless disclosure thereof is legally required or
has been made public.

     11.  Speculative Position Limits.
          ---------------------------

          If, at any time during the term of this Agreement, it appears to the
Advisor that it may be required to aggregate the Trust's Commodities positions
with the positions of any other accounts it owns or controls for purposes of
applying the speculative position limits of the Commodity Futures Trading
Commission ("CFTC"), any exchange, self-regulatory body, or governmental
authority, the Advisor promptly will notify the Managing Owner if the Trust's
positions under its management are included in an aggregate amount which
equals or exceeds the applicable speculative limit. The Advisor agrees that,
if its trading recommendations pursuant to its agreed upon Trading Approach
are altered because of the potential application of speculative position
limits, the Advisor will modify its trading instructions to the Trust and its
other accounts in a good faith effort to achieve an equitable treatment of all
accounts; to wit, the Advisor will liquidate Commodities positions and/or
limit the taking of new positions in all accounts it manages, including the
Trust, as nearly as possible in proportion to the assets available for trading
of the respective accounts (including "notional" equity) to the extent
necessary to comply with applicable speculative position limits. The Advisor
presently believes that its Trading Approach for the management of the Trust's
account can be implemented for the benefit of the Trust notwithstanding the
possibility that, from time to time, speculative position limits may become
applicable.


                                      24
<PAGE>

     12.  Redemptions, Distributions, Reallocations and Additional Allocations.
          --------------------------------------------------------------------

          (a) Notice. The Managing Owner agrees to give the Advisor at least
one (1) business day prior notice of any proposed redemptions, exchanges,
distributions, reallocations, additional allocations, or withdrawals.

          (b) Allocations. Redemptions, exchanges, withdrawals, and
distributions of Series I Interests shall be charged against Series I
Allocated Assets.

     13.  Brokerage Confirmations and Reports.
          -----------------------------------

          The Managing Owner will instruct the Trust's commodity broker or
brokers to furnish the Advisor with copies of all trade confirmations, daily
equity runs, and monthly trading statements relating to the Series I Allocated
Assets. The Advisor will maintain records and will monitor all open positions
relating thereto; provided, however, that the Advisor shall not be responsible
for any errors by the Trust's brokers. The Managing Owner also will furnish
the Advisor with a copy of the form of all reports, including but not limited
to, monthly, quarterly and annual reports, sent to the Limited Owners, and
copies of all reports filed with the SEC, the CFTC and the NFA. The Advisor
shall, at the Managing Owner's request, make a good faith effort to provide
the Managing Owner with copies of all trade confirmations, daily equity runs,
monthly trading reports or other reports sent to the Advisor by the Trust's
commodity broker regarding the Trust, and in the Advisor's possession or
control, as the Managing Owner deems appropriate, if the Managing Owner cannot
obtain such copies on its own behalf. Upon request, the Managing Owner will
provide the Advisor with accurate information with respect to the Series I
Allocated Assets.


                                      25
<PAGE>

     14.  The Advisor's Representations and Warranties.
          --------------------------------------------

          The Advisor represents and warrants that:

          (a) it has full capacity and authority to enter into this Agreement,
and to provide the services required of it hereunder;

          (b) it will not by entering into this Agreement and by acting as a
commodity trading advisor to the Trust, (i) be required to take any action
contrary to its incorporating or other formation documents or any applicable
statute, law or regulation of any jurisdiction or (ii) breach or cause to be
breached any undertaking, agreement, contract, statute, rule or regulation to
which it is a party or by which it is bound which, in the case of (i) or (ii),
would materially limit or materially adversely affect its ability to perform
its duties under this Agreement;

          (c) it is duly registered as a commodity trading advisor under the
CE Act and is a member of the NFA as a commodity trading advisor and it will
maintain and renew such registration and membership during the term of this
Agreement;

          (d) a copy of its most recent Commodity Trading Advisor Disclosure
Document as required by Part 4 of the CFTC's regulations has been provided to
the Managing Owner on behalf of the Trust in the form of Exhibit D hereto (and
the Managing Owner acknowledges receipt of such Disclosure Document on behalf
of the Trust) and, except as disclosed in such Disclosure Document, all
information in such Disclosure Document (including, but not limited to,
background, performance, trading methods and trading systems) is true,



                                      26
<PAGE>

complete and accurate in all material respects and is in conformity in all
material respects with the provisions of the CE Act, as amended, including the
rules and regulations thereunder;

          (e) the Series I Allocated Assets should not, in the reasonable
judgment of the Advisor, result in the Advisor being required to alter its
Trading Approach to a degree which would be expected to have a material
adverse effect on the Trust; and

          (f) neither the Advisor, nor its stockholders, directors, officers,
employees, agents, principals, affiliates, nor any of its or their respective
successors or assigns: (i) shall knowingly use or distribute for any purpose
whatsoever any list containing the names and/or residence addresses of, and/or
other information about, the Limited Owners of the Trust; nor (ii) shall
solicit any person it or they know is a Limited Owner of the Trust for the
purpose of soliciting commodity business from such Limited Owner, unless such
Limited Owner shall have first contacted the Advisor or is already a client of
the Advisor or a prospective client with which the Advisor has commenced
discussions or is introduced or referred to the Advisor by an unaffiliated
agent other than in violation of clause (i).

          The within representations and warranties shall be continuing during
the term of this Agreement, and, if at any time, any event has occurred which
would make or tend to make any of the foregoing not true in any material
respect with respect to the Advisor, the Advisor promptly will notify the
Trust in writing thereof.



                                      27
<PAGE>

     15.  The Managing Owner's Representations and Warranties.
          ---------------------------------------------------

          The Managing Owner represents and warrants on behalf of the Trust
and itself that:

          (a) each has the full capacity and authority to enter into this
Agreement and to perform its obligations hereunder;

          (b) it will not, by acting as managing owner to the Trust or by
entering into this Agreement, and the Trust will not (i) be required to take
any action contrary to its incorporating or other formation documents or any
applicable statute, law or regulation of any jurisdiction, or (ii) breach or
cause to be breached (A) any undertaking, agreement, contract, statute, rule
or regulation to which it or the Trust is a party or by which it or the Trust
is bound, or (B) any order of any court or governmental or regulatory agency
having jurisdiction over it or the Trust, which in the case of (i) or (ii)
would materially limit or materially adversely affect the performance of its
or the Trust's duties under this Agreement;

          (c) it is registered as a commodity pool operator under the CE Act
and is a commodity pool operator member of the NFA, and it will maintain and
renew such registration and membership during the term of this Agreement;

          (d) this Agreement has been duly and validly authorized, executed
and delivered, and is a valid and binding agreement, enforceable against each
of them, in accordance with its terms; and

          (e) on the date hereof, it is, and during the term of this
Agreement, it will be (i) in the case of the Trust, a duly formed and validly
existing Delaware statutory trust, and (ii) in


                                      28
<PAGE>

the case of the Managing Owner, a duly formed and validly existing
corporation, in each case, in good standing under the laws of the State of
Delaware and the State of Connecticut, respectively, and in good standing and
qualified to do business in each jurisdiction in which the nature and conduct
of its business requires such qualification and where the failure to be so
qualified would materially adversely affect its ability to perform its
obligations under this Agreement.

          The within representations and warranties shall be continuing during
the term of this Agreement, and, if at any time, any event has occurred which
would make or tend to make any of the foregoing not true in any material
respect, the Managing Owner promptly will notify the Advisor in writing.

     16.  Assignment.
          ----------

          This Agreement may not be assigned by any of the parties hereto
without the express prior written consent of the other parties hereto, except
that the Advisor need not obtain the consent of any Other Advisor.

     17.  Successors.
          ----------

          This Agreement shall be binding upon and inure to the benefit of the
parties hereto and the successors and permitted assignees of each of them, and
no other person (except as otherwise provided herein) shall have any right or
obligation under this Agreement. The terms "successors" and "assignees" shall
not include any purchasers, as such, of Interests.


                                      29


<PAGE>


     18.  Amendment or Modification or Waiver.
          -----------------------------------

          This Agreement may not be amended or modified, nor may any of its
provisions be waived, except upon the prior written consent of the parties
hereto, except that an amendment to, a modification of, or a waiver of any
provision of the Agreement as to the Advisor need not be consented to by any
Other Advisor.

     19.  Notices.
          -------

          Except as otherwise provided herein, all notices required to be
delivered under this Agreement shall be effective only if in writing and shall
be deemed given by the party required to provide notice when received by the
party to whom notice is required to be given and shall be delivered personally
or by registered mail, postage prepaid, return receipt requested, or by
telecopy, as follows (or to such other address as the party entitled to notice
shall hereafter designate by written notice to the other parties):

     If to the Managing Owner or the Trust:

     Preferred Investment Solutions Corp.
     Two American Lane
     Greenwich, Connecticut 06830
     Attention:
     Facsimile:  (203) ___-____

     and in either case with a copy to:

     Sidley Austin Brown & Wood LLP
     787 Seventh Avenue
     New York, New York  10019
     Attention:  Michael J. Schmidtberger, Esq.
     Facsimile:  (212) 839-5599


                                      30


<PAGE>


     If to the Advisor:

     Eagle Trading Systems Inc.
     47 Hulfish Street, Suite 410
     Princeton, New Jersey  08542
     Attention:  Menachem Sternberg
     Facsimile:  (609) 688-2099


     20.  Governing Law.
          -------------

          Each party agrees that this Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard
to conflict of laws principles.

