# EDGAR Filing Document

**Accession Number:** 0002099103
**File Stem:** 0001437749-26-004276
**Filing Date:** 2026-2
**Character Count:** 1982293
**Document Hash:** 0b326ef879883b7a7cb0027ca1fdc25b
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001437749-26-004276.hdr.sgml**: 20260217

**ACCESSION NUMBER**: 0001437749-26-004276

**CONFORMED SUBMISSION TYPE**: S-1/A

**PUBLIC DOCUMENT COUNT**: 18

**FILED AS OF DATE**: 20260217

**DATE AS OF CHANGE**: 20260217

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** iShares Staked Ethereum Trust ETF
- **CENTRAL INDEX KEY:** 0002099103
- **STANDARD INDUSTRIAL CLASSIFICATION:** [6221]
- **ORGANIZATION NAME:** 09 Crypto Assets
- **EIN:** 000000000
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** S-1/A
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-291992
- **FILM NUMBER:** 26638025

**BUSINESS ADDRESS:**
- **STREET 1:** C/O ISHARES DELAWARE TRUST SPONSOR LLC
- **STREET 2:** 400 HOWARD STREET
- **CITY:** SAN FRANCISCO
- **STATE:** CA
- **ZIP:** 94105
- **BUSINESS PHONE:** 415-670-6416

**MAIL ADDRESS:**
- **STREET 1:** C/O ISHARES DELAWARE TRUST SPONSOR LLC
- **STREET 2:** 400 HOWARD STREET
- **CITY:** SAN FRANCISCO
- **STATE:** CA
- **ZIP:** 94105

**As filed with the Securities and Exchange Commission on February 17**, **2026.**

Registration Statement No. 333-291992

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**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

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 **AMENDMENT NO.1**

 **TO**

**FORM S-1**

**REGISTRATION STATEMENT**

***UNDER***

***THE SECURITIES ACT OF 1933***

## iSHARES <sup>®</sup> STAKED ETHEREUM TRUST ETF
**SPONSORED BY iSHARES DELAWARE TRUST SPONSOR LLC**

**(Exact name of Registrant as specified in its charter)**

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| | | |
|:---|:---|:---|
| **Delaware** | **6221** | **41-2865343** |
| **(State or other jurisdiction of** <br> **incorporation or organization)** | **(Primary Standard Industrial** <br> **Classification Code Number)** | **(I.R.S. Employer Identification No.)** |

---

**c/o iShares Delaware Trust Sponsor LLC**

**400 Howard Street, San Francisco, CA 94105**

**(415) 670-2000**

**(Address, including zip code, and telephone number, including area code, of Registrant**'**s principal executive offices)**

**iShares Delaware Trust Sponsor LLC**

**iShares Product Research & Development**

**(415) 670-2000**

**(Name, address, including zip code, and telephone number, including area code, of agent for service)**

**Copies to:**

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| | |
|:---|:---|
| **Jason D. Myers, Esq.** <br> **Jefferey LeMaster, Esq.** <br> **Tae Ho Cho, Esq.** <br> **Jesse Overall, Esq.** <br> **Clifford Chance US LLP** <br> **375 9th Avenue** <br> **New York, NY 10001**  | **Marisa Rolland, Esq.**<br> **Adithya Attawar, Esq.**<br> **BlackRock, Inc.**<br> **400 Howard Street**<br> **San Francisco, CA 94105** |

---

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of Securities Act. ☒

**The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said section 8(a), may determine.**

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[**Table of Contents**](#toc)

**The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.**

**PROSPECTUS**

**SUBJECT TO COMPLETION, DATED FEBRUARY 17, 2026**

**iShares**<sup>®</sup> **Staked Ethereum Trust ETF**

The iShares Staked Ethereum Trust ETF (the "Trust") is a Delaware statutory trust that issues shares ("Shares") representing fractional undivided beneficial interests in its net assets. The assets of the Trust consist primarily of ether, whose private keys are held by a custodian on behalf of the Trust. The Trust seeks to reflect generally the performance of the price of ether and rewards from staking a portion of the Trust's ether, to the extent the Sponsor in its sole discretion determines that the Trust may do so without incurring undue legal or regulatory risk, including, without limitation, any risk to the Trust's qualification as a grantor trust for U.S. federal income tax purposes. The Trust seeks to reflect such performance before payment of the Trust's expenses and liabilities. iShares Delaware Trust Sponsor LLC (the "Sponsor") is the sponsor of the Trust; Wilmington Trust, National Association, a national association (the "Delaware Trustee"), is the Delaware trustee of the Trust; BlackRock Fund Advisors (the "Trustee") is the trustee of the Trust; Coinbase Custody Trust Company, LLC, (the "Ether Custodian") is the custodian for the Trust's ether holdings; Coinbase Inc., ("Coinbase", "Coinbase Inc." or the "Prime Execution Agent") is the prime execution agent of the Trust; Anchorage Digital Bank N.A. (the "Additional Ether Custodian") is an available alternative custodian for the Trust's ether holdings; and The Bank of New York Mellon is the custodian for the Trust's cash holdings (the "Cash Custodian" and together with the Ether Custodian and the Additional Ether Custodian, the "Custodians") and the administrator of the Trust (the "Trust Administrator"). The Trust is not an investment company registered under the Investment Company Act of 1940, as amended (the "Investment Company Act"), and the Sponsor is not registered with the Securities and Exchange Commission ("SEC") as an investment adviser and is not subject to regulation by the SEC as such in connection with its activities with respect to the Trust. The Trust is not a commodity pool for purposes of the Commodity Exchange Act of 1936, as amended (the "Commodity Exchange Act" or "CEA"), and the Sponsor is not subject to regulation by the Commodity Futures Trading Commission (the "CFTC") as a commodity pool operator or a commodity trading advisor with respect to the Trust.

To effectuate the staking of the Trust's ether ("Staking Activities"), the Sponsor has directed, and may from time to time direct, the Prime Execution Agent, as agent for the Ether Custodian (except in the case of the Coinbase Approved Validator Schedule (defined below), which the Trust enters directly with the Prime Execution Agent, and in which case the Prime Execution Agent acts as Approved Validator (defined below), in a principal capacity), pursuant to the agreement between the Trust and the Prime Execution Agent (the "Staking Addendum" or "Staking Services Agreement"), to enter into written agreements (the "Staking Arrangements" or "Approved Validator Schedules") between the Prime Execution Agent, on behalf of the Trust, and one or more third-party staking services providers (each, a "Staking Services Provider" or "Approved Validator"), which may be either affiliates of the Ether Custodian or other approved third-party validators, to stake the Trust's ether. In the case of one Approved Validator Schedule (the "Coinbase Approved Validator Schedule"), the Prime Execution Agent itself is the Approved Validator, acting in a principal capacity, and the Trust enters such Approved Validator Schedule directly. Staking involves the Ether Custodian, who controls the private keys to the Trust's ether, locking the Trust's ether that the Sponsor instructs the Ether Custodian to stake ("Staked Assets") in the Ethereum network's protocol staking smart contract (the "Protocol Staking Deposit Contract"). The Ether Custodian designates: (i) the Staking Services Provider as the validator for a specified amount of the Trust's Staked Assets, allowing the Staking Services Provider to generate a set of public-private validator keys ("Validator Keys") relating to the Trust's Staked Assets that the Staking Services Provider can use to perform validation activities which maintain the security and integrity of the Ethereum network's blockchain, verify transactions and add new blocks ("Validation Activities"), and (ii) the Trust's own segregated custody account at the Ether Custodian ("Vault Account" or "Vault Balance"), the private keys to which the Ether Custodian holds in offline ("cold") storage, as the withdrawal address for both applicable staking rewards and the underlying staked assets themselves after they are unstaked by the Ether Custodian at the Sponsor's instruction. The Staking Services Provider then uses the Validator Keys to perform Validation Activities, operating validator software, with the Trust's Staked Assets that are staked with such Staking Services Provider subject to automatic, computer code-enforced ("programmatic") forfeiture or confiscation by the Ethereum network ("slashing") if the Staking Services Provider commits certain forms of misconduct during the course of its Validation Activities ("Provider-Facilitated Staking"). The Staking Services Provider does not control the cold storage private keys and thus cannot transfer or take possession or ownership of the Trust's Staked Assets when staked with such Staking Services Provider. Instead, such Staked Assets are locked in the Ethereum network's Protocol Staking Deposit Contract until unstaked by the Ether Custodian or the Staking Services Provider, at the Sponsor's instruction, at which point the Trust's Staked Assets are returned programmatically to the Trust's Vault Account at the Ether Custodian. The Sponsor anticipates that the Trust's Staking Activities will be executed exclusively by means of Provider-Facilitated Staking. The Sponsor's choice of third-party Staking Services Providers, and its decision to allocate ether amongst chosen Staking Services Providers, will be based on a range of factors, including but not limited to the performance, reliability, and reputation of the Staking Services Provider, including monitoring their uptime and slashing history.

The Trust intends to issue Shares on a continuous basis and is registering an indeterminate number of Shares with the SEC in accordance with Rule 456(d) and 457(u). The Trust issues and redeems Shares only in blocks of 40,000 or integral multiples thereof, based on the quantity of ether attributable to each Share (net of accrued but unpaid remuneration due to the Sponsor (the "Sponsor's Fee") and any accrued but unpaid expenses or liabilities). A block of 40,000 Shares is called a "Basket." These transactions will take place in exchange for ether or cash. Baskets will be offered continuously at the net asset value per Share ("NAV") for 40,000 Shares. Only registered broker-dealers that become authorized participants by entering into a contract with the Sponsor and the Trustee ("Authorized Participants") may purchase or redeem Baskets. Shares will be offered to the public from time to time at varying prices that will reflect the price of ether and the trading price of the Shares on The Nasdaq Stock Market LLC ("NASDAQ" or the "Exchange") at the time of the offer.

The Authorized Participants will deliver only ether or cash to create Shares and will receive only ether or cash when redeeming Shares.

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[**Table of Contents**](#toc)

Prior to this offering, there has been no public market for the Shares. The Shares will be listed and traded on NASDAQ under the ticker symbol "ETHB." Market prices for the Shares may be different from the NAV.

CME CF Ether–Dollar Reference Rate – New York Variant for the ether – U.S. Dollar trading pair (the "CF Benchmarks Index"), produced by CF Benchmarks Ltd., on February 12, 2026 was $1,918.94.

*Except when aggregated in Baskets, Shares are not redeemable securities. Baskets are only redeemable by Authorized Participants.*

The Trust is an "emerging growth company," as that term is used in the Jumpstart Our Business Startups Act (the "JOBS Act"), subject to reduced public company reporting requirements under U.S. federal securities laws.

 **Investing in the Shares involves significant risks. See** "**Risk Factors**" **starting on page 21.**

**Neither the SEC nor any state securities commission has approved or disapproved of the securities offered in this prospectus, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.**

The Shares are not interests in nor obligations of any of the Sponsor, the Trustee, the Delaware Trustee, BlackRock Financial Management, Inc. (the "Seed Capital Investor"), the Trust Administrator, the Cash Custodian, the Ether Custodian, the Additional Ether Custodian, or their respective affiliates. The Shares are not insured or guaranteed by the Federal Deposit Insurance Corporation ("FDIC") or any other governmental agency.

"iShares" is a registered trademark of BlackRock, Inc. or its affiliates.

On January 14, 2026, the Seed Capital Investor, an affiliate of the Sponsor, subject to conditions, purchased the Seed Creation Baskets, comprising 4,000 Shares at a per-Share price equal to $25. Total proceeds to the Trust from the sale of the Seed Creation Baskets were $100,000. On [ ], 2026, the Trust purchased [ ] ether with the proceeds of the Seed Creation Baskets using the Prime Execution Agent. The Seed Capital Investor will act as a statutory underwriter in connection with this purchase. See "Seed Capital Investor" and "Plan of Distribution" for additional information.

The price of the Seed Creation Baskets was determined as described above and such Shares could be sold at different prices if sold by the Seed Capital Investor at different times.

The date of this prospectus is , 2026.

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**TABLE OF CONTENTS**

**Page**

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| | |
|:---|:---|
| [<u>STATEMENT REGARDING FORWARD-LOOKING STATEMENTS</u>](#statementregard) | <u>[iv](#statementregard)</u> |
| [<u>PROSPECTUS SUMMARY</u>](#prospectussumm) | <u>[1](#prospectussumm)</u> |
| [<u>THE OFFERING</u>](#theoffering) | <u>[8](#theoffering)</u> |
| [<u>SUMMARY FINANCIAL CONDITION</u>](#summfincondition) | <u>[20](#summfincondition)</u>  |
| [<u>RISK FACTORS</u>](#riskfactors) | <u>[21](#riskfactors)</u>  |
| [<u>USE OF PROCEEDS</u>](#useofproceeds) | <u>[80](#useofproceeds)</u>  |
| [<u>OVERVIEW OF THE ETHEREUM INDUSTRY</u>](#overviewindustry) | <u>[81](#overviewindustry)</u>  |
| [<u>BUSINESS OF THE TRUST</u>](#businesstrust) | <u>[92](#businesstrust)</u>  |
| [<u>DESCRIPTION OF THE SHARES AND THE TRUST AGREEMENT</u>](#dessharestrust) | <u>[105](#dessharestrust)</u>  |
| [<u>THE SECURITIES DEPOSITORY; BOOK-ENTRY-ONLY SYSTEM; GLOBAL SECURITY</u>](#bookentryonly) | <u>[119](#bookentryonly)</u>  |
| [<u>THE SPONSOR</u>](#sponsor) | <u>[120](#sponsor)</u>  |
| [<u>THE TRUSTEE</u>](#trustee) | <u>[122](#trustee)</u>  |
| [<u>THE TRUST ADMINISTRATOR</u>](#trustadmin) | <u>[123](#trustadmin)</u>  |
| [<u>THE DELAWARE TRUSTEE</u>](#delawaretrustee) | <u>[123](#delawaretrustee)</u>  |
| [<u>THE CUSTODIANS</u>](#custodians) | <u>[124](#custodians)</u>  |
| [<u>THE PRIME EXECUTION AGENT AND THE TRADE CREDIT LENDER</u>](#primeexeagent) | <u>[132](#primeexeagent)</u>  |
| [<u>U.S. FEDERAL INCOME TAX CONSEQUENCES</u>](#usfedincome) | <u>[139](#usfedincome)</u>  |
| [<u>ERISA AND RELATED CONSIDERATIONS</u>](#erisa) | <u>[144](#erisa)</u>  |
| [<u>SEED CAPITAL INVESTOR</u>](#seedcap) | <u>[145](#seedcap)</u>  |
| [<u>PLAN OF DISTRIBUTION</u>](#plandistro) | <u>[145](#plandistro)</u>  |
| [<u>CONFLICTS OF INTEREST</u>](#conflictsinterest) | <u>[146](#conflictsinterest)</u>  |
| [<u>GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION</u>](#govlaw) | <u>[147](#govlaw)</u>  |
| [<u>LEGAL MATTERS</u>](#legalmatters) | <u>[147](#legalmatters)</u>  |
| [<u>EXPERTS</u>](#experts) | <u>[148](#experts)</u>  |
| [<u>WHERE YOU CAN FIND MORE INFORMATION</u>](#whereinfo) | <u>[148](#whereinfo)</u>  |
| [<u>GLOSSARY</u>](#glossary) | <u>[149](#glossary)</u>  |
| [<u>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</u>](#report) | <u>[156](#report)</u>  |

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This prospectus contains information you should consider when making an investment decision about the Shares. You may rely on the information contained in this prospectus. Neither the Trust nor the Sponsor has authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus. This prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted.

Until [ ], 2026 (25 days after the date of this prospectus), all dealers effecting transactions in the Shares, whether or not participating in this distribution, may be required to deliver a prospectus. This requirement is in addition to the obligations of dealers to deliver a prospectus when acting as underwriters and with respect to unsold allotments or subscriptions. The Sponsor first intends to use this prospectus on [ ], 2026.

Authorized Participants may be required to deliver a prospectus when making transactions in the Shares. See "Plan of Distribution."

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**STATEMENT REGARDING FORWARD-LOOKING STATEMENTS**

This prospectus includes statements which relate to future events or future performance. In some cases, you can identify such forward-looking statements by terminology such as "may," "should," "could," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this prospectus that address activities, events or developments that may occur in the future, including such matters as changes in commodity prices and market conditions (for ether and the Shares), the Trust's operations, the Sponsor's plans and references to the Trust's future success and other similar matters are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses made by the Sponsor on the basis of its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. Whether or not actual results and developments will conform to the Sponsor's expectations and predictions, however, is subject to a number of risks and uncertainties, including the special considerations discussed in this prospectus, general economic, market and business conditions, changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments. See "Risk Factors." Consequently, all the forward-looking statements made in this prospectus are qualified by these cautionary statements, and there can be no assurance that the actual results or developments the Sponsor anticipates will be realized or, even if substantially realized, will result in the expected consequences to, or have the expected effects on, the Trust's operations or the value of the Shares. None of the Trust, the Sponsor, the Trustee or the Delaware Trustee or their respective affiliates is under a duty to update any of the forward-looking statements to conform such statements to actual results or to a change in the Sponsor's expectations or predictions.

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**PROSPECTUS SUMMARY**

 *Although the Sponsor believes that this summary is materially complete, you should read the entire prospectus, including* "*Risk Factors*" *beginning on page 21, before making an investment decision about the Shares.*

 *Definitions of terms used in this prospectus can be found in the Glossary on page 149.*

**Trust Structure, the Sponsor, the Trustee, the Delaware Trustee and the Custodians**

The Trust was formed as a Delaware statutory trust on November 19, 2025. The purpose of the Trust is to own ether transferred to or purchased by the Trust in exchange for Shares issued by the Trust, as well as ether earned through the Trust's Staking Activities. Each Share represents a fractional undivided beneficial interest in the net assets of the Trust. The assets of the Trust consist primarily of ether, whose private keys are held by the Ether Custodian pursuant to the Custodial Services Agreement between Coinbase Custody and the Trust (the "Custodian Agreement") on behalf of the Trust. The Trust has also executed a Staking Services Addendum to the Custodian Agreement (the "Staking Addendum" or "Staking Services Agreement") with Coinbase Inc. to make the Trust's ether held with the Ether Custodian available for staking. The Trust has also entered into a custody agreement with the Additional Ether Custodian pursuant to the Master Custody Services Agreement between Anchorage and the Trust (the "Additional Ether Custodian Agreement" or the "Anchorage Custodian Agreement"). The Trust is not required to hold any particular amount of assets at either the Ether Custodian or the Additional Ether Custodian, and the Sponsor shall, in its sole discretion, determine the amounts held at either custodian from time to time as permitted by the Trust Agreement. The Sponsor has not established any specific criteria that it would consider in making this decision. As of the date of this prospectus, the Trust's ether is held with the Ether Custodian, and the Sponsor has no plans to move any of the Trust's ether to the Additional Ether Custodian, though such plans are subject to ongoing review. The addition of the Additional Ether Custodian as an available alternative custodian of the Trust's ether reflects the Sponsor's ongoing risk management approach as part of the Trust's growing size and the Sponsor's expanding presence in the digital asset space.

The Sponsor of the Trust is iShares Delaware Trust Sponsor LLC, a Delaware limited liability company and a consolidated subsidiary of BlackRock, Inc. ("BlackRock"). **The Shares are not obligations of, and are not guaranteed by, iShares Delaware Trust Sponsor LLC, or any of its subsidiaries or affiliates.**

The Trust is governed by the provisions of the Trust Agreement executed as of February 5, 2026 by the Sponsor, the Trustee and the Delaware Trustee (as amended from time to time, the "Trust Agreement").

The Trust issues and redeems Shares only in Baskets or integral multiples thereof, based on the quantity of ether attributable to each Share (net of accrued but unpaid Sponsor's Fee and any accrued but unpaid expenses or liabilities). Baskets may be redeemed by the Trust in exchange for either (1) the cash proceeds from selling the amount of ether corresponding to their redemption value or (2) the amount of ether corresponding to their redemption value. These transactions take place in exchange for cash or ether. Individual Shares will not be redeemed by the Trust but will be listed and traded on NASDAQ under the ticker symbol "ETHB". The Trust seeks to reflect generally the performance of the price of ether and rewards from staking a portion of the Trust's ether, to the extent the Sponsor in its sole discretion determines that the Trust may do so without incurring undue legal or regulatory risk, including, without limitation, any risk to the Trust's qualification as a grantor trust for U.S. federal income tax purposes. The Trust seeks to reflect such performance before payment of the Trust's expenses and liabilities. The material terms of the Trust are discussed in greater detail under the section "Description of the Shares and the Trust Agreement."

The Trust is a passive investment vehicle that does not seek to generate returns beyond tracking the price of ether and staking some portion of the ether it holds (which may vary from time to time). This means the Sponsor does not speculatively sell ether at times when its price is high or speculatively acquire ether at low prices in the expectation of future price increases. It also means the Trust will not utilize leverage, derivatives or any similar arrangements in seeking to meet its investment objective. The Trust, the Sponsor and the Trust's service providers will stake the Trust's ether in accordance with the Ethereum Staking Liquidity Risk Policy (defined below), but will not loan, pledge or rehypothecate the Trust's assets, including staked assets, nor will the Trust's assets, including Staked Assets, serve as collateral for any loan or similar arrangement, except with respect to securing the repayment of Trade Credits (as defined below). See "The Custodians—The Ether Custodian and the Additional Ether Custodian" and "The Prime Execution Agent and the Trade Credit Lender—The Prime Execution Agent." Although the Trust is a passive investment vehicle, it will employ its ether in Staking Activities and accordingly will earn staking rewards and/or income from Staking Activities ("Staking Consideration"). The Trust is not a registered investment company under the Investment Company Act and is not required to register under the Investment Company Act. The Sponsor is not registered with the Securities and Exchange Commission ("SEC") as an investment adviser and is not subject to regulation by the SEC as such in connection with its activities with respect to the Trust. The Trust is not a commodity pool for purposes of the CEA, and the Sponsor is not subject to regulation by the CFTC as a commodity pool operator or a commodity trading advisor in connection with its activities with respect to the Trust.

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To effectuate the Trust's Staking Activities, the Sponsor has directed, and may from time to time direct, the Prime Execution Agent, as agent of the Ether Custodian, to enter into Staking Arrangements with one or more Staking Services Providers, which may be either affiliates of the Ether Custodian or other approved third-party validators, to conduct Staking Activities through Provider-Facilitated Staking. The Sponsor anticipates that the Trust's Staking Activities will be executed exclusively by means of Provider-Facilitated Staking. The Sponsor's choice of third-party Staking Services Providers, and its decision to allocate ether amongst chosen Staking Services Providers, will be based on a range of factors, including but not limited to the performance, reliability, and reputation of the Staking Services Provider, including monitoring their uptime and slashing history.

The Trust's staking program seeks to maximize the portion of the Trust's ether available for staking while controlling for liquidity and redemption risks. To manage the liquidity and redemption risks associated with staking, The Sponsor intends to maintain a reserve of unstaked ether (the "Liquidity Sleeve") designed to accommodate anticipated redemption activity.

The Prime Execution Agent, Ether Custodian and the Staking Services Provider will exercise no discretion as to the amount of the Trust's ether to be staked or the timing of the Trust's Staking Activities. As of the date of this prospectus, the Trust seeks to stake as much of the Trust's ether as practicable (i.e. 70% - 95% under normal market circumstances) through one or more Staking Services Providers, except (i) to fund or rebalance the Liquidity Sleeve, (ii) as necessary to pay the Sponsor's Fee or any Trust expenses not assumed by the Sponsor, (iii) as necessary to satisfy existing and reasonably foreseen potential redemption orders, (iv) as necessary to reduce the ether obtained by the Trust as Staking Consideration to cash for distribution at regular intervals, (v) if the Sponsor determines that Staking Activities raise significant governmental, policy or regulatory concerns or is subject or likely subject to a specialized regulatory regime, (vi) if the Sponsor determines that any vulnerability exists in the source code, validator or client software, (vii) if the Ether Custodian or a Staking Services Provider discontinue their arrangements with the Trust (including any temporary suspension or unstaking instruction intended to protect the Trust's assets against the risk of loss of ownership of the staked digital assets, but only with respect to the stake assets affected by the cessation, (viii) if the Sponsor otherwise determines that continued Staking Activities of such portion of the Trust's assets would be inconsistent with the Trust's purpose of protecting and conserving the value of the Trust or (ix) in accordance with the Ethereum Staking Liquidity Risk Policy or any other exception that is expressly contemplated in the 2025 IRS revenue procedure that provides a safe harbor pursuant to which, if all the requirements listed therein are satisfied, a trust's authorization pursuant to its trust agreement to stake its digital assets will not prevent the trust from qualifying as a grantor trust for U.S. federal income tax purposes (the "2025 Staking Tax Guidance").

All ether received by the Trust in connection with the creation of new Shares, or as Staking Consideration, would also be staked upon receipt by the Trust, unless one or more of the exceptions described in clauses (i)-(ix) above applies. Moreover, any staked ether which must be unstaked in order to fulfill a distribution in connection with a redemption (to the extent such distribution cannot be fulfilled utilizing the portion of the Trust's ether that has not been staked, or through another mechanism to manage liquidity in connection with redemptions contemplated by the 2025 Staking Tax Guidance) will be unstaked only after the redemption order is approved by the Trust, the Sponsor executes an unstake or withdrawal transaction through the Ether Custodian, and such transaction is processed by the Ethereum network. The Staking Services Provider will not be able to transfer unstaked ether or Staking Consideration to another address on the Ethereum network.

Under the Trust's staking program, the Sponsor instructs the Prime Execution Agent, as agent for the Ether Custodian, to stake the Trust's ether. The Ether Custodian, who controls the private keys to the Trust's ether, sends the Trust's Staked Assets from the Trust's Vault Account to the Ethereum network's Protocol Staking Deposit Contract. The Ether Custodian designates (i) the Staking Services Provider as the validator in connection with a specified amount of the Trust's Staked Assets, giving the Staking Services Provider access to a set of Validator Keys relating to such Staked Assets that the Staking Services Provider can use to perform Validation Activities, and (ii) the Trust's own Vault Account as the withdrawal address for both staking rewards and the underlying staked assets themselves after they are unstaked by the Ether Custodian at the Sponsor's instruction. The Staking Services Provider then uses the Validator Keys to perform Validation Activities, operating validator software, including validator nodes, with the Trust's Staked Assets staked with such Staking Services Provider subject to slashing if the Staking Services Provider commits certain forms of misconduct when performing Validation Activities. The Staking Services Provider does not control the private keys to transfer or take possession or ownership of the Trust's Staked Assets when staked with such Staking Services Provider. Instead, the Staked Assets are locked in the Ethereum network's Protocol Staking Deposit Contract until unstaked by the Ether Custodian at the Sponsor's instruction, at which point the Trust's Staked Assets (and any related rewards) are transferred programmatically to the Vault Account at the Ether Custodian. The Staking Services Provider is the node operator and is obligated to perform Validation Activities with the Trust's Staked Assets consistent with the terms of the Trust's agreements with Staking Services Providers. The Trust retains control and ownership of the Trust's staked ether because the Ether Custodian controls the private keys to the Trust's Staked Assets. Validator Keys do not give the Staking Services Provider the ability to transfer the Trust's Staked Assets, and the Trust's Staked Assets are never transferred to a wallet address of the Staking Services Provider; furthermore, the Protocol Staking Deposit Contract is a smart contract that has no associated private keys and, upon unstaking, programmatically transfers the Trust's Staked Assets back to the Trust's Vault Account at the Ether Custodian. The Trust also retains control given that it (rather than the Staking Services Provider) will retain the ability through the Ether Custodian to unstake its ether at any time (subject to Ethereum network processes and delays). The Trust's agreements with the Staking Services Providers and Coinbase also specifically provide that the Staked Assets belong to the Trust and neither the Staking Services Providers nor Coinbase have any ownership or property interest in the Trust's Staked Assets. The Trust's agreements with Staking Services Providers require each Staking Services Provider to maintain Validator Keys that solely correspond to Staked Assets of the Trust and not commingle the staked assets of any other person (such as the Staking Services Provider or others who stake to the Staking Services Provider) with the Staked Assets of the Trust, despite the Trust delegating the validation rights to the Trust's Staked Assets to the Staking Services Provider, which may serve as a staking services provider for other persons and, as a result, hold other validator keys and perform validation activities corresponding to staked ether belonging to other ether holders. Staking will be a passive activity for the Trust, as it relies on Provider-Facilitated Staking, and will not operate its own node or perform validation activities on its own. Moreover, the Trust's role will be limited to (i) selecting the Staking Services Provider(s), and (ii) determining, from time to time, what portion of the Trust's ether to stake and unstake so as to maintain sufficient Trust assets to satisfy all outstanding redemption orders, and informing the Staking Services Provider(s) of those determinations. Under normal market circumstances, the Sponsor intends to stake 70% - 95% of the Trust's ether.

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The Trust expects to receive certain staking rewards of ether from Staking Activities, which would be treated as giving rise to taxable income for U.S. federal income tax purposes under current Internal Revenue Service ("IRS") guidance. See "U.S. Federal Income Tax Consequences" for further description of the tax implications of the receipt of Staking Consideration by the Trust. The Staking Services Provider shall exercise no discretion as to the amount of the Trust's ether to be staked or the timing of the Trust's Staking Activities. The Ether Custodian will maintain exclusive possession and control of the Trust's private keys associated with transferring any staked ether at all times while Staking Service Providers will maintain exclusive possession and control of the private keys associated with ether validation activities at all times. Staking activity on the Ethereum network involves the delegation of ether to validators and carries certain risks.

Misbehavior or poor performance by validators may result in such validators receiving reduced staking rewards for an epoch during which they misbehaved or performed poorly. Additionally, as part of the "activating" and "exiting" (followed by withdrawal) processes of staking, staked ether will be inaccessible for a variable period of time determined by a range of factors, including network congestion, resulting in potential inaccessibility during those periods. During activation, exit, and withdrawal, the Trust's staked assets will not earn any rewards. "Activation" is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the Ethereum network's proof-of-stake consensus protocol. "Exit" is the request to exit from the active set and no longer participate in the Ethereum network's proof-of-stake consensus protocol, and is followed by a protocol-administered withdrawal process, which takes additional time to complete. As part of these "activation", "exiting" and withdrawal processes of staking on the Ethereum network, any staked ether will be inaccessible for a period of time. The duration of activation and exit/withdrawal periods are dependent on a range of factors, including network conditions. In periods of low demand, unstaking may be completed within days, while in periods of elevated exit activity the process may take multiple weeks or months to complete.

See "Description of the Shares and the Trust Agreement" for more details.