     21.  Survival.
          --------

          The provisions of this Agreement shall survive the termination of
this Agreement with respect to any matter arising while this Agreement was in
effect.

     22.  Disclosure Document Modifications.
          ---------------------------------

          The Advisor shall promptly furnish the Managing Owner with a copy of
all modifications to its Disclosure Document when available for distribution.
Upon receipt of any modified Disclosure Document by the Managing Owner, the
Managing Owner will provide the Advisor with an acknowledgement of receipt
thereof.

     23.  Promotional Literature.
          ----------------------

          Each party agrees that prior to using any promotional literature in
which reference to the other parties hereto is made, it shall furnish in
advance a copy of such information to the other parties and will not make use
of any promotional literature containing references to such


                                      31


<PAGE>


other parties to which such other parties object, except as otherwise required
by law or regulation.

     24.  No Waiver.
          ---------

          No failure or delay on the part of any party hereto in exercising
any right, power or remedy hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. Any waiver granted hereunder must be in writing and
shall be valid only in the specific instance in which given.

     25.  No Liability of Limited Owners.
          ------------------------------

          This Agreement has been made and executed by and on behalf of the
Trust, and the obligations of the Trust and/or the Managing Owner set forth
herein are not binding upon any of the Limited Owners individually, but
rather, are binding only upon the assets and property of the Trust, and, to
the extent provided herein, upon the assets and property of the Managing
Owner.

     26.  Headings.
          --------

          Headings to Sections herein are for the convenience of the parties
only, and are not intended to be or to affect the meaning or interpretation of
this Agreement.

     27.  Complete Agreement.
          ------------------

          Except as otherwise provided herein, this Agreement and the
Representation Agreement constitute the entire agreement between the parties
with respect to the matters


                                      32


<PAGE>


referred to herein, and no other agreement, verbal or otherwise, shall be
binding upon the parties hereto.

     28.  Counterparts.
          ------------

          This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original and all of which, when taken together, shall
constitute one original instrument.

     29.  Arbitration, Remedies.
          ---------------------

          Each party hereto agrees that any dispute relating to the subject
matter of this Agreement shall be settled and determined by arbitration in the
City of New York pursuant to the rules of NFA or, if NFA should refuse to
accept the matter, the American Arbitration Association.

     30.  Series Disclaimer.
          -----------------

          The parties hereto acknowledge and agree that the Trust is organized
in series pursuant to Sections 3804(a) and 3806(b)(2) of the Delaware
Statutory Trust Act. As such, the debt, liabilities, obligations and expenses
incurred, contracted for or otherwise existing with respect to each series of
the Trust shall be enforceable against the assets of such series of the Trust
only, and not against the assets of the Trust generally or the assets of any
other series of the Trust or against the trustee of the Trust. There may be
several series of the Trust created pursuant to the Declaration of Trust and
Trust Agreement of the Trust.


                                      33


<PAGE>


          IN WITNESS WHEREOF, this Agreement has been executed for and on
behalf of the undersigned as of the day and year first above written.


WORLD MONITOR TRUST III - SERIES I            PREFERRED INVESTMENT
                                              SOLUTIONS CORP.
By: Preferred Investment Solutions Corp.,
its sole Managing Owner


                                               By:
                                                  ----------------------------
                                               Esther E. Goodman
                                               Chief Operating Officer and
                                               Senior Executive Vice President

By:
    ----------------------------------
    Esther E. Goodman
    Chief Operating Officer and
    Senior Executive Vice-President


EAGLE TRADING SYSTEMS INC.


By:
    ----------------------------------
    Menachem Sternberg
    Chairman


                                      34


<PAGE>


                                                                  EXHIBIT 10.4

                                   EXHIBIT A

                            EAGLE MOMENTUM PROGRAM
                            ----------------------



          The Advisor's will make its trading decisions for Series I according
to its Eagle-Momentum Program as described in Exhibit D as amended from time
to time.


<PAGE>


                                                                  EXHIBIT 10.4


                                   EXHIBIT B

                       TRADING LIMITATIONS AND POLICIES
                       --------------------------------


          The following limitations and policies are applicable to assets
representing the Series I Allocated Assets of the Trust as a whole and at the
outset to the Advisor individually; since the Advisor initially will manage
100% of the Trust's Series I Allocated Assets, such application of the
limitations and policies is identical initially for the Series I Allocated
Assets of the Trust and the Advisor. The Advisor sometimes may be prohibited
from taking positions for the Series I Allocated Assets which it would
otherwise acquire due to the need to comply with these limitations and
policies. The Managing Owner will monitor compliance with the trading
limitations and policies set forth below, and it may impose additional
restrictions (through modification of such limitations and policies) upon the
trading activities of the Advisor, as it, in good faith, deems appropriate in
the best interests of the Series I Interests of the Trust, subject to the
terms of the Advisory Agreement.

          The Managing Owner will not approve a material change in the
following trading limitations and policies without obtaining the prior written
approval of Limited Owners owning more than 50% of the Series I Interests. The
Managing Owner may, however, impose additional trading limitations on the
trading activities of the Series I Interests of the Trust without obtaining
such approval if the Managing Owner determines such additional limitations to
be necessary in the best interests of the Series I Interests of the Trust.

Trading Limitations

          The Series I Interests of the Trust will not: (i) engage in
pyramiding its commodities positions (i.e., the use of unrealized profits on
existing positions to provide margin for the acquisition of additional
positions in the same or a related commodity), but may take into account open
trading equity on existing positions in determining generally whether to
acquire additional commodities positions; (ii) borrow or loan money (except
with respect to the initiation or maintenance of commodities positions or
obtaining lines of credit for the trading of forward currency contracts;
provided, however, that the Series I Interests of the Trust is prohibited from
incurring any indebtedness on a non-recourse basis); (iii) permit rebates to
be received by the Managing Owner or its affiliates, or permit the Managing
Owner or any affiliate to engage in any reciprocal business arrangements which
would circumvent the foregoing prohibition; (iv) permit the Advisor to share
in any portion of the commodity brokerage fees paid by the Series I Interests
of the Trust; (v) commingle its assets, except as permitted by law; or (vi)
permit the churning of its commodity accounts.

          The Series I Interests of the Trust will conform in all respects to
the rules, regulations and guidelines of the markets on which its trades are
executed.


<PAGE>


Trading Policies

          Subject to the foregoing limitations, the Advisor has agreed to
abide by the trading policies of the Series I Interests of the Trust, which
currently are as follows:

          (1) Series I Allocated Assets will generally be invested in
contracts which are traded in sufficient volume which, at the time such trades
are initiated, are reasonably expected to permit entering and liquidating
positions.

          (2) Stop or limit orders may, in the Advisor's discretion, be given
with respect to initiating or liquidating positions in order to attempt to
limit losses or secure profits. If stop or limit orders are used, no assurance
can be given, however, that the clearing broker will be able to liquidate a
position at a specified stop or limit order price, due to either the
volatility of the market or the inability to trade because of market
limitations.

          (3) The Series I Interests of the Trust generally will not initiate
an open position in a futures contract (other than a cash settlement contract)
during any delivery month in that contract, except when required by exchange
rules, law or exigent market circumstances. This policy does not apply to
forward and cash market transactions.

          (4) The Series I Interests of the Trust may occasionally make or
accept delivery of a commodity including, without limitation, currencies. The
Series I Interests of the Trust also may engage in EFP transactions involving
currencies and metals and other commodities.

          (5) The Series I Interests of the Trust may, from time to time,
employ trading techniques such as spreads, straddles and conversions.

          (6) The Series I Interests of the Trust will not initiate open
futures or option positions which would result in net long or short positions
requiring as margin or premium for outstanding positions in excess of 15% of
the Trust's Series I Allocated Assets for any one commodity, or in excess of
66 2/3% of the Trust's Series I Allocated Assets for all commodities combined.
Under certain market conditions, such as an inability to liquidate open
commodities positions because of daily price fluctuations, the Managing Owner
may be required to commit Allocated Assets as margin in excess of the
foregoing limits and in such case the Managing Owner will cause the Advisor to
reduce its open futures and option positions to comply to these limits before
initiating new commodities positions.

          (7) To the extent the Series I Interests of the Trust engages in
transactions in forward currency contracts other than with or through UBS
Securities LLC, the Series I Interests of the Trust will only engage in such
transactions with or through a bank which as of the end of its last fiscal
year had an aggregate balance in its capital, surplus and related accounts of
at least $100,000,000, as shown by its published financial statements for such
year, and through other broker-dealer firms with an aggregate balance in its
capital, surplus and related accounts of at least $50,000,000.


                                      2


<PAGE>


                                                                  EXHIBIT 10.4


                                   EXHIBIT C

                      REPRESENTATION AGREEMENT CONCERNING
                 THE REGISTRATION STATEMENT AND THE PROSPECTUS
                 ---------------------------------------------


          REPRESENTATION AGREEMENT (this "Agreement") dated as of the ____ day
of _______, 2004, by and among World Monitor Trust III - Series I (the
"Trust"), a separate series of a statutory trust organized under Chapter 38 of
Title 12 of the Delaware Code (the "Delaware Act"), [Name of Selling Agent], a
________ corporation (the "Selling Agent"), Preferred Investment Solutions
Corp., a Connecticut corporation (the "Managing Owner"), and Eagle Trading
Systems Inc., a Delaware corporation (the "Advisor").

                             W I T N E S S E T H:

          WHEREAS, the Trust proposes to make an initial public offering (the
"Offering") of units of beneficial interest in the Trust (the "Interests")
issuable in multiple series of Interests (the "Series"), each separately
managed by a different professional commodity trading advisor through the
Selling Agent, an affiliate of the Managing Owner and in connection therewith,
the Trust intends to file with the United States Securities and Exchange
Commission (the "SEC"), pursuant to the United States Securities Act of 1933,
as amended (the "1933 Act"), a registration statement on Form S-1 to register
the Interests, including the Series I Interests, and as a part thereof a
prospectus (which registration statement, together with all amendments
thereto, shall be referred to herein as the "Registration Statement" and which
Prospectus in final form, together with all amendments and supplements
thereto, shall be referred to as the "Prospectus"); and

          WHEREAS, the Trust and the Managing Owner entered into an agreement
with the Advisor, dated as of ________, 2004 (the "Advisory Agreement"),
pursuant to which the


<PAGE>


Advisor has agreed to act as a commodity trading advisor to the Trust with
respect to the trust estate represented by Series I Interests; and

     WHEREAS, the parties hereto wish to set forth their duties and
obligations to each other with respect to the Registration Statement as of its
effective date and the Prospectus as of the date(s) on which subscribers'
funds are transferred to the trust estate represented by Series I Interests
("Closing date(s)").

     NOW, THEREFORE, the parties agree as follows:

     1. Representations and Warranties of the Advisor. The Advisor hereby
represents and warrants to the Selling Agent, the Trust and the Managing Owner
that:

          a. All references in the Registration Statement as of its effective
     date and the Prospectus as of the Closing Date to (i) the Advisor and its
     affiliates and the controlling persons, shareholders, directors, officers
     and employees of any of the foregoing, (ii) the Advisor's Trading
     Approach (as defined in the Advisory Agreement) and (iii) the actual past
     performance of discretionary accounts directed by the Advisor or any
     principal thereof, including the notes to the tables reflecting such
     actual past performance (hereinafter referred to as the Advisor's "Past
     Performance History") are complete and accurate in all material respects,
     and as to such persons, the Advisor's Trading Approach and the Advisor's
     Past Performance History, the Registration Statement as of its effective
     date and Prospectus as of each Closing Date contain all information
     required to be included therein by the Commodity Exchange Act, as amended
     (the "CE Act"), and the regulations (including interpretations thereof)
     thereunder, and do not contain an untrue statement of a material fact or
     omit to state a material fact required to be stated therein or


                                      2


<PAGE>


     necessary to make the statements therein (with respect to the Prospectus,
     in light of the circumstances in which they were made) not misleading.
     The Advisor also represents and warrants as to the accuracy and
     completeness in all material respects of the underlying data made
     available by the Advisor to the Trust and the Managing Owner for purposes
     of preparing the Pro Forma Performance tables, it being understood that
     no representation or warranty is being made with respect to the Pro Forma
     Performance tables or notes thereto. The term "principal" in this
     Agreement shall have the same meaning as that term in Commodity Futures
     Trading Commission (the "CFTC") Regulation ss. 4.10(e) under the CE Act.

          b. The Advisor will not distribute the Registration Statement, the
     Prospectus and/or the selling materials related thereto.

          c. This Agreement and the Advisory Agreement have been duly and
     validly authorized, executed and delivered on behalf of the Advisor and
     each is a valid and binding agreement enforceable in accordance with its
     terms. The performance of the Advisor's obligations under this Agreement
     and the consummation of the transactions set forth in this Agreement, in
     the Advisory Agreement and in the Registration Statement as of its
     effective date and Prospectus as of the Closing Date are not contrary to
     the provisions of the Advisor's formation documents, or to the best of
     its knowledge, any applicable statute, law or regulation of any
     jurisdiction, and will not result in any violation, breach or default
     under any term or provision of any undertaking, contract, agreement or
     order to which the Advisor is a party or by which the Advisor is bound.


                                      3


<PAGE>


          d. The Advisor has all governmental and regulatory licenses,
     registrations and approvals required by law as may be necessary to
     perform its obligations under the Advisory Agreement and this Agreement
     and to act as described in the Registration Statement as of its effective
     date and the Prospectus as of the Closing Date including, without
     limitation, registration as a commodity trading advisor under the CE Act
     and membership as a commodity trading advisor with the National Futures
     Association (the "NFA") and it will maintain and renew any required
     licenses, registrations, approvals or memberships during the term of the
     Advisory Agreement.

          e. On the date hereof the Advisor is, and at all times during the
     term of this Agreement will be, a corporation duly formed and validly
     existing and in good standing under the laws of its jurisdiction of
     incorporation and in good standing and qualified to do business in each
     jurisdiction in which the nature or conduct of its business requires such
     qualifications and the failure to be so qualified would materially
     adversely affect the Advisor's ability to perform its obligations
     hereunder or under the Advisory Agreement. The Advisor has full capacity
     and authority to conduct its business and to perform its obligations
     under this Agreement, and to act as described in the Registration
     Statement as of its effective date and the Prospectus as of the Closing
     Date.

          f. Subject to adequate assurances of confidentiality, the Advisor
     has supplied to or made available for review by the Managing Owner and
     the Selling Agent (and if requested by the Managing Owner and the Selling
     Agent to its designated auditor) all documents, statements, agreements
     and workpapers requested by them relating to all accounts covered by the
     Advisor's Past Performance History in the Registration Statement as of
     its effective date and the Prospectus as of the Closing Date which are in


                                      4


<PAGE>


     the Advisor's possession or to which it has access, provided, however,
     that the Advisor may, in its sole discretion, withhold from any such
     inspection the identity of the clients for whom any such accounts are
     maintained.

          g. Without limiting the generality of paragraph a. of this Section
     1. neither the Advisor nor any of its principals has managed, controlled
     or directed, on an overall discretionary basis, the trading for any
     commodity account which is required by CFTC regulations and the rules and
     regulations under the 1933 Act to be disclosed in the Registration
     Statement as of its effective date and the Prospectus as of the Closing
     Date which is not set forth in the Registration Statement as of its
     effective date and Prospectus as of the Closing Date as required.

          h. The Advisor does not provide any services to any persons or
     conduct any business involving advice with respect to investments other
     than Commodities (as defined in the Advisory Agreement), except as has
     been disclosed in writing to the Managing Owner. The Advisor is not
     required to be registered as an investment adviser under the United
     States Investment Advisers Act of 1940, as amended (the "Advisers Act"),
     but voluntarily may so register in the future.

          i. As of the date hereof, there has been no material adverse change
     in the Advisor's Past Performance History as set forth in the
     Registration Statement or in the Prospectus under the caption ["Series I
     - Eagle's Past Performance"] which has not been communicated in writing
     to and received by the Managing Owner and the Selling Agent or their
     counsel.


                                      5


<PAGE>


          j. Except for subsequent performance, as to which no representation
     is made, since the date of the Advisory Agreement, (i) there has not been
     any material adverse change in the condition, financial or otherwise, of
     the Advisor or in the earnings, affairs or business prospects of the
     Advisor, whether or not arising in the ordinary course of business, and
     (ii) there have not been any material transactions entered into by the
     Advisor other than those in the ordinary course of its business.

          k. Except as disclosed in the Registration Statement and in the
     Prospectus, there is no pending, or to the best of its knowledge,
     threatened or contemplated action, suit or proceeding before or by any
     court, governmental, administrative or self-regulatory body or
     arbitration panel to which the Advisor or its principals is a party, or
     to which any of the assets of the Advisor is subject which reasonably
     might be expected to result in any material adverse change in the
     condition (financial or otherwise), business or prospects of the Advisor
     or reasonably might be expected to materially adversely affect any of the
     material assets of the Advisor or which reasonably might be expected to
     (A) impair materially the Advisor's ability to discharge its obligations
     to the Trust, or (B) result in a matter which would require disclosure in
     the Registration Statement and/or Prospectus; and the Advisor has not
     received any notice of an investigation by (i) the NFA regarding
     non-compliance with its rules or the CE Act, (ii) the CFTC regarding
     non-compliance with the CE Act, or the rules and regulations thereunder,
     or (iii) any exchange regarding non-compliance with its rules of such
     exchange which investigation reasonably might be expected to materially
     impair its ability to discharge its obligations under this Agreement or
     the Advisory Agreement.