The Trust intends to continuously offer Shares but may suspend issuances of Shares at any time.

The Sponsor has arranged for the creation of the Trust, the registration of the Shares for their public offering in the United States and the listing of the Shares on NASDAQ. The Sponsor has agreed to assume the marketing and the following administrative expenses incurred by the Trust: the fees of the Trustee, the Delaware Trustee and the Trust Administrator, the Custodians' fee (the "Custodians' Fee"), NASDAQ listing fees, SEC registration fees, printing and mailing costs, tax reporting fees, audit fees, license fees and expenses and up to $500,000 per annum in ordinary legal fees and expenses. The Sponsor will also pay the costs of the Trust's organization and the initial sale of the Shares. The Sponsor may determine in its sole discretion to assume legal fees and expenses of the Trust in excess of the $500,000 per annum required under the Trust Agreement. To the extent that the Sponsor does not voluntarily assume such fees and expenses, they will be the responsibility of the Trust.

The Trust may incur certain extraordinary, non-recurring expenses that are not assumed by the Sponsor, including but not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, Ethereum network fees and similar transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the Shareholders, any indemnification of the Cash Custodian, the Ether Custodian, the Additional Ether Custodian, Prime Execution Agent, Trust Administrator or other agents, service providers (including, without limitation, Staking Services Providers) or counterparties of the Trust, and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters or legal fees, costs or expenses incurred by the Trust or Coinbase (when acting as agent on behalf of the Trust) in enforcing the Trust's rights against Staking Services Providers.

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The Sponsor will maintain a public website on behalf of the Trust, containing information about the Trust and the Shares. The internet address of the Trust's website will be www.iShares.com. This internet address is only provided here as a convenience to you, and the information contained on or connected to the Trust's website is not considered part of this prospectus. The Sponsor is responsible for oversight and overall management of the Trust but has delegated day-to-day administration of the Trust to the Trustee under the Trust Agreement. The Sponsor may remove the Trustee and appoint a successor trustee in its discretion or if, having received written notice of a material breach of its obligations under the Trust Agreement, the Trustee has not cured the breach within thirty days. The Sponsor may also replace the Trustee during the 90 days following any merger, consolidation or conversion in which the Trustee is not the surviving entity. The Trustee also has the right to select any new or additional custodians.

The Sponsor, the Trustee or any of their respective affiliates and associates currently engage in, and may in the future engage in, the promotion, management or investment management of other accounts, funds or trusts that invest primarily in ether or another digital asset, and such activities may create potential conflicts of interest. Although officers and professional staff of the Sponsor's or the Trustee's management intend to devote as much time to the Trust as is deemed appropriate to perform their duties, the Sponsor's or the Trustee's management may allocate their time and services among the Trust and the other accounts, funds or trusts. In addition, the Sponsor and the Trustee may agree to amend the Trust Agreement, including to increase the Sponsor's Fee and the Staking Fee, without Shareholder consent. See "Conflicts of Interest."

The Trustee is BlackRock Fund Advisors, the Delaware Trustee is Wilmington Trust, National Association, the Ether Custodian is Coinbase Custody Trust Company, LLC ("Coinbase Custody"), and the Cash Custodian and the Trust Administrator is The Bank of New York Mellon.

Subject to the Sponsor's oversight, the Trustee is generally responsible for the management and day-to-day operations of the Trust. The responsibilities of the Trustee include (1) processing orders for the creation and redemption of Baskets; (2) coordinating with the Ether Custodian and the Prime Execution Agent the receipt and delivery of ether purchased or sold by or otherwise transferred to, or by, the Trust and with the Cash Custodian or Ether Custodian the receipt and delivery of cash or ether transferred to or by the Trust in connection with each issuance and redemption of Baskets; (3) calculating the net asset value of the Trust on any day other than: a Saturday or a Sunday, or a day on which NASDAQ is closed for regular trading ("Business Day"); and (4) selling the Trust's ether as needed to cover the Trust's expenses. Under the Trust Agreement, the Trustee may delegate all or a portion of its duties to any agent and has delegated the bulk of the day-to-day responsibilities to the Trust Administrator and certain other administrative and record-keeping functions to its affiliates and other agents.

The Ether Custodian is responsible for safekeeping the ether owned by the Trust. The Ether Custodian and the Additional Ether Custodian are appointed by the Trustee. The general role and responsibilities of the Ether Custodian and the Additional Ether Custodian are further described in "The Custodians—The Ether Custodian and the Additional Ether Custodian."

**Trust Objective**

The Trust seeks to reflect generally the performance of the price of ether and rewards from staking a portion of the Trust's ether, to the extent the Sponsor in its sole discretion determines that the Trust may do so without incurring undue legal or regulatory risk, including, without limitation, any risk to the Trust's qualification as a grantor trust for U.S. federal income tax purposes. The Trust seeks to reflect such performance before payment of the Trust's expenses and liabilities. The Shares are intended to constitute a simple means of making an investment similar to an investment in ether rather than by acquiring, holding, and trading ether directly on a peer-to-peer or other basis or via a digital asset platform. The Shares have been designed to remove the obstacles represented by the complexities and operational burdens involved in a direct investment in ether, while at the same time having an intrinsic value that reflects, at any given time, the investment exposure to ether owned by the Trust at such time, less the Trust's expenses and liabilities. Although the Shares are not the exact equivalent of a direct investment in ether, they provide investors with an alternative method of achieving investment exposure to ether through the securities market, which may be more familiar to them.

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An investment in Shares is:

*Backed by ether held by the Ether Custodian on behalf of the Trust.*

The Shares are backed by the assets of the Trust. The Ether Custodian will keep custody of all of the Trust's ether, other than that which is maintained in a trading account (the "Trading Balance") with Coinbase, Inc. ("Coinbase Inc." or the "Prime Execution Agent", which is an affiliate of the Ether Custodian), in accounts that are required to be segregated from the assets held by the Ether Custodian as principal and the assets of its other customers (the "Vault Account" or "Vault Balance"). The Ether Custodian will keep all of the private keys associated with the Trust's ether held by the Ether Custodian in the Vault Balance in "cold storage", which refers to a safeguarding method by which the private keys corresponding to the Trust's ether are generated and stored in an offline manner using computers or devices that are not connected to the internet, which is intended to make them more resistant to hacking.

The Trust is not required to hold any particular amount of assets at either the Ether Custodian or the Additional Ether Custodian, and the Sponsor shall, in its sole discretion, determine the amounts held at either custodian from time to time as permitted by the Trust Agreement. The Sponsor has not established any specific criteria that it would consider in making this decision. As of the date of this prospectus, the Trust's ether is held with the Ether Custodian, and the Sponsor has no plans to move any of the Trust's ether to the Additional Ether Custodian, though such plans are subject to ongoing review. The addition of the Additional Ether Custodian as an available alternative custodian of the Trust's ether reflects the Sponsor's ongoing risk management approach as part of the Trust's growing size and the Sponsor's expanding presence in the digital asset space.

For more information, see "The Custodians—The Ether Custodian and the Additional Ether Custodian" below.

The Trust's ether holdings and cash holdings from time to time may be held with the Prime Execution Agent in the Trading Balance in connection with creations and redemptions of Baskets, and the sale of ether to pay the Sponsor's Fee and any other Trust expenses not assumed by the Sponsor, to the extent applicable, and in extraordinary circumstances, in connection with the liquidation of the Trust's ether. Within the Trust's Trading Balance, the Prime Execution Agent Agreement provides that the Trust does not have an identifiable claim to any particular ether (and cash). Instead, the Trust's Trading Balance represents an entitlement to a pro-rata share of the ether (and cash) the Prime Execution Agent holds on behalf of customers who hold similar entitlements against the Prime Execution Agent. In this way, the Trust's Trading Balance represents an omnibus claim on the Prime Execution Agent's ether (and cash) held on behalf of the Prime Execution Agent's customers. With respect to the Trust's Trading Balance, the Prime Execution Agent holds the ether associated with customer entitlements across a combination of omnibus cold wallets, omnibus "hot wallets" (meaning wallets whose private keys are generated and stored online, in internet-connected computers or devices) or in omnibus accounts in the Prime Execution Agent's name on a trading venue (including third-party venues and the Prime Execution Agent's own execution venue) where the Prime Execution Agent executes orders to buy and sell ether on behalf of its clients. Within such omnibus hot and cold wallets and accounts, the Prime Execution Agent has represented to the Sponsor that it keeps the majority of assets in cold wallets, to promote security, while the balance of assets is kept in hot wallets to facilitate rapid withdrawals. However, with respect to the Trading Balance, the Sponsor has no control over, and for security reasons the Prime Execution Agent does not disclose to the Sponsor, the percentage of ether that the Prime Execution Agent holds for customers holding similar entitlements as the Trust which are kept in omnibus cold wallets, as compared to omnibus hot wallets or omnibus accounts in the Prime Execution Agent's name on a trading venue. The Prime Execution Agent has represented to the Sponsor that , with respect to the Trading Balance, the percentage of assets maintained in cold versus hot storage is determined by ongoing risk analysis and market dynamics, in which the Prime Execution Agent attempts to balance anticipated liquidity needs for its customers as a class against the anticipated greater security of cold storage.

*As convenient and easy to handle as any other investment in shares.*

Investors may purchase and sell Shares through traditional securities brokerage accounts and can avoid the complexities of handling ether directly (e.g., managing wallets and public and private keys themselves, or interfacing with a trading platform), which some investors may not prefer or may find unfamiliar.

*Listed.*

Although there can be no assurance that an actively traded market in the Shares will develop, the Shares will be listed and traded on NASDAQ under the ticker symbol "ETHB".

**Summary Risk Factors**

***Risk Factors Related to Digital Assets***

● The trading prices of many digital assets, including ether, have experienced extreme volatility in recent periods and may continue to do so. Extreme volatility in the future, including further declines in the trading prices of ether, could have a material adverse effect on the value of the Shares and the Shares could lose all or substantially all of their value.

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● The value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of ether as a digital asset, including the fact that digital assets are bearer instruments and loss, theft, destruction, or compromise of the associated private keys could result in permanent loss of the asset, and the capabilities and development of blockchain technologies such as the Ethereum blockchain.

● Digital assets represent a new and rapidly evolving industry, and the value of the Shares depends on the acceptance of ether.

● Smart contracts, including those relating to decentralized finance ("DeFi") applications, are a new technology and their ongoing development and operation may result in problems, which could reduce the demand for ether or cause a wider loss of confidence in the Ethereum network, either of which could have an adverse impact on the value of ether.

● Changes in the governance of a digital asset network may not receive sufficient support from users and validators, which may negatively affect that digital asset network's ability to grow and respond to challenges.

● The limited ability to facilitate in-kind creations and redemptions of Shares could have adverse consequences for the Trust.

***Risk Factors Related to the Digital Asset Markets***

● The value of the Shares relates directly to the value of ether, the value of which may be highly volatile and subject to fluctuations due to a number of factors.

● The Index (as defined below) has a limited performance history, the Index price could fail to track the global ether price, and a failure of the Index price could adversely affect the value of the Shares.

● The Index price used to calculate the value of the Trust's ether may be volatile, adversely affecting the value of the Shares.

***Risk Factors Related to the Trust and the Shares***

● If the process of creation and redemption of Baskets encounters any unanticipated difficulties, the possibility for arbitrage transactions by Authorized Participants intended to keep the price of the Shares closely linked to the price of ether may not exist and, as a result, the price of the Shares may fall or otherwise diverge from NAV.

● The liquidity of the Shares may also be affected by the withdrawal from participation of Authorized Participants or Ether Trading Counterparties.

● Security threats to the Trust's account at the Ether Custodian could result in the halting of Trust operations and a loss of Trust assets or damage to the reputation of the Trust, each of which could result in a reduction in the value of the Shares.

● Ether transactions are irrevocable and stolen or incorrectly transferred ether may be irretrievable. As a result, any incorrectly executed ether transactions could adversely affect the value of the Shares.

● If the Custodian Agreement, the Prime Execution Agent Agreement, the Authorized Participant Agreements or the Ether Trading Counterparty Agreements are terminated or the Custodians, the Prime Execution Agent, Authorized Participants or the Ether Trading Counterparties fail to provide services as required, the Trustee may operationalize the Additional Ether Custodian or may need to find and appoint replacement custodians, an execution agent, authorized participants or ether trading counterparties, which could pose a challenge to the safekeeping of the Trust's ether, the Trust's staking program, the Trust's ability to create and redeem Shares and the Trust's ability to continue to operate may be adversely affected.

● The lack of full insurance and Shareholders' limited rights of legal recourse against the Trust, the Delaware Trustee, the Sponsor, the Trust Administrator, the Cash Custodian, the Prime Execution Agent, the Ether Custodian and, if operationalized, the Additional Ether Custodian, expose the Trust and its Shareholders to the risk of loss of the Trust's ether for which no person or entity is liable.

● Loss of a critical banking relationship for, or the failure of a bank used by, the Prime Execution Agent could adversely impact the Trust's ability to create or redeem Baskets, or could cause losses to the Trust.

***Risk Factors Related to Staking Activities*** 

● Staked ether tokens will be inaccessible for a variable period of time, determined by a range of factors, which could result in certain liquidity risk to the Trust.

● The Trust will be dependent on third parties to effectively execute the Trust's Staking Activities.

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***Risk Factors Related to the Regulation of the Trust and the Shares***

● Digital asset markets in the United States exist in a state of regulatory uncertainty, and adverse legislative or regulatory developments could significantly harm the value of ether or the Shares, such as by banning, restricting or imposing onerous conditions or prohibitions on the use of ether, validation activity, digital wallets, the provision of services related to trading and providing custody services for ether, the operation of the Ethereum network, or the digital asset markets generally.

● If regulators subject the Trust, the Trustee, the Sponsor or Ether Trading Counterparties to regulation as a money services business ("MSB") or money transmitter, this could result in extraordinary expenses to the Trust, the Trustee, the Sponsor or Ether Trading Counterparties and also result in decreased liquidity for the Shares.

● Regulatory changes or interpretations could obligate an Authorized Participant, the Trust, the Trustee or the Sponsor to register and comply with new regulations, resulting in potentially extraordinary, nonrecurring expenses to the Trust.

● The treatment of digital assets and Staking Activities for U.S. federal, state and local income tax purposes is uncertain.

**Emerging Growth Company Status**

The Trust is an "emerging growth company," as defined in the JOBS Act. For as long as the Trust is an emerging growth company, the Trust may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies," including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes–Oxley Act of 2002 (the "Sarbanes-Oxley Act"), reduced disclosure obligations regarding executive compensation in the Trust's periodic reports and audited financial statements in this prospectus, exemptions from the requirements of holding advisory "say-on-pay" votes on executive compensation and shareholder advisory votes on "golden parachute" compensation and exemption from any rules requiring mandatory audit firm rotation and auditor discussion and analysis and, unless otherwise determined by the SEC, any new audit rules adopted by the Public Company Accounting Oversight Board.

Under the JOBS Act, the Trust will remain an emerging growth company until the earliest of:

● the last day of the fiscal year during which the Trust has total annual gross revenues of $1.235 billion or more;

● the last day of the fiscal year following the fifth anniversary of this offering;

● the date on which the Trust has, during the previous three-year period, issued more than $1 billion in non-convertible debt; or

● the date on which the Trust is deemed to be a "large accelerated filer" (i.e., an issuer that (1) has more than $700 million in outstanding equity held by non-affiliates and (2) has been subject to the reporting requirements of the Exchange Act for at least 12 calendar months and has filed at least one annual report on Form 10-K.)

The JOBS Act also provides that an emerging growth company can utilize the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the "Securities Act") for complying with new or revised accounting standards. The Trust is choosing to opt out of this extended transition period and, as a result, the Trust will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for companies that are not "emerging growth companies." Section 107 of the JOBS Act provides that the Trust's decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

**Principal Offices**

The Sponsor's office is located at 400 Howard Street, San Francisco, CA 94105 and its telephone number is (415) 670-2000. The Trust's office is c/o iShares Delaware Trust Sponsor LLC, 400 Howard Street, San Francisco, CA 94105 and its telephone number is (415) 670-2000. The Trustee's office is located at 400 Howard Street, San Francisco, CA 94105. The Ether Custodian's office is located at One Madison Ave, New York, NY 10010. The Additional Ether Custodian's office is located at 101 S. Reid Street, Suite 29, Sioux Falls, South Dakota 57103. The Cash Custodian's and the Trust Administrator's office is located at 240 Greenwich Street, New York, NY 10286.

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**THE OFFERING**

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| Offering  | The Shares represent units of fractional undivided beneficial interest in the net assets of the Trust. |
| Use of proceeds | Proceeds received by the Trust from the issuance and sale of Baskets consist of ether and cash deposits. Staking Consideration received by the Trust from staking, net of the Staking Fee, is intended to be distributed monthly but no less frequently than quarterly by the Trust. Ether deposits will be held by the Ether Custodian or Prime Execution Agent on behalf of the Trust, during which time they may be employed in Staking Activities, until (i) delivered to Authorized Participants or their designated agent or client in connection with an in-kind redemption or sold in connection with a cash redemption, or (ii) sold to pay the Sponsor's Fee and Trust expenses of liabilities not assumed by the Sponsor. Cash deposits will be held by the Cash Custodian or Prime Execution Agent on behalf of the Trust until (i) transferred in connection with the purchase of ether, (ii) delivered to Authorized Participants in connection with a cash redemption of Baskets or (iii) transferred to pay the Sponsor's Fee and Trust expenses or liabilities not assumed by the Sponsor.  |
| NASDAQ ticker symbol  | ETHB |
| CUSIP  | 46438M106  |
| Creation and redemption | The Trust issues and redeems Baskets on a continuous basis. These transactions will take place in exchange for cash or ether. Baskets are only issued or redeemed in exchange for an amount of ether or cash determined by the Trustee on each day that NASDAQ is open for regular trading. No Shares are issued unless the Ether Custodian or Prime Execution Agent has allocated to the Trust's account the corresponding amount of ether. As of [ ], 2026, a Basket requires delivery of $[ ] or [ ] ether. The amount of ether necessary for the creation of a Basket, or to be received upon redemption of a Basket, will decrease over the life of the Trust, due to the payment or accrual of fees and other expenses or liabilities payable by the Trust. Baskets may be created or redeemed only by Authorized Participants, who pay BlackRock Investments, LLC ("BRIL"), an affiliate of the Trustee that has been retained by the Trust to perform certain order processing, Authorized Participant communications, and related services in connection with the issuance and redemption of Baskets ("ETF Services"), (1) a transaction fee for each order to create or redeem Baskets (the "ETF Servicing Fee") and (2) transfer, processing and other transaction costs charged by the Ether Custodian in connection with the issuance of Baskets for such purchase order ("Custody Transaction Costs").  |

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|  | The Authorized Participants will deliver only ether or cash to create Shares and will receive only ether or cash when redeeming Shares.<br>See "Description of the Shares and the Trust Agreement" for more details. |
| Delayed Settlement | Based on market conditions, or in order to act in the interest of shareholders, if redemptions placed during a given order window cause the Liquidity Sleeve to fall below a certain level ("Reduced Buffer Scenario") the Trust may, in its sole discretion, require cash-in-lieu redemption orders until the Liquidity Sleeve has been restored. <br>In stressed conditions, there remains a risk that redemptions exhaust the Liquidity Sleeve, liquidity management policies are unable to sufficiently adjust, and the Trust is unable to meet redemptions in the typical settlement cycle. In that situation, the Sponsor plans to initiate a coordinated redemption workflow where the Sponsor will alert the Trust's Authorized Participants in a timely fashion and transparently work with Authorized Participants to facilitate an orderly settlement of redemption orders when stressed conditions may affect the availability of ether. The Trust will file a Current Report on Form 8-K if such stressed conditions occur. <br>In stressed conditions where the Trust has limited unstaked ether remaining or does not have enough unstaked ether available to meet in-kind redemptions, as determined by the Sponsor in its sole discretion, the Sponsor may, in its sole discretion, determine to either (1) continue processing in-kind redemptions, but delay settlement of such in-kind redemptions beyond the ordinary settlement cycle for in-kind redemptions (a "Delayed In-Kind Redemption"), or (2) solely permit cash redemptions, until the Liquidity Sleeve is rebalanced to the target range (the "in-kind policy cutoff"). During stressed conditions, the Sponsor plans to prioritize redemptions over distribution of staking rewards and payment of fees. Staking reward distributions and fees will continue to accrue during the delayed redemption period. After redemptions have been paid and the Sponsor has determined, in its discretion, that stressed conditions no longer persist, the Sponsor will resume its ordinary procedures to pay the Sponsor's Fee, Staking Fee and distributions of staking rewards, including, in each case, any delinquent amounts.  |

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|  | Furthermore, in stressed conditions where the Trust has limited unstaked ether remaining or does not have enough unstaked ether available to meet cash redemptions, as determined by the Sponsor in its sole discretion, and the Sponsor has invoked the in-kind policy cutoff and is solely permitting cash redemptions, the Sponsor may further, in its sole discretion, determine to either (1) process cash redemptions on the ordinary settlement cycle for cash redemptions, or (2) delay settlement of cash redemptions beyond the ordinary settlement cycle for cash redemptions (a "Delayed Cash Redemption"). Upon submission of either a Delayed In-Kind Redemption or a Delayed Cash Redemption (collectively, a "Delayed Settlement Scenario"), the Sponsor will alert the Authorized Participant and allow the Authorized Participant to choose whether to (1) cancel the redemption order, or (2) accept delayed settlement in accordance with the Delayed Settlement Scenario and proceed with the redemption. The Sponsor shall determine, in its sole discretion, the time at which settlement occurs in a Delayed Settlement Scenario, whether a Delayed Cash Redemption or a Delayed In-Kind Redemption. An Authorized Participant who chooses to proceed with redemption in a Delayed Settlement Scenario shall be bound by the Sponsor's determination and shall not be entitled to choose a different time when their redemption order shall settle, other than the time determined by the Sponsor. If the Authorized Participant decides to proceed with redemption following a Delayed Settlement Scenario that is a Delayed Cash Redemption, the Authorized Participant will deliver the appropriate number of Shares to the Trust. In a Delayed Settlement Scenario that is a Delayed Cash Redemption, the Sponsor will initiate unstaking sufficient to satisfy all redemptions that have not been cancelled and prioritize orders by order date placed then sell pro-rata amounts of liquid ether available each day to the relevant orders (prioritized by order date placed) until all orders are satisfied. Redemptions may be satisfied by any unstaked ether balance, including unstaked ether received via creation orders. <br>In the event an Authorized Participant submits a Delayed In-Kind Redemption before the Sponsor enables the in-kind policy cutoff, Authorized Participants will be allowed to (1) cancel, (2) accept delayed settlement in-kind in accordance with the Delayed Settlement Scenario, and proceed with the redemption, or (3) replace with a cash order at the next cash order window. If the Authorized Participant decides to proceed with a Delayed In-Kind Redemption, the Authorized Participant will deliver the appropriate number Shares to the Trust. In a Delayed In-Kind Redemption, the Sponsor will initiate unstaking transactions sufficient to satisfy all redemptions that have not been cancelled and prioritize orders by order date. When sufficient liquid ether is available to satisfy all prioritized in-kind orders, as determined by the Sponsor in its sole discretion, the Sponsor will settle the full amount the following business day.  |
| Net Asset Value | The net asset value of the Trust will be equal to the total assets of the Trust, which will consist solely of ether and cash, less total liabilities of the Trust, each determined by the Trustee pursuant to policies established from time to time by the Trustee or its affiliates or otherwise described herein. The methodology used to calculate an index (the "Index") price to value ether in determining the net asset value of the Trust may not be deemed consistent with U.S. generally accepted accounting principles ("GAAP"). |

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| The Sponsor has the exclusive authority to determine the Trust's net asset value, which it has delegated to the Trustee under the Trust Agreement. The Trustee has delegated to the Trust Administrator the responsibility to calculate the net asset value of the Trust and the NAV, based on a pricing source selected by the Trustee. In determining the Trust's net asset value, the Trust Administrator values the ether held by the Trust based on the Index, unless the Sponsor in its sole discretion determines that the Index is unreliable. The CF Benchmarks Index shall constitute the Index, unless the CF Benchmarks Index is not available or the Sponsor in its sole discretion determines the CF Benchmarks Index is unreliable as the Index and therefore determines not to use the CF Benchmarks Index as the Index. If the CF Benchmarks Index is not available or the Sponsor determines, in its sole discretion, that the CF Benchmarks Index is unreliable (together a "Fair Value Event"), the Trust's holdings may be fair valued on a temporary basis in accordance with the fair value policies approved by the Trustee. Additionally, the Trust Administrator will monitor for unusual prices and escalate to the Trustee if detected. If the CF Benchmarks Index is not used, the Trust will notify Shareholders in a prospectus supplement, in its periodic Exchange Act reports and/or on the Trust's website.  |
| The Trust Administrator calculates the NAV of the Trust once each Business Day. The NAV for a normal trading day will be released after 4:00 p.m. Eastern Time ("ET"). Trading during the core trading session on the Exchange typically closes at 4:00 p.m. ET. However, NAVs are not officially released until after the completion of a comprehensive review of the NAV and prices utilized to determine the NAV of the Trust by the Trust Administrator. Upon the completion of the end-of-day reviews by the Trust Administrator the NAV is released to the public typically by 5:30 p.m. ET and generally no later than 8:00 p.m. ET. The period between 4:00 p.m. ET and the NAV release after 5:30 p.m. ET (or later) provides an opportunity for the Trust Administrator and the Trustee to detect, flag, investigate, and correct unusual pricing should it occur and implement a Fair Value Event, if necessary. Any such correction could adversely affect the value of the Shares.<br>The Trust's periodic financial statements may not utilize net asset value of the Trust to the extent the methodology used to calculate the Index is deemed not to be consistent with GAAP. The Trust's periodic financial statements will be prepared in accordance with the Financial Accounting Standards Board Accounting Standards Codification Topic 820, "Fair Value Measurements and Disclosures" ("ASC Topic 820") and utilize an exchange-traded price from the Trust's principal market for ether as of 11:59 p.m. ET on the Trust's financial statement measurement date. The Sponsor will determine in its sole discretion the valuation sources and policies used to prepare the Trust's financial statements in accordance with GAAP. The Trust intends to engage a third-party vendor to obtain a price from a principal market for ether, which will be determined and designated by such third-party vendor daily based on its consideration of several exchange characteristics, including oversight, and the volume and frequency of trades. Under GAAP, such a price is expected to be deemed a Level 1 input in accordance with the ASC Topic 820 because it is expected to be a quoted price in active markets for identical assets or liabilities. |

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| Net Asset Value Calculation and Index | On each Business Day, as soon as practicable after 4:00 p.m. ET, the Trust Administrator evaluates the ether held by the Trust as reflected by the CF Benchmarks Index and determines the net asset value of the Trust and the NAV. For purposes of making these calculations, a Business Day means any day other than a day when NASDAQ is closed for regular trading. |
|  | The CF Benchmarks Index employed by the Trust is calculated on each Business Day by aggregating the notional value of ether trading activity across major spot ether platforms. The CF Benchmarks Index is designed based on the IOSCO Principles for Financial Benchmarks and is a registered benchmark under the UK Benchmark Regulations ("BMR"). The administrator of the CF Benchmarks Index is CF Benchmarks Ltd. (the "Index Administrator") a UK incorporated company, authorized and regulated by the Financial Conduct Authority ("FCA") of the UK as a Benchmark Administrator, under UK BMR. The CF Benchmarks Index serves as a once-a-day benchmark rate of the U.S. dollar price of ether (USD/ETH), calculated as of 4:00 p.m. ET. The CF Benchmarks Index aggregates the trade flow of several ether platforms, during an observation window between 3:00 p.m. and 4:00 p.m. ET into the U.S. dollar price of one ether at 4:00 p.m. ET. Specifically, the CF Benchmarks Index is calculated based on the "Relevant Transactions" (as defined in "Business of the Trust – Valuation of Ether; the CF Benchmarks Index") of all of its constituent ether platforms, which are currently Bitstamp, Coinbase, itBit, Kraken, Gemini, LMAX Digital, Bullish Exchange and Crypto.com (the "Constituent Platforms"), and which may change from time to time.<br>The Trust is intended to provide a way for Shareholders to obtain exposure to ether by investing in the Shares rather than by acquiring, holding and trading ether directly on a peer-to-peer or other basis or via a digital asset platform. An investment in the Shares is not the same as an investment directly in ether on a peer-to-peer or other basis or via a digital asset platform.  |
| Intraday Indicative Value  | In order to provide updated information relating to the Trust for use by Shareholders, the Trust intends to publish an intraday indicative value per Share ("IIV") using the CME CF Ether-Dollar Real Time Index ("ETHUSD_RTI"). One or more major market data vendors will provide an IIV updated every 15 seconds, as calculated by the Exchange or a third-party financial data provider during NASDAQ's regular market session of 9:30 a.m. to 4:00 p.m. ET (the "Regular Market Session"). The IIV will be calculated by using the prior day's closing NAV as a base and updating that value during the Regular Market Session to reflect changes in the value of the Trust's NAV during the trading day.<br>The IIV's dissemination during the Regular Market Session should not be viewed as an actual real-time update of the NAV, which will be calculated only once at the end of each trading day. The IIV will be widely disseminated every 15 seconds during the Regular Market Session by one or more major market data vendors. In addition, the IIV will be available through online information services. |