                                      6


<PAGE>


     2. Covenants of the Advisor. If, at any time during the term of the
Advisory Agreement, the Advisor discovers any fact or omission, or any event
or change of circumstances has occurred which would make the Advisor's
representations and warranties in Section 1 inaccurate or incomplete in any
material respect, or which might render the Registration Statement or
Prospectus, with respect to (i) the Advisor or its principals, (ii) the
Advisor's Trading Approach, or (iii) the Advisor's Past Performance History,
untrue or misleading in any material respect, the Advisor will provide prompt
written notification to the Trust, the Managing Owner and the Selling Agent of
any such fact, omission, event or change of circumstance, and the facts
related thereto, and it is agreed that the failure to provide such
notification or the failure to continue to be in compliance with the foregoing
representations and warranties during the term of the Advisory Agreement
within a reasonable time following such notification shall be cause for the
Trust and the Managing Owner to terminate the Advisory Agreement with the
Advisor on prior written notice to the Advisor. The Advisor also agrees that,
during the term of the Advisory Agreement, from and after the Effective Date
of the Registration Statement and for so long as Interests in the Trust are
being offered, whether during the Initial Offering Period or during any
Subsequent Offering Period (as those terms are defined in the Prospectus), it
will provide the Selling Agent, the Trust and the Managing Owner with updated
month-end information relating to the Advisor's Past Performance History, as
required to be disclosed in the performance tables relating to the performance
of the Advisor in the Prospectus under the caption ["Past Performance
Information - Series I"] beyond the periods disclosed therein. The Advisor
shall use its best efforts to provide such information within a reasonable
period of time after the end of the month to which such updated information
relates and the information is available to it.


                                      7


<PAGE>


     3. Modification of Registration Statement or Prospectus. If any event or
circumstance occurs as a result of which it becomes necessary, in the judgment
of the Managing Owner and the Selling Agent, to amend the Registration
Statement in order to make the Registration Statement not materially
misleading or to amend or to supplement the Prospectus in order to make the
Prospectus not materially misleading in light of the circumstances existing at
the time it is delivered to a subscriber, or if it is otherwise necessary in
order to permit the Trust to continue to offer its Interests subsequent to the
Initial Offering Period subject to the limitations set forth in the Advisory
Agreement, the Advisor will furnish such information with respect to itself
and its principals, as well as its Trading Approach and Past Performance
History as the Managing Owner or the Selling Agent may reasonably request, and
will cooperate to the extent reasonably necessary in the preparation of any
required amendments or supplements to the Registration Statement and/or the
Prospectus.

     4. Advisor's Closing Obligations. On or prior to the Closing Date with
respect to the initial offering of Series I Interests (the "Initial Closing
Date"), and thereafter, only if requested, on or prior to each closing date
during the continuous offering of Series I Interests (each a "Subsequent
Closing Date"), the Advisor shall deliver or cause to be delivered, at the
expense of the Advisor, to the Selling Agent, the Trust and the Managing
Owner, the reports, certificates, documents and opinions described below
addressed to them and, except as may be set forth below, dated the Initial
Closing Date or the Subsequent Closing Date, as appropriate (provided that the
Advisor shall not be obligated to provide either a certificate of good
standing or an opinion of its counsel more frequently than once per annum
absent good cause shown). Unless the context otherwise requires, the Initial
Closing Date and each Subsequent Closing Date shall each be referred to as a
"Closing Date",


                                      8


<PAGE>


          a. A report from the Advisor which shall present, for the period
     from the date after the last day covered by the Advisor's Past
     Performance History as set forth under ["Past Performance Information -
     Series I"] in the Prospectus to the latest practicable month-end before
     the Closing Date, figures which shall show the actual past performance of
     the Advisor (or, if such actual past performance information is
     unavailable, then the estimated past performance) for such period, and
     which shall certify that, to the best of its knowledge, such figures are
     complete and accurate in all material respects.

          b. A certificate of the Advisor in the form proposed prior to the
     Closing Date by counsel to the Selling Agent, the Trust and the Managing
     Owner, with such changes in such form as are proposed by the Advisor or
     its counsel and are acceptable to the Selling Agent, the Trust and the
     Managing Owner and their counsel so as to make such form mutually
     acceptable to the Selling Agent, the Trust, the Managing Owner, the
     Advisor, and their respective counsel, to the effect that:

               (i) The representations and warranties of the Advisor in
          Section 1 above are true and correct in all material respects on the
          date of the certificate as though made on such date.

               (ii) Nothing has come to the Advisor's attention which would
          cause the Advisor to believe that, at any time from the time the
          Registration Statement initially became effective to the Closing
          Date, the Registration Statement, as amended from time to time, or
          the Prospectus, as amended or supplemented from time to time, with
          respect to the Advisor, or the affiliates, controlling persons,
          shareholders, directors, officers or employees of any of the
          foregoing, or with


                                      9


<PAGE>


          respect to the Advisor's Trading Approach or Past Performance
          History, contained an untrue statement of a material fact or omitted
          to state a material fact required to be stated therein or necessary
          to make the statements therein (with respect to the Prospectus, in
          light of the circumstances in which they were made) not misleading.

                    (iii) The Advisor has performed all covenants and
               agreements herein contained to be performed on its part at or
               prior to the Closing Date.

          c. A certificate of the Advisor (together with such supporting
     documents as are set forth in the certificate), in the form proposed
     prior to the Closing Date by counsel to the Selling Agent, the Trust and
     the Managing Owner, with such changes in such form as are proposed by the
     Advisor or its counsel and are acceptable to the Selling Agent, the Trust
     and the Managing Owner and their counsel so as to make such form mutually
     acceptable to the Selling Agent, the Trust, the Managing Owner, the
     Advisor, and their respective counsel, with respect to, (i) the continued
     effectiveness of the organizational documents of the Advisor, (ii) the
     continued effectiveness of the Advisor's registration as a commodity
     trading advisor under the CE Act and membership as a commodity trading
     advisor with the NFA and (iii) the incumbency and genuine signature of
     the President and Secretary of the Advisor.

          d. A certificate from the state of formation of the Advisor, to be
     dated at, on or around the Closing Date, as to its formation and good
     standing.


                                      10


<PAGE>


          e. An opinion of counsel, in form and substance satisfactory to the
     Trust, the Managing Owner and the Selling Agent and their counsel, dated
     the Closing Date, to the following effect:

               (i) The Advisor is a duly formed and validly existing
          corporation in good standing under the laws of the state of its
          formation and, if different, the state where it conducts its primary
          business activity. The Advisor has full corporate power and
          authority under its Certificate of Incorporation to perform its
          obligations under the Advisory Agreement and this Agreement, and to
          act as described in the Registration Statement as of its effective
          date and the Prospectus as of the Closing Date.

               (ii) Each of the Advisory Agreement and this Agreement have
          been duly and validly authorized, executed and delivered on behalf
          of the Advisor, and assuming the due execution and delivery of each
          such Agreement by the Trust and the Managing Owner, each such
          agreement constitutes the legal, valid and binding obligations of
          the Advisor, enforceable in accordance with their respective terms,
          except as the same may be limited by bankruptcy, insolvency,
          reorganization, moratorium or similar laws at the time in effect
          affecting creditors rights generally, or by applicable principles of
          equity, whether in an action at law or in equity, and except that
          the enforceability of the indemnification provisions may be limited
          under applicable federal or state securities, commodities and other
          laws or by public policy; and the execution and delivery of such
          agreements and the incurrence of the obligations thereunder and the
          consummation of the transactions set forth in such agreements and in
          the Prospectus will not violate or


                                      11


<PAGE>


          result in a breach of the Advisor's formation documents, and, to the
          best of such counsel's knowledge, after due inquiry, will not result
          in any violation, breach or default under any term or provision of
          any undertaking, contract, agreement or order to which the Advisor
          is a party or by which the Advisor is bound.

               (iii) To the best of such counsel's knowledge, after due
          inquiry, the Advisor has obtained all required governmental and
          regulatory licenses, registrations and approvals required by law as
          may be necessary in order to perform its obligations under the
          Advisory Agreement and this Agreement and to act as described in the
          Registration Statement as of its effective date and the Prospectus
          as of the Closing Date (including, without limitation, registration
          as a commodity trading advisor under the CE Act and membership as a
          commodity trading advisor with the NFA) and such licenses,
          registrations and approvals have not, to the best of such counsel's
          knowledge, after due inquiry, been rescinded, revoked or otherwise
          removed.

               (iv) Assuming that the Trust is operated as described in the
          Prospectus, the Advisor is not required to be licensed or registered
          as an investment adviser under the Advisers Act (even if it
          voluntarily is so registered), and to such counsel's knowledge,
          without independent investigation, it is not required to be
          registered as an investment adviser or commodity trading advisor
          under the laws of the state of its principal place of business.

               (v) To such counsel's knowledge without independent
          investigation, except as described in the Prospectus, or in a
          schedule delivered by counsel to the


                                      12


<PAGE>


          Selling Agent and the Managing Owner prior to the date hereof, there
          is no pending, or threatened, suit or proceeding, known to such
          counsel, before or by any court, governmental or regulatory body or
          arbitration panel to which the Advisor or any of the assets of the
          Advisor or any of its principals is subject and which reasonably
          might be expected to result in any material adverse change in the
          condition (financial or otherwise), business or prospects of the
          Advisor or any of its principals or reasonably might be expected
          materially adversely to affect any of the assets of the Advisor or
          any of its principals or which reasonably might be expected to (A)
          impair materially the Advisor's ability to discharge its obligations
          to the Trust or (B) result in a matter which would require
          disclosure in the Registration Statement or Prospectus; and, to the
          best of such counsel's knowledge, neither the Advisor nor any of its
          principals has received any notice of an investigation by (i) the
          NFA regarding non-compliance with its rules or the CE Act, (ii) the
          CFTC regarding non-compliance with the CE Act or (iii) any exchange,
          regarding non-compliance with its rules, which investigation
          reasonably might be expected to (A) impair materially the Advisor's
          ability to discharge its obligations to the Trust or (B) result in a
          matter which would require disclosure in the Registration Statement
          or Prospectus.

               (vi) With respect to the Advisor and the affiliates,
          controlling persons, shareholders, directors, officers and employees
          of any of the foregoing, and with respect to the Advisor's Trading
          Approach, nothing has come to the attention of such counsel that
          leads such counsel to believe that the Registration Statement (at
          the time it initially became effective and at the time any
          post-effective amendment


                                      13


<PAGE>


          thereto became effective) or the Prospectus contains any untrue
          statement of a material fact or omits to state a material fact
          required to be stated therein or which is necessary to make the
          statements therein (with respect to the Prospectus, in light of the
          circumstances in which they are made) not misleading, except that
          such counsel is not required to express any opinion or belief as to
          the financial statements or other financial or statistical data,
          past performance tables and notes thereto or other past performance
          information contained in the Registration Statement or the
          Prospectus.

     In rendering the foregoing opinions, such counsel may rely (i) as to
matters of fact, on a certificate of an officer of the Advisor, unless such
counsel has actual knowledge otherwise, and (ii) as to matters of law of
states other than that in which they are licensed to practice law, upon the
opinions of other counsel, in each case satisfactory in form and substance to
counsel to the Managing Owner and the Selling Agent, and such counsel shall
state that they believe the Managing Owner and the Selling Agent may rely on
them.

     5. Advisor Acknowledgements. The Advisor acknowledges that: (i) it may be
a condition to each closing under the Selling Agreement that the Selling Agent
shall have received, at no cost to the Advisor, letter(s) from certified
public accountants or other reputable professionals selected by the Selling
Agent with respect to the Past Performance History of the Advisor as set forth
in the Selling Agreement, (ii) the Trust may at any time withdraw the
Registration Statement from the SEC or otherwise terminate the Registration
Statement or the offering of Interests, and upon any such withdrawal or
termination or if the "minimum" number of Interests, as described in the
Prospectus, is not sold, this Agreement shall terminate and none


                                      14


<PAGE>


of the parties hereto shall have any obligation to any other party pursuant to
this Agreement, except pursuant to Section 10 of this Agreement to the extent
that such section is applicable.

     6. Representations and Warranties of the Trust and the Managing Owner.
The Managing Owner hereby represents and warrants (on its own behalf and on
behalf of the Trust, as applicable) to the Advisor that:

          a. On the date hereof the Trust is, and at all times during the term
     of this Agreement and the Advisory Agreement will be, a duly formed and
     validly existing statutory trust in good standing under the laws of the
     State of Delaware, and at all times during the term of this Agreement and
     the Advisory Agreement will be in good standing and qualified to do
     business in each jurisdiction in which the nature or conduct of its
     business requires such qualifications and the failure to be so qualified
     materially adversely would affect its ability to perform its obligations
     under this Agreement and the Advisory Agreement and to operate as
     described in the Prospectus, and the Managing Owner is, and at all times
     during the term of this Agreement and the Advisory Agreement will be, a
     duly formed and validly existing corporation in good standing under the
     laws of the State of Connecticut, and is, and at all times during the
     term of this Agreement and the Advisory Agreement will be, in good
     standing and qualified to do business as a foreign corporation in each
     other jurisdiction in which the nature or conduct of its business
     requires such qualifications and the failure to be so qualified
     materially adversely would affect its ability to act as Managing Owner of
     the Trust and perform its obligations hereunder and under the Advisory
     Agreement, and each has full capacity and authority to conduct its
     business and to perform its obligations under this Agreement and


                                      15


<PAGE>


     the Advisory Agreement, and to act as described in the Registration
     Statement as of its effective date and the Prospectus as of the Closing
     Date.

          b. Each of this Agreement and the Advisory Agreement has been duly
     and validly authorized, executed and delivered on behalf of the Trust and
     the Managing Owner, is a valid and binding agreement of the Trust and the
     Managing Owner, and is enforceable in accordance with its terms. The
     performance of the Trust's and the Managing Owner's obligations under
     this Agreement and the Advisory Agreement and the consummation of the
     transactions set forth in this Agreement and the Advisory Agreement, and
     in the Registration Statement as of its effective date and Prospectus as
     of the Closing Date are not contrary to the provisions of the Trust's
     Declaration of Trust and Trust Agreement (the "Trust Agreement"),
     Certificate of Trust or the Managing Owner's [Articles] of Incorporation
     or By-Laws, respectively, any applicable statute, law or regulation of
     any jurisdiction and will not result in any violation, breach or default
     under any term or provision of any undertaking, contract, agreement or
     order, to which the Trust or the Managing Owner, is a party or by which
     the Trust or the Managing Owner is bound.

          c. Each of the Trust and the Managing Owner has obtained all
     required governmental and regulatory licenses, registrations and
     approvals required by law as may be necessary to perform their
     obligations under this Agreement and the Advisory Agreement and to act as
     described in the Registration Statement as of its effective date and the
     Prospectus as of the Closing Date (including, without limitation, the
     Managing Owner's registration as a commodity pool operator under the CE
     Act and membership as a commodity pool operator with the NFA) and will
     maintain and renew any required


                                      16


<PAGE>


     licenses, registrations, approvals and memberships required during the
     term of this Agreement and the Advisory Agreement.

          d. The Trust is not required to be registered as an investment
     company under the United States Investment Company Act of 1940, as
     amended (the "Investment Company Act").

          e. All authorizations, consents or orders of any court, or of any
     federal, state or other governmental or regulatory agency or body
     required for the valid authorization, issuance, offer and sale of the
     Interests have been obtained, and, no order preventing or suspending the
     use of the Prospectus with respect to the Interests has been issued by
     the SEC, the CFTC or the NFA. The Registration Statement as of its
     effective date and the Prospectus as of the Closing Date contain all
     statements which are required to be made therein, conform in all material
     respects with the requirements of the 1933 Act and the CE Act, and the
     rules and regulations of the SEC and the CFTC, respectively thereunder,
     and with the rules of the NFA, and do not contain an untrue statement of
     a material fact or omit to state a material fact required to be stated
     therein or necessary to make the statements therein (with respect to the
     Prospectus, in light of the circumstances in which they are made) not
     misleading; and at all times subsequent hereto up to and including the
     date of termination of the Initial Offering Period and any Subsequent
     Offering Period, the Registration Statement as of its effective date and
     the Prospectus as of the Closing Date will contain all statements
     required to be made therein and will conform in all material respects
     with the requirements of the 1933 Act and the CE Act, and the rules and
     regulations of the SEC and the CFTC, respectively thereunder, and with
     the rules of the NFA and will not contain any untrue statement of a
     material fact or omit to state a


                                      17


<PAGE>


     material fact required to be stated therein (with respect to the
     Prospectus, in light of the circumstances in which they are made) not
     misleading; provided, however, that this representation and warranty
     shall not apply to any statements or omissions made in reliance upon and
     in conformity with information furnished to the Managing Owner, the Trust
     or to the Selling Agent by or on behalf of the Advisor for the express
     purpose of inclusion in the Registration Statement or the Prospectus,
     including, without limitation, references to the Advisor and its
     affiliates, controlling persons, shareholders, directors, officers and
     employees, as well as to the Advisor's Trading Approach and Past
     Performance History.

          f. The Registration Statement as of its effective date and the
     Prospectus as of the Closing Date have been delivered to the Advisor.

          g. There is no pending, or to its knowledge, threatened or
     contemplated action, suit or proceeding before any court or arbitration
     panel, or before or by any governmental, administrative or
     self-regulatory body, to which the Trust, the Managing Owner, or the
     principals of either is a party, or to which any of the assets of any of
     the foregoing persons is subject, which might reasonably be expected to
     result in any material adverse change in their condition (financial or
     otherwise), business or prospects or reasonably might be expected to
     affect adversely in any material respect any of their assets or which
     reasonably might be expected to materially impair their ability to
     discharge their obligations under this Agreement or the Advisory
     Agreement; and neither the Trust nor the Managing Owner has received any
     notice of an investigation by (i) the NFA regarding non-compliance with
     NFA rules or the CE Act, (ii) the CFTC regarding non-compliance with the
     CE Act, or the rules and regulations thereunder, or (iii) any


                                      18


<PAGE>


     exchange regarding non-compliance with the rules of such exchange which
     investigation reasonably might be expected to materially impair the
     ability of each of the Trust and the Managing Owner to discharge its
     obligations under this Agreement or the Advisory Agreement.

     7. Covenants of the Managing Owner and the Trust. If, at any time during
the term of the Advisory Agreement, the Managing Owner or the Trust discovers
any fact or omission, or any event or change of circumstance has occurred
which would make the Managing Owner's or the Trust's representations and
warranties in Section 6 of this Agreement inaccurate or incomplete in any
material respect, the Trust or the Managing Owner, as appropriate, promptly
will provide written notification to the Advisor of such event or change of
circumstance and the facts related thereto. The Managing Owner and the Trust
shall provide the Advisor with a copy of each amendment to the Registration
Statement and amendment or supplement to the Prospectus, and no amendment to
the Registration Statement or amendment or supplement to the Prospectus which
contains any statement or information regarding the Advisor will be filed or
used unless the Advisor has received reasonable prior notice and a copy
thereof and has consented in writing to such statement or information being
filed and used.