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| Trust expenses  | The Trust's only ordinary recurring expenses are expected to be the Sponsor's Fee and the Staking Fee. In exchange for the Sponsor's Fee, the Sponsor has agreed to assume the marketing and the following administrative expenses of the Trust: the fees of the Trustee, the Delaware Trustee and the Trust Administrator, the Custodians' Fee, NASDAQ listing fees, SEC registration fees, printing and mailing costs, tax reporting fees, audit fees, license fees and expenses and up to $500,000 per annum in ordinary legal fees and expenses. The Sponsor may determine in its sole discretion to assume legal fees and expenses of the Trust in excess of the $500,000 per annum required under the Trust Agreement. To the extent that the Sponsor does not voluntarily assume such fees and expenses, they will be the responsibility of the Trust. The Sponsor will also pay the costs of the Trust's organization and the initial sale of the Shares.<br>The Sponsor's Fee is accrued daily at an annualized rate equal to 0.25% of the net asset value of the Trust and is payable at least quarterly in arrears in U.S. dollars or in-kind or any combination thereof. The Sponsor may, at its sole discretion and from time to time, waive all or a portion of the Sponsor's Fee for stated periods of time. The Sponsor is under no obligation to waive any portion of its fees and any such waiver shall create no obligation to waive any such fees during any period not covered by the waiver. For a twelve-month period commencing on the day the Shares are initially listed on NASDAQ, the Sponsor will waive a portion of the Sponsor's Fee so that the Sponsor's Fee after the fee waiver will be equal to 0.12% of the net asset value of the Trust for the first $2.5 billion of the Trust's assets. <br>The Trust will pay a "Staking Fee", which will include (i) remuneration for the Sponsor's facilitation of Staking Activities pursuant to the Trust Agreement (the "Sponsor's Staking Portion") and (ii) the Prime Execution Agent's share of Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers for their respective shares of the Trust's Staking Consideration), in accordance with the Staking Services Agreement. As of the date hereof, the Sponsor's Staking Portion and the Prime Execution Agent's share of such Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers in respect of their shares of the Staking Consideration) comprise an aggregate of 18% of the gross Staking Consideration. The Trust will retain the remainder of such gross Staking Consideration. <br>The Trust may incur certain extraordinary, non-recurring expenses that are not assumed by the Sponsor, including but not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, Ethereum network fees and similar transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders, any indemnification of the Cash Custodian, the Ether Custodian, the Additional Ether Custodian, the Prime Execution Agent, Trust Administrator, or other agents, service providers (including, without limitation, Staking Services Providers) or counterparties of the Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters or legal fees, costs or expenses incurred by the Trust or Coinbase (when acting as agent on behalf of the Trust) in enforcing the Trust's rights against Staking Services Providers. To cover the Sponsor's Fee, the Sponsor's Staking Portion and any expenses not assumed by the Sponsor, the Trust will need to sell ether. Trust expenses not assumed by the Sponsor and not included in trade execution costs paid by the Trust shall accrue daily and be payable by the Trust to the Sponsor at least quarterly in arrears. The Trust may also be subject to other liabilities (for example, as a result of litigation) that have also not been assumed by the Sponsor. The only source of funds to cover those liabilities will be sales of ether held by the Trust. Even if there are no expenses other than those assumed by the Sponsor, and there are no other liabilities of the Trust, the Trust will need to sell ether to pay the Sponsor's Fee. The result of these sales is a decrease in the amount of ether represented by each Share.  |

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|  | To cover the Sponsor's Fee and expenses not assumed by the Sponsor, the Sponsor or its delegate will cause the Trust (or its delegate) to convert ether into U.S. dollars at the price available through the Prime Execution Agent's Coinbase Prime service (less applicable trading fees) through the Trading Platform which the Sponsor is able to obtain using commercially reasonable efforts. The number of ether represented by a Share will decline each time the Trust pays the Sponsor's Fee or any Trust expenses not assumed by the Sponsor by transferring or selling ether.<br>The quantity of ether to be sold to permit payment of the Sponsor's Fee or Trust expenses not assumed by the Sponsor, will vary from time to time depending on the level of the Trust's expenses and the value of ether held by the Trust. Assuming that the Trust is a grantor trust for U.S. federal income tax purposes, each delivery or sale of ether by the Trust for the payment of expenses generally will be a taxable event to Shareholders. See "U.S. Federal Income Tax Consequences."<br>In the event that any of the foregoing fees and expenses are incurred with respect to the Trust and other Client Accounts (as defined in "Conflicts of Interest"), the Sponsor will allocate the costs across the entities on a pro rata basis, except to the extent that certain expenses are specifically attributable to the Trust or another Client Account. The Trust expects that any trading commissions associated with block trading, if applicable, will be allocated across the relevant entities on a pro rata basis. |
| Staking Activities | To effectuate the Trust's Staking Activities, the Sponsor will direct, or may from time to time direct, the Ether Custodian to enter into Staking Arrangements with one or more Staking Services Providers, which may be either affiliates of the Ether Custodian or other approved third-party validators, to conduct Staking Activities through Provider-Facilitated Staking. The Sponsor anticipates that the Trust's Staking Activities will be executed exclusively by means of Provider-Facilitated Staking. The Sponsor will direct the Ether Custodian to stake the Trust's ether with one or more third-party Staking Services Providers based on a range of factors, including, but not limited to, the performance, reliability, and reputation of each Staking Services Provider, as well as ongoing monitoring of their uptime, slashing history, and other operational metrics. <br>The Trust's staking program seeks to maximize the portion of the Trust's ether available for staking while controlling for liquidity and redemption risks. To manage the liquidity and redemption risks associated with staking, the Sponsor intends to maintain a Liquidity Sleeve consisting of a target range of 5%-30% unstaked ether maintained solely to ensure that the Trust has sufficient readily available assets to meet redemption requests. The Liquidity Sleeve will be held by the Ether Custodian and maintained in cold storage, and will not be held in hot wallets. Except for temporary movements into a Trading Balance solely to facilitate creation or redemption activity, all ether in the Liquidity Sleeve will remain in the custody of the Ether Custodian in cold storage, and any ether in the Trading Balance will be swept back into cold storage on a daily basis. <br>The Ether Custodian and the Staking Services Provider will exercise no discretion as to the amount of the Trust's ether to be staked or the timing of the Trust's Staking Activities. As of the date of this prospectus, the Trust seeks to stake as much of the Trust's ether as practicable (i.e. 70% - 95% under normal market circumstances) through one or more Staking Services Providers, except (i) to fund or rebalance the Liquidity Sleeve, (ii) as necessary to pay the Sponsor's Fee or any Trust expenses not assumed by the Sponsor, (iii) as necessary to satisfy existing and reasonably foreseen potential redemption orders, (iv) as necessary to reduce the ether obtained by the Trust as Staking Consideration to cash for distribution at regular intervals, (v) if the Sponsor determines that Staking Activities raise significant governmental, policy or regulatory concerns or is subject or likely subject to a specialized regulatory regime, (vi) if the Sponsor determines that any vulnerability exists in the source code, validator or client software, or any other core protocol or staking component of the Ethereum network, (vii) if the Ether Custodian or a Staking Services Provider discontinue their arrangements with the Trust, (viii) if the Sponsor otherwise determines that continued Staking Activities of such portion of the Trust's assets would be inconsistent with the Trust's purpose of protecting and conserving the value of the Trust or (ix) in accordance with any other exception that is expressly contemplated in the 2025 Staking Tax Guidance.  |

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All ether received by the Trust in connection with the creation of new Shares, or as Staking Consideration (net of the Sponsor's Staking Portion), would also be staked upon receipt by the Trust, unless one or more of the exceptions described in clauses (i)-(ix) above applies. Moreover, any staked ether which must be unstaked in order to fulfill a distribution in connection with a redemption (to the extent such distribution cannot be fulfilled utilizing the portion of the Trust's ether that has not been staked, or through another mechanism to manage liquidity in connection with redemptions contemplated by the 2025 Staking Tax Guidance) will be unstaked only after the redemption order is approved by the Trust, the Sponsor executes an unstaking or withdrawal transaction through the Ether Custodian, and such transaction is processed by the Ethereum network. The Staking Services Provider will not be able to transfer unstaked ether or Staking Consideration to another address on the Ethereum network <br>Under the Trust's staking program, the Sponsor instructs the Prime Execution Agent, as agent for the Ether Custodian, to stake the Trust's ether. The Ether Custodian, who controls the private keys to the Trust's ether, sends the Trust's Staked Assets from the Trust's Vault Account to the Ethereum network's Protocol Staking Deposit Contract. The Ether Custodian designates (i) the Staking Services Provider as the validator in connection with a specified amount of the Trust's Staked Assets, giving the Staking Services Provider access to a set of Validator Keys relating to such Staked Assets that the Staking Services Provider can use to perform Validation Activities, and (ii) the Trust's own Vault Account as the withdrawal address for both staking rewards and the underlying staked assets themselves after they are unstaked by the Ether Custodian at the Sponsor's instruction. The Staking Services Provider then uses the Validator Keys to perform Validation Activities, operating validator software, including validator nodes, with the Trust's Staked Assets staked with such Staking Services Provider subject to slashing if the Staking Services Provider commits certain forms of misconduct when performing Validation Activities. The Staking Services Provider does not control the private keys to transfer or take possession or ownership of the Trust's Staked Assets when staked with such Staking Services Provider. Instead, the Staked Assets are locked in the Ethereum network's Protocol Staking Deposit Contract until unstaked by the Ether Custodian at the Sponsor's instruction, at which point the Trust's Staked Assets (and any related rewards) are transferred programmatically to the Vault Account at the Ether Custodian. The Staking Services Provider is the node operator and is obligated to perform Validation Activities with the Trust's Staked Assets consistent with the terms of the Trust's agreements with Staking Services Providers. The Trust retains control and ownership of the Trust's staked ether because the Ether Custodian controls the private keys to the Trust's Staked Assets. Validator Keys do not give the Staking Services Provider the ability to transfer the Trust's Staked Assets, and the Trust's Staked Assets are never transferred to a wallet address of the Staking Services Provider; furthermore, the Protocol Staking Deposit Contract is a smart contract that has no associated private keys and, upon unstaking, programmatically transfers the Trust's Staked Assets back to the Trust's Vault Account at the Ether Custodian. The Trust (rather than the Staking Services Provider) also will retain the ability through the Ether Custodian to unstake its ether at any time (subject to Ethereum network processes and delays). The Trust's agreements with the Staking Services Providers and Coinbase also specifically provide that the Staked Assets belong to the Trust and neither the Staking Services Providers nor Coinbase have any ownership or property interest in the Trust's Staked Assets. The Trust's agreements with Staking Services Providers require each Staking Services Provider to maintain Validator Keys that solely correspond to Staked Assets of the Trust and not commingle the staked assets of any other person (such as the Staking Services Provider or others who stake to the Staking Services Provider) with the Staked Assets of the Trust, despite the Trust delegating the validation rights to the Trust's Staked Assets to the Staking Services Provider, which may serve as a staking services provider for other persons and, as a result, hold other validator keys and perform validation activities corresponding to staked ether belonging to other ether holders. Staking will be a passive activity for the Trust, as it relies on Provider-Facilitated Staking, and will not operate its own node or perform validation activities on its own. Moreover, the Trust's role will be limited to (i) selecting the Staking Services Provider(s), and (ii) determining, from time to time, what portion of the Trust's ether to stake and unstake so as to maintain sufficient Trust assets to satisfy all outstanding redemption orders, and informing the Staking Services Provider(s) of those determinations. Under normal market circumstances, the Sponsor intends to stake 70% - 95% of the Trust's ether. <br>The Trust expects to receive certain staking rewards of ether from Staking Activities, which would be treated as giving rise to taxable income for U.S. federal income tax purposes under current "IRS" guidance. See "U.S. Federal Income Tax Consequences" for further description of receipt of Staking Consideration by the Trust. The Staking Services Provider shall exercise no discretion as to the amount of the Trust's ether to be staked or the timing of the Trust's Staking Activities. The Ether Custodian will maintain exclusive possession and control of the private keys associated with transferring any staked ether at all times while Staking Service Providers will maintain exclusive possession and control of the private keys associated with ether validation activities at all times. Staking activity on the Ethereum network involves the delegation of ether to validators and carries certain risks. Misbehavior or poor performance by validators may result in such validators receiving reduced staking rewards for an epoch during which they misbehaved or performed poorly. Additionally, as part of the "activating" and "exiting" (followed by withdrawal) processes of staking, staked ether will be inaccessible for a variable period of time determined by a range of factors, including network congestion, resulting in potential inaccessibility during those periods. During activation, exit, and withdrawal, the Trust's staked assets will not earn any rewards. "Activation" is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the Ethereum network's proof-of-stake consensus protocol. "Exit" is the request to exit from the active set and no longer participate in the Ethereum network's proof-of-stake consensus protocol, and is followed by a protocol-administered withdrawal process, which takes additional time to complete. As part of these "activation", "exiting" and withdrawal processes of staking on the Ethereum network, any staked ether will be inaccessible for a period of time. The duration of activation and exit/withdrawal periods are dependent on a range of factors, including network conditions. In periods of low demand, unstaking may be completed within days, while in periods of elevated exit activity the process may take multiple weeks or months to complete. <br>See "Description of the Shares and the Trust Agreement" for more details.<br>

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| Incidental Rights / IR Digital Asset | From time to time, the Trust may be entitled to or come into possession of rights to acquire, or otherwise establish dominion and control over, any digital asset (for avoidance of doubt, other than ether) or other asset or right, which rights are incident to the Trust's ownership of ether and arise without any action of the Trust, or of the Sponsor or Delaware Trustee on behalf of the Trust ("Incidental Rights") and/or digital asset tokens, or other assets or rights, acquired by the Trust through the exercise (subject to the applicable provisions of the Trust Agreement) of any Incidental Right ("IR Digital Asset") by virtue of its ownership of ether, generally through a fork in the Ethereum blockchain, an airdrop offered to holders of ether or other similar event. |

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|  | With respect to a fork, airdrop or similar event, the Sponsor will cause the Trust to permanently and irrevocably abandon the Incidental Rights and IR Digital Asset and no such Incidental Right or IR Digital Asset shall be taken into account for purposes of determining the NAV of the Trust. In the event the Trust seeks to change this position, an application would need to be filed with the SEC by NASDAQ seeking approval to amend its listing rules to permit the Trust to sell Incidental Rights or IR Digital Asset and distribute the cash proceeds (net of expenses and applicable withholding taxes) to Depository Trust Company ("DTC") or distribute the Incidental Rights or IR Digital Asset in-kind to DTC. Because the Trust will abandon any Incidental Rights and IR Digital Asset, the Trust would not receive any direct or indirect consideration for the Incidental Rights or IR Digital Asset, and thus the value of the Shares will not reflect the value of the Incidental Rights or IR Digital Asset. See "Risk Factors—Risk Factors Related to the Trust and the Shares – A temporary or permanent "fork" could adversely affect the value of the Shares. In addition, Shareholders will not receive the benefits of any Incidental Rights and any IR Digital Asset, including any forked or airdropped assets." |
| Tax Considerations  | Owners of Shares will be treated, for U.S. federal income tax purposes, as if they owned a corresponding share of the assets of the Trust. They will also be viewed as if they directly received a corresponding share of any income of the Trust, or as if they had incurred a corresponding share of the expenses of the Trust. Consequently, each sale of ether by the Trust will constitute a taxable event to the Shareholders. Also, the Trust's receipt of staking rewards from Staking Activities would be treated as giving rise to taxable income for U.S. federal income tax purposes under current IRS guidance. See "U.S. Federal Income Tax Consequences—Taxation of U.S. Shareholders." |
| Voting Rights  | Owners of Shares do not have any voting rights, take no part in the management or control of, and have no voice in, the Trust's operations or business. See "Description of the Shares and the Trust Agreement—Voting Rights." |

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| Suspension of Issuance, Transfers and Redemptions  | The Trustee may, and upon the direction of the Sponsor shall, suspend the acceptance of purchase orders or the delivery or registration of transfers of Shares generally, or may, and upon the direction of the Sponsor shall, refuse a particular purchase order, delivery or registration of Shares (i) during any period when the transfer books of the Trustee are closed or (ii) at any time, if the Sponsor thinks it advisable for any reason. The Trustee may, in its sole discretion, and upon the direction of the Sponsor will, suspend the right to surrender Shares or postpone the delivery date of ether or other Trust property generally or with respect to a particular redemption order (i) during any period in which regular trading on NASDAQ is suspended or restricted, or the exchange is closed (other than scheduled holiday or weekend closings), or (ii) during a period when the Sponsor determines that delivery, disposal or evaluation of ether is not reasonably practicable (for example, as a result of an interruption in services or availability of the Prime Execution Agent, Ether Custodian, Cash Custodian, Administrator, or other service providers to the Trust, act of God, catastrophe, civil disturbance, government prohibition, war, terrorism, strike or other labor dispute, fire, force majeure, interruption in telecommunications, iShares order entry system, internet services, or network provider services, unavailability of Fedwire, SWIFT or banks' payment processes, significant technical failure, bug, error, disruption or fork of the Ethereum network, hacking, cybersecurity breach, or power, internet, or Ethereum network outage, or similar event). The Trustee shall reject any purchase order or redemption order that is not in proper form. See "Description of the Shares and the Trust Agreement—Requirements for Trustee Actions." |

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| Limitation on Obligations and Liability  | The Sponsor and the Trustee:<br>● are only obligated to take the actions specifically set forth in the Trust Agreement without willful misconduct, gross negligence, reckless disregard or bad faith;<br>● are not liable if either of them is prevented or delayed by law or circumstances beyond their control from performing their respective obligations under the Trust Agreement; |

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● are not liable for the exercise of discretion permitted under the Trust Agreement;<br>● have no obligation to prosecute any lawsuit or other proceeding on behalf of the Shareholders or any other person;<br>● are not liable for any loss of ether occurring prior to the delivery of ether to the Ether Custodian or Prime Execution Agent, as applicable, or after the delivery of ether by the Ether Custodian or Prime Execution Agent, as applicable, in connection with creations and redemptions (and for the avoidance of doubt, are not liable for the loss of ether while held by the Ether Custodian or Prime Execution Agent, or for any loss of ether occurring during the transfer of ether from the Ether Custodian or the Prime Execution Agent to the Additional Ether Custodian or vice versa, absent willful misconduct, gross negligence, reckless disregard or bad faith by the Sponsor and Trustee); and<br>

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|  | ● may rely upon any advice or information from other persons they believe in good faith to be competent to provide such advice or information.<br>See "Description of the Shares and the Trust Agreement—Limitations on Obligations and Liability."  |
| Dissolution events  | The Trustee will dissolve the Trust if: |
|  | ● the Trustee is notified that the Shares are delisted from NASDAQ and are not approved for listing on another national securities exchange within five Business Days of their delisting; |
|  | ● a U.S. federal or state court or regulator, or applicable law or regulatory requirements, requires the Trust to shut down, or forces the Trust to liquidate its ether, or seizes, impounds or otherwise restricts access to Trust assets; |
|  | ● the Sponsor notifies the Trustee in writing that it has determined, in its sole discretion, that the dissolution of the Trust is advisable or desirable for any reason; or |
|  | ● DTC is unable or unwilling to continue to perform its functions, and a comparable replacement is unavailable. |
|  | The Sponsor may, in its sole discretion, dissolve the Trust if: |
|  | ● 60 days have elapsed since the Trustee notified the Sponsor of the Trustee's election to resign or since the Sponsor removed the Trustee, and a successor trustee has not been appointed and accepted its appointment;  |
|  | ● the SEC (or its staff) or a court of competent jurisdiction determines that the Trust is an investment company under the Investment Company Act;  |
|  | ● the CFTC determines that the Trust is a commodity pool under the Commodity Exchange Act of 1936, as amended (the "Commodity Exchange Act" or "CEA"); |
|  | ● the U.S. Department of the Treasury Financial Crimes Enforcement Network ("FinCEN") determines that the Trust or the Sponsor is required to register as an MSB, or the New York Department of Financial Services determines the Trust or the Sponsor is required to obtain licensure under 23 NYCRR Part 200 ("BitLicense"); |

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| ● if any state regulator or court of competent authority determines the Sponsor or the Trust is required to obtain a money transmitter license or other state license;<br>● the Index Administrator ceases to maintain the Index or any ongoing event exists that prevents or makes impractical the determination of the Index price and, in the opinion of the Sponsor, no successor or similar pricing source is reasonably available;<br>● the net assets of the Trust in relation to the operating expenses of the Trust is at a level at which continued operation of the Trust is unreasonable or imprudent;<br>● any ongoing event exists that either prevents the Trust from or makes impractical the Trust's holding of ether, or prevents the Trust from converting or makes impractical the Trust's reasonable efforts to convert ether to U.S. dollars; |
| ● the Trust fails to qualify for treatment, or ceases to be treated, for U.S. federal income tax purposes, as a grantor trust, and the Trustee receives notice from the Sponsor that the Sponsor has determined that, because of that tax treatment or change in tax treatment, termination of the Trust is advisable; or |
| ● any custodian (including, for the avoidance of doubt, any of the Custodians) or prime execution agent (including, for the avoidance of doubt, the Prime Execution Agent) then acting resigns, is removed, is prohibited by applicable law or regulation to act as or otherwise ceases to act as custodian or prime execution agent, and, in the opinion of the Sponsor, no successor custodian or prime execution agent has been employed and operationalized prior to, at the Sponsor's election, (i) the effective date of such resignation, removal, prohibition or cessation, or (ii) in the case of the Ether Custodian or Prime Execution Agent, the final date as of which the Ether Custodian or Prime Execution Agent will cease to hold any of the Trust's assets, to the extent different from (i). |
| The term of the Trust is perpetual (unless terminated earlier in certain circumstances). See "Description of the Shares and the Trust Agreement—Amendment and Dissolution."<br>On and after dissolution of the Trust, the Trustee will wind up the business and affairs of the Trust and deliver Trust property upon surrender and cancellation of Shares. The Trustee will not accept any purchase order or redemption order after the date of dissolution. If any Shares remain outstanding after the date of dissolution of the Trust, the Trustee thereafter will (i) discontinue the registration of transfer of Shares; (ii) continue to collect distributions pertaining to Trust property and hold proceeds thereof uninvested, without liability for interest; and (iii) pay the Trust's expenses and may sell Trust property as necessary to meet those expenses. After the dissolution of the Trust, the Trustee will sell or otherwise liquidate the Trust property then held and after deducting any fees, expenses, taxes or other governmental charges payable by the Trust and any expenses for the account of DTC of such Shares and any applicable taxes or other governmental charges, promptly distribute the net proceeds from such sale to DTC. See "Description of the Shares and the Trust Agreement—Amendment and Dissolution." |

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| Authorized Participants  | Baskets may be created or redeemed only by Authorized Participants. Each Authorized Participant must be a registered broker-dealer, a participant in DTC, have entered into an agreement with the Sponsor and the Trustee (the "Authorized Participant Agreement") and be in a position to transfer cash or ether to, and take delivery of cash or ether from, the Trust Administrator through one or more accounts. The Authorized Participant Agreement provides the procedures for the creation and redemption of Baskets and for the delivery of cash or ether in connection with such creations or redemptions. As of the date of this prospectus, the Authorized Participant is Virtu Americas LLC. Additional Authorized Participants may be added at any time, subject to the discretion of the Sponsor.  |
| Ether Trading Counterparties | In connection with cash creations and redemptions, the Trust will engage in ether transactions for converting cash into ether (in association with purchase orders) and ether into cash (in association with redemption orders). The Trust will conduct its ether purchase and sale transactions by, in its sole discretion, choosing to trade directly with third parties (each, a "Ether Trading Counterparty"), pursuant to written agreements between such Ether Trading Counterparties and the Trust, or choosing to trade through the Prime Execution Agent through its Coinbase Prime service pursuant to the Prime Execution Agent Agreement. As of the date of this prospectus, the Ether Trading Counterparty is Virtu Financial Singapore Pte. Ltd. In connection with cash creations and redemptions, each Ether Trading Counterparty represents to the Trust that it is acting for itself and not for another person<sup>.</sup> Upon receipt of an order from an Authorized Participant to create or redeem Baskets, the Trust may obtain quotes for a price to purchase or sell ether from one or more Ether Trading Counterparties. An Ether Trading Counterparty may respond to the Trust's request with an offer of a quote at which it is willing to sell the specified quantity of ether, or a portion thereof, in the case of a creation, or a quote at which it is willing to buy the specified quantity of ether, or a portion thereof, in the case of a redemption, as indicated in such offer. The Ether Trading Counterparties are not contractually obligated to participate in cash orders for creations or redemptions by placing any offers to buy or sell ether with the Trust. The Trust then determines, in its sole discretion, whether to utilize one of the Ether Trading Counterparties that provided a quote or to trade through the Prime Execution Agent to execute an ether trade. Once an offer is accepted, it becomes a trade that is binding on both the Trust and the Ether Trading Counterparty, subject to customary exceptions.  |
| Clearance and settlement  | The Shares will be evidenced by a global certificate that the Trust issues to DTC. The Shares are issued in book-entry form only. Transactions in Shares clear through the facilities of DTC. Investors may hold their Shares through DTC, if they are participants in DTC, or indirectly through entities that are participants in DTC. |

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**SUMMARY FINANCIAL CONDITION**

As of [__], 2026, the net asset value of the Trust was $[__] and the NAV was $[__].

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**RISK FACTORS**

*The Shares are speculative and involve a high degree of risk. Before making an investment decision, you should consider carefully the risks described below, as well as the other information included in this prospectus.* 

**Risk Factors Related to Digital Assets** 

***The trading prices of many digital assets, including ether, have experienced extreme volatility in recent periods and may continue to do so. Extreme volatility in the future, including further declines in the trading prices of ether, could have a material adverse effect on the value of the Shares and the Shares could lose all or substantially all of their value.***

The trading prices of many digital assets, including ether, have experienced extreme volatility in recent periods and may continue to do so. For instance, there were steep increases in the value of certain digital assets, including ether, over the course of 2021, and multiple market observers asserted that digital assets were experiencing a "bubble." These increases were followed by steep drawdowns throughout 2022 in digital asset trading prices, including for ether. These episodes of rapid price appreciation followed by steep drawdowns have occurred multiple times throughout ether's history, including in 2021-2025. For example, ether lost approximately 12.2% of its value according to some sources in mid-October 2025 as part of wider digital asset market turmoil, widely attributed to global trade tensions, which triggered a number of dislocations in the digital asset market (the "October 2025 Flash Crash"), including liquidations of up to $20 billion in collateral in the form of various digital assets (including, but not limited to, ether) securing trades (particularly perpetual futures contracts and various forms of financing transactions), along with reported service interruptions, halted orders, forced unwinding of trades, and other issues, across centralized and decentralized exchanges. As of the date of this prospectus, digital asset prices have continued to fluctuate in 2026.

Extreme volatility may persist, and the value of the Shares may significantly decline in the future without recovery. The digital asset markets may still be experiencing a bubble or may experience a bubble again in the future. For example, in the first half of 2022, each of Celsius Network, Voyager Digital Ltd., and Three Arrows Capital declared bankruptcy, resulting in a loss of confidence in participants of the digital asset ecosystem and negative publicity surrounding digital assets more broadly. In November 2022, FTX Trading Ltd. ("FTX"), one of the largest digital asset platforms by volume at the time, halted customer withdrawals amid rumors of the company's liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly thereafter, FTX's CEO resigned and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates have entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department of Justice brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX's and its affiliates' senior executives, including its former CEO. In addition, several other entities in the digital asset industry filed for bankruptcy following FTX's bankruptcy filing, such as BlockFi Inc. and Genesis Global Capital, LLC ("Genesis"). In response to these events (collectively, the "2022 Events"), the digital asset markets have experienced extreme price volatility and other entities in the digital asset industry have been, and may continue to be, negatively affected, further undermining confidence in the digital asset markets. These events have also negatively impacted the liquidity of the digital asset markets as certain entities affiliated with FTX engaged in significant trading activity. If the liquidity of the digital asset markets continues to be negatively impacted by these events, the prices of digital assets, including ether, may continue to experience significant volatility or declines and confidence in the digital asset markets may be further undermined. In addition, regulatory and enforcement scrutiny has increased, including from, among others, the Department of Justice, the SEC, the CFTC, the White House and Congress, as well as state regulators and authorities. These events are continuing to develop, and the full facts are continuing to emerge. It is not possible to predict at this time all of the risks that they may pose to the Trust, its service providers or the digital asset industry as a whole.

The prices of some digital assets, including ether, have fluctuated significantly following the election of Donald Trump as president of the United States. Some expect the new administration to adopt a constructive attitude toward the digital asset industry. Through his executive orders, President Trump has indicated that the administration will work toward providing greater regulatory clarity and certainty for emerging technologies, including blockchain technology and digital assets, thereby fostering their development in the U.S. Similarly, the digital asset industry expects favorable legislation from the new U.S. Congress as certain members have expressed interest in advancing digital asset specific legislation. To the extent market expectations about future activity by the administration or Congress lead digital asset prices and valuations to increase, there can be no assurance such expectations will be fulfilled, or that digital asset prices will rise or maintain their current levels. Some commentators have referred to the digital asset market post-President Trump's election as a bubble. There can be no assurance that such a bubble does not exist. The failure of the administration and Congress to provide greater regulatory clarity and certainty for blockchain technology and digital assets, such as through promulgating a regulatory framework governing the issuance and operation of digital assets that meets industry expectations, could lead to a decline in the prices of digital assets, including ether. Such a decline could cause a reduction in the value of the Shares and cause Shareholders to suffer losses. Moreover, there can be no assurance that political sentiments toward the digital asset industry, or market perceptions of those sentiments, will not shift over time.

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On March 6, 2025, President Trump issued an executive order for the "Establishment of the Strategic Bitcoin Reserve and United States Digital Asset Stockpile" (the "Order"). The Order requires the Secretary of the U.S. Department of Treasury to establish two offices to administer and maintain a "Strategic Bitcoin Reserve" (the "Bitcoin Reserve") and a U.S. Digital Asset Stockpile (the "Digital Asset Stockpile"), respectively. The Bitcoin Reserve will be capitalized with bitcoin forfeited as part of U.S. criminal or civil proceedings or in satisfaction of penalties imposed by executive agencies. The Order directs the Secretaries of the U.S. Treasury Department and the U.S. Department of Commerce to develop budget-neutral strategies for acquiring additional bitcoin for the Bitcoin Reserve. As established by the Order, the Bitcoin Reserve will not contain ether, and there can be no assurance, and there is no present indication, that it would be changed to include ether in the future. The Digital Asset Stockpile will be capitalized initially with digital assets other than bitcoin forfeited as part of criminal or civil asset forfeiture proceedings, which could include ether; however, there will be no new acquisitions of ether as part of the Digital Asset Stockpile. The anticipation of a U.S. government-funded strategic cryptocurrency reserve may have motivated large-scale purchases of ether in the expectation of the U.S. government potentially acquiring ether to fund such an expected reserve, and the market price of ether may have decreased as a result of the ultimate content of the Order, which did not ultimately provide for acquisition of ether as part of the Bitcoin Reserve, though ether could be held as part of the Digital Asset Stockpile. While legislation has been introduced in the U.S. Senate and the U.S. House of Representatives, which would direct the acquisition of one million bitcoin by the federal government over a five-year period, no such similar federal legislation has been introduced that would provide for acquiring ether. Even if such legislation providing for the acquisition of ether were to be introduced at the federal level, it could fail to pass. Bills have also been introduced in several state legislatures to authorize the acquisition of bitcoin by state governments or their instrumentalities, some of which have failed to pass; however, the Sponsor is not aware as of the date of this prospectus that similar legislation at the state level has been introduced in respect of ether, in the same quantity as legislation in respect of bitcoin. If now or in the future, the U.S. federal government or any state government or any instrumentality thereof does not announce ether acquisition plans or does announce such plans, but these plans fall short of market expectations, the price of ether may decline, which may impact Share value. Even if government acquisitions of ether were to occur or if legislation requiring acquisitions of ether is enacted, the price of ether may decline if there are implementation challenges, unexpected difficulties, or policy or legal reversals, any of which may negatively impact Share value. Further, executive orders such as the Order are subject to change and can be reversed or overturned. The enduring existence and size of the Digital Asset Stockpile is subject to complex challenges and uncertainty that makes it difficult to evaluate its effect on the value of ether and the Shares, now or in the future. There can be no assurance that any particular legislation will ever be introduced or passed at either the federal or state level providing for the acquisition of ether by governmental instrumentalities.

Extreme volatility in the future, including further declines in the trading prices of ether, could have a material adverse effect on the value of the Shares and the Shares could lose all or substantially all of their value. The Trust is not actively managed and will not take any action to take advantage, or mitigate the impacts, of volatility in the price of ether.

***The value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of ether as a digital asset, including the fact that digital assets are bearer instruments and loss, theft, destruction, or compromise of the associated private keys could result in permanent loss of the asset, and the capabilities and development of blockchain technologies such as the Ethereum blockchain.***

Digital assets such as ether were only introduced within the past decade, and the medium-to-long term value of the Shares is subject to a number of factors relating to the capabilities and development of blockchain technologies, such as the recentness of their development, their dependence on the internet and other technologies, their dependence on the role played by users, developers and validators and the potential for malicious activity. For example, the realization of one or more of the following risks could materially adversely affect the value of the Shares:

● Digital asset networks, including the Ethereum peer-to-peer network and associated blockchain ledger (such blockchain, the "Ethereum blockchain" and together with the peer-to-peer network, the "Ethereum network" or "Layer 1 Ethereum network"), and the software used to operate them are in the early stages of development. Given the recentness of the development of digital asset networks, digital assets may not function as intended and parties may be unwilling to use digital assets, which would dampen the growth, if any, of digital asset networks. Because ether is a digital asset, the value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of digital assets, including the fact that digital assets are bearer instruments and loss, theft, compromise, or destruction of the associated private keys could result in permanent loss of the asset.

● Digital assets, including ether, are controllable only by the possessor of both the unique public key and private key or keys relating to the Ethereum network address, or "wallet," at which the digital asset is held. Private keys must be safeguarded and kept private in order to prevent a third party from accessing the digital asset held in such wallet. The loss, theft, compromise or destruction of a private key required to access a digital asset may be irreversible. If a private key is lost, stolen, destroyed or otherwise compromised and no backup of the private key is accessible, the owner would be unable to access the digital asset corresponding to that private key and the private key will not be capable of being restored by the digital asset network, resulting in the total loss of the value of the digital asset linked to the private key.

● Digital asset networks are dependent upon the internet. A disruption of the internet or a digital asset network, such as the Ethereum network, would affect the ability to transfer digital assets, including ether, and, consequently, their value.

● The acceptance of software patches or upgrades by some, but not all, nodes, users and validators in a digital asset network, such as the Ethereum network, could result in a "fork" in such network's blockchain, including the Ethereum blockchain, resulting in the operation of multiple separate networks.

● Governance of the Ethereum network is by voluntary consensus and open competition. As a result, there may be a lack of consensus or clarity on the governance of the Ethereum network, which may stymie the Ethereum network's utility and ability to grow and face challenges. In particular, it may be difficult to find solutions or marshal sufficient effort to overcome any future problems on the Ethereum network, especially long-term problems.

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● The foregoing notwithstanding, the Ethereum network's protocol is informally overseen by a collective of core developers who, along with members of the Ethereum community, can introduce proposals, known as Ethereum Improvement Proposals ("EIPs"), for updating the Ethereum network. The core developers evolve over time, largely based on self-determined participation. An Ethereum client ("Ethereum Client") is a software application that implements the Ethereum network specification and communicates with the Ethereum network. A "node" is a computer or other device that has downloaded the Ethereum Client and is connected to other computers also running the Ethereum Client software, together forming the Ethereum network. To the extent that node operators update their individual Ethereum Client to new specifications, the Ethereum network could be subject to changes that may adversely affect the value of ether. In addition, if a digital asset network has high-profile contributors, the perception that such contributors will no longer contribute to the network could have an adverse effect on the market price of the related digital asset.

● Over the past several years, digital asset validator operations have evolved from individual users to "professionalized" validating operations using proprietary hardware or sophisticated machines. If the profit margins of digital asset validating operations are not sufficiently high, including due to a decrease in transaction fees, validators are more likely to immediately sell tokens earned by validating, resulting in an increase in liquid supply of that digital asset, which would generally tend to reduce that digital asset's market price.

● To the extent that any validators cease to record transactions that do not include the payment of a transaction fee in solved blocks or do not record a transaction because the transaction fee is too low, such transactions will not be recorded on the Ethereum blockchain until a block is validated by a validator who does not require the payment of transaction fees or is willing to accept a lower fee. Any widespread delays in the recording of transactions could result in a loss of confidence in a digital asset network.

● Many digital asset networks, including the Ethereum network, face significant scaling challenges and may periodically be upgraded with various features designed to increase the speed of digital asset transactions and the number of transactions that can be processed in a given period (known as "throughput"). These attempts to increase the volume of transactions may not be effective or may result in unforeseen problems or issues, and such upgrades may fail, resulting in potentially irreparable damage to the Ethereum network and the value of ether.

● Moreover, in the past, bugs, defects, and flaws in the source code for digital assets have been exposed and exploited, including flaws that disrupted normal Ethereum network, Ethereum Client, or dApp and smart contract operations or disabled related functionality for users, exposed users' personal information and/or resulted in the theft of users' digital assets. For example, in May 2023, the main Ethereum network itself reportedly suffered outages or bugs that for a short time prevented transactions from finalizing and being recorded in blocks twice in two days. Major Ethereum Clients which nodes use to access the Ethereum network, such as Geth, Besu and Nethermind, have in the past suffered outages or disruptions due to bugs. For more on an unplanned fork involving Geth clients, see "—A temporary or permanent "fork" could adversely affect the value of the Shares." The cryptography underlying the Ethereum network or ether as an asset could prove to be flawed or ineffective, or developments in mathematics and/or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such cryptography becoming ineffective. Quantum computing technology is an emerging phenomenon which, because it is still developing, makes it difficult to predict its ultimate effect on the future value of ether and other digital assets. However, if quantum computing technology is able to advance and significantly increase its capacity relative to the capacity of today's leading quantum computers, it could potentially undermine the viability of many of the cryptographic algorithms used across the world's information technology infrastructure, including the cryptographic algorithms used for digital assets like ether. If quantum computing is able to advance in that way, there is a risk that quantum computing could result in the cryptography underlying the Ethereum network becoming ineffective, which, if realized, could compromise the security of the Ethereum network, or allow a malicious actor to compromise the wallets holding ether owned by the Trust or others on the Ethereum network, which would result in losses to Shareholders. While various actors in the Ethereum community are taking steps to enable the uses of cryptographic algorithms that would be resistant to advanced quantum computers, there is no guarantee that new quantum-proof architectures will be built and appropriate transitions will be implemented across the network at scale in a timely manner; any such changes could require the achievement of broad consensus within the Ethereum network community and a fork (or multiple forks), and there can be no assurance that such consensus would be achieved or the changes implemented successfully. See "—Changes in the governance of a digital asset network may not receive sufficient support from users and miners, which may negatively affect that digital asset network's ability to grow and respond to challenges" and "—A temporary or permanent "fork" could adversely affect the value of the Shares." If any of the foregoing were to occur, it could result in losses to Shareholders. Moreover, normal operations and functionality of the Ethereum network may be negatively affected. Such losses of functionality could lead to the Ethereum network losing attractiveness to users, nodes, validators, or other stakeholders, thereby dampening demand for ether. Even if another digital asset other than ether were affected by similar circumstances, any reduction in confidence in the source code or cryptography underlying digital assets generally could negatively affect the demand for digital assets and therefore adversely affect the value of the Shares.

● The Ethereum network has been in the process of implementing a series of software upgrades and other changes to its protocol, which were previously referred to collectively as "Ethereum 2.0" and some of which were implemented during 2022, such as the Bellatrix and Paris planned forks (defined below) that transitioned the Ethereum network from a proof-of-work consensus mechanism to a proof-of-stake consensus mechanism ("the Merge"). These upgrades have resulted in, and are expected to continue to result in, changes to the Ethereum network. Many of the contemplated upgrades to the Ethereum network will include updates to material aspects of its source code. Although some of these upgrades have been successfully implemented, such as the Merge, which was completed in September 2022, there is no guarantee that there are not undiscovered flaws that will emerge in the future even in upgrades previously considered successful, and previously successful upgrades do not guarantee that future upgrades will be successful. Any such undiscovered flaws, or the failure to properly implement future changes, could have a material adverse effect on the value of ether and the value of the Shares. One completed upgrade is known as the "Shanghai" upgrade, which allows users to unstake their ether and remove it from the relevant smart contract. As a result of these or future upgrades, it is possible that significant volumes of currently locked and illiquid ether could become unlocked and sold, which could increase volatility in ether prices or have a material adverse effect on the value of ether and the value of the Shares. Upgrades currently being considered to increase throughput and promote scaling, such as "sharding" the Layer 1 Ethereum network or greater reliance on so-called "Layer 2" solutions, could have effects which are difficult to anticipate at this time, but could – if unsuccessfully implemented, or if they contain undiscovered flaws – materially adversely impact or even effectively eliminate the value of ether, and therefore impact the price of the Shares. In addition, the acceptance of software patches or upgrades by a significant, but not overwhelming, percentage of the users and validators in a digital asset network could result in a "fork" in such network's blockchain, resulting in the operation of multiple separate networks. See "—A temporary or permanent "fork" could adversely affect the value of the Shares" for additional information.

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● The Ethereum network is still in the process of developing and making significant decisions that will affect policies that govern the supply and issuance of ether as well as other Ethereum network protocols. For example, the Ethereum network has on occasion reduced the quantity of ether rewarded per block and may make additional changes in the future, see "Overview of the Ethereum Industry—Creation of New Ether" for additional information. The open-source nature of many digital asset network protocols, such as the protocol for the Ethereum network, means that developers and other contributors are generally not directly compensated for their contributions in maintaining and developing such protocols. As a result, the developers and other contributors of a particular digital asset may lack a financial incentive to maintain or develop the network, or may lack the resources to adequately address emerging issues. Alternatively, some developers may be funded by companies whose interests are at odds with other participants in a particular digital asset network. If the Ethereum network does not successfully develop its policies on supply and issuance and other major design decisions, or does so in a manner that is not attractive to network participants, it could lead to a decline in adoption of the Ethereum network and price of ether.

● Decentralized application and smart contract developers depend on being able to obtain ether to run their programs and operate their businesses. In particular, decentralized applications and smart contracts require ether in order to pay the gas fees needed to power such applications and smart contracts and execute transactions. As such, they represent a significant source of demand for ether. Ether's price volatility (particularly where ether prices increase), or the Ethereum network's wider inability to meet the demands of decentralized applications and smart contracts in terms of inexpensive, reliable, and prompt transaction execution (including during congested periods), or to solve its scaling challenges or increase its throughput, may discourage such decentralized application and smart contract developers from using the Ethereum network as the foundational infrastructure layer for building their applications and smart contracts. If decentralized application and smart contract developers abandon the Ethereum blockchain for other blockchain or digital asset networks or protocols for whatever reason, the value of ether could be negatively affected.

Moreover, because digital assets, including ether, have been in existence for a short period of time and are continuing to develop, there may be additional risks in the future that are impossible to predict as of the date of this prospectus.

***Digital assets represent a new and rapidly evolving industry, and the value of the Shares depends on the acceptance of ether.***

The first digital asset, bitcoin, was launched in 2009. The Ethereum network launched in 2015 (though some ether was sold in a pre-mine in 2014). Ether, along with bitcoin, was one of the first cryptographic digital assets to gain global adoption and critical mass. In general, digital asset networks, including the Ethereum network and other cryptographic and algorithmic protocols governing the issuance of digital assets represent a new and rapidly evolving industry that is subject to a variety of factors that are difficult to evaluate. For example, the realization of one or more of the following risks could materially adversely affect the value of the Shares:

● Ether is only selectively accepted as a means of payment by retail and commercial outlets, and use of ether by consumers to pay such retail and commercial outlets remains limited. Banks and other established financial institutions may refuse to process funds for ether transactions; process wire transfers to or from digital asset platforms, ether-related companies or service providers; or maintain accounts for persons or entities transacting in ether. As a result, the prices of ether may be influenced to a significant extent by speculators, thus contributing to price volatility that makes retailers less likely to accept ether in the future.

● Banks may not provide banking services, or may cut off banking services, to businesses that provide digital asset-related services or that accept digital assets as payment, which could dampen liquidity in the market and damage the public perception of digital assets generally or any one digital asset in particular, such as ether, and their or its utility as a payment system, which could decrease the price of digital assets generally or individually. Further, the lack of availability of banking services could prevent the Trust from being able to complete creations and redemptions of Baskets, the timely liquidation of ether and withdrawal of assets from the Ether Custodian even if the Sponsor determined that such liquidation was appropriate or suitable, or otherwise disrupt the Trust's operations.

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● Certain privacy-preserving features have been or are expected to be introduced to digital asset networks, including the Ethereum network. For example, some prominent contributors to the Ethereum network have proposed the concept of "privacy pools," zero-knowledge proofs, and other privacy-preserving features. If any such features are introduced to the Ethereum network, any platforms or businesses that facilitate transactions in ether may be at an increased risk of criminal or civil lawsuits, or of having banking services cut off if there is a concern that these features interfere with the performance of anti-money laundering duties and economic sanctions checks or facilitate illicit financing or crime.

● Users, protocol and application developers and validators may otherwise switch to or adopt certain digital assets at the expense of their engagement with other digital asset networks, which may negatively impact those networks, including the Ethereum network.

The Trust is not actively managed and will not have any formal strategy relating to the development of the Ethereum network.

***Changes in the governance of a digital asset network may not receive sufficient support from users and validators, which may negatively affect that digital asset network***'***s ability to grow and respond to challenges.***

The governance of decentralized networks, such as the Ethereum network, is by voluntary consensus and open competition. As a result, there may be a lack of consensus or clarity on the governance of any particular decentralized digital asset network, which may stymie such network's utility and ability to grow and face challenges. The foregoing notwithstanding, the protocols for some decentralized networks, such as the Ethereum network, are informally managed by a group of core developers that propose amendments to the relevant network's source code. Core developers' roles evolve over time, largely based on self-determined participation. If a significant majority of nodes, users and validators adopt amendments to a decentralized network based on the proposals of such core developers, such network will be subject to new protocols that may adversely affect the value of the relevant digital asset.

As a result of the foregoing, it may be difficult to find solutions or marshal sufficient effort to overcome any future problems, especially long-term problems, on digital asset networks.

***Potential amendments to the Ethereum network***'***s protocols and software could, if accepted and authorized by the Ethereum network community, adversely affect an investment in the Trust.***

The Ethereum ****network uses cryptographic protocols to govern the interactions within the Ethereum ****network. A loose community known as the core developers has evolved to informally manage the source code for the protocol. Membership in the community of core developers evolves over time, largely based on self-determined participation in the resource section dedicated to Ethereum on Github.com. The core developers can propose amendments to the Ethereum ****network's source code that, if accepted by nodes, validators and users, could alter the protocols and software of the Ethereum ****network and the properties of ether. These alterations would occur through software upgrades, and could potentially include changes to the irreversibility of transactions and limitations on the issuance of new ether or changes to the ether supply, which could undermine the appeal and market value of ether. Alternatively, software upgrades and other changes to the protocols of the Ethereum network could fail to work as intended or could introduce bugs, coding defects or flaws, security risks, or otherwise adversely affect, the speed, security, usability, or value of the Ethereum network or ether. As a result, the Ethereum network could be subject to changes to its protocols and software in the future that may adversely affect an investment in the Trust.

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***The open-source structure of the Ethereum network protocol means that the core developers and other contributors are generally not directly compensated for their contributions in maintaining and developing the Ethereum network protocol. A failure to properly monitor and upgrade the Ethereum network protocol could damage the Ethereum network and an investment in the Trust.***

The Ethereum ****network operates based on an open-source protocol maintained by the core developers and other contributors, largely on the GitHub resource section dedicated to Ethereum network development. As new ether are rewarded solely for validator activity (other than the 2014 pre-mine) and are not sold on an ongoing basis to generate revenue to support development activity, and the Ethereum network protocol itself is made available for free rather than sold or made available subject to licensing or subscription fees and its use does not generate revenues for its development team, the core developers are generally not compensated for maintaining and updating the source code for the Ethereum network protocol. Consequently, there is a lack of financial incentive for developers to maintain or develop the Ethereum network and the core developers may lack the resources to adequately address emerging issues with the Ethereum network protocol. Although the Ethereum network is currently supported by the core developers, there can be no guarantee that such support will continue or be sufficient in the future. For example, there have been recent reports that the number of core developers who have the authority to make amendments to the Ethereum network's source code in the GitHub repository is relatively small, although there are believed to be a larger number of developers who contribute to the overall development of the source code of the Ethereum network.

Another example of Ethereum's open-source dependencies is that Shipyard, one of the key maintainers of libp2p — the peer-to-peer networking stack under Ethereum — ceased support for Go and JavaScript by September 30, 2025. Libp2p is important for the efficient operation of the Ethereum network, particularly in broadcasting new blocks and validator votes, which illustrates Ethereum's open-source dependencies. A failure to maintain or evolve the network's open-source components could materially impair the Ethereum network's functionality and, in turn, adversely impact the price of ether and value of the Shares.

***Digital asset networks face significant scaling challenges and efforts to increase the volume and speed of transactions may not be successful.***

Many digital asset networks, including the Ethereum network, face significant scaling challenges due to the fact that public blockchains generally face a tradeoff between security and scalability. One means through which public blockchains achieve security is decentralization, meaning that no intermediary is responsible for securing and maintaining these systems. For example, a greater degree of decentralization generally means a given digital asset network is less susceptible to manipulation or capture. In practice, this typically means that every single validator on a given digital asset network is responsible for securing the system by processing every transaction and every single full node is responsible for maintaining a copy of the entire state of the network. As a result, a digital asset network may be limited in the number of transactions it can process by the fact that all validators participate in validating in each block and the capabilities of each single fully participating node.

As of November 30, 2025, the Ethereum network handled approximately 18 transactions per second (according to Coin Metrics). In an effort to increase the volume of transactions that can be processed on a given digital asset network, many digital assets are being upgraded with various features to increase the speed and throughput of digital asset transactions. As corresponding increases in throughput lag behind growth in the use of digital asset networks, average fees and settlement times may increase considerably. For example, the Ethereum network has been, at times, at capacity, which has led to increased transaction fees. In December 2017, the popularity of the blockchain-based game Cryptokitties led to significant network congestion on the Ethereum network. The game, which allows players to trade and create virtual kitties, represented by non-fungible tokens ("NFTs"), was reported by some sources to have accounted for more than 10% of the entire Ethereum network traffic at the time causing increases in transaction fees and delays in transaction processing times, and driving Ethereum network traffic to a reported then-all-time high. Since January 1, 2020, ether transaction fees have increased from $0.08 average daily transaction fees per ether transaction, to a high of up to approximately $200.06 average daily transaction fees per transaction on May 1, 2022. As of November 30, 2025, ether transaction fees stood at $0.19 per transaction, on average, according to Coin Metrics. Increased fees and decreased settlement speeds could preclude certain uses for ether (e.g., micropayments), and could reduce demand for, and the price of, ether, which could adversely impact the value of the Shares.

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In the second half of 2020, the Ethereum network began the first of several stages of an upgrade culminating in the Merge. The Merge amended the Ethereum network's consensus mechanism to a process known as proof-of-stake, and was intended to address the perceived shortcomings of the proof-of-work consensus mechanism in terms of labor intensity and duplicative computational effort expended by validators (known under proof-of-work as "miners") who did not win the race, under proof of work, to be the first in time to solve the cryptographic puzzle that would allow them to be the only validator permitted to validate the block and receive the resulting block reward (which was only given to the first validator to successfully solve the puzzle and hash a given block, and not to others). Instead, under proof-of-stake, a single validator is randomly selected to solve the cryptographic puzzle needed to validate a block, which it proposes to a committee of other validators, who vote for whether to include the block (or not), which reduces the computational work performed – and energy expended – to validate each block compared to proof-of-work. See "Overview of the Ethereum Industry—Creation of New Ether" and "—Modifications to the Ethereum Protocol" for additional information.

Following the Merge, core development of the Ethereum source code has increasingly focused on modifications of the Ethereum protocol to increase speed, throughput and scalability and to improve existing or next-generation uses. Future upgrades to the Ethereum protocol and Ethereum blockchain to address scaling issues – such as network congestion, slow throughput and periods of high transaction fees owing to spikes in network demand – have been discussed by network participants, such as sharding. The purpose of sharding is to increase scalability of the Ethereum blockchain by splitting the blockchain into subsections, called shards, and dividing validation responsibility so that a defined subset of validators would be responsible for each shard, rather than all validators being responsible for the entire blockchain, allowing for parallel processing and validation of transactions. However, there appears to be uncertainty and a lack of existing widespread consensus among network participants about how to solve the scaling challenges faced by the Ethereum network.

The rapid development of other competing scalability solutions, such as those which would rely on handling the bulk of computational work relating to transactions or smart contracts and applications built on the Ethereum network (consistent with common usage, all such applications are referred to as "decentralized applications" or "dApps", whether or not decentralized in fact) outside of the main Ethereum network and Ethereum blockchain, has caused alternatives to sharding to emerge. "Layer 2" is a collective term for solutions which are designed to help increase throughput and reduce transaction fees by handling or validating transactions off the main Ethereum network (known as "Layer 1") and then attempting to take advantage of the perceived security and integrity advantages of the Layer 1 Ethereum network by uploading the transactions validated on the Layer 2 protocol back to the Layer 1 Ethereum network. The details of how this is done vary significantly between different Layer 2 technologies and implementations. For example, "rollups" perform transaction execution outside the Layer 1 Ethereum network and then post the data, typically in batches, back to the Layer 1 Ethereum network where consensus is reached. "Zero knowledge rollups" are generally designed to run the computation needed to validate the transactions off-chain, on the Layer 2 protocol, and submit a proof of validity of a batch of transactions (not all of the transactions themselves) that is recorded on the Layer 1 Ethereum network. By contrast, "optimistic rollups" assume transactions are valid by default and only run computation, via a fraud proof, in the event of a challenge. Other proposed Layer 2 scaling solutions include, among others, "state channels", which are designed to allow participants to run a large number of transactions on the Layer 2 side channel protocol and only submit two transactions to the main Layer 1 Ethereum network (the transaction opening the state channel, and the transaction closing the channel), "side chains", in which an entire Layer 2 blockchain network with similar capabilities to the existing Layer 1 Ethereum network runs in parallel with the existing Layer 1 Ethereum network and allows smart contracts and dApps to run on the Layer 2 side chain without burdening the main Layer 1 network, and others. To date, the Ethereum network community has not coalesced overwhelmingly around any particular Layer 2 solution, though this could change.

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There is no guarantee that any of the mechanisms in place or being explored for increasing the speed and throughput of settlement of Ethereum network transactions will be effective, or how long these mechanisms will take to become effective, which could cause the Ethereum network to not adequately resolve scaling challenges and adversely impact the adoption of ether and the Ethereum network and the value of the Shares. There is no guarantee that any potential scaling solution, whether a change to the Layer 1 Ethereum network like sharding or the introduction of a Layer 2 solution like rollups, state channels or side chains, will achieve widespread adoption. Alternatively, in theory, the widespread adoption of Layer 2 solutions could succeed in reducing congestion on the Layer 1 Ethereum network by moving transactions and computational work to the Layer 2 level and thereby reducing direct transactions on the Layer 1 Ethereum network, but by reducing transactions on the Layer 1 Ethereum network, could reduce demand for ether on the Layer 1 Ethereum network, which could in theory negatively impact the price of ether. It is possible that proposed changes to the Layer 1 Ethereum network could divide the community, potentially even causing a hard fork, or that the decentralized governance of the Ethereum network causes network participants to fail to coalesce overwhelmingly around any particular solution, causing the Ethereum network to suffer reduced adoption or causing nodes, users or validators to migrate to other blockchain networks. It is also possible that scaling solutions could fail to work as intended or could introduce bugs, coding defects or flaws, security risks, or other problems that could cause them to suffer operational disruptions. For example, in April 2024, Starknet, a Layer 2 built on the Layer 1 Ethereum network, suffered an outage reportedly caused by a rounding error bug that halted production of new blocks on Starknet's Layer 2 blockchain network. Similar outages, bugs, defects, or other problems could affect Layer 2s in the future. Similarly, in multiple instances throughout 2022 and 2023, the Arbitrum Layer 2 network experienced outages due to failures in its primary node responsible for submitting transactions to the Layer 1 Ethereum network. Although the Layer 1 Ethereum network is believed not to have been affected by those outages, problems on Layer 2s in the future could conceivably affect or cause issues for the Layer 1 Ethereum network. Alternatively, if a widely used Layer 2 network were to fail, it could reduce demand for ether because it would eliminate a source of demand for using ether to record transactions from the Layer 2 onto the Layer 1 Ethereum network. Any of the foregoing could adversely affect the price of ether or the value of the Shares.

***Digital assets may have concentrated ownership and large sales or distributions by holders of such digital assets could have an adverse effect on the market price of such digital assets.***

The largest ether wallets are believed to hold, in aggregate, a significant percentage of the ether in circulation. Moreover, it is possible that other persons or entities control multiple wallets that collectively hold a significant number of ether, even if they individually only hold a small amount, and it is possible that some of these wallets are controlled by the same person or entity. As a result of this concentration of ownership, large sales or distributions by such holders could have an adverse effect on the market price of ether.

***If the digital asset award or transaction fees for recording transactions on the Ethereum network are not sufficiently high to incentivize validators, or if certain jurisdictions continue to limit or otherwise regulate validating activities, validators may cease expanding validating power or demand high transaction fees, which could negatively impact the value of ether and the value of the Shares.***

In 2021, the Ethereum network implemented the EIP-1559 upgrade. EIP-1559 changed the methodology used to calculate transaction fees paid to ether validators in such a manner that reduced the total net issuance of ether fees paid to validators. If the digital asset awards for validating blocks or the transaction fees for recording transactions on the Ethereum network are not sufficiently high to incentivize validators, or if certain jurisdictions continue to limit or otherwise regulate validating activities, validators may cease expending validating power to validate blocks and confirmations of transactions on the Ethereum blockchain could be slowed. For example, the realization of one or more of the following risks could materially adversely affect the value of the Shares:

● A reduction in the processing power expended by validators on the Ethereum network could increase the likelihood of a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtaining control. See "—If a malicious actor or botnet obtains control of more than 50% of the validating power on the Ethereum network, or otherwise obtains control over the Ethereum network through its influence over core developers or otherwise, such actor or botnet could manipulate the Ethereum blockchain to adversely affect the value of the Shares or the ability of the Trust to operate."

● Validators have historically accepted relatively low transaction confirmation fees on most digital asset networks. If validators demand higher transaction fees for recording transactions in the Ethereum blockchain or a software upgrade automatically charges fees for all transactions on the Ethereum network, the cost of using ether may increase and the marketplace may be reluctant to accept ether as a means of payment. Alternatively, validators could collude in an anti-competitive manner to reject low transaction fees on the Ethereum network and force users to pay higher fees, thus reducing the attractiveness of the Ethereum network. Higher transaction confirmation fees resulting through collusion or otherwise may adversely affect the attractiveness of the Ethereum network, the value of ether and the value of the Shares.

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● To the extent that any validators cease to record transactions that do not include the payment of a transaction fee in blocks or do not record a transaction because the transaction fee is too low, such transactions will not be recorded on the Ethereum blockchain until a block is validated by a validator who does not require the payment of transaction fees or is willing to accept a lower fee. Any widespread delays or disruptions in the recording of transactions could result in a loss of confidence in the Ethereum network and could prevent the Trust from completing transactions associated with the day-to-day operations of the Trust, including creations and redemptions of the Shares in exchange for ether or cash with Authorized Participants.