     8. Trust's and Managing Owner's Closing Obligations. On or prior to the
initial Closing Date, and thereafter on or prior to each Subsequent Closing
Date, if the Trust and the Managing Owner have requested that the Advisor
provide certificates, documents and opinions pursuant to Section 4 hereof, the
Trust and the Managing Owner shall deliver or cause to be delivered to the
Advisor, the certificates, documents and opinions described below addressed to
the Advisor and, except as may be set forth below, dated each such Closing
Date:


                                      19


<PAGE>


          a. Certificates of the Trust and the Managing Owner, addressed to
     the Advisor, in the form proposed prior to the Closing Date by counsel to
     the Trust and the Managing Owner with such changes in such form as are
     proposed by the Advisor or its counsel and are acceptable to the Trust,
     the Managing Owner and their counsel so as to make such form mutually
     acceptable to the Trust, the Managing Owner, the Advisor, and their
     respective counsel, with respect to, as applicable, (i) the continued
     effectiveness of the Trust Agreement and the Certificate of Trust of the
     Trust and the [Articles] of Incorporation and By-Laws of the Managing
     Owner, (ii) the continued effectiveness of the registration of the
     Managing Owner as a commodity pool operator under the CE Act and
     membership as a commodity pool operator with the NFA and (iii) the
     incumbency and genuine signature of the President and Secretary of the
     Managing Owner.

          b. Certificates from the States of Delaware and Connecticut with
     respect to the Trust and the Managing Owner, respectively, to be dated
     at, on or around the Closing Date as to the formation and good standing
     of the Trust and the Managing Owner, respectively.

          c. Certificates of the Trust and the Managing Owner in the form
     proposed prior to the Closing Date by counsel to the Trust and the
     Managing Owner with such changes in such form as are proposed by the
     Advisor or its counsel and are acceptable to the Trust, the Managing
     Owner and their counsel so as to make such form mutually acceptable to
     the Trust, the Managing Owner, the Advisor, and their respective counsel,
     to the effect that:


                                      20


<PAGE>


               (i) The representations and warranties in Section 6 above are
          true and correct in all material respects on the date of the
          certificates as though made on such date, and

               (ii) The Trust and the Managing Owner have each performed all
          covenants and agreements herein contained to be performed on their
          part at or prior to the Closing Date.

          d. An opinion letter of counsel to the Trust and the Managing Owner,
     dated the Closing Date, as follows:

               (i) The Trust is a duly created and validly existing statutory
          trust in good standing under the Delaware Act, with requisite power
          and authority under the Delaware Act, its Trust Agreement and its
          Certificate of Trust to perform its obligations under this Agreement
          and the Advisory Agreement, and to act as described in the
          Registration Statement as of its effective date and the Prospectus
          as of the Closing Date.

               (ii) The Managing Owner is a duly formed and validly existing
          corporation in good standing under the laws of the State of
          Connecticut. The Managing Owner has full corporate power and
          authority under its [Articles] of Incorporation, By-Laws and the
          [General Corporation Law] of the State of Connecticut to perform its
          obligations under this Agreement and the Advisory Agreement, and to
          act as described in the Registration Statement as of its effective
          date and the Prospectus as of the Closing Date.


                                      21


<PAGE>


               (iii) Each of this Agreement and the Advisory Agreement has
          been duly and validly authorized or ratified, executed and delivered
          on behalf of each of the Trust and the Managing Owner, and, assuming
          due execution and delivery of each such Agreement by the Advisor,
          each agreement constitutes the legal, valid and binding obligations
          of the Trust and the Managing Owner, respectively, enforceable in
          accordance with their respective terms, except as the same may be
          limited by bankruptcy, insolvency, reorganization, moratorium or
          similar laws at the time in effect affecting creditors rights
          generally, or by applicable principles of equity, whether in an
          action at law or in equity, and except that the enforceability of
          the indemnification provisions may be limited under applicable
          federal or state securities, commodities and other laws or by public
          policy; and the execution and delivery of such agreements and
          incurrence of the obligations thereunder and the consummation of the
          transactions set forth in such agreements and in the Prospectus will
          not violate or result in a breach of their formation documents, and,
          to the best of such counsel's knowledge, after due inquiry, will not
          result in any violation, breach or default under any term or
          provision of any undertaking, contract, agreement or order to which
          they are parties or by which they are bound.

               (iv) The Trust is not required to be registered as an
          investment company under the Investment Company Act in order to act
          as described in the Registration Statement as of its effective date
          and the Prospectus as of the Closing Date or to perform its
          obligations under this Agreement or the Advisory Agreement.


                                      22


<PAGE>


               (v) To the best of such counsel's knowledge, after due inquiry,
          all authorizations, consents or orders of any court or of any
          federal, state or other governmental or regulatory agency or body
          required for the valid authorization, issuance, offer and sale of
          Interests have been obtained, including such as may be required
          under the 1933 Act, including the rules and regulations thereunder,
          the CE Act, including the rules and regulations thereunder, the
          rules and regulations of the NFA or the securities laws of any state
          or of any jurisdiction in which offers and sales were made, and, to
          the best of such counsel's knowledge, no order suspending the
          effectiveness of the Registration Statement or the use of the
          Prospectus has been issued by the SEC, the CFTC, the NFA or any
          state in which offers and sales of Interests were made nor has any
          proceeding for the issuance of such an order been instituted or
          threatened by the SEC, the CFTC, the NFA, or any such state. The
          foregoing may be qualified by the fact that such counsel is not
          admitted to practice law in all jurisdictions, and that in rendering
          its opinion such counsel shall rely solely upon an examination of
          the securities laws and related rules, regulations and
          administrative determinations, if any, promulgated thereunder, of
          the various jurisdictions as reported in customarily relied upon
          standard compilations, and upon such counsel's understanding of the
          various conclusions expressed, formally or informally, by
          administrative officials or other employees of the various
          regulatory or other governmental agencies or authorities concerned.

               (vi) To the best of such counsel's knowledge, after due
          inquiry, each of the Trust and the Managing Owner has obtained all
          required governmental and


                                      23


<PAGE>


          regulatory licenses, registrations and approvals required by law as
          may be necessary in order for each of the Trust and the Managing
          Owner to perform its obligations under this Agreement and under the
          Advisory Agreement and to act as described in the Registration
          Statement as of its effective date and the Prospectus as of the
          Closing Date (including, without limitation, the Managing Owner's
          registration as a commodity pool operator under the CE Act and
          membership as a commodity pool operator with the NFA) and such
          licenses, registrations and approvals have not, to the best of such
          counsel's knowledge, after due inquiry, been rescinded, revoked or
          otherwise removed.

               (vii) To such counsel's knowledge without independent
          investigation, except as described in the Prospectus, or in a
          schedule delivered by counsel to the Selling Agent, the Managing
          Owner and the Advisor prior to the date hereof, there is no pending,
          or threatened, suit or proceeding, known to such counsel, before or
          by any court, governmental or regulatory body or arbitration panel
          to which the Trust and the Managing Owner or any of the assets of
          the Trust or the Managing Owner or any of their principals is
          subject and which reasonably might be expected to result in any
          material adverse change in the condition (financial or otherwise),
          business or prospects of the Trust or Managing Owner or any of their
          principals or reasonably might be expected materially adversely to
          affect any of the assets of the Trust or Managing Owner or any of
          their principals or which reasonably might be expected to (A) impair
          materially the Trust's or Managing Owner's ability to discharge
          their obligations to the Advisor or (B) result in a matter which
          would require disclosure in the Registration Statement or Prospectus


                                      24


<PAGE>


          which is not so disclosed; and, to such counsel's knowledge, neither
          the Trust or Managing Owner, nor any of their principals has
          received any notice of an investigation by (i) the NFA regarding
          non-compliance with its rules or the CE Act, (ii) the CFTC regarding
          non-compliance with the CE Act or (iii) any exchange, regarding
          non-compliance with its rules, which investigation reasonably might
          be expected to (A) impair materially the Trust's or Managing Owner's
          ability to discharge its obligations to the Advisor or (B) result in
          a matter which would require disclosure in the Registration
          Statement or Prospectus which is not so disclosed.

               (viii) The Registration Statement as of its effective date and
          the Prospectus as of the Closing Date are responsive in all material
          respects to the requirements of the 1933 Act, including the rules
          and regulations thereunder, the CE Act, including the rules and
          regulations thereunder, and the rules and regulations of the NFA,
          and nothing has come to the attention of such counsel that leads it
          to believe that either the Registration Statement (at the time it
          initially became effective and at the time any post-effective
          amendment thereto became effective) or the Prospectus contains any
          untrue statement of a material fact or omits to state a material
          fact required to be stated therein or which is necessary to make the
          statements therein (with respect to the Prospectus, in light of the
          circumstances in which they were made) not misleading, except that
          such counsel is not required to express any opinion or belief (A) as
          to the financial statements or other financial or statistical data,
          past performance tables and notes thereto or other past performance
          information contained in the Registration Statement or the


                                      25


<PAGE>


          Prospectus, or (B) as to any statements or omissions made in
          reliance on and in conformity with information furnished by the
          Advisor for the express purpose of inclusion in the Registration
          Statement or the Prospectus, including, without limitation,
          references to the Advisor and its affiliates, controlling persons,
          shareholders, directors, officers and employees, as well as to the
          Advisor's Trading Approach and Past Performance History.

     In rendering such opinions, such counsel may rely, (i) as to matters of
fact, on a certificate of an officer of the Managing Owner, unless such
counsel has actual knowledge otherwise, and (ii) as to matters of law of
states other than that in which they are licensed to practice law, upon the
opinions of other counsel, in each case satisfactory in form and substance to
the Advisor and its counsel, and such counsel shall state that they believe
the Advisor may rely on them.

     9. Survival of Representations, Warranties and Covenants. All
representations, warranties and covenants in this Agreement, or contained in
certificates required to be delivered hereunder, shall survive the delivery of
any payment for the Interests under the Underwriting Agreement and the
termination of the Advisory Agreement and this Agreement, with respect to any
matter arising while the Advisory Agreement or this Agreement was in effect.
Furthermore, all representations, warranties and covenants hereunder shall
inure to the benefit of each of the parties to this Agreement and their
respective successors and permitted assigns.

     10.  Indemnification.
          ---------------

          a. In any action in which the Selling Agent, the Trust, Wilmington
     Trust Company, a Delaware corporation, in its capacity as trustee of the
     Trust (in such


                                      26


<PAGE>


     capacity, the "Trustee") or the Managing Owner, or their respective
     controlling persons, shareholders, partners, members, managers,
     directors, officers and/or employees of any of the foregoing are parties,
     the Advisor agrees (A) to indemnify and hold harmless the foregoing
     persons against any loss, claim, damage, charge, liability or expense
     (including, without limitation, reasonable attorneys' and accountants'
     fees) ("Losses") to which such persons may become subject, insofar as
     such Losses arise out of or are based exclusively upon (i) any
     misrepresentation or material breach of any warranty, covenant or
     agreement of the Advisor contained in this Agreement or (ii) any untrue
     statement of any material fact contained in the Registration Statement or
     the Prospectus or the omission to state in the Registration Statement or
     the Prospectus a material fact required to be stated therein or necessary
     to make the statements therein (with respect to the Prospectus, in light
     of the circumstances in which they are made), not misleading in each case
     under this subclause (ii) to the extent, but only to the extent, that
     such untrue statement or omission was made in reliance upon and in
     material conformity with information furnished by the Advisor to the
     Managing Owner for inclusion in the Registration Statement or Prospectus,
     including, without limitation, all information relating to the Advisor
     and its affiliates, controlling persons, shareholders, directors,
     officers and employees, as well as to the Advisor's Trading Approach and
     Past Performance History, and including, but not limited to, any
     notification by the Advisor to any such person and given under this
     Agreement, including liabilities under the 1933 Act, the Exchange Act and
     the CE Act, and (B) to reimburse each of the foregoing persons for any
     legal or other fees or expenses reasonably incurred in connection with
     investigating or defending any action or claim arising out of or based
     upon any of the foregoing.


                                      27


<PAGE>


          b. In any action in which the Advisor, or the controlling persons,
     shareholders, directors, officers and/or employees of any of the
     foregoing (the "Advisor Indemnified Parties") are parties, the Managing
     Owner agrees (A) to indemnify and hold harmless the foregoing persons
     against any Losses, insofar as such Losses arise out of or are based
     exclusively upon (i) any misrepresentation or material breach of any
     warranty, covenant or agreement of the Trust or the Managing Owner
     contained in this Agreement, (ii) any untrue statement of any material
     fact contained in the Registration Statement or the Prospectus or the
     omission to state in the Registration Statement or the Prospectus a
     material fact required to be stated therein or necessary to make the
     statements therein (with respect to the Prospectus, in light of the
     circumstances in which they are made), not misleading, (iii) any failure
     to comply with any legal requirements relating to the Offering of the
     Interests (including without limitation, any noncompliance with the
     requirements of the Exchange Act, and/or the 1933 Act, and/or the CE Act,
     including the rules and regulations thereunder, and or the rules and
     regulation of the NFA, in each case with respect to the Offering of
     Interests), or (iv) any claim relating to or involving the Advisor that
     is not substantiated, resolved or otherwise finally determined, in each
     case under subclauses (ii), (iii) or (iv) hereof, except to the extent
     that such untrue statement, omission or failure was made in reliance upon
     and in material conformity with information furnished by the Advisor to
     the Managing Owner for inclusion in the Registration Statement or the
     Prospectus including, without limitation, all information relating to the
     Advisor and its affiliates, controlling persons, shareholders, directors,
     officers and employees, as well as to the Advisor's Trading Approach and
     Past Performance History, and including but not limited to, any
     notification required and


                                      28


<PAGE>


     given under this Agreement, including liabilities under the 1933 Act, the
     Exchange Act and the CE Act, and (B) to reimburse each of the Advisor
     Indemnified Parties for any legal or other fees or expenses reasonably
     incurred in connection with investigating or defending any action or
     claim arising out of or based upon any of the foregoing. With respect to
     subclause (iv) above only, the Advisor and the Managing Owner agree to
     negotiate in good faith a reduction, if any, in the indemnification
     amount required to be paid pursuant to subclause (iv) above to the
     Advisor based upon the relative responsibility of the Advisor for
     circumstances giving rise to the Losses for which indemnification is
     sought (including, but not limited to, the parties' assessment of the
     merits of the claim), provided that in the event the Managing Owner and
     the Advisor fail to agree on the amount of any such reduction after good
     faith negotiations, they shall submit the matter to binding arbitration
     in accordance with Section 15 of this Agreement.

          c. None of the indemnifications contained in this Section 10 shall
     be applicable with respect to default judgments or confessions of
     judgment, or to settlements entered into by an indemnified party claiming
     indemnification without the prior written consent of the indemnifying
     party.

          d. Promptly after receipt by an indemnified party under this Section
     10 of notice of any claim or dispute or commencement of any action or
     litigation, such indemnified party will, if a claim in respect thereof is
     to be made against an indemnifying party under this Section 10, notify
     the indemnifying party of the commencement thereof, but the omission to
     notify the indemnifying party will not relieve it from any liability
     which it may have to any indemnified party otherwise than under this
     Section 10 except to the extent, if any, that such failure or delay
     prejudiced the indemnifying party in


                                      29
<PAGE>


     defending against the claim. In case any such claim, dispute, action or
     litigation is brought or asserted against any indemnified party, and it
     timely notifies the indemnifying party of the commencement thereof, the
     indemnifying party will be entitled to participate in the defense
     therein, and to the extent that it may wish, to assume such defense
     thereof, with counsel specifically approved in writing by such
     indemnified party, such approval not to be unreasonably withheld,
     following notice from the indemnifying party to such indemnified party of
     its election so to assume the defense thereof, in which event, the
     indemnifying party will not be liable to such indemnified party under
     this Section 10 for any legal or other expenses subsequently incurred by
     such indemnified party in connection with the defense thereof, but shall
     continue to be liable to the indemnified party in all other respects as
     heretofore set forth in this Section 10. Notwithstanding any other
     provisions of this Section 10, if, in any claim, dispute, action or
     litigation as to which indemnity is or may be available, any indemnified
     party reasonably determines that its interests are or may be, in whole or
     in part, adverse to the interests of the indemnifying party, the
     indemnified party may retain its own counsel in connection with such
     claim, dispute, action or litigation and shall continue to be indemnified
     by the indemnifying party for any legal or any other expenses reasonably
     incurred in connection with investigating or defending such claim,
     dispute, action or litigation.

          e. Expenses incurred by an indemnified party in defending a
     threatened or asserted claim or a threatened or pending action shall be
     paid by the indemnifying party in advance of final disposition or
     settlement of such matter, if and to the extent that the person on whose
     behalf such expenses are paid shall agree in writing to reimburse the


                                      30


<PAGE>


     indemnifying party in the event indemnification is not permitted under
     this Section 10 upon final disposition or settlement.

          f. The parties hereto acknowledge and agree on their own behalf that
     the indemnities provided in this Agreement shall be inapplicable in the
     event of any loss, claim, damage, charge or liability arising out of or
     based upon, but limited to the extent caused by, any misrepresentation or
     breach of any warranty, covenant or agreement of any indemnified party to
     any indemnifying party contained in this Agreement.

     11. Limits on Claims. The Advisor agrees that it will not take any of the
following actions against the Trust: (i) seek a decree or order by a court
having jurisdiction in the premises (A) for relief in respect of the Trust in
an involuntary case or proceeding under the Federal Bankruptcy Code or any
other federal or state bankruptcy, insolvency, reorganization, rehabilitation,
liquidation or similar law or (B) adjudging the Trust a bankrupt or insolvent,
or seeking reorganization, rehabilitation, liquidation, arrangement,
adjustment or composition of or in respect of the Trust under the Federal
Bankruptcy Code or any other applicable federal or state law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of the Trust or of any substantial part of any of its
properties, or ordering the winding up or liquidation of any of its affairs,
or (ii) seek a petition for relief, reorganization or to take advantage of any
law referred to in the preceding clause or (iii) file an involuntary petition
for bankruptcy (collectively "Bankruptcy or Insolvency Action"). In addition,
the Advisor agrees that for any obligations due and owing to it by the Trust,
the Advisor will look solely and exclusively to the assets of Series I or the
Managing Owner, if it has liability in its capacity as Managing Owner, to
satisfy its claims and will not seek to attach or otherwise assert a claim
against the assets of any other Series or the other assets of the Trust,
whether there is a


                                      31


<PAGE>


Bankruptcy or Insolvency Action taken. The parties agree that this provision
will survive the termination of this Agreement, whether terminated in a
Bankruptcy or Insolvency Action or otherwise.