● During the course of the block validation processes, validators exercise the discretion to select which transactions to include within a block and in what order to include these transactions. Beyond the standard block reward and transaction fees, validators on many blockchains, including the Ethereum blockchain, have the ability to extract what is known as Maximal Extractable Value ("MEV") by strategically choosing, reordering, or excluding certain transactions during block production in return for increased transaction fees or other forms of profit for such validators. In blockchain networks that facilitate DeFi protocols in particular, such as the Ethereum network, users may attempt to gain an advantage over other users by offering additional fees to validators for effecting a certain order or inclusions of certain transactions within a block. Certain software solutions, such as MEV Boost by Flashbots, have been developed which facilitate validators and other parties in the ecosystem in capturing MEV. MEV Boost is one way to capture MEV on the Ethereum network, but it is not the only way, although it is widely understood that most validation on the Ethereum network involves MEV Boost. MEV Boost is designed to separate block building from block proposal ("proposer-builder separation"), with the intent to decentralize validation activity and reduce the likelihood of transaction censorship by validators. In MEV Boost, there are four groups of market participants: "searchers", who identify MEV opportunities by scanning the publicly visible so-called memory pool ("mempool") of pending but unexecuted transactions awaiting validation; "builders", who take transactions awaiting validation and build them into potential blocks in a manner that captures the MEV opportunities identified by searchers, but do not propose the block to the Ethereum network; "relays", who send limited information about the block (such as the amount of transaction fees payable to the validator), but not the complete list of transactions, to the validator who will propose them to the Ethereum network; and "proposers", the validators who have been selected by the Ethereum network to propose a particular block, who are generally intended to accept blocks in the form proposed by block builders and relayed by relays without changing their contents (leading to the intended proposer-builder separation that MEV-Boost was designed to facilitate). The presence of MEV on many blockchains, including the Ethereum blockchain, may incentivize associated practices such as sandwich attacks or front running that can have negative repercussions on DeFi users. A "sandwich attack" on many blockchains that enable DeFi transactions, including the Ethereum blockchain, is executed by placing two transactions around a large, detected transaction to capitalize on the expected price impact. For instance, a market participant (such as a searcher on MEV Boost) might identify a sizable transaction within the publicly visible mempool that will significantly alter an asset's price on a decentralized exchange. The participant could then for example orchestrate a transaction bundle: one transaction to acquire the asset prior to the detected transaction, followed by the large transaction itself, and a final transaction to sell the asset after the market price has increased due to the large transaction's execution. Such transaction bundles can be submitted to validators through mechanisms like MEV-Boost (in the case of the Ethereum network, with other networks having other mechanisms), with validators receiving a share of the profits as an incentive to include the specific transaction bundle in the block. In the context of MEV on the Ethereum network, "front running" is said to occur when a user spots a transaction in the mempool, and then pays a high transaction fee to a validator to have their transaction executed on a priority basis in a manner designed to profit from the pending, but unexecuted, transaction that is still in the mempool. MEV may also compromise the predictability of transaction execution on many blockchains, including the Ethereum blockchain, which may deter usage of the network as a whole. Although based on widely available information given that transactions in the mempool are publicly visible, there have also been instances of validators allegedly leveraging the MEV-Boost software to allegedly trick the software into prematurely releasing the full contents of proposed blocks, such as by a block proposer providing a false signature to the relay. For example, in April 2023, certain Ethereum validators (acting as proposers) allegedly exploited the MEV-Boost software that allegedly allowed them to view the full contents of proposed blocks submitted by relays before this information was made public (for example, by allegedly signing transactions with relays using false signatures), allegedly enabling them to insert their own front-running transactions (acting as builders) in front of the front-running transactions originally identified by searchers, propose modified blocks containing those front-running transactions, and allegedly capture approximately $25 million in profits by manipulating block order to the detriment of the original sandwichers (i.e., the searchers who identified MEV opportunities for block builders to incorporate into potential blocks and relays to relay to potential proposers). On May 15, 2024, Anton Peraire-Bueno and James Peraire-Bueno were indicted in the United States District Court for the Southern District of New York for this exploitation of MEV-Boost and specifically charged with wire fraud, wire fraud conspiracy, and money laundering. They assert defenses on a variety of grounds, including, among others, that the searchers in MEV Boost conducted the original sandwich attacks, which victimize ordinary traders by driving up costs and exploiting their trades in the publicly visible mempool in the first place. As of the date of this prospectus, a mistrial was declared in the original proceeding. The government has moved to retry the case, which is opposed by the defendants, and the case has not been decided yet. The case, which the indictment itself acknowledges is the "first of its kind", raises novel issues for the digital asset industry given that validators attempting to capture MEV is a widespread practice on many blockchain networks, including the Ethereum network, and is widely viewed as a test case by legal commentators, illustrating that applicable law and regulation around MEV remains unsettled. Any potential perception of MEV as unfair manipulation, despite its prevalence on many blockchain networks, including the Ethereum network, may lead to adverse publicity, legal and regulatory uncertainty, or discourage users and other stakeholders from engaging with DeFi protocols or the Ethereum network in general, which could cause ether to lose value. In addition, it is possible governmental authorities, regulators or legislators could enact rules which restrict practices associated with MEV, which could diminish the popularity of the Ethereum network among users and validators and could – if it hampers or impedes existing validation processes – potentially even lead to a reduction in network security or cause ether to lose value. MEV is a novel issue, and while it is impossible to predict with certainty how it could affect the price of ether over time, any of these or other outcomes related to MEV may adversely affect the value of ether and the value of the Shares. In addition, the Trust's Staking Services Providers incorporate MEV as a source of rewards in the staking they perform on behalf of the Trust. If MEV is eventually deemed to violate applicable laws, the Trust's staking program could be disrupted. Although as part of the Staking Arrangements, the Staking Services Providers make representations to Coinbase, on behalf of the Trust, that they comply with applicable laws in performing staking activities on behalf of the Trust, given MEV is a novel issue and the legal framework is evolving, there can be no assurance that such representations will entirely mitigate any legal risk to the Trust in connection with the use of MEV in the Trust's staking program, and if such risk eventuates, it could adversely impact the Trust or the value of the Shares.

***If a malicious actor or botnet obtains control of more than 33% of the validating stake on the Ethereum network, or otherwise obtains control over the Ethereum network through its influence over core developers or otherwise, such actor or botnet could delay or manipulate the Ethereum blockchain in the short term, which could adversely affect the value of the Shares or the ability of the Trust to operate.***

Following the Merge and the switch to proof-of-stake validation, the Ethereum network is currently vulnerable to several types of attacks, including:

● ">33% attack" where, if a validator or group of validators were to gain control of more than 33% of the total staked ether on the Ethereum network, a malicious actor could temporarily impede or delay block confirmation or even cause a temporary fork in the blockchain. This is believed to be temporary, as the Ethereum network's inactivity leak would be expected to eventually penalize the attacker enough for the chain to finalize again (i.e., the honest majority would be expected to reclaim 2/3<sup>rd</sup> stake as the attacker's stake is penalized). However, it is not believed that with 33% control, a malicious actor could engage in double-spending or fraudulent block propagation.

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● ">50% attack" where, if a validator or group of validators acting in concert were to gain control of more than 50% of the total staked ether on the Ethereum network, a malicious actor would be able to gain full control of the Ethereum network and the ability to manipulate future transactions on the blockchain, including censoring transactions, double-spending and fraudulent block propagation, potentially for an extended period or even permanently. In theory, the minority non-attackers might reach social consensus to reject blocks proposed by the malicious majority attacker, reducing the attacker's ability to engage in malicious activity, but there can be no assurance this would happen or that non-attackers would be able to coordinate effectively.

● ">66% attack" where, if a validator or group of validators acting in concert were to gain control of more than 66% of the total staked ether on the Ethereum network, a malicious actor could permanently and irreversibly manipulate the blockchain, including censorship, double-spending and fraudulent block propagation. The attacker could finalize their preferred chain without any consideration for the votes of other stakers and could also revert finalized blocks.

If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority (over 50%) of the validating power on the Ethereum network, it may be able to alter the Ethereum blockchain on which transactions in ether rely by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. The malicious actor or botnet could also control, exclude or modify the ordering of transactions. Although the malicious actor or botnet would not be able to generate new tokens or transactions using such control, it could "double-spend" its own tokens (i.e., spend the same tokens in more than one transaction) and prevent the confirmation of other users' transactions for so long as it maintained control (over 50%). To the extent that such malicious actor or botnet did not yield its control of the validating power on the Ethereum network or the Ethereum community did not reject the fraudulent blocks as malicious, reversing any changes made to the Ethereum blockchain may not be possible. If the malicious actor were to gain control of more than 33% of the total staked ether on the Ethereum network, it could temporarily impede or delay block confirmation or even cause a temporary fork in the blockchain, but it is not believed that it could engage in double-spending or fraudulent block propagation. Even without 33% control, a malicious actor or botnet could create a flood of transactions in order to slow down the Ethereum network (similar to a denial-of-service attack).

For example, in August 2020, the Ethereum Classic network was the target of two double-spend attacks by an unknown actor or actors that gained more than 50% of the processing power of the Ethereum Classic network. The attacks resulted in reorganizations of the Ethereum Classic blockchain that allowed the attacker or attackers to reverse previously recorded transactions in excess of $5 million and $1 million.

Additionally, in May 2019, the Bitcoin Cash network experienced a 51% attack when two large mining pools reversed a series of transactions in order to stop an unknown miner from taking advantage of a flaw in a recent Bitcoin Cash protocol upgrade. Although this particular attack was arguably benevolent, the fact that such coordinated activity was able to occur could have negatively impacted perceptions of the Bitcoin Cash network. Although the two attacks described above took place on proof-of-work-based networks, it is possible that a similar attack may occur on the proof-of-stake Ethereum network, which could negatively impact the value of ether and the value of the Shares.

Although there are no known reports of malicious activity on, or control of, the Ethereum network, it is possible that certain groups of coordinating or connected ether holders may together have more than 50% of outstanding ether, which if staked and if the users run validators, would permit them to exert authority over the validation of ether transactions. This risk is heightened if over 50% of the processing power on the network falls within the jurisdiction of a single governmental authority. If network participants, including the core developers and the administrators of validating pools, do not act to ensure greater decentralization of ether, the feasibility of a malicious actor obtaining control of the validating power on the Ethereum network will increase, which may adversely affect the value of the Shares. See also"—Liquid staking applications pose centralization concerns" below.

A malicious actor may also obtain control over the Ethereum network through its influence over core developers by gaining direct control over a core developer or an otherwise influential programmer. To the extent that nodes, users and validators accept amendments to the source code proposed by the controlled core developer, other core developers do not counter such amendments, and such amendments enable the malicious exploitation of the Ethereum network, the risk that a malicious actor may be able to obtain control of the Ethereum network in this manner exists. Moreover, it is possible that a group of ether holders that together control more than 50% of outstanding ether are in fact part of the initial or current core developer group, or are otherwise influential members of the Ethereum community. To the extent that the initial or current core developer groups also control more than 50% of outstanding ether, as some believe, the risk of and arising from this particular group of users obtaining control of the validating power on the Ethereum network will be even greater, and should this materialize, it may adversely affect the value of the Shares.

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***Liquid staking applications pose centralization concerns.***

Validators must deposit at least 32 ether (and up to 2048) to activate a unique validator key pair that is used to sign block proposals and attestations on behalf of its stake (i.e., vote on its view of the chain). An application built on the Ethereum network, or a single node operator, can manage many validator key pairs. For example, Lido, an application that provides a so-called "liquid staking" solution which permits holders of ether to deposit them with Lido, which stakes the ether while issuing the holder a transferrable token, is reported by some sources to have or have had a large number of different validator key pairs divided across a large number of node operators. At times, Lido has reportedly controlled around or in excess of 33% of the total staked ether on the Ethereum network. While it is widely believed that Lido has little incentive to attempt to interfere with transaction finality or block confirmations using its reported 33% stake, since doing so would likely cause its entire stake to be slashed and thus lost (assuming good actors unaffiliated with Lido controlled the remainder), and also because Lido is believed to not control most of the third party node operators where its ether is staked, and finally because the occurrence of such manipulation of the Ethereum network's consensus process by Lido or any other actor would likely cause ether to lose substantial value (which would hurt Lido economically), it nevertheless poses centralization concerns. If Lido, or a bad actor with a similar sized stake, were to attempt to interfere with transaction finality or block confirmations, it could negatively affect the use and adoption of the Ethereum network, the value of ether, and thus the value of the Shares.

***A temporary or permanent* "*fork*" *could adversely affect the value of the Shares.***

The Ethereum network operates using open-source protocols, meaning that any user can become a node by downloading the Ethereum Client and participating in the Ethereum network, and no permission of a central authority or body is needed to do so. In addition, anyone can propose a modification to the Ethereum network's source code and then propose that the Ethereum network community support the modification. These proposed modifications to the Ethereum network's source code, if adopted, could lead to forks (referred to as "planned forks" because they take place through a formal process).

In the case of planned forks, the core developers, including those associated with or funded by the Ethereum Foundation, are able to access and alter the Ethereum network source code and, as a result, they are typically responsible for proposing quasi-official or widely publicized releases of updates and other changes to the Ethereum network's source code <u>(</u><u>"</u>EIPs<u>"</u><u>).</u> Any user can propose an idea for modifying the Ethereum network's source code, and the core developers are responsible for merging the proposed idea into the EIP repository on GitHub, where it formally becomes an EIP. However, the release of proposed updates to the Ethereum network's source code by core developers does not guarantee that the updates will be automatically adopted. The developers of each Ethereum Client must agree to implement the EIP's changes to the Ethereum network in the source code for their respective client software, nodes must accept the changes made available by the developers of the Ethereum Client software they use by choosing to individually download the modified Ethereum Client software, and ultimately a critical mass of validators and users – such as dApp and smart contract developers, as well as end users of dApps and smart contracts, and anyone else who transacts on the Ethereum blockchain or Ethereum network – must support the shift, or the upgrades will lack adoption.

Typically, in the case of a planned fork, once the EIPs are formally introduced by being merged into the EIP repository on GitHub, a robust debate within the Ethereum community as to the advisability of the proposed change ordinarily follows. Assuming the core developers at the protocol level and the developers of individual Ethereum Clients reach a broad consensus among themselves in favor of introducing the change into the respective source code they are responsible for developing and maintaining, the source code modification will be introduced and made available to download. A modification of the Ethereum network's source code is only effective with respect to the Ethereum nodes that download it and modify their Ethereum Clients accordingly, and in practice such decisions are heavily influenced by the preferences of validators and users. Typically, after a modification is introduced and if a sufficiently broad critical mass of users and validators support the modification and nodes download the modification into their individual Ethereum Clients, the change is implemented and the Ethereum network continues to operate uninterrupted, assuming there are no software issues (e.g., bugs, outages, etc.). However, if less than a sufficiently broad critical mass (in practice, amounting to a substantial majority) of users and validators support the proposed modification and nodes refuse to download the modification to their Ethereum Clients, and the modification is not backwards compatible with the Ethereum blockchain or network or the Ethereum Clients of nodes prior to their modification, the consequence would be what is known as a "hard fork" of the Ethereum network, with one group of nodes running the pre-modified software, with users and validators continuing to use the pre-modified software, while the other group would adopt and run the modified software. The effect of such a hard fork would be the existence of two versions of the Ethereum network running in parallel on separate networks using separate blockchain ledgers, yet lacking interchangeability. In practice, in a hard fork, the two networks would compete with each other for developers, node operators, users, validators, and adoption, potentially to their mutual detriment (for example, if the number of validators on each network is too small leading to security concerns, as discussed below, or if the number of users on each is reduced compared to the number of users of the single pre-fork blockchain network). Debates relating to hard forks can be contentious and hard fought among network participants and can lead to ill will. Another possible result of a hard fork is an inherent decrease in the level of security due to significant amounts of validating power remaining on one network or migrating instead to the new forked network. After a hard fork, it may become easier for an individual validator or validating pool's validating power to exceed 50% of the total on either network, thereby making them both more susceptible to attack.

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A future fork in the Ethereum network could adversely affect the value of the Shares or the ability of the Trust to operate. A fork could also adversely affect the price of ether at the time of announcement or adoption or subsequently. For example, the announcement of a hard fork could lead to increased demand for the pre-fork digital asset, in anticipation that ownership of the pre-fork digital asset would entitle holders to a new digital asset following the fork. The increased demand for the pre-fork digital asset may cause the price of the digital asset to rise. After the hard fork, it is possible the aggregate price of the two versions of the digital asset running in parallel would be less than the price of the digital asset immediately prior to the fork. Alternatively, as with any change to software code, software upgrades and other changes to the source code or protocols of the Ethereum network could fail to work as intended or could introduce bugs, coding defects, unanticipated or undiscovered problems, flaws, or security risks, create problematic economic incentives which incentivize behavior which has a negative effect on the Ethereum network's users, validators, or the Ethereum network as a whole, or otherwise adversely affect, the speed, security, usability, or value of the Ethereum network or ether. If a fork caused operational problems for either post-fork network or blockchain, the digital assets associated with the affected network could lose some or all of their value. Furthermore, while the Sponsor will, as permitted by the terms of the Trust Agreement, determine which network is generally accepted as the Ethereum network and should therefore be considered the appropriate network for the Trust's purposes, there is no guarantee that the Sponsor will choose the network and the associated digital asset that is ultimately the most valuable. Any of these events could therefore adversely impact the value of the Shares.

On March 13, 2024, the Ethereum network underwent a planned fork called "Dencunˮ implementing a series of EIPs. EIP 4844, which some commentators perceive to be the most significant EIP within the Dencun series, is intended to improve the economics of Layer 2s by reducing transaction fees for Layer 2s who batch transactions executed on the Layer 2s and upload them as a batch (or as a single proof) onto the main Layer 1 Ethereum network. Among other objectives, the Dencun software upgrade was designed to provide Layer 2 scaling solutions a designated storage space on the Layer 1 Ethereum network, called Binary Large Objects ("blobs"), which attach large data chunks to transactions on the Layer 1 Ethereum network and are recorded on its blockchain. The data in blobs become inaccessible on the Layer 1 Ethereum network after a temporary period (three weeks), unlike the previous method of storing batched data from Layer 2s on the Layer 1 Ethereum network, which was stored permanently. The cost of accessing the temporary storage in blobs is expected by proponents of the Dencun upgrade to be substantially lower than the cost of storing the data on the Ethereum Layer 1 network permanently, making Layer 2s more cost-efficient to operate and, some commentators hope, more attractive as a scaling solution. Immediately following the upgrade, some Layer 2s reportedly experienced reduced transaction fees when batching transactions to the main Layer 1 Ethereum network, which in turn lowered the transaction costs for executing transactions on such Layer 2s, but this also is believed to have resulted in ether prices (ether being the native asset of the Layer 1 Ethereum network) dropping as well, due in part to the reduced demand for ether to pay the transaction costs of recording data on the Layer 1 Ethereum network. Decreased ether prices could have an adverse effect on the value of the Shares. Additionally, some Layer 2s, such as Blast, reportedly experienced outages and other disruptions in the aftermath of the Dencun upgrade, which in the case of Blast halted block production on the Blast Layer 2 blockchain for a period of time, though it was reportedly restored afterward. As with any change to software code, planned forks such as Dencun could introduce bugs, coding defects, unanticipated or undiscovered problems, flaws, security risks, problematic incentive structures, or otherwise fail to work as intended or achieve the expected benefits that proponents hope for in the short term or the long term, which could also have an adverse effect on adoption of the Ethereum network and the value of ether, and therefore the Shares.

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In September 2022, the Ethereum network transitioned to a proof-of-stake consensus model, in an upgrade referred to as the "Merge." Following the Merge, a hard fork of the Ethereum network occurred, as a small number of Ethereum validators and network participants planned to maintain the proof-of-work consensus mechanism that was removed as part of the Merge. This version of the network, which is not backwards compatible with the Ethereum Layer 1 blockchain, is considered a forked branch and was rebranded as "Ethereum Proof-of-Work." To the extent significant developer talent, users or validators abandon the Ethereum Layer 1 network and adopt the Ethereum Proof-of-Work blockchain instead, the value of the Shares could be adversely affected.

The Ethereum core developers have agreed on December 2025 as the date of the upcoming Fusaka hard fork, which is designed to expand data capacity, reinforce defenses against denial-of-service attacks, and introduce new tools for developers and users, among others. The main feature of the Fusaka upgrade is a new way of handling the data in the blobs introduced by the Dencun upgrade, which is expected to create improvements for Layer 2s to store data on the main Ethereum network. As with any change to software code, planned forks such as Fusaka could introduce bugs, coding defects, unanticipated or undiscovered problems, flaws, security risks, problematic incentive structures, or otherwise fail to work as intended or achieve the expected benefits that proponents hope for in the short term or the long term, which could also have an adverse effect on adoption of the Ethereum network and the value of ether, and therefore the Shares.

As illustrated by Dencun, the Merge, and Fusaka, the Ethereum network regularly implements planned forks in an effort to achieve its development roadmap, advance the scalability process, and to improve the network generally. For example, in connection with the Ethereum development roadmap, the Ethereum network executed planned forks to transition from the initial Frontier development stage into the Homestead development stage in 2016; to transition from the Homestead development stage to the first sub-stage, Byzantium, of the Metropolis development stage in 2017; to transition from the Byzantium sub-stage to the St. Petersburg sub-stage in early 2019; and to transition from the St. Petersburg sub-stage to the Istanbul sub-phase, in late 2019. In April 2021, the Ethereum network underwent the Berlin and Altair planned forks, among others. In 2022, Ethereum underwent the Bellatrix and Paris planned forks in connection with the Merge. In 2023, Ethereum underwent the Capella and Shanghai planned forks (collectively, "Shapella"), which enabled withdrawals of staked assets to the Ethereum Layer 1 blockchain mainnet for the first time (they had previously been locked on the Beacon Chain testnet following the Merge). On May 7, 2025, "Pectra" which is a combination of the Prague execution layer hard fork and the Electra consensus layer upgrade, went live. Pectra, among other changes, increased the maximum amount of ether that a validator can stake from 32 to 2,048, allowing validators to manage higher balances with the goals of potentially reducing costs; introducing account abstraction, allowing externally owned accounts (EOAs) to temporarily function like smart contracts; and reducing security risks and shortening the wait time for new validators. Any of these or future planned forks could fail to work as intended or could introduce bugs, coding defects, unanticipated or undiscovered problems, flaws, or security risks, or create problematic economic incentives which could increase behavior that has a negative effect on the Ethereum network's nodes, users, validators, or the Ethereum network as a whole, or otherwise adversely affect, the speed, security, usability, or value of the Ethereum network or ether. Alternatively, such hard forks could be contentious, leading to a split and fracture in the Ethereum community to its collective detriment, as discussed above. Any such outcomes could adversely affect the value of the Shares.

Forks may also occur as a digital asset network community's response to a significant security breach. For example, in July 2016, Ethereum underwent a hard fork between the Layer 1 Ethereum network and a new digital asset running on a "forked" branch of the network, Ethereum Classic, as a result of the Ethereum network community's response to a significant security breach. In June 2016, an anonymous hacker exploited a smart contract running on the Ethereum network to syphon approximately $60 million of ether held by The DAO, a decentralized autonomous organization, into a segregated account. In response to the hack, and after a contentious debate, most participants in the Ethereum community elected to adopt a hard fork that effectively reversed the hack, and this network constitutes the Layer 1 Ethereum network. However, a minority of users continued to develop the original blockchain, now referred to as "Ethereum Classic", which is not backwards compatible with the Layer 1 Ethereum network and is considered a forked branch, with the native digital asset on that blockchain now referred to as Ethereum Classic, or ETC. ETC now trades on several digital asset platforms. Following the July 2016 hard fork between the Ethereum and Ethereum Classic networks, new security concerns surfaced. Replay attacks, in which transactions from one network were rebroadcast to nefarious effect on the other network, plagued Ethereum exchanges through at least October 2016. An Ethereum exchange announced in July 2016 that it had lost 40,000 Ethereum Classic, worth about $100,000 at that time, as a result of replay attacks. Similar replay attack concerns occurred in connection with the Bitcoin Cash and Bitcoin Satoshi's Vision networks split in November 2018, and security concerns could similarly surface in connection with future hard forks.

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An unplanned fork may also occur as a result of an unintentional or unanticipated software flaw in the various versions of Ethereum Client software that nodes run and use to access the Ethereum network. For example, such an unplanned fork reportedly occurred in the Go-Ethereum ("Geth") client, which is a popular Ethereum Client that many nodes use to access the Ethereum network and whose developers are financially supported by the Ethereum Foundation. In November 2020, a bug was discovered in Geth (but not the other Ethereum Clients at the time, such as Besu, OpenEthereum, and Nethermind), and a patch was released that all nodes using the Geth client were supposed to download and apply simultaneously. However, not all nodes using Geth did so, resulting in the non-patched Geth nodes temporarily running a different version of the Ethereum blockchain than the patched Geth nodes and nodes using other Ethereum Clients. This temporarily created two conflicting versions of the Ethereum blockchain, causing the nodes using the non-patched Geth version to be unable to reach consensus with the rest of the nodes on the Ethereum blockchain, interrupting the non-patch Geth nodes' access to the Ethereum network. For example, Infura, which is a node operator that provides services to major Ethereum smart contracts, wallet software providers like MetaMask, ether trading platforms, and other market participants, reportedly ran numerous nodes using the Geth client. Infura's Geth client running nodes reportedly used the outdated, non-patched Geth version initially, which is said to have caused those nodes to be on the minority blockchain, impacting transaction execution, validation, and recording on the main Layer 1 Ethereum network for Infura's customers – such as Ethereum-based smart contracts, wallet providers like MetaMask, ether trading platforms, etc. – until Infura was able to apply the software update released by the Geth client developers to Infura's nodes that use Geth as their Ethereum Client. Ultimately, the problem was reportedly fixed by releasing a new upgraded version of Geth that all nodes using the Geth client were to promptly download. This reportedly harmonized the conflicting versions and restored synchronization among Geth nodes, fixing the problem and restoring access to the Ethereum network, including for Infura and its customers.

In the future, if an accidental or unintentional fork similar to what happened within the Geth client in November 2020 were to reoccur within Geth (or any other major Ethereum Client), or were to happen to the Ethereum network as a whole (instead of being limited to a single Ethereum Client, in this case Geth), such a fork could lead to nodes, users and validators losing confidence in the Ethereum network and abandoning it in favor of other blockchain protocols. Furthermore, it is possible that, in a future unplanned fork, a substantial number of nodes, users and validators could adopt an incompatible version of the digital asset while resisting community-led efforts to merge the two chains, resulting in a permanent fork. Moreover, following the Merge, nodes on the Ethereum network must run two Ethereum Clients, i.e., an Execution Client and a Consensus Client paired together, with the implementations selected at the discretion of the node operator. There are multiple groups independently developing and implementing their respective Execution Clients and Consensus Clients; while some individual Execution Clients or Consensus Clients are more popular or widely adopted than others, there remains heterogeneity among Ethereum Clients. Each Execution Client and Consensus Client needs to interoperate effectively with the other Execution Client and Consensus Client. Although this diversity of Ethereum Clients is perceived by some to promote decentralization of the Ethereum network, it comes at a potential cost: if there are any unanticipated or undiscovered flaws, bugs, software defects, or interoperability failures causing any individual Execution Client to fail to interoperate effectively with any other individual Execution Client or any Consensus Client, the Ethereum network as a whole could suffer an unplanned fork, major disruption, catastrophic outage, system failure, loss of confidence or adoption among users or validators, or a variety of other problems. Any of these events could cause ether to decline in value, adversely affecting the price of Shares.

Protocols may also be cloned. Unlike a fork, which modifies an existing blockchain, and results in two competing networks, each with the same genesis block, a "clone" is a copy of a protocol's codebase that results in an entirely new blockchain and new genesis block. Tokens are created solely from the new "clone" network and, in contrast to forks, holders of tokens of the existing network that was cloned do not receive any tokens of the new network. A "clone" results in a competing network that has characteristics substantially similar to the network it was based on, subject to any changes as determined by the developer(s) that initiated the clone. For example, following the DAO hack in July 2016, holders of Ethereum voted on-chain to reverse the hack, effectively causing a hard fork. For the days following the vote, the price of Ethereum rose from $11.65 on July 15, 2016 to $14.66 on July 21, 2016, the day after the first Ethereum Classic block was mined. A clone may also adversely affect the price of ether at the time of announcement or adoption or subsequently. For example, on November 6, 2016, Rhett Creighton, a Zcash developer, cloned the Zcash Network to launch Zclassic, a substantially identical version of the Zcash Network that eliminated the Founders' Reward. For the days following the date the first Zclassic block was mined, the price of ZEC, the native cryptocurrency of Zcash, fell from $504.57 on November 5, 2016 to $236.01 on November 7, 2016 in the midst of a broader sell-off of ZEC beginning immediately after the Zcash Network launch on October 28, 2016.

***Shareholders will not receive the benefits of any Incidental Rights and any IR Digital Asset, including any forked or airdropped assets.***

In addition to forks, a digital asset may become subject to a similar occurrence known as an "airdrop." In an airdrop, the promotors of a new digital asset announce to holders of another digital asset that such holders will be entitled to claim a certain amount of the new digital asset for free, based on the fact that they hold such other digital asset. For example, in March 2017 the promoters of Stellar Lumens announced that anyone that owned bitcoin as of June 26, 2017 could claim, until August 27, 2017, a certain amount of Stellar Lumens. Airdrops could create operational, security, legal or regulatory, or other risks for the Trust, the Sponsor, the Ether Custodian, Authorized Participants, or other entities.

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We refer to the right to receive any such benefit as an "Incidental Right" and any such digital asset (other than ether) acquired through an Incidental Right as an "IR Digital Asset." With respect to a fork, airdrop or similar event, the Sponsor will cause the Trust to irrevocably abandon the Incidental Rights and any IR Digital Asset associated with such event. As such, Shareholders will not receive the benefits of any Incidental Rights or any IR Digital Asset.

In the event the Trust seeks to change the Trust's policy with respect to Incidental Rights or IR Digital Assets, an application would need to be filed with the SEC by NASDAQ seeking approval to amend its listing rules to permit the Trust to sell Incidental Rights or IR Digital Assets and distribute the cash proceeds (net of expenses and applicable withholding taxes) to DTC or distribute the Incidental Rights or IR Digital Asset in-kind to DTC. However, there can be no assurance as to whether or when the Sponsor would make such a decision, or when NASDAQ will seek or obtain this approval, if at all.

Even if such regulatory approval is sought and obtained, Shareholders may not receive the benefits of a fork, the Trust may not choose, or be able, to participate in an airdrop, and the timing of receiving any benefits from a fork, airdrop or similar event is uncertain. Any inability to recognize the economic benefit of a hard fork or airdrop could adversely affect the value of the Shares. Investors who prefer to have a greater degree of control over events such as forks, airdrops, and similar events, and any assets made available in connection with each, should consider investing in ether directly rather than purchasing Shares.

***In the event of a hard fork of the Ethereum network, the Sponsor will, if permitted by the terms of the Trust Agreement, use its discretion to determine which network should be considered the appropriate network for the Trust***'***s purposes, and in doing so may adversely affect the value of the Shares.***

In the event of a hard fork of the Ethereum network, the Sponsor will, as permitted by the terms of the Trust Agreement, use its discretion to determine, in good faith, which peer-to-peer network, among a group of incompatible forks of the Ethereum network, is generally accepted as the Ethereum network and should therefore be considered the appropriate network for the Trust's purposes. The Sponsor will base its determination on whatever factors it deems relevant, including, but not limited to, the Sponsor's beliefs regarding expectations of the core developers of ether, users, services, businesses, validators and other constituencies, as well as the actual continued acceptance of, validating power on, and community engagement with, the Ethereum network, or whatever other factors it deems relevant. There is no guarantee that the Sponsor will choose the digital asset that is ultimately the most valuable fork, and the Sponsor's decision may adversely affect the value of the Shares as a result. The Sponsor may also disagree with Shareholders, the Ether Custodian, other service providers, the Index Administrator, crypto asset platforms, or other market participants on what is generally accepted as ether and should therefore be considered "ether" for the Trust's purposes, which may also adversely affect the value of the Shares as a result.

***Any name change and any associated rebranding initiative by the core developers of ether may not be favorably received by the digital asset community, which could negatively impact the value of ether and the value of the Shares.***

From time to time, digital assets may undergo name changes and associated rebranding initiatives. For example, Bitcoin Cash may sometimes be referred to as Bitcoin ABC in an effort to differentiate itself from any Bitcoin Cash hard forks, such as Bitcoin Satoshi's Vision, and in the third quarter of 2018, the team behind ZEN rebranded and changed the name of ZenCash to "Horizen." The Sponsor cannot predict the impact of any name change and any associated rebranding initiative on ether. After a name change and associated rebranding initiative, a digital asset may not be able to achieve or maintain brand-name recognition or status that is comparable to the recognition and status previously enjoyed by such digital asset. The failure of any name change and associated rebranding initiative by ether could result in ether not realizing some or all of the anticipated benefits contemplated by the name change and associated rebranding initiative, and could negatively impact the value of ether and the value of the Shares.