     12. Subordination Agreement. Each of the Advisor, the Managing Owner and
the Trustee ("Potential Creditor(s)") agrees and consents (the "Consent") to
look solely to each Series for which brokerage and clearing services are being
performed ("Series I") and assets (the "Series I Assets") of Series I and to
the Managing Owner and its assets for payment. Series I Assets include only
those funds and other assets that are paid, held or distributed to the Trust
on account of and for the benefit of Series I, including, without limitation,
funds delivered to the Trust for the purchase of interests in Series I. In
furtherance of the Consent, the Potential Creditors agree that (i) any debts,
liabilities, obligations, indebtedness, expenses and claims of any nature and
of all kinds and descriptions (collectively, "Claims") incurred, contracted
for or otherwise existing arising from, related to or in connection with the
Trust and its assets and Series I and Series I Assets, shall be subject to the
following limitations:

          a. Subordination of certain claims and rights. (i) except as set
     forth below, the Claims, if any, of the Potential Creditors (the
     "Subordinated Claims") shall be expressly subordinate and junior in right
     of payment to any and all other Claims against the Trust and any Series
     thereof, and any of their respective assets, which may arise as a matter
     of law or pursuant to any contract; provided, however, that the Potential
     Creditors' Claims (if any) against Series I shall not be considered
     Subordinated Claims with respect to enforcement against and distribution
     and repayment from Series I, the Series I Assets and the Managing Owner
     and its assets; and provided further that the Potential Creditors' valid
     Claims, if any, against Series I shall be pari passu and equal in right
     of repayment


                                      32


<PAGE>


     and distribution with all other valid Claims against Series I and (ii)
     the Potential Creditors, individually or collectively, will not take,
     demand or receive from any Series or the Trust or any of their respective
     assets (other than Series I, the Series I Assets and the Managing Owner
     and its assets) any payment for the Subordinated Claims;

          b. the Claims of each of the Potential Creditors with respect to
     Series I shall only be asserted and enforceable against Series I, Series
     I Assets and the Managing Owner and its assets; and such Claims shall not
     be asserted or enforceable for any reason whatsoever against any other
     Series, the Trust generally or any of their respective assets;

          c. if the Claims of a Potential Creditor against Series I or the
     Trust are secured in whole or in part, each of the Potential Creditors
     hereby waives (under section 1111(b) of the Bankruptcy Code (11 U.S.C.
     ss. 1111(b)) any right to have any deficiency Claims (which deficiency
     Claims may arise in the event such security is inadequate to satisfy such
     Claims) treated as unsecured Claims against the Trust or any Series
     (other than Series I), as the case may be;

          d. in furtherance of the foregoing, if and to the extent that the
     Potential Creditors receive monies in connection with the Subordinated
     Claims from a Series or the Trust (or their respective assets), other
     than Series I, Series I Assets and the Managing Owner and its assets, the
     Potential Creditors shall be deemed to hold such monies in trust and
     shall promptly remit such monies to the Series or the Trust that paid
     such amounts for distribution by the Series or the Trust in accordance
     with the terms hereof; and


                                      33


<PAGE>


          e. the foregoing Consent shall apply at all times notwithstanding
     that the Claims are satisfied, and notwithstanding that the agreements in
     respect of such Claims are terminated, rescinded or canceled.

     13. Notices. Any notices under this Agreement required to be given shall
be effective only if given or confirmed in writing, shall be deemed given by
the party providing notice when received by the party to whom notice is being
given, and shall be sent certified mail, postage prepaid, or hand delivered,
to the following address, or to such other address as a party may specify by
written notice to each of the other parties hereto:

If to the Selling Agent:

     [Name of the Selling Agent]
     Two American Lane
     Greenwich, Connecticut 06830
     Attention: ________________

If to the Managing Owner or the Trust:

     Preferred Investment Solutions Corp.
     Two American Lane
     Greenwich, Connecticut 06830
     Attention: General Counsel
     Facsimile: (203) ___-____

in either case with a copy to:

     Michael J. Schmidtberger, Esq.
     Sidley Austin Brown & Wood LLP
     787 Seventh Avenue
     New York, New York 10019
     Facsimile: (212) 839-5599

If to the Advisor:

     Eagle Trading Systems Inc.
     701 Mount Lucas Road
     Princeton, New Jersey 08542
     Attention: Liora Sternberg


                                      34


<PAGE>


     Facsimile: (609) 497-5813

     Baer Marks & Upham
     805 Third Avenue
     New York, New York 10022
     Attention: Stephen F. Selig, Esq.
     Facsimile: (212) 702-1443

     14. Governing Law. This Agreement shall be deemed to be made under the
laws of the State of New York applicable to contracts made and to be performed
in that State and shall be governed by and construed in accordance with the
laws of that State, without regard to the conflict of laws principles.

     15. Arbitration, Remedies. Each party hereto agrees that any dispute
relating to the subject matter of this Agreement shall be settled and
determined by arbitration in the City of New York pursuant to the rules of NFA
or, if NFA should refuse to accept the matter, the American Arbitration
Association. The parties also agree that the award of the arbitrators shall be
final and may be enforced in the courts of New York and in the courts of New
York and in any other court having jurisdiction over the parties.

     16. Assignment. This Agreement may not be assigned by any party without
the express prior written consent of each of the other parties hereto.

     17. Amendment or Modification or Waiver. This Agreement may not be
amended or modified except by the written consent of each of the parties
hereto.

     18. Successors. Except as set forth in Section 10, this Agreement is made
solely for the benefit of and shall be binding upon the Trust, the Managing
Owner, the Selling Agent and the Advisor, and the respective successors and
permitted assigns of each of them, and no other


                                      35


<PAGE>


person shall have any right or obligation under this Agreement. The terms
"successors" and "assigns" shall not include any purchasers, as such, of
Interests.

     19. Survival. The provisions of this Agreement shall survive the
termination of this Agreement with respect to any matter arising while this
Agreement was in effect.

     20. No Waiver. No failure or delay on the part of any party hereto in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. Any waiver granted hereunder must be in writing
and shall be valid only in the specific instance in which given.

     21. No Liability of Limited Owners. This Agreement has been made and
executed by and on behalf of the Trust and the Managing Owner, and the
obligations of the Trust and/or the Managing Owner set forth herein are not
binding upon any of the Limited Owners individually, but rather, are binding
only upon the assets and property of the Trust, and, to the extent provided
herein, upon the assets and property of the Managing Owner.

     22. Headings. Headings to Sections herein are for the convenience of the
parties only, and are not intended to be or to affect the meaning or
interpretation of this Agreement.

     23. Complete Agreement. Except as otherwise provided herein, this
Agreement and the Advisory Agreement constitute the entire agreement among the
parties with respect to the matters referred to herein, and no other
agreement, verbal or otherwise, shall be binding upon the parties hereto.


                                      36


<PAGE>


     24. Counterparts. This Agreement may be executed in one or more
counterparts, all of which, when taken together, shall be deemed to constitute
one original instrument.

     25.  Series Disclaimer.
          -----------------

          The parties hereto acknowledge and agree that the Trust is organized
in series pursuant to Sections 3804(a) and 3806(b)(2) of the Delaware
Statutory Trust Act. As such, the debt, liabilities, obligations and expenses
incurred, contracted for or otherwise existing with respect to each series of
the Trust shall be enforceable against the assets of such series of the Trust
only, and not against the assets of the Trust generally or the assets of any
other series of the Trust or against the Trustee. There may be several series
of the Trust created pursuant to the Declaration of Trust and Trust Agreement
of the Trust.


                                      37


<PAGE>


     IN WITNESS WHEREOF, this Agreement has been executed as of the day and
year first above written.

WORLD MONITOR TRUST III - SERIES I             PREFERRED INVESTMENT
                                               SOLUTIONS CORP.
Preferred Investment Solutions Corp.,
its sole Managing Owner

By:                                            By:
   --------------------------------------         ----------------------------
   Esther E. Goodman                           Esther E. Goodman
   Chief Operating Officer and                 Chief Operating Officer and
   Senior Executive Vice President             Senior Executive Vice President


EAGLE TRADING SYSTEMS INC.


By:
   --------------------------------------
   Liora Sternberg
   President


                                     38


<PAGE>


     IN WITNESS WHEREOF, this Agreement has been executed as of the day and
year first above written.

WORLD MONITOR TRUST III - SERIES I             PREFERRED INVESTMENT
                                               SOLUTIONS CORP.
Preferred Investment Solutions Corp.,
its sole Managing Owner

By:                                            By:
   --------------------------------------         ----------------------------
   Esther E. Goodman                              Esther E. Goodman
   Chief Operating Officer and                    Chief Operating Officer and
   Senior Vice-President                          Senior Vice-President


EAGLE TRADING SYSTEMS INC.


By:
   -------------------------------------
   Liora Sternberg
   President


                                      39