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***Smart contracts, including those relating to DeFi applications, are a new technology and their ongoing development and operation may result in problems, which could reduce the demand for ether or cause a wider loss of confidence in the Ethereum network, either of which could have an adverse impact on the value of ether.***

Smart contracts are programs that run on the Ethereum blockchain that execute automatically when certain conditions are met. Because smart contracts typically cannot be stopped or reversed, vulnerabilities in their programming can have damaging effects. For example, in June 2016, a vulnerability in the smart contracts underlying The DAO allowed an attack by a hacker to syphon approximately $60 million worth of ether from The DAO's accounts into a segregated account. In the aftermath of the theft, certain core developers and contributors pursued a "hard fork" of the Ethereum network in order to erase any record of the theft. Despite these efforts, the price of ether reportedly dropped approximately 35% in the aftermath of the attack and subsequent hard fork. In addition, in July 2017, a vulnerability in a smart contract for a multi-signature wallet software developed by Parity reportedly led to a $30 million theft of ether, and in November 2017, a new vulnerability in Parity's wallet software reportedly led to roughly $160 million worth of ether being indefinitely frozen in an account. Furthermore, in April 2018, a batch overflow bug was found in many Ethereum-based ERC20-compatible smart contract tokens that allowed hackers to create a large number of smart contract tokens, causing multiple crypto asset platforms worldwide to shutdown ERC20-compatible token trading. Similarly, in March 2020, a design flaw in the MakerDAO smart contract caused forced liquidations of crypto assets at significantly discounted prices, resulting in millions of dollars of losses to users who had deposited crypto assets into the smart contract. Other smart contracts, such as bridges between blockchain networks and DeFi protocols have also been manipulated, exploited or used in ways that were not intended or envisioned by their creators such that attackers syphoned over $3.8 billion worth of digital assets from smart contracts in 2022. Problems with the development, deployment, and operation of smart contracts may have an adverse effect on the value of ether.

In some cases, smart contracts can be controlled by one or more "admin keys" or users with special privileges, or "super users." These users may have the ability to unilaterally make changes to the smart contract, enable or disable features on the smart contract, change how the smart contract receives external inputs and data or transmits ether or other digital assets, or make other changes to the smart contract. Furthermore, in some cases inadequate public information may be available about certain smart contracts or applications, and information asymmetries may exist, even with respect to open-source smart contracts or applications; certain participants may have hidden informational or technological advantages, making for an uneven playing field. There may be opportunities for bad actors to perpetrate fraudulent schemes and engage in illicit activities and other misconduct, such as exit scams and rug pulls (orchestrated by developers and/or influencers who promote a smart contract or application and, ultimately, escape with the money at an agreed time), or Ponzi or similar fraud schemes.

Many DeFi applications are currently deployed on the Ethereum network, and smart contracts relating to DeFi applications currently represent a significant source of demand for ether. DeFi applications may achieve their investment purposes through self-executing smart contracts that may allow users, for example, to invest digital assets in a pool from which other users can borrow without requiring an intermediate party to facilitate these transactions. These investments may earn interest based on the rates at which borrowers repay the loan, and can generally be withdrawn by the investor. For smart contracts that hold a pool of digital asset reserves, smart contract super users or admin key holders may be able to extract funds from the pool, liquidate assets held in the pool, or take other actions that decrease the value of the digital assets held by the smart contract in reserves. Even for digital assets that have adopted a decentralized governance mechanism, such as smart contracts that are governed by the holders of a governance token, such governance tokens can be concentrated in the hands of a small group of core community members, who would be able to make similar changes unilaterally to the smart contract. If any such super user or group of core members unilaterally make adverse changes to a smart contract, the design, functionality, features and value of the smart contract, its related digital assets may be harmed. In addition, assets held by the smart contract in reserves may be stolen, misused, burnt, locked up or otherwise become unusable and irrecoverable. Super users can also become targets of hackers and malicious attackers. If an attacker is able to access or obtain the super user privileges of a smart contract, or if a smart contract's super users or core community members take actions that adversely affect the smart contract, users who transact with the smart contract may experience decreased functionality of the smart contract or may suffer a partial or total loss of any digital assets they have used to transact with the smart contract. Furthermore, the underlying smart contracts may be insecure, contain bugs or other vulnerabilities, or otherwise may not work as intended. Any of the foregoing could cause users of the DeFi application to be negatively affected or could cause the DeFi application to be the subject of negative publicity. Because DeFi applications may be built on the Ethereum network and represent a significant source of demand for ether, public confidence in the Ethereum network itself could be negatively affected, such sources of demand could diminish, and the value of ether could decrease. Similar risks apply to any smart contract or decentralized application, not just DeFi applications.

The complexity and interconnectedness of digital asset networks, applications, and economic systems enables new forms of malicious attacks that leverage a feature or vulnerability of one system to attack another. Such an attack may take the form of a temporary manipulation of the price of certain digital assets that trigger second order behaviors, such as automatic collateral liquidations on decentralized applications or digital asset trading platforms. Such an attack could adversely affect investments. A malicious actor can exploit the structure of one or a series of smart contracts or applications in ways that do not technically constitute exploitation of a "bug" or flaw in the smart contract or application. For example, such an exploit has occurred repeatedly in the Ethereum DeFi ecosystem, whereby a decentralized trading platform or lending application is designed to reference an external pricing source of a particular digital asset to determine when to liquidate collateral. By manipulating the price of the particular digital asset on a third-party platform (such as a digital asset trading platform), the pricing source used by the decentralized trading platform or application is consequently manipulated, which then leads to uneconomic collateral liquidations on the decentralized trading platform or application. Such liquidations may be processed automatically and could have a material adverse effect on our investments and trading strategies.

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***Validators may suffer losses due to staking, or staking may prove unattractive to validators, which could make the Ethereum network less attractive.***

Validation on the Ethereum network requires ether to be transferred into smart contracts on the underlying blockchain networks not under the Trust's or anyone else's control. As part of the Trust's staking program, the Ether Custodian transfers the Trust's staked ether to the Protocol Staking Deposit Contract. If the Ethereum network source code or protocol, including the Protocol Staking Deposit Contract, fail to behave as expected, suffer cybersecurity attacks or hacks, experience security issues, or encounter other problems, such assets may be irretrievably lost. Although the Sponsor is not currently aware of reports of the Protocol Staking Deposit Contract failing to behave as designed or suffering cybersecurity issues since the Merge, the Protocol Staking Deposit Contract is a smart contract located directly on the Ethereum blockchain, and like any software, the Protocol Staking Deposit Contract could in the future suffer from undiscovered bugs, flaws, software defects, cybersecurity vulnerabilities, or otherwise experience problems or issues that could result in the loss of the Trust's staked assets. Because none of the Sponsor, the Ether Custodian, the Prime Execution Agent, or any Approved Validator have the ability to control or modify the Protocol Staking Deposit Contract, if the Protocol Staking Deposit Contract were to suffer issues or problems causing a loss of the Trust's assets, no person may be responsible, and no recourse may be available, to the Trust or holders of Shares in respect of the loss.

The Ethereum network imposes fault-based sanctions for validator misbehavior, primarily through slashing, which may include correlated slashing penalties. Slashing occurs when a validator engages in malicious or erroneous actions that pose consensus safety violations, such as proposing multiple blocks in a given slot or attesting to conflicting blocks. Slashed validators face an initial slashing penalty and are forcibly exited from the validator set. The exact amount of ether burned in a slashing depends on network conditions, namely the number of other validators slashed around the same time. Any slashed assets will be debited from the Trust's Vault Account at the Ether Custodian. In some cases, Staking Services Providers may make compensatory payments to Coinbase for the benefit of the Trust, or alternatively for the benefit of all affected clients, which Coinbase will allocate in accordance with validator instructions or on a pro rata basis. Such payments may not be made at all, or if made, may not offset losses to the Trust, fully or in part, or in timely fashion, and protracted legal proceedings could result without any assurance of successful recovery or compensation from the Approved Validator. There can be no guarantee that the Trust would recover any of its staked assets, or the value thereof, if it is subject to penalties or slashing imposed by the Ethereum network.

Separately, if a validator fails to perform required protocol duties, including submitting timely attestations, it may incur inactivity penalties. Under normal network conditions, these penalties result in a reduction of the validator's staked ether in an amount generally similar to the rewards the validator would have earned had it performed those duties. Validators may also be subject to increased penalties during an inactivity leak. An "inactivity leak" is a protocol-level state that is triggered when the Ethereum network goes into an extended period without achieving finality. Finality requires agreement by validators representing at least two-thirds of the total staked ether. This means that if validators representing more than one-third of the total staked ether are offline or otherwise fail to attest, the network may be unable to finalize blocks. If this condition persists, the protocol activates an inactivity leak under which ether staked by the inactive validators is reduced more rapidly than under normal conditions. This mechanism is intended to incentivize validators to remain online and continue participating, thereby helping restore finality to the network. However, if the Approved Validators staking the Trust's ether are not in the active validator set, the Trust could suffer a loss of its staked assets arising from the inactivity leak. There can be no assurance that the Trust's Approved Validators would be responsible to the Trust in respect of losses from an inactivity leak, or – even if responsible to the Trust – would perform their obligations to the Trust and not default, which could cause losses to the Trust and to holders of Shares.

Validators may also face correlated slashing after an initial slashing. Correlated slashing refers to an elevated penalty levied on a validator when multiple validators are penalized at the same time due to a shared cause, such as collective malicious or fraudulent behavior (such as a coordinated attack on the Ethereum network's consensus process), or common software, configuration, or operational dependencies. Correlated slashing was incorporated into the source code of the Ethereum network in an attempt to deter coordinated attacks on the Ethereum network's consensus process, but it can also be triggered by situations where common software or operational dependencies (such as, for example, a bug or defect in popular Ethereum Client software) cause multiple validators inadvertently to engage in behavior that causes them to suffer slashing penalties simultaneously. In these circumstances, a single attack, event, or error may result in simultaneous slashing across multiple validators, leading to aggregate losses that are greater than the penalty that each would otherwise suffer individually for that single event. In October 2025, a validator holding 2,020 ether faced correlated slashing, which resulted in a 0.69838 ether penalty.

Within the post-Merge Ethereum network, as part of the "activating" and "exiting" processes of staking, staked ether will be inaccessible for a variable period of time determined by a range of factors, including network congestion, resulting in potential inaccessibility during those periods. "Activation" is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the Ethereum network's proof-of-stake consensus protocol. "Exit" is the request to exit from the active set and no longer participate in the Ethereum network's proof-of-stake consensus protocol. As part of these "activating" and "exiting" processes of staking on the Ethereum network, any staked ether will be inaccessible for a period of time. The duration of activating and exiting periods are dependent on a range of factors, including network conditions. In periods of low demand, unstaking may be completed within hours or several days, while in periods of elevated exit activity the process may take multiple weeks or months to complete.

The Ethereum network requires the payment of base fees and the practice of paying tips is common, and such fees can become significant as the amount and complexity of the transaction grows, depending on the degree of network congestion and the price of ether. Any cybersecurity attacks, security issues, hacks, penalties, slashing events, or other problems could damage validators' willingness to participate in validation, discourage existing and future validators from serving as such, and adversely impact the Ethereum network's adoption or the price of ether; if such risks affect the Trust's staking program, losses to the Trust and holders of Shares could result. Any disruption of validation on the Ethereum network could interfere with network operations and cause the Ethereum network to be less attractive to users and application developers than competing blockchain networks, which could cause the price of ether to decrease. The limited liquidity during the "activation" or "exiting" processes could dissuade potential validators from participating, which could interfere with network operations or security and cause the Ethereum network to be less attractive to users and application developers than competing blockchain networks, which could cause the price of ether to decrease.

***Proof-of-stake blockchains are a relatively recent innovation and have not been subject to as widespread use or adoption over as long of a period of time as traditional proof-of-work blockchains.***

Certain digital assets, such as bitcoin, use a "proof-of-work" consensus algorithm. The genesis block on the bitcoin blockchain was mined in 2009, and Bitcoin's blockchain has been in operation since then. Many newer blockchains enabling smart contract functionality, including the current Ethereum network following the completion of the Merge in 2022, use a newer consensus algorithm known as "proof-of-stake." While their proponents believe that they may have certain advantages, the "proof-of-stake" consensus mechanisms and governance systems underlying many newer blockchain protocols, including the Ethereum network following the Merge, and their associated digital assets – including the ether held by the Trust – have not been tested at scale over as long of a period of time or subject to as widespread use or adoption as, for example, Bitcoin's proof-of-work consensus mechanism has. This could lead to these blockchains, and their associated digital assets, having undetected vulnerabilities, structural design flaws, suboptimal incentive structures for network participants (e.g., validators), technical disruptions, or a wide variety of other problems, any of which could cause these blockchains not to function as intended, lead to outright failure to function entirely causing a total outage or disruption of network activity, or to suffer other operational problems or reputational damage, leading to a loss of users or adoption or a loss in value of the associated digital assets, including the Trust's assets. Over the long term, there can be no assurance that the proof-of-stake blockchain on which the Trust's assets rely will achieve widespread scale or adoption or perform successfully and any failure to do so could negatively impact the value of the Trust's assets.

***Unlike some digital assets, which have a limit on outstanding supply, there is no limit on ether supply.***

Some digital assets have a limit ("hard cap") on the supply of outstanding digital assets. There is no hard cap on the supply of ether, which will continue to be issued as a reward to validators for new blocks. The price of many digital assets like ether is heavily influenced by supply and demand. If the supply of ether is inflationary, then in the absence of deflationary forces, ether could lose value, assuming the same amount of demand.

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**Risk Factors Related to the Digital Asset Markets** 

***The value of the Shares relates directly to the value of ether, the value of which may be highly volatile and subject to fluctuations due to a number of factors.***

The value of the Shares relates directly to the value of the ether held by the Trust and fluctuations in the price of ether could adversely affect the value of the Shares. The market price of ether may be highly volatile, and subject to a number of factors, including:

● an increase in the global ether supply or a decrease in global ether demand;

● market conditions of, and overall sentiment towards, the digital assets and blockchain technology industry;

● trading activity on digital asset platforms, which, in many cases, is largely unregulated or may be subject to manipulation;

● the adoption of ether as a medium of exchange, store-of-value or other consumptive asset and the maintenance and development of the open-source software protocol of the Ethereum network, and its ability to meet user demands;

● manipulative trading activity on digital asset platforms, which, in many cases, are largely unregulated;

● the lack of a hard cap on ether supply;

● forks in the Ethereum network;

● changes or instability in the leadership of the Ethereum Foundation;

● investors' expectations with respect to interest rates, the rates of inflation of fiat currencies or ether, and digital asset exchange rates;

● consumer preferences and perceptions of ether specifically and digital assets generally;

● negative events, publicity, and social media coverage relating to the digital assets and blockchain technology industry;

● fiat currency withdrawal and deposit policies on digital asset platforms;

● the liquidity of digital asset markets and any increase or decrease in trading volume or market making on digital asset markets;

● business failures, bankruptcies, hacking, fraud, crime, government investigations, or other negative developments affecting digital asset businesses, including digital asset platforms, or banks or other financial institutions and service providers which provide services to the digital asset industry;

● the use of leverage in digital asset markets, including the unwinding of positions, "margin calls," collateral liquidations and similar events;

● investment and trading activities of large or active consumer and institutional users, speculators, validators, and investors;

● a "short squeeze" resulting from speculation on the price of ether, if aggregate short exposure exceeds the number of Shares available for purchase;

● an active derivatives market for ether or for digital assets generally;

● monetary policies of governments, legislation or regulation, tariffs, trade restrictions, currency devaluations and revaluations, or macroeconomic conditions generally;

● regulatory measures or enforcement actions, if any, that restrict the use of ether as a form of payment or the purchase of ether on the digital asset markets;

● global or regional political, economic or financial conditions, events and situations, or major public issues;

● fees associated with processing an ether transaction and the speed at which ether transactions are settled;

● the maintenance, troubleshooting, and development of the Ethereum network including by validators and developers worldwide;

● the ability for the Ethereum network to attract and retain validators to secure and confirm transactions accurately and efficiently;

● ongoing technological viability and security of the Ethereum network and ether transactions, including scalability and vulnerabilities against hacks;

● governmental or regulatory actions by, or investigations or litigation in, countries around the world targeting well-known decentralized applications or smart contracts that are built on the Ethereum network, or other developments or problems, and associated publicity, involving or affecting such decentralized applications or smart contracts;

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● financial strength of market participants;

● the availability and cost of funding and capital;

● the liquidity and credit risk of digital asset platforms;

● interruptions in service from or closures or failures of major digital asset platforms or their banking partners, or outages or system failures affecting the Ethereum network;

● decreased confidence in digital assets and digital assets platforms;

● poor risk management or fraud by entities in the digital asset ecosystem;

● increased competition from other digital assets or networks, including other blockchain networks combining smart contracts, programmable scripting languages, and an associated runtime environment, with blockchain-based recordkeeping, particularly where such other blockchain networks are able to offer users access to a larger consumer user base, greater efficiency, reliability, or processing speed, more economical transaction processing fees, or any other more favorable attributes, than the Ethereum network;

● the Trust's own acquisitions or dispositions of ether, since there is no limit on the number of ether that the Trust may acquire, and the Sponsor is an affiliate of BlackRock, which is a prominent participant in financial markets.

Although returns from investing in ether have at times diverged from those associated with other asset classes to a greater or lesser extent, there can be no assurance that there will be any such divergence in the future, either generally or with respect to any particular asset class, or that price movements will not be correlated. In addition, there is no assurance that ether will maintain its value in the long-, intermediate- or short- term. In the event that the price of ether declines, the Sponsor expects the value of the Shares to decline proportionately.

The value of ether as represented by the Index or other pricing source used by the Trust may also be subject to momentum pricing due to speculation regarding future appreciation in value, leading to greater volatility that could adversely affect the value of the Shares. Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for future appreciation in value, if any. The Sponsor believes that momentum pricing of ether has resulted, and may continue to result, in speculation regarding future appreciation in the value of ether, inflating and making the Index more volatile. As a result, ether may be more likely to fluctuate in value due to changing investor confidence, which could impact future appreciation or depreciation in the Index or other pricing source used by the Trust and could adversely affect the value of the Shares.

***Because the Trust holds only ether and cash, an investment in the Trust may be more volatile than an investment in a more broadly diversified portfolio.***

The Trust holds only ether and cash. As a result, the Trust's holdings are not diversified. Accordingly, the Trust's net asset value may be more volatile than another investment vehicle with a more broadly diversified portfolio and may fluctuate substantially over short or long periods of time. Fluctuations in the price of ether are expected to have a direct impact on the value of the Shares.

An investment in the Trust may be deemed speculative and is not intended as a complete investment program. An investment in Shares should be considered only by persons financially able to maintain their investment and who can bear the risk of total loss associated with an investment in the Trust. Investors should review closely the objective and strategy of the Trust and redemption rights, as discussed herein, and familiarize themselves with the risks associated with an investment in the Trust.

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***Due to the unregulated nature and lack of transparency surrounding the operations of digital asset platforms, which may experience fraud, manipulation, security failures or operational problems, as well as the wider ether market, the value of ether and, consequently, the value of the Shares may be adversely affected, causing losses to Shareholders.***

Digital asset platforms are relatively new and, in some cases, unregulated. Many operate outside the United States. Furthermore, while many prominent digital asset platforms provide the public with significant information regarding their ownership structure, management teams, corporate practices and regulatory compliance, many digital asset platforms do not provide this information. Digital asset platforms may not be subject to, or may not comply with, regulation in a similar manner as other regulated trading platforms, such as national securities exchanges or designated contract markets. As a result, the marketplace may lose confidence in digital asset platforms, including prominent platforms that handle a significant volume of ether trading.

Many digital asset platforms are unlicensed, may be unregulated, may be subject to regulation in a relevant jurisdiction, but may or may not be in compliance therewith, may operate without extensive supervision by governmental authorities, and do not provide the public with significant information regarding their ownership structure, management team, corporate practices, cybersecurity, and regulatory compliance. In particular, those located outside the United States may be subject to significantly less stringent regulatory and compliance requirements in their local jurisdictions, and may take the position that they are not subject to laws and regulations that would apply to a national securities exchange or designated contract market in the United States, or may, as a practical matter, be beyond the ambit of U.S. regulators. As a result, trading activity on or reported by these digital asset platforms is generally significantly less regulated than trading in regulated U.S. securities and commodities markets, and may reflect behavior that would be prohibited in regulated U.S. trading venues. For example, in 2019 there were reports claiming that 80.95% of bitcoin trading volume on digital asset platforms was false or noneconomic in nature, with specific focus on unregulated platforms located outside of the United States. Such reports alleged that certain overseas platforms have displayed suspicious trading activity suggestive of a variety of manipulative or fraudulent practices, such as fake or artificial trading volume or trading volume based on non-economic "wash trading" (where offsetting trades are entered into for other than bona fide reasons, such as the desire to inflate reported trading volumes), and attributed such manipulative or fraudulent behavior to motives like the incentive to attract listing fees from token issuers who seek the most liquid and high-volume platforms on which to list their coins.

Other academics and market observers have put forth evidence to support claims that manipulative trading activity has occurred on certain digital asset platforms. For example, in a 2017 paper titled "Price Manipulation in the Bitcoin Ecosystem" sponsored by the Interdisciplinary Cyber Research Center at Tel Aviv University, a group of researchers used publicly available trading data, as well as leaked transaction data from a 2014 Mt. Gox security breach, to identify and analyze the impact of "suspicious trading activity" on Mt. Gox between February and November 2013, which, according to the authors, caused the price of bitcoin to increase from around $150 to more than $1,000 over a two-month period. In August 2017, it was reported that a trader or group of traders nicknamed "Spoofy" was placing large orders on Bitfinex without actually executing them, presumably in order to influence other investors into buying or selling by creating a false appearance that greater demand existed in the market. In December 2017, an anonymous blogger (publishing under the pseudonym Bitfinex'd) cited publicly available trading data to support his or her claim that a trading bot nicknamed "Picasso" was pursuing a paint-the-tape-style manipulation strategy by buying and selling bitcoin and bitcoin cash between affiliated accounts in order to create the appearance of substantial trading activity and thereby influence the price of such assets. Although bitcoin and ether are different assets, there can be no assurance that ether prices may not at times be subject to similar activity. Even in the United States, there have been allegations of wash trading even on regulated venues. Any actual or perceived false trading in the digital asset platform market, and any other fraudulent or manipulative acts and practices, could adversely affect the value of digital assets and/or negatively affect the market perception of digital assets.

The ether market globally and in the United States is not subject to comparable regulatory guardrails as exist in regulated securities markets. Furthermore, many ether trading venues lack certain safeguards put in place by exchanges for more traditional assets to enhance the stability of trading on the exchanges and prevent "flash crashes," such as limit-down circuit breakers. As a result, the prices of ether on trading venues may be subject to larger and/or more frequent sudden declines than assets traded on more traditional exchanges. Tools to detect and deter fraudulent or manipulative trading activities such as market manipulation, front-running of trades, and wash trading may not be available to or employed by digital asset platforms or may not exist at all. The SEC has identified possible sources of fraud and manipulation in the digital asset markets generally, including, among others (1) "wash trading"; (2) persons with a dominant position in a digital asset manipulating the digital asset's pricing; (3) hacking of the digital asset's peer-to-peer network, protocols and trading platforms; (4) malicious control of the digital asset network; (5) trading based on material, non-public information (for example, plans of market participants to significantly increase or decrease their holdings in the digital asset, new sources of demand for the digital asset, etc.) or based on the dissemination of false and misleading information; (6) manipulative activity involving purported "stablecoins" (for more information, see "—Prices of ether may be affected due to stablecoins (including Tether and US Dollar Coin ("USDC")), the activities of stablecoin issuers and their regulatory treatment"); and (7) fraud and manipulation at digital asset trading platforms. The effect of potential market manipulation, front-running, wash trading, and other fraudulent or manipulative trading practices may inflate the volumes actually present in the digital asset markets and/or cause distortions in price, which could adversely affect the Trust or cause losses to Shareholders.

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In addition, over the past several years, some digital asset platforms have been closed due to fraud and manipulative activity, business failure or security breaches. In many of these instances, the customers of such digital asset platforms were not compensated or made whole for the partial or complete losses of their account balances in such digital asset platforms. While, generally speaking, smaller digital asset platforms are less likely to have the infrastructure and capitalization that make larger digital asset platforms more stable, larger digital asset platforms are more likely to be appealing targets for hackers and malware and their shortcomings or ultimate failures are more likely to have contagion effects on the digital asset ecosystem, and therefore may be more likely to be targets of regulatory enforcement action. For example, the collapse of Mt. Gox, which filed for bankruptcy protection in Japan in late February 2014, demonstrated that even the largest digital asset platforms could be subject to abrupt failure with consequences for both users of digital asset platforms and the digital asset industry as a whole. In particular, in the two weeks that followed the February 7, 2014 halt of bitcoin withdrawals from Mt. Gox, the value of one bitcoin fell on other platforms from around $795 on February 6, 2014 to $578 on February 20, 2014. Additionally, in January 2015, Bitstamp announced that approximately 19,000 bitcoin had been stolen from its operational or "hot" wallets. Further, in August 2016, it was reported that almost 120,000 bitcoins worth around $78 million were stolen from Bitfinex, a large digital asset platform. The value of bitcoin and other digital assets immediately decreased over 10% following reports of the theft at Bitfinex. Regulatory enforcement actions have followed, such as in July 2017, when FinCEN assessed a $110 million fine against BTC-E, a now defunct digital asset platform, for facilitating crimes such as drug sales and ransomware attacks. In addition, in December 2017, Yapian, the operator of Seoul-based digital asset platform Youbit, suspended digital asset trading and filed for bankruptcy following a hack that resulted in a loss of 17% of Yapian's assets. Following the hack, Youbit users were allowed to withdraw approximately 75% of the digital assets in their platform accounts, with any potential further distributions to be made following Yapian's pending bankruptcy proceedings. In addition, in January 2018, the Japanese digital asset platform, Coincheck, was hacked, resulting in losses of approximately $535 million, and in February 2018, the Italian digital asset platform Bitgrail, was hacked, resulting in approximately $170 million in losses. In May 2019, one of the world's largest digital asset platforms, Binance, was hacked, resulting in losses of approximately $40 million. In November 2022, FTX Trading Ltd. ("FTX"), one of the largest digital asset platforms by volume at the time, halted customer withdrawals amid rumors of the company's liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly thereafter, FTX's CEO resigned, and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department of Justice brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX's and its affiliates' senior executives, including its former CEO. Around the same time, there were reports that approximately $300-600 million of digital assets were removed from FTX and the full facts remain unknown, including whether such removal was the result of a hack, theft, insider activity, or other improper behavior. On February 21, 2025, Bybit, a centralized platform for exchanging digital assets, announced that more than $1.4 billion in ether had been stolen from its platform. Hackers were able to manipulate Bybit's transfer process to authorize and complete the illicit transaction. The incident has resulted in renewed concerns over the security of digital asset platforms.

Negative perception, a lack of stability and standardized regulation in the digital asset markets and the closure or temporary shutdown of digital asset platforms due to fraud, business failure, security breaches or government mandated regulation, and associated losses by customers, may reduce confidence in the Ethereum network and result in greater volatility or decreases in the prices of ether. Furthermore, the closure or temporary shutdown of a digital asset platform used in calculating the Index may result in a loss of confidence in the Trust's ability to determine its NAV on a daily basis. The potential consequences of a digital asset platform's failure could adversely affect the value of the Shares.

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***The Index has a limited performance history, the Index price could fail to track the global ether price, and a failure of the Index price could adversely affect the value of the Shares.***

The CF Benchmarks Index was developed by the Index Administrator and has a limited performance history. Although the Index is based on materially the same methodology (except calculation time) as the Index Administrator's Ether Reference Rate ("ETHUSD_RR") which was first introduced in May 2018, the Index itself has only been in operation since February 2022. The Index price is a composite CF Benchmarks Index calculated using volume-weighted trading price data from various Constituent Platforms. The Index has only featured its current list of Constituent Platforms since July 2025. A longer history of actual performance through various economic and market conditions would provide greater and more reliable information for an investor to assess the Index's performance. The Constituent Platforms chosen by the Index Administrator could also change over time. The Index Administrator may remove or add Constituent Platforms to the CF Benchmarks Index in the future at its discretion. For more information on the inclusion criteria for Constituent Platforms in the CF Benchmarks Index, see "Business of the Trust—Valuation of Ether; The CF Benchmarks Index."

Although the Index is intended to accurately capture the market price of ether, third parties may be able to purchase and sell ether on public or private markets not included among the Constituent Platforms, and such transactions may take place at prices materially higher or lower than the Index price. Moreover, there may be variances in the prices of ether on the various Constituent Platforms, including as a result of differences in fee structures or administrative procedures on different Constituent Platforms. While the Index provides a U.S. dollar-denominated composite for the price of ether based on, in the case of the CF Benchmarks Index, the volume-weighted price of ether on certain Constituent Platforms, at any given time, the prices on each such Constituent Platform or pricing source may not be equal to the value of ether as represented by the Index. It is possible that the price of ether on the Constituent Platforms could be materially higher or lower than the Index price. To the extent the Index price differs materially from the actual prices available on a Constituent Platform, or the global market price of ether, the price of the Shares may no longer track, whether temporarily or over time, the global market price of ether, which could adversely affect an investment in the Trust by reducing investors' confidence in the Shares' ability to track the market price of ether. To the extent such prices differ materially from the Index price, investors may lose confidence in the Shares' ability to track the market price of ether, which could adversely affect the value of the Shares.

If the Index is not available, the Trust's holdings may be fair valued on a temporary basis in accordance with the policy approved by the Trustee. To the extent the valuation determined in accordance with the policy approved by the Trustee differs materially from the actual market price of ether, the price of the Shares may no longer track, whether temporarily or over time, the global market price of ether, which could adversely affect an investment in the Trust by reducing investors' confidence in the Shares' ability to track the global market price of ether. To the extent such prices differ materially from the market price for ether, investors may lose confidence in the Shares' ability to track the market price of ether, which could adversely affect the value of the Shares.

***The Index price used to calculate the value of the Trust***'***s ether may be volatile, adversely affecting the value of the Shares.***

The price of ether on public digital asset platforms has a limited history, and during this history, ether prices on the digital asset markets more generally, and on digital asset platforms individually, have been volatile and subject to influence by many factors, including operational interruptions. While the Index is designed to limit exposure to the interruption of individual digital asset platforms, the Index price, and the price of ether generally, remains subject to volatility experienced by digital asset platforms, and such volatility could adversely affect the value of the Shares.

Furthermore, because the number of liquid and credible digital asset platforms is limited, the Index will necessarily be composed of a limited number of digital asset platforms. If a digital asset platform was subjected to regulatory, volatility or other pricing issues, in the case of the CF Benchmarks Index, the Index Administrator would have limited ability to remove such digital asset platform from the Index, which could skew the price of ether as represented by the Index. Trading on a limited number of digital asset platforms may result in less favorable prices and decreased liquidity of ether and, therefore, could have an adverse effect on the value of the Shares.

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***The Index Administrator could experience system failures or errors.***

If the computers or other facilities of the Index Administrator, data providers and/or relevant Constituent Platforms malfunction for any reason, calculation and dissemination of the CF Benchmarks Index may be delayed. Errors in the CF Benchmarks Index data, the CF Benchmarks Index computations and/or construction may occur from time to time and may not be identified and/or corrected for a period of time or at all, which may have an adverse impact on the Trust and the Shareholders. Any of the foregoing may lead to the errors in the CF Benchmarks Index, which may lead to a different investment outcome for the Trust and the Shareholders than would have been the case had such events not occurred.

The CF Benchmarks Index is used to determine the net asset value of the Trust and the NAV. Consequently, losses or costs associated with the CF Benchmarks Index's errors or other risks described above will generally be borne by the Trust and the Shareholders and neither the Sponsor nor its affiliates or agents make any representations or warranties regarding the foregoing. If the CF Benchmarks Index is not available or the Sponsor in its sole discretion determines the CF Benchmarks Index is unreliable as the Index and therefore determines not to use the CF Benchmarks Index the Trust's holdings may be fair valued on a temporary basis in accordance with the fair value policies approved by the Trustee. See "Business of the Trust—Net Asset Value." To the extent the valuation determined in accordance with the policy approved by the Trustee differs materially from the actual market price of ether, the price of the Shares may no longer track, whether temporarily or over time, the price of ether, which could adversely affect an investment in the Trust and the value of Shares by reducing investors' confidence in the Shares' ability to track the price of ether.

***The Index price being used to determine the net asset value of the Trust may not be consistent with GAAP. To the extent that the Trust***'***s financial statements are determined using a different pricing source that is consistent with GAAP, the net asset value reported in the Trust***'***s periodic financial statements may differ, in some cases significantly, from the Trust***'***s net asset value determined using the Index pricing.***

The Trust will determine the net asset value of the Trust on each Business Day based on the value of ether as reflected by the Index. The methodology used to calculate the Index price to value ether in determining the net asset value of the Trust may not be deemed consistent with GAAP. To the extent the methodology used to calculate the Index is deemed inconsistent with GAAP, the Trust will utilize an alternative GAAP-consistent pricing source for purposes of the Trust's periodic financial statements. Creation and redemption of Baskets, the Sponsor's Fee and other expenses borne by the Trust will be determined using the Trust's net asset value determined daily based on the Index. Such net asset value of the Trust determined using the Index Price may differ, in some cases significantly, from the net asset value reported in the Trust's periodic financial statements.

***Competition from central bank digital currencies (***"***CBDCs***"***) and emerging payments initiatives involving financial institutions could adversely affect the value of ether and other digital assets.***

Central banks in various countries have introduced digital forms of legal tender (CBDCs). Whether or not they incorporate blockchain or similar technology, CBDCs, as legal tender in the issuing jurisdiction, could have an advantage in competing with, or replace, ether and other crypto assets as a medium of exchange or store of value. Central banks and other governmental entities have also announced cooperative initiatives and consortia with private sector entities, with the goal of leveraging blockchain and other technology to reduce friction in cross-border and interbank payments and settlement, and commercial banks and other financial institutions have also recently announced a number of initiatives of their own to incorporate new technologies, including blockchain and similar technologies, into their payments and settlement activities, which could compete with, or reduce the demand for, ether. As a result of any of the foregoing factors, the value of ether could decrease, which could adversely affect an investment in the Trust.

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***Prices of ether may be affected due to stablecoins (including Tether and USDC), the activities of stablecoin issuers and their regulatory treatment.***

While the Trust does not invest in stablecoins, it may nonetheless be exposed to risks that stablecoins pose for the ether market and other digital asset markets. Stablecoins are digital assets designed to have a stable value over time as compared to typically volatile digital assets and are typically marketed as being pegged to a fiat currency, such as the U.S. dollar, at a certain value. Although the prices of stablecoins are intended to be stable, their market value may fluctuate. This volatility has in the past apparently impacted the price of ether. Stablecoins are a relatively new phenomenon, and it is impossible to know all of the risks that they could pose to participants in the ether market. In addition, some have argued that some stablecoins, particularly Tether, are improperly issued without sufficient backing in a way that, when the stablecoin is used to pay for bitcoin, could cause artificial rather than genuine demand for bitcoin, artificially inflating the price of bitcoin, and if true, there is no assurance similar dynamics would not be at work in the market for ether. There have been reports that those associated with certain stablecoins may be involved in laundering money. On February 17, 2021, the New York Attorney General entered into an agreement with Tether's operators, including Bitfinex, requiring them to cease any further trading activity with New York persons and pay $18.5 million in penalties for false and misleading statements made regarding the assets backing Tether. On October 15, 2021, the CFTC announced a settlement with Tether's operators, Tether Holdings Limited, Tether Operations Limited, Tether Limited, and Tether International Limited, in which they agreed to pay $42.5 million in fines to settle charges that, among others, Tether's claims that it maintained sufficient U.S. dollar reserves to back every Tether stablecoin in circulation with the "equivalent amount of corresponding fiat currency" held by Tether were untrue. Bitfinex also agreed to pay the CFTC a $1.5 million fine to settle charges that Bitfinex offered off-exchange leveraged, margined, or financed transactions involving crypto assets, including ether, with U.S. customers who were not eligible contract participants and accepted funds (including in the form of Tether stablecoins) and orders in connection with such illegal off-exchange transactions, triggering an obligation to register with the CFTC, which the CFTC order asserts it violated. The CFTC previously fined Bitfinex in 2016 on similar charges. In addition, a large amount of Tether is issued as ERC-20 tokens on the Ethereum network. If Tether were to no longer be issued or operating on the Ethereum network, there would be no need to use ether to pay the gas fees needed to record ERC-20 Tether transactions on the Ethereum blockchain, and a substantial source of demand for ether could be eliminated, which could cause the price of ether to decrease, affecting the value of the Shares.

USDC is a reserve-backed stablecoin issued by Circle Internet Financial that is commonly used as a method of payment in digital asset markets, including the ether market. An affiliate of the Sponsor acts as investment manager to a Money Market Fund, the Circle Reserve Fund, which the issuer of USDC uses to hold cash, U.S. Treasury bills, notes and other obligations issued or guaranteed as to principal and interest by the U.S. Treasury, and repurchase agreements secured by such obligations or cash, which serve as reserves backing USDC stablecoins. While USDC is designed to maintain a stable value at 1 U.S. dollar at all times, on March 10, 2023, the value of USDC fell below $1.00 for multiple days after Circle Internet Financial disclosed that US$3.3 billion of the USDC reserves were held at Silicon Valley Bank, which had entered FDIC receivership earlier that day. Stablecoins are reliant on the U.S. banking system and U.S. treasuries, and the failure of either to function normally could impede the function of stablecoins, and therefore could adversely affect the value of the Shares. An affiliate of the Sponsor has a minority equity interest in the issuer of USDC. Similar to Tether, a large amount of USDC is issued as ERC-20 tokens on the Ethereum network. If USDC were to no longer be issued or operating on the Ethereum network, there would be no need to use ether to pay the gas fees needed to record ERC-20 USDC transactions on the Ethereum blockchain, and a substantial source of demand for ether could be eliminated, which could cause the price of ether to decrease, affecting the value of the Shares.

Given the foundational role that stablecoins play in global digital asset markets, their fundamental liquidity can have a dramatic impact on the broader digital asset market, including the market for ether. A significant portion of the digital asset market continues to depend on stablecoins such as Tether and USDC. As such, any disruption in the operation or perceived stability of these stablecoins such as a disorderly de-pegging event or a loss of market confidence resulting in a run on reserves could lead to substantial market volatility across digital assets more broadly.

Additional risks such as operational failures (e.g., technical issues that prevent settlement), concerns regarding the adequacy or transparency of reserve assets backing stablecoins, the use of unbacked or undercollateralized stablecoins in potentially manipulative trading practices and regulatory scrutiny of stablecoin issuers or intermediaries, including exchanges that facilitate stablecoin transactions, may also adversely affect market confidence and liquidity. Further, these risks are underscored by recent legislative developments. On July 18, 2025, the Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025 ("GENIUS Act") was enacted, establishing a federal regulatory framework for payment stablecoins. The GENIUS Act will become effective on July 18, 2028. The GENIUS Act prohibits the issuance or use of payment stablecoins unless the issuer obtains a qualifying license and complies with a range of regulatory requirements, including reserve backing with liquid assets, redemption rights, governance standards, and operational transparency. The GENIUS Act also restricts the payment of interest on stablecoins and imposes oversight on both bank and nonbank issuers. The enactment of the GENIUS Act, or the removal or migration of prominent stablecoins from the Ethereum network, could reduce the willingness of market participants to engage in digital asset transactions that rely on stablecoins, diminish liquidity in the ether market, and adversely affect the price of ether. Any such developments could, in turn, materially and adversely impact the value of the Shares.

***Competition from the emergence or growth of other digital assets or methods of investing in ether could have a negative impact on the price of ether and adversely affect the value of the Shares.***

As of November 30, 2025, ether was the second largest digital asset by market capitalization as tracked by CoinGecko.com. As of November 30, 2025, there were over 18,000 alternative digital assets tracked by CoinGecko.com, having a total market capitalization of approximately $3.2 trillion (including the approximately $362 billion market capitalization of ether), as calculated using market prices and total available supply of each digital asset, excluding tokens pegged to other assets. In addition, many consortiums and financial institutions are also researching and investing resources into private or permissioned smart contracts platforms rather than open platforms like the Ethereum network. Competition from the emergence or growth of alternative digital assets and smart contract platforms, such as Solana, Avalanche, Tron, BNB Coin, Polkadot, or Cardano, among many others, could have a negative impact on the demand for, and price of, ether and thereby adversely affect the value of the Shares.

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In addition, some digital asset networks, including the Ethereum network, may be the target of ill will from users of other digital asset networks. For example, in July 2016, the Ethereum network underwent a contentious hard fork that resulted in the creation of a new digital asset network called Ethereum Classic. As a result, some users of the Ethereum Classic network may harbor ill will toward the Ethereum network. These users may attempt to negatively impact the use or adoption of the Ethereum network. For additional information on the hard fork that resulted in the creation of Ethereum Classic, see "Overview of the Ethereum Industry —Introduction to ether and the Ethereum network—The DAO and Ethereum Classic."

Investors may invest in ether through means other than the Shares, including through direct investments in ether and other potential financial vehicles, possibly including securities backed by or linked to ether and digital asset financial vehicles similar to the Trust, or ether futures-based products. Market and financial conditions, and other conditions beyond the Sponsor's control, may make it more attractive to invest in other financial vehicles or to invest in ether directly, which could limit the market for, and reduce the liquidity of, the Shares. In addition, to the extent digital asset financial vehicles other than the Trust tracking the price of ether are formed and represent a significant proportion of the demand for ether, large purchases or redemptions of the securities of these digital asset financial vehicles, or private funds holding ether, could negatively affect the Index, the Trust's ether holdings, the price of the Shares, the net asset value of the Trust and the NAV.

Additionally, the Trust and the Sponsor face competition from competing exchange-traded ether products. The Trust could fail to acquire substantial assets, or fail to retain acquired assets due to competition and/or market conditions. The Trust's competitors may also charge a substantially lower fee than the Sponsor's Fee in order to achieve initial market acceptance and scale. Accordingly, the Sponsor's competitors may commercialize a competing product more rapidly or effectively than the Sponsor is able to, which could adversely affect the Sponsor's competitive position and the likelihood that the Trust will achieve initial market acceptance, and could have a detrimental effect on the scale and sustainability of the Trust. If the Trust fails to achieve sufficient scale due to competition, the Sponsor may have difficulty raising sufficient revenue to cover the costs associated with launching and maintaining the Trust and such shortfalls could impact the Sponsor's ability to properly invest in robust ongoing operations and controls of the Trust to minimize the risk of operating events, errors, or other forms of losses to the Shareholders. In addition, the Trust may also fail to attract adequate liquidity in the secondary market due to such competition, resulting in a sub-standard number of Authorized Participants willing to make a market in the Shares, which in turn could result in a significant premium or discount in the Shares for extended periods and the Trust's failure to reflect the performance of the price of ether.

***Digital asset treasury companies risk.***

In recent times, a number of companies engaged in businesses outside the digital asset industry have begun to hold their corporate treasuries in digital assets instead of in fiat currency ("digital asset treasury companies"). In some cases, these companies have raised funds through financing or securities offerings and applied the proceeds to purchase digital assets, including ether.

Digital asset treasury companies are a relatively new phenomenon and it is difficult to predict their long-term sustainability, and therefore their impact to digital asset markets, and to the Trust. Digital asset treasury companies may increase procyclical dynamics in the market because they may purchase digital assets, such as ether, when prices are rising and they may in certain circumstances be forced to sell such assets when prices are decreasing, potentially causing downward pressure on ether prices in a falling market (causing prices to fall faster than they otherwise would). Digital asset treasury companies could cause greater volatility in digital asset markets, including markets for ether. Negative events or sentiment surrounding digital asset treasury companies could affect the market for ether. The increase of consolidated positions in ether held by digital asset treasury companies could affect the operation of the Ethereum blockchain. One digital asset treasury company, BitMine Immersion Technology Inc. ("BitMine Immersion"), held approximately 2.8% of ether's supply as of November 3, 2025. If BitMine Immersion or another similarly situated digital asset treasury company begins to operate validators, it could gain influence in how the Ethereum blockchain operates. The foregoing or similar events involving digital asset treasury companies could adversely affect holders of Shares in the Trust.

***Operational cost may exceed the award for validating transaction, and increased transaction fees may adversely affect the usage of the Ethereum network.***

If transaction confirmation fees become too high, the marketplace may be reluctant to use ether. This may result in decreased usage and limit expansion of the Ethereum network in the retail, commercial and payments space, adversely impacting investment in the Trust. Conversely, if the reward for validators or the value of the transaction fees is insufficient to motivate validators, they may cease to validate transactions.

Ultimately, if the awards of new ether costs of validating transactions grow disproportionately, validators may operate at a loss, transition to other networks, or cease operations altogether. Each of these outcomes could, in turn, slow transaction validation and usage, which could have a negative impact on the Ethereum network and could adversely affect the value of the ether held by the Trust. As a result of Ethereum's fee burning mechanism, the incentives for validators to validate transactions with higher gas fees may be reduced, since fee burning changes the gas fee split between users, validators, and token holders.

An acute cessation of validator operations would reduce the collective processing power on the Ethereum network, which would adversely affect the transaction verification process by temporarily decreasing the speed at which blocks are added to the blockchain and make the blockchain more vulnerable to a malicious actor obtaining control in excess of 50% of the processing power on the blockchain. Reductions in processing power could result in material, though temporary, delays in transaction confirmation time. Any reduction in confidence in the transaction verification process may adversely impact the value of Shares of the Trust or the ability of the Sponsor to operate.

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***If regulators or public utilities take actions that restrict or otherwise impact mining activities, such actions could result in decreased security of a digital asset network, including the Ethereum network, which could adversely affect the value of the Shares.***

Concerns have been raised about the electricity required to secure and maintain digital asset networks. Although measuring the electricity consumed by the process of securing and maintaining digital asset networks is difficult because these operations are performed by various machines with varying levels of efficiency, the process consumes a significant amount of energy. Driven by concerns around energy consumption and the impact on public utility companies, various states and cities have implemented, or are considering implementing, moratoriums on mining activity in their jurisdictions.

Ethereum uses a system called proof-of-stake to validate transaction information. Anyone that owns the specific proof-of-stake digital asset can participate in staking, subject to certain minimum amounts as determined by the applicable proof-of-stake digital asset. Generally, the higher the amount staked by any actor, the higher the chances of being chosen by the applicable blockchain to act as validator and reaping validator rewards; in other words, the higher the stake, the higher the chances of earning a staking reward. This has led to the creation of staking pools, where third parties combine smaller stakes into large pools, which leads to higher returns for owners of small stakes, in return for a fee collected by the third parties.

Other digital asset networks may use a system called proof-of-work to validate transaction information. It's called proof-of-work because solving the encrypted hash takes time and energy, which acts as proof that work was done. Proof of work requires users to mine or complete complex computational puzzles before submitting new transactions to the network.

Proof-of-stake digital assets allow people to pledge or lock up some of their holdings as a way of vouching for the accuracy of newly added information. Meanwhile, proof-of-work digital assets require people to solve complex cryptographic puzzles — which can incur significant energy costs — before they're allowed to propose a new block. This expenditure of time, computing power and energy is intended to make the cost of fraud higher than the potential rewards of a dishonest action.

The operations of digital asset networks can consume significant amounts of electricity, which may have a negative environmental impact and give rise to public opinion against allowing, or government regulations restricting, the use of electricity for mining operations, in the case of proof-of-work networks. Additionally, miners on proof-of-work networks may be forced to cease operations during an electricity shortage or power outage, or if electricity prices increase where the mining activities are performed.

The operations of the Ethereum network and other digital asset networks may also consume significant amounts of energy, even though the Ethereum blockchain is generally considered to consume significantly less energy than other digital asset networks, such as the Bitcoin blockchain, due to its proof-of-stake, rather than proof-of-work, transaction validation mechanism. Further, in addition to the direct energy costs of performing calculations on any given digital asset network, there are indirect costs that impact a network's total energy consumption, including the costs of cooling the machines that perform these calculations.

Notwithstanding Ethereum's move to proof-of-stake, if regulators or public utilities take actions that restrict or otherwise impact mining activities, such actions could result in decreased security of digital asset networks that rely on proof-of-stake. This could create negative sentiment around digital assets generally and, consequently, adversely impact the value of the Shares.

**Risk Factors Related to the Trust and the Shares**

***The Trust may be negatively impacted by the effects of the spread of illnesses or other public health emergencies on the global economy and the markets and service providers relevant to the performance of the Trust.***

A public health emergency could adversely affect the economics of many nations and could have serious negative effects on social, economic and financial systems, including significant uncertainty and volatility in the digital asset markets. For example, digital asset prices, including ether decreased significantly in the first quarter of 2020 amidst broader market declines as a result of the novel coronavirus outbreak.

Future public health emergencies could result in an increase of the costs of the Trust and affect liquidity in the digital asset market, as well as the correlation between the price of the Shares and the net asset value of the Trust, any of which could adversely affect the value of the Shares. In addition, future public health emergencies could impair the information technology and other operational systems upon which the Trust's service providers, including the Sponsor, the Trustee, the Delaware Trustee and the Custodians, rely, and could otherwise disrupt the ability of employees of the Trust's service providers to perform essential tasks on behalf of the Trust. Governmental and quasi-governmental authorities and regulators throughout the world have at times responded to major economic disruptions with a variety of fiscal and monetary policy changes, including, but not limited to, direct capital infusions into companies and other issuers, new monetary tools and lower interest rates. An unexpected or sudden reversal of these policies, or the ineffectiveness of these policies, is likely to increase volatility in the digital asset markets, which could adversely affect the value of ether and the price of the Shares.

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***The Trust will rely on the information and technology systems of the Custodians, the Trustee, the Sponsor, the Authorized Participants, the Ether Trading Counterparties, the listing exchange, and the Trust***'***s other service providers and counterparties (referred to herein as the*** "***Service Providers***"***), each of which could be directly or indirectly adversely affected by information systems interruptions, cybersecurity incidents or other disruptions, which in turn could have a material adverse effect on the Trust.***

The Trust and the Service Providers are susceptible to operational, information security and related cybersecurity risks both directly and through their own service providers. Cyber incidents can result from deliberate attacks or unintentional events. They include, but are not limited to, gaining unauthorized access to systems, corrupting or destroying data, and causing operational disruption. Geopolitical tensions may increase the scale and sophistication of deliberate attacks, particularly those from nation-states or from entities with nation-state backing.

Cybersecurity incidents may cause disruptions and impact business operations. They may result in any of the following: financial losses (including loss or theft of Trust assets), interference with the Trust's ability to calculate its NAV, disclosure of confidential information, impediments to trading, submission of erroneous trades or erroneous creation or redemption orders or ether price movements, the inability of the Trust or the Service Providers to transact business, violations of applicable privacy and other laws, regulatory fines, penalties, reputational damage, reimbursement or other compensation costs, and other legal and compliance costs. In addition, cyber incidents may render records of Trust assets and transactions, Shareholder ownership of the Shares, and other data integral to the functioning of the Trust inaccessible, inaccurate or incomplete. The Trust may incur substantial costs in order to resolve or prevent cyber incidents.

The Sponsor, a consolidated subsidiary of BlackRock, is responsible for the oversight and overall management of the Trust. The Sponsor relies on BlackRock's enterprise risk management framework for the Trust's cybersecurity risk management and strategy. Although BlackRock has implemented policies and controls, and takes protective measures involving significant expense, to prevent and address potential data breaches, inadvertent disclosures, increasingly sophisticated cyber-attacks and cyber-related fraud, there can be no assurance that any of these measures proves fully effective. In addition, a successful cyber-attack may persist for an extended period of time before being detected, and it may take a considerable amount of time for an investigation to be completed and the severity and potential impact to be known. Furthermore, the Trust cannot control the cybersecurity plans and systems of its Service Providers. The Trust and its Shareholders could be negatively impacted as a result.

***The amount of the Trust***'***s assets represented by each Share will decline over time as the Trust pays the Sponsor***'***s Fee and additional expenses born by the Trust, and as a result, the value of the Shares may decrease over time.***

The amount of ether represented by each Share will decrease over the life of the Trust due to the sales or transfers of ether necessary to pay the Sponsor's Fee, the Staking Fee and other Trust expenses. Without increases in the price of ether sufficient to compensate for that decrease, the price of the Shares will also decline and you will lose money on your investment in Shares.

Although the Sponsor has agreed to assume all organizational and certain ordinary administrative and marketing expenses incurred by the Trust, not all Trust expenses have been assumed by the Sponsor. For example, any taxes and other governmental charges that may be imposed on the Trust's property will not be paid by the Sponsor. As part of its agreement to assume some of the Trust's ordinary administrative expenses, the Sponsor has agreed to pay ordinary legal fees and expenses of the Trust not in excess of $500,000 per annum. Any legal fees and expenses in excess of the amount required under the Trust Agreement will be the responsibility of the Trust.

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To cover the Sponsor's Fee, the Sponsor's Staking Portion and any expenses not assumed by the Sponsor, the Trust will need to sell ether. The Trust may also be subject to other liabilities (for example, as a result of litigation) that have also not been assumed by the Sponsor. The only source of funds to cover those liabilities will be sales of ether held by the Trust. Even if there are no expenses other than those assumed by the Sponsor, and there are no other liabilities of the Trust, the Sponsor will still need to sell ether to pay the Sponsor's Fee. The result of these sales is a decrease in the amount of ether represented by each Share. New deposits of ether received in exchange for new Shares issued by the Trust or purchases of ether utilizing cash proceeds from new Shares issued by the Trust do not reverse this trend.

A decrease in the amount of ether represented by each Share results in a decrease in its price even if the price of ether has not changed. To retain the Share's original price, the price of ether has to increase. Without that increase, the lesser amount of ether represented by the Share will have a correspondingly lower price. If these increases do not occur or are not sufficient to counter the lesser amount of ether represented by each Share, you will sustain losses on your investment in Shares.

An increase in the Trust expenses not assumed by the Sponsor, or the existence of unexpected liabilities affecting the Trust, will force the Sponsor to sell larger amounts of ether, and will result in a more rapid decrease of the amount of ether represented by each Share and a corresponding decrease in its value.

***The Trust is a passive investment vehicle that does not seek to generate returns beyond tracking the price of ether. The Trust is not actively managed and will be affected by a general decline in the price of ether.***

The Trust is a passive investment vehicle that does not seek to generate returns beyond tracking the price of ether and staking some portion of the ether it holds (which may vary from time to time). This means the Sponsor does not speculatively sell ether at times when its price is high or speculatively acquire ether at low prices in the expectation of future price increases. It also means the Trust will not utilize leverage, derivatives or any similar arrangements in seeking to meet its investment objective. Any losses sustained by the Trust will adversely affect the value of your Shares.

***An investment in the Shares deviates from a direct investment in ether.***

The market value of the Shares may not have a direct relationship with the prevailing price of ether, and changes in the prevailing price of ether similarly will not necessarily result in a comparable change in the market value of the Shares. The performance of the Trust will not reflect the specific return an investor would realize if the investor actually held or purchased ether directly. The differences in performance may be due to factors such as fees, transaction costs, operating hours of NASDAQ and index tracking risk. Investors will also forgo certain rights conferred by owning ether directly, such as the right to claim airdrops.

***The value of the Shares may be influenced by a variety of factors unrelated to the value of ether.***

The value of the Shares may be influenced by a variety of factors unrelated to the price of ether and the digital asset platforms included in the Index that may have an adverse effect on the value of the Shares. These factors include the following factors:

● unanticipated problems or issues with respect to the mechanics of the Trust's operations and the trading of the Shares may arise, in particular due to the fact that the mechanisms and procedures governing the creation and redemption of the Shares in exchange for cash, offering of the Shares and storage of ether have been developed specifically for this product;

● the Trust could experience difficulties in operating and maintaining its technical infrastructure, including in connection with expansions or updates to such infrastructure, which are likely to be complex and could lead to unanticipated delays, unforeseen expenses and security vulnerabilities;

● the Trust could experience unforeseen issues relating to the performance and effectiveness of the security procedures used to protect the Trust's account with the Ether Custodian, or the security procedures may not protect against all errors, software flaws or other vulnerabilities in the Trust's technical infrastructure, which could result in theft, loss or damage of its assets;

● service providers may default on or fail to perform their obligations or deliver services under their contractual agreements with the Trust, or decide to terminate their relationships with the Trust, for a variety of reasons, which could affect the Trust's ability to operate; or

● if the Ethereum network introduces privacy enhancing features in the future, service providers may decide to terminate their relationships with the Trust due to concerns that the introduction of privacy enhancing features to the Ethereum network may increase the potential for ether to be used to facilitate crime, exposing such service providers to potential reputational harm.

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Any of these factors could affect the value of the Shares, either directly or indirectly through their effect on the Trust's assets.

***The liquidity of the Shares may also be affected by the withdrawal from participation of Authorized Participants or Ether Trading Counterparties.***

In the event that one or more Authorized Participants or Ether Trading Counterparties withdraw from or cease participation in creation and redemption activity or ether transactions with the Trust for any reason, the liquidity of the Shares will likely decrease, which could adversely affect the market price of the Shares and result in your incurring a loss on your investment in Shares.

***There may be situations where an Authorized Participant is unable to redeem a Basket of Shares. To the extent the value of ether decreases, these delays may result in a decrease in the amount the Authorized Participant will receive when the redemption occurs, as well as a reduction in liquidity for all Shareholders in the secondary market.***

Although Shares surrendered by Authorized Participants in Basket-size aggregations are redeemable in exchange for the underlying amount of ether or cash proceeds from selling the underlying amount of ether, redemptions may be suspended (i) during any period in which regular trading on NASDAQ is suspended or restricted, or the exchange is closed (other than scheduled holiday or weekend closings) or (ii) during a period when the Sponsor determines that delivery, disposal or evaluation of ether is not reasonably practicable (for example, as a result of an interruption in services or availability of the Prime Execution Agent, the Ether Custodian, the Cash Custodian, the Trust Administrator, the Ether Trading Counterparties, or other service providers to the Trust, act of God, catastrophe, civil disturbance, government prohibition, war, terrorism, strike or other labor dispute, fire, force majeure, interruption in telecommunications, iShares order entry system, internet services, or network provider services, unavailability of Fedwire, SWIFT or banks' payment processes, significant technical failure, bug, error, disruption or fork of the Ethereum network, hacking, cybersecurity breach, or power, internet, or Ethereum network outage, or similar event). If any of these events occurs at a time when an Authorized Participant intends to redeem Shares, and the price of ether decreases before such Authorized Participant is able again to surrender for redemption Baskets, such Authorized Participant will sustain a loss with respect to the amount that it would have been able to obtain upon the redemption of its Shares, had the redemption taken place when such Authorized Participant originally intended it to occur. As a consequence, Authorized Participants may reduce their trading in Shares during periods of suspension, decreasing the number of potential buyers of Shares in the secondary market and, therefore, decreasing the price a Shareholder may receive upon sale.

***The Trust is an*** "***emerging growth company***" ***and it cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make the Shares less attractive to investors.***

The Trust is an "emerging growth company" as defined in the JOBS Act. For as long as the Trust continues to be an emerging growth company it may choose to take advantage of certain exemptions from various reporting requirements applicable to other public companies but not to emerging public companies, which include, among other things:

● exemption from the auditor attestation requirements under Section 404(b) of the Sarbanes-Oxley Act;

● reduced disclosure obligations regarding executive compensation in the Trust's periodic reports and audited financial statements in this prospectus;

● exemptions from the requirements of holding advisory "say-on-pay" votes on executive compensation and shareholder advisory votes on "golden parachute" compensation; and

● exemption from any rules requiring mandatory audit firm rotation and auditor discussion and analysis and, unless otherwise determined by the SEC, any new audit rules adopted by the Public Company Accounting Oversight Board.

The Trust could be an emerging growth company until the last day of the fiscal year following the fifth anniversary after its initial public offering, or until the earliest of (1) the last day of the fiscal year in which it has annual gross revenue of $1.235 billion or more, (2) the date on which it has, during the previous three year period, issued more than $1 billion in non-convertible debt or (3) the date on which it is deemed to be a large accelerated filer under the federal securities laws. The Trust will qualify as a large-accelerated filer as of the first day of the first fiscal year after it has (A) more than $700 million in outstanding equity held by nonaffiliates, (B) been public for at least 12 months and (C) filed at least one annual report on Form 10-K.

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Under the JOBS Act, emerging growth companies are also permitted to elect to delay adoption of new or revised accounting standards until companies that are not subject to periodic reporting obligations are required to comply, if such accounting standards apply to non-reporting companies. However, the Trust has chosen to opt out of this extended transition period for complying with new or revised accounting standards. Section 107 of the JOBS Act provides that the decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

The Trust cannot predict if investors will find an investment in the Trust less attractive if it relies on these exemptions.

***The lack of an active trading market for the Shares may result in losses on your investment at the time of disposition of your Shares.***

Although Shares will be listed for trading on NASDAQ, you should not assume that an active trading market for the Shares will be maintained. If you need to sell your Shares at a time when no active market for them exists, such lack of an active market will most likely adversely affect the price you receive for your Shares (assuming you are able to sell them).

***The limited ability to facilitate in-kind creations and redemptions of Shares could have adverse consequences for the Trust.***

Authorized Participants must be registered broker-dealers. Registered broker-dealers are subject to various requirements of the federal securities laws and rules, including financial responsibility rules such as the customer protection rule, the net capital rule and recordkeeping requirements. On May 15, 2025, the Division of Trading and Markets of the SEC and the Office of General Counsel of the Financial Industry Regulatory Authority ("FINRA") stated that broker-dealers are permitted to facilitate in-kind creations and redemptions in connection with spot crypto exchange-traded products; however, there has yet to be definitive regulatory guidance on and the specific details of how registered broker-dealers can comply with SEC rules with regard to transacting in or holding spot ether. Until further regulatory clarity emerges regarding whether registered broker-dealers can hold and deal in ether under such rules, there is a risk that registered broker-dealers participating in the in-kind creation or redemption of Shares for ether may be unable to demonstrate compliance with such requirements. While compliance with rules such as the customer protection rule, the net capital rule and recordkeeping requirements would be the broker-dealer's responsibility, a national securities exchange is required to enforce compliance by its member broker-dealers with applicable federal securities law and rules.

Even with the recent approval of in-kind creations and redemptions, the Trust's limited ability to facilitate in-kind creations and redemptions could result in the exchange-traded product arbitrage mechanism failing to function as efficiently as it otherwise would, leading to the potential for the Shares to trade at premiums or discounts to the NAV, and such premiums or discounts could be substantial. See "—The use of cash creations and redemptions, as opposed to in-kind creations and redemptions, may adversely affect the arbitrage transactions by Authorized Participants intended to keep the price of the Shares closely linked to the price of ether and, as a result, the price of the Shares may fall or otherwise diverge from NAV." Furthermore, if cash creations or redemptions are unavailable, either due to the Sponsor's decision to reject or suspend such orders, the unavailability of Ether Trading Counterparties or the Prime Execution Agent's services, or otherwise, Authorized Participants will be limited in their ability to redeem or create Shares, in which case the arbitrage mechanism may not function as efficiently. This could result in impaired liquidity for the Shares, wider bid/ask spreads in secondary trading of the Shares and greater costs to investors and other market participants. In addition, the Trust's limited ability to facilitate in-kind creations and redemptions, and resulting relative reliance on cash creations and redemptions, could cause the Sponsor to halt or suspend the creation or redemption of Shares during times of market volatility or turmoil, among other consequences.

Any of these factors could adversely affect the performance of the Trust and the value of the Shares.

***If the process of creation and redemption of Baskets encounters any unanticipated difficulties, the possibility for arbitrage transactions by Authorized Participants intended to keep the price of the Shares closely linked to the price of ether may not exist and, as a result, the price of the Shares may fall or otherwise diverge from NAV.***

If the processes of creation and redemption of Shares (which depend on timely transfers of ether to and by the Authorized Participant or its designated agent or client, the Ether Custodian and the Prime Execution Agent) encounter any unanticipated difficulties due to, for example, the price volatility of ether, the insolvency, business failure or interruption, default, failure to perform, security breach, or other problems affecting the Prime Execution Agent, the Ether Custodian, the Authorized Participants or the Ether Trading Counterparties, the closing of ether trading platforms due to fraud, failures, security breaches or otherwise, or network outages or congestion, spikes in transaction fees demanded by miners, or other problems or disruptions affecting the Ethereum network, then potential market participants, such as the Authorized Participants and their customers, who would otherwise be willing to purchase or redeem Baskets (in the case of Authorized Participants) to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying ether or to engage in ether transactions (in the case of Ether Trading Counterparties or transactions facilitated by the Prime Execution Agent) may not take the risk that, as a result of those difficulties, they may not be able to realize the profit they expect. In certain such cases, as further described in "Description of the Shares and the Trust Agreement-Requirements for Trustee Actions," the Trustee may, and upon the direction of the Sponsor shall, suspend the process of creation and redemption of Baskets. During such times, trading spreads, and the resulting premium or discount, on Shares may widen. Alternatively, in the case of a network outage or other problems affecting the Ethereum network, the processing of transactions on the Ethereum network may be disrupted, which in turn may prevent Authorized Participants or their designated agent or client, Ether Trading Counterparties (as defined in "Description of the Shares and the Trust Agreement—Issuance of Baskets") from depositing or withdrawing ether from their accounts at the Prime Execution Agent, or prevent the Prime Execution Agent from facilitating ether transactions through its Coinbase Prime service, which in turn could affect the creation or redemption of Baskets. If this is the case, the liquidity of the Shares may decline and the price of the Shares may fluctuate independently of the price of ether and may fall or otherwise diverge from NAV. Furthermore, in the event that the market for ether should become relatively illiquid and thereby materially restrict opportunities for arbitraging, the price of Shares may diverge from the value of ether.

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***The use of cash creations and redemptions, as opposed to in-kind creations and redemptions, may adversely affect the arbitrage transactions by Authorized Participants intended to keep the price of the Shares closely linked to the price of ether and, as a result, the price of the Shares may fall or otherwise diverge from NAV.***

Baskets may be created or redeemed in exchange for ether or cash. However, only certain Authorized Participants, at present, have the ability to also, through their affiliates, support in-kind creation and redemption activity. The use of cash creations and redemptions, as opposed to in-kind creations and redemptions, could cause delays in trade execution due to potential operational issues arising from implementing a cash creation and redemption model, which involves greater operational steps (and therefore execution risk) than the originally contemplated in-kind creation and redemption model, or the potential unavailability or exhaustion of the Trade Credits, which the Trust would not be able to use in connection with in-kind creations and redemptions. Such delays could cause the execution price associated with such trades to materially deviate from the Index price used to determine the NAV. In addition, Ether Trading Counterparties must settle ether transactions with the Trust within a contractually specified time period, subject to customary exceptions. If the Ether Trading Counterparty fails to perform its obligations within the contractually specified time period, the Trust would seek to use the Prime Execution Agent's Coinbase Prime service or an alternate Ether Trading Counterparty to execute the ether transaction. However, the pricing or terms of the ultimate ether transaction conducted through the Prime Execution Agent's Coinbase Prime service or an alternate Ether Trading Counterparty after the failure of the Ether Trading Counterparty to perform its obligations could deviate, potentially significantly, from the pricing or terms of the transaction that the Trust originally entered with the Ether Trading Counterparty. Even though the Authorized Participant is responsible for the dollar cost of such difference in prices, Authorized Participants could default on their obligations to the Trust, or such potential risks and costs could lead to Authorized Participants, who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying ether, to elect to not participate in the Trust's Share creation and redemption processes. This may adversely affect the arbitrage mechanism intended to keep the price of the Shares closely linked to the price of ether, and as a result, the price of the Shares may fall or otherwise diverge from NAV. If the arbitrage mechanism is not effective, purchases or sales of Shares on the secondary market could occur at a premium or discount to NAV, which could harm Shareholders by causing them to buy Shares at a price higher than the value of the underlying ether held by the Trust or sell Shares at a price lower than the value of the underlying ether held by the Trust, causing Shareholders to suffer losses. Alternatively, Authorized Participants could refrain from participating in creating and redeeming Baskets and could disrupt the Trust's ability to operate. Similarly, if Ether Trading Counterparties or the parties to transactions with the Trust through the Prime Execution Agent's Coinbase Prime service refrain from transacting with the Trust it could disrupt the Trust's ability to operate. The Trust expects to conduct ether purchase and sale transactions through the Prime Execution Agent's Coinbase Prime service and with Ether Trading Counterparties. The reliance on the Prime Execution Agent's Coinbase Prime service and Ether Trading Counterparties creates a risk that if the Prime Execution Agent's Coinbase Prime service or trading with Ether Trading Counterparties is unavailable or disrupted for any reason, the Trust will be unable to execute ether transactions and the Trust's cash creation and redemption processes will be disrupted. In addition, a failure to settle ether transactions, whether with the Ether Trading Counterparty or the Prime Execution Agent's Coinbase Prime service, could disrupt the calculation of the Trust's NAV or potentially cause inaccuracies in NAV calculation, which could disrupt the Trust's operations or cause Shareholders to suffer losses.

***As an owner of Shares, you will not have the rights normally associated with ownership of other types of shares.***

Shares are not entitled to the same rights as shares issued by a corporation. By acquiring Shares, you are not acquiring the right to elect directors, to receive dividends, to vote on certain matters regarding the issuer of your Shares or to take other actions normally associated with the ownership of shares. You will only have the limited rights contained in the Trust Agreement and described under "Description of the Shares and the Trust Agreement."

***The Sponsor and the Trustee may agree to amend the Trust Agreement without the consent of the Shareholders.***

The Sponsor and the Trustee may agree to amend the Trust Agreement, including to increase the Sponsor's Fee or the Staking Fee, without Shareholder consent. The Sponsor shall determine the contents and manner of delivery of any notice of any Trust Agreement amendment. If an amendment imposes new fees and charges or increases existing fees or charges, including the Sponsor's Fee and the Staking Fee (except for taxes and other governmental charges, registration fees or other such expenses), or prejudices a substantial right of Shareholders, it will become effective for outstanding Shares 30 days after notice of such amendment is given to registered owners. Shareholders that are not registered owners (which most shareholders will not be) may not receive specific notice of a fee increase other than through an amendment to the prospectus. Moreover, at the time an amendment becomes effective, by continuing to hold Shares, Shareholders are deemed to agree to the amendment and to be bound by the Trust Agreement as amended without specific agreement to such increase (other than through the "negative consent" procedure described above).

***Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act or the protections afforded by the CEA.***

The Investment Company Act is designed to protect investors by preventing insiders from managing investment companies to their benefit and to the detriment of public investors, such as: the issuance of securities having inequitable or discriminatory provisions; the management of investment companies by irresponsible persons; the use of unsound or misleading methods of computing earnings and asset value; changes in the character of investment companies without the consent of investors; and investment companies engaging in excessive leveraging. To accomplish these ends, the Investment Company Act requires the safekeeping and proper valuation of fund assets, greatly restricts transactions with affiliates, limits leveraging, and imposes governance requirements as a check on fund management.

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The Trust is not a registered investment company under the Investment Company Act, and the Sponsor believes that the Trust is not required to register under such act. Consequently, Shareholders do not have the regulatory protections provided to investors in investment companies.

The Trust will not hold or trade in commodity interests regulated by the CEA, as administered by the CFTC. Furthermore, the Sponsor believes that the Trust is not a commodity pool for purposes of the CEA, and that neither the Sponsor nor the Trustee is subject to regulation by the CFTC as a commodity pool operator or a commodity trading adviser in connection with the operation of the Trust. Consequently, Shareholders will not have the regulatory protections provided to investors in CEA-regulated instruments or commodity pools. However, Congress is currently considering legislation, such as the Digital Asset Market Clarity Act of 2025 (CLARITY Act), which could give the CFTC greater powers to regulate the spot digital asset market. It is possible that, if legislation is passed, it could require the Trust or the Sponsor, or service providers to the Trust, such as the Prime Execution Agent, Authorized Participants, or Ether Trading Counterparties, among others, to register with the CFTC. Such additional regulatory obligations may cause the Trust, the Trustee, the Sponsor, Prime Execution Agent, Authorized Participants or Ether Trading Counterparties to incur extraordinary expenses. If the Trust, the Trustee, the Sponsor, Prime Execution Agent, Authorized Participants or the Ether Trading Counterparties decided to seek the required licenses, there is no guarantee that they will timely receive them. The Trustee may decide to discontinue and wind up the Trust. A dissolution of the Trust in response to the changed regulatory circumstances may be at a time that is disadvantageous to the Shareholders. An Ether Trading Counterparty may also instead decide to terminate its role as an Ether Trading Counterparty of the Trust, which may decrease the liquidity of the Shares.

***As the Sponsor and its management have limited history of operating investment vehicles like the Trust, their experience may be inadequate or unsuitable to manage the Trust.***

The Sponsor and its management team have a limited track record in operating investment vehicles, such as the Trust, that specifically deal with crypto assets. This limited experience poses several potential risks to the effective management and operation of the Trust. Crypto assets, such as ether, are known for their high volatility, unique technical, legal and regulatory challenges, and rapidly evolving market dynamics. The Sponsor's limited experience in this specific field may not fully equip it to navigate these complexities effectively.

The past performances of the Sponsor's management in other investment vehicles are no indication of their ability to manage an investment vehicle such as the Trust. The unique nature of crypto assets makes past performance an unreliable indicator of future success in this area. The crypto asset market is technology-driven and requires a deep understanding of the underlying blockchain technology and security considerations. The Sponsor's limited experience may not fully encompass the technical expertise required to mitigate risks such as cyber threats, technological failures, or operational errors related to crypto asset transactions and custody.

Should the Sponsor and its management team's experience prove inadequate or unsuitable for managing a crypto asset-based investment vehicle like the Trust, it could result in suboptimal decision-making, increased operational risks, and potential legal or regulatory non-compliance. These factors could adversely affect the Trust's operations, leading to potential losses for investors or a decrease in the Trust's overall value.

Furthermore, the Sponsor is currently engaged in the management of other investment vehicles which could divert their attention and resources. If the Sponsor were to experience difficulties in the management of such other investment vehicles that damaged the Sponsor or its reputation, it could have an adverse impact on the Sponsor's ability to continue to serve as Sponsor for the Trust.

***Security threats to the Trust***'***s account at the Ether Custodian could result in the halting of Trust operations and a loss of Trust assets or damage to the reputation of the Trust, each of which could result in a reduction in the value of the Shares.***

Security breaches, computer malware and computer hacking attacks have been a prevalent concern in relation to digital assets. The Sponsor believes that the Trust's ether held in the Trust's account at the Ether Custodian or Trading Balance held with the Prime Execution Agent will be an appealing target to hackers or malware distributors seeking to destroy, damage or steal the Trust's ether and will only become more appealing as the Trust's assets grow. To the extent that the Trust, the Sponsor or the Ether Custodian or Prime Execution Agent is unable to identify and mitigate or stop new security threats or otherwise adapt to technological changes in the digital asset industry, the Trust's ether may be subject to theft, loss, destruction or other attack.

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The Sponsor believes that the security procedures in place for the Trust, including, but not limited to, offline storage, or cold storage, multiple encrypted private key "shards," and other measures, are reasonably designed to safeguard the Trust's ether. Nevertheless, the security procedures cannot guarantee the prevention of any loss due to a security breach, software defect or act of God that may be borne by the Trust and the security procedures may not protect against all errors, software flaws or other vulnerabilities in the Trust's technical infrastructure, which could result in theft, loss or damage of its assets. The Sponsor does not control the Ether Custodian's or Prime Execution Agent's operations or their implementation of such security procedures and there can be no assurance that such security procedures will actually work as designed or prove to be successful in safeguarding the Trust's assets against all possible sources of theft, loss or damage. Assets not held in cold storage, such as assets held in a trading account, may be more vulnerable to security breach, hacking or loss than assets held in cold storage. Furthermore, assets held in a trading account, including the Trust's Trading Balance (as defined below) at the Prime Execution Agent, are held on an omnibus, rather than segregated basis, which creates greater risk of loss. Even though ether is only moved into the Trading Balance in connection with and to the extent of purchases and sales of ether by the Trust and such ether is swept from the Trust's Trading Balance to the Trust's Vault Balance each trading day pursuant to a regular end-of-day sweep process, there are no policies that would limit the amount of ether that can be held temporarily in the Trading Balance maintained by the Prime Execution Agent. This could create greater risk of loss of the Trust's ether, which could cause Shareholders to suffer losses. The security procedures and operational infrastructure may be breached due to the actions of outside parties, error or malfeasance of an employee of the Sponsor, the Ether Custodian, or otherwise, and, as a result, an unauthorized party may obtain access to the Trust's account at the Ether Custodian, the relevant private keys (and therefore ether) or other data or property of the Trust. Additionally, outside parties may attempt to fraudulently induce employees of the Sponsor or the Ether Custodian to disclose sensitive information in order to gain access to the Trust's infrastructure. As the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, or may be designed to remain dormant until a predetermined event and often are not recognized until launched against a target, the Sponsor and the Ether Custodian may be unable to anticipate these techniques or implement adequate preventative measures.

An actual or perceived breach of the Trust's account at the Ether Custodian could harm the Trust's operations, result in partial or total loss of the Trust's assets, resulting in a reduction in the value of the Shares. The Trust may also cease operations, the occurrence of which could similarly result in a reduction in the value of the Shares.

***Ether transactions are irrevocable and stolen or incorrectly transferred ether may be irretrievable. As a result, any incorrectly executed ether transactions could adversely affect the value of the Shares.***

Ether transactions are typically not reversible without the consent and active participation of the recipient of the transaction. Once a transaction has been verified and recorded in a block that is added to the Ethereum blockchain, an incorrect transfer or theft of ether generally will not be reversible and the Trust may not be capable of seeking compensation for any such transfer or theft. Although the Trust's transfers of ether will regularly be made to or from the Trust's account at the Ether Custodian, it is possible that, through computer or human error, or through theft or criminal action, the Trust's ether could be transferred from the Trust's account at the Ether Custodian in incorrect amounts or to unauthorized third parties, or to uncontrolled accounts.

Such events have occurred in connection with digital assets in the past. For example, in September 2014, the Chinese digital asset platform Huobi announced that it had sent approximately 900 bitcoins and 8,000 Litecoins (worth approximately $400,000 at the prevailing market prices at the time) to the wrong customers. To the extent that the Trust is unable to seek a corrective transaction with such third party or is incapable of identifying the third party which has received the Trust's ether through error or theft, the Trust will be unable to revert or otherwise recover incorrectly transferred ether. The Trust will also be unable to convert or recover its ether transferred to uncontrolled accounts. To the extent that the Trust is unable to seek redress for such error or theft, such loss could adversely affect the value of the Shares.

***If the Custodian Agreement, the Prime Execution Agent Agreement, the Authorized Participant Agreements or the Ether Trading Counterparty Agreements are terminated or the Custodians, the Prime Execution Agent, the Authorized Participants or the Ether Trading Counterparties fail to provide services as required, the Trustee may operationalize the Additional Ether Custodian or may need to find and appoint replacement custodians, an execution agent, authorized participants or ether trading counterparties, which could pose a challenge to the safekeeping of the Trust***'***s ether, the Trust***'***s ability to create and redeem Shares and the Trust***'***s ability to continue to operate may be adversely affected.***

The Trust is dependent on the Ether Custodian, which is Coinbase Custody, and the Prime Execution Agent, Coinbase Inc. to operate. Coinbase Custody performs essential functions in terms of safekeeping the Trust's ether in the Vault Balance, and its affiliate, Coinbase Inc., in its capacity as Prime Execution Agent, facilitates the buying and selling of ether by the Trust in connection with cash creations and redemptions, the selling of ether to pay the Sponsor's Fee, any other Trust expenses, to the extent applicable, and in extraordinary circumstances, to liquidate the Trust's ether. If Coinbase Custody or Coinbase Inc. fails to perform the functions they perform for the Trust, the Trust may be unable to operate or create or redeem Baskets, which could force the Trust to liquidate or adversely affect the price of the Shares.

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On March 22, 2023, the Prime Execution Agent and its parent, Coinbase Global, Inc. (such parent, "Coinbase Global" and together with Coinbase Inc., the "Relevant Coinbase Entities") received a "Wells Notice" from the SEC staff stating that the SEC staff made a "preliminary determination" to recommend that the SEC file an enforcement action against the Relevant Coinbase Entities alleging violations of the federal securities laws, including the Exchange Act and the Securities Act. According to Coinbase Global's public reporting company disclosure, based on discussions with the SEC staff, the Relevant Coinbase Entities believe these potential enforcement actions would relate to aspects of the Relevant Coinbase Entities' Coinbase Prime service, spot market, staking service Coinbase Earn, and Coinbase Wallet, and the potential civil action may seek injunctive relief, disgorgement, and civil penalties. On June 6, 2023, the SEC filed a complaint against the Relevant Coinbase Entities in federal district court in the Southern District of New York, alleging, inter alia: (i) that Coinbase Inc. has violated the Exchange Act by failing to register with the SEC as a national securities exchange, broker-dealer, and clearing agency, in connection with activities involving certain identified digital assets that the SEC's complaint alleges are securities, (ii) that Coinbase Inc. has violated the Securities Act by failing to register with the SEC the offer and sale of its staking program, and (iii) that Coinbase Global is jointly and severally liable as a control person under the Exchange Act for Coinbase Inc.'s violations of the Exchange Act to the same extent as Coinbase Inc. The SEC's complaint against the Relevant Coinbase Entities did not allege that ether is a security, nor did it allege that Coinbase Inc's activities involving ether caused the alleged registration violations, and the Ether Custodian was not named as a defendant. The SEC's complaint sought a permanent injunction against the Relevant Coinbase Entities to prevent them from violations of the Exchange Act or Securities Act, disgorgement, civil monetary penalties, and such other relief as the court deems appropriate or necessary.

On February 27, 2025, the SEC and Coinbase Inc. and Coinbase Global filed a joint stipulation to dismiss the case with prejudice, and the case has been dismissed. Notwithstanding the dismissal of the SEC enforcement action, Coinbase Inc. is currently, and it and the Ether Custodian from time to time may be in the future subject, to a variety of other litigation. Although the Trust does not presently anticipate such an outcome, there can be no assurance that in the future Coinbase Inc., as Prime Execution Agent, or Coinbase Custody, as the Ether Custodian, will not be required, as a result of a judicial determination, or will not choose, to restrict or curtail the services they offer, or their financial condition and ability to provide services to the Trust will not be negatively affected. If in the future the Prime Execution Agent or the Ether Custodian were to be required or choose to restrict or curtail the services they offer for any reason, whether related to litigation or otherwise, it could negatively affect the Trust's ability to operate or process creations or redemptions of Baskets, which could force the Trust to liquidate or adversely affect the price of the Shares.

Alternatively, the Trustee could decide to replace Coinbase Custody as the Ether Custodian of the Trust's ether, pursuant to the Custodian Agreement. Similarly, Coinbase Custody or Coinbase Inc. could terminate services under the Custodian Agreement or the Prime Execution Agent Agreement respectively upon providing the applicable notice to the Trust for any reason, or immediately for Cause. A Termination for Cause is defined in the Custodian Agreement and Prime Execution Agent Agreement as (i) the Trust materially breaching any provision of the Custodian Agreement and such failure is not cured within 30 calendar days after notice of such breach is provided by Coinbase Inc. to the Trust, or the Trust materially breaching any provision of the Prime Execution Agent Agreement and such breach remains uncured for 10 calendar days following notice; (ii) the Trust becomes bankrupt or insolvent; or (iii) the Trust fails to pay and settle in full its obligations to Coinbase Custody's affiliate, the Trade Credit Lender (as defined below), which may, from time to time, provide financing to the Trust in the form of Trade Credits. In the event that the Trust transfers maintenance responsibilities of the Trust's account at the Ether Custodian to another custodian (or transfers the Trust's ether from the Ether Custodian or the Prime Execution Agent to the Additional Ether Custodian or vice versa), the Trust's ether would be subject to a risk of loss during the transfer, which, if such risk eventuates, could have a negative impact on the performance of the Shares or result in loss of the Trust's assets. As Prime Execution Agent, Coinbase Inc. does not guarantee uninterrupted access to the Trading Platform or the services it provides to the Trust as Prime Execution Agent. Under certain circumstances, Coinbase Inc. is permitted to halt or suspend trading on its trading platform, or impose limits on the amount or size of, or reject, the Trust's orders, including in the event of, among others, (a) delays, suspension of operations, failure in performance, or interruption of service that are directly due to a cause or condition beyond the reasonable control of Coinbase Inc., (b) the Trust has engaged in unlawful or abusive activities or fraud, (c) the acceptance of the Trust's order would cause the amount of Trade Credits extended to exceed the maximum amount of Trade Credit (as defined below) that the Trust's agreement with the Trade Credit Lender permits to be outstanding at any one time, or (d) a security or technology issue occurred and is continuing that results in Coinbase Inc. being unable to provide trading services or accept the Trust's order, in each case, subject to certain protections for the Trust. Also, if Coinbase Custody or Coinbase Inc. becomes insolvent, suffers business failure, ceases business operations, defaults on or fails to perform their obligations under their contractual agreements with the Trust, or abruptly discontinues the services they provide to the Trust for any reason, the Trust's operations, including its creation and redemption processes, would be adversely affected.

Further, if the Trustee decides to operationalize the Additional Ether Custodian, the Additional Ether Custodian would perform essential functions in terms of safekeeping any of the Trust's ether that is held with Anchorage. The Anchorage Custodian Agreement provides the Trust with an available alternative ether custodian to safeguard the Trust's ether; however, if the Trustee does not operationalize the Additional Ether Custodian, or if Anchorage fails to perform the functions of the Anchorage Custodian Agreement once operationalized, the Trust may be unable to operate or create or redeem Baskets, or may suffer losses, which could force the Trust to liquidate or adversely affect the price of the Shares. Anchorage could terminate services under the Anchorage Custodian Agreement upon providing the applicable notice to the Trust for any reason, or immediately for Cause. A "Termination for Cause" is defined in the Anchorage Custodian Agreement as: (i) the Trust materially breaches any provision of the Additional Ether Custodian Agreement, and such breach remains uncured for a period of 30 calendar days after notice of such breach is provided by Anchorage to the Trust; or (ii) the Trust becomes bankrupt or insolvent. If Anchorage were to terminate services under the Anchorage Custodian Agreement, the Trustee may need to find and appoint a replacement ether custodian.

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The Trustee may not be able to find a party willing to serve as the custodian of the Trust's ether or as the Trust's prime execution agent under the same terms as the current Custodian Agreement or Prime Execution Agent Agreement or at all. To the extent that Trustee is not able to find a suitable party willing to serve as the custodian or prime execution agent, the Trustee may be required to terminate the Trust and liquidate the Trust's ether. In addition, to the extent that the Trustee finds a suitable party but must enter into a modified custodian agreement or prime execution agreement that is less favorable for the Trust or Trustee, the value of the Shares could be adversely affected. If the Trust is unable to find a replacement prime execution agent, its operations could be adversely affected.

Similarly, if an Authorized Participant or an Ether Trading Counterparty suffers insolvency, business failure or interruption, default, failure to perform, security breach, or in certain circumstances a force majeure event or if an Authorized Participant or an Ether Trading Counterparty, as applicable, chooses not to participate in the creation and redemption process of the Trust, and the Trust is unable to engage replacement Authorized Participants or Ether Trading Counterparties or access alternative services on commercially acceptable terms or at all, then the creation and redemption process of the Trust, the arbitrage mechanism used to keep the Shares in line with the NAV and the Trust's operations generally could be negatively affected.

 ***The lack of full insurance and Shareholders***' ***limited rights of legal recourse against the Trust, the Delaware Trustee, the Sponsor, the Trust Administrator, the Cash Custodian, the Prime Execution Agent, the Ether Custodian and, if operationalized, the Additional Ether Custodian expose the Trust and its Shareholders to the risk of loss of the Trust***'***s ether for which no person or entity is liable.***

The Trust is not a banking institution or otherwise a member of the FDIC or Securities Investor Protection Corporation ("SIPC") and, therefore, deposits held with or assets held by the Trust are not subject to the protections enjoyed by depositors with FDIC or SIPC member institutions. In addition, neither the Trust nor the Sponsor insure the Trust's ether.

Coinbase Global has informed the Sponsor that it maintains an institutional insurance program, which is intended to cover the loss of client assets held by Coinbase Global and all of its subsidiaries, including the Ether Custodian and the Prime Execution Agent (collectively, Coinbase Global and its subsidiaries are referred to as the "Coinbase Insureds"), including from employee collusion or fraud, physical loss including theft, damage of key material, security breach or hack, and fraudulent transfer. The insurance maintained by Coinbase Global is shared among all of Coinbase Insureds' customers, is not specific to the Trust or to customers holding ether with the Ether Custodian or Prime Execution Agent and may not be available or sufficient to protect the Trust from all possible losses or sources of losses. Coinbase Global's insurance may not cover the type of losses experienced by the Trust. Alternatively, the Trust may be forced to share such insurance proceeds with other clients or customers of the Coinbase Insureds, which could reduce the amount of such proceeds that are available to the Trust. In addition, the digital asset insurance market is limited, and the level of insurance maintained by Coinbase Global may be substantially lower than the assets of the Trust. While the Ether Custodian maintains certain capital reserve requirements depending on the assets under custody, and such capital reserves may provide additional means to cover client asset losses, the Trust cannot be assured that the Ether Custodian will maintain capital reserves sufficient to cover actual or potential losses with respect to the Trust's digital assets. None of Coinbase Inc., Coinbase Custody, or Coinbase Global are an FDIC or SIPC member institution.

Furthermore, under the Custodian Agreement, the Ether Custodian's liability is limited as follows, among others: (i) other than with respect to claims and losses arising from spot trading of ether, or fraud or willful misconduct, the Mutually Capped Liabilities (defined below), the Ether Custodian's aggregate liability under the Custodian Agreement shall not exceed the greater of (A) the greater of (x) $5 million and (y) the aggregate fees paid by the Trust to the Ether Custodian in the 12 months prior to the event giving rise to the Ether Custodian's liability, and (B) the value of the affected ether or cash giving rise to the Ether Custodian's liability; (ii) the Ether Custodian's aggregate liability in respect of each cold storage address shall not exceed $100 million; (iii) in respect of the Ether Custodian's obligations to indemnify the Trust and its affiliates against third-party claims and losses to the extent arising out of or relating to, among others, the Ether Custodian's gross negligence, violation of its confidentiality, data protection and/or information security obligations, or violation of any law, rule or regulation with respect to the provision of its services (the "Mutually Capped Liabilities"), the Ether Custodian's liability shall not exceed the greater of (A) $5 million and (B) the aggregate fees paid by the Trust to the Ether Custodian in the 12 months prior to the event giving rise to the Ether Custodian's liability; and (iv) in respect of any incidental, indirect, special, punitive, consequential or similar losses, the Ether Custodian is not liable, even if the Ether Custodian has been advised of or knew or should have known of the possibility thereof. In general, the Ether Custodian is not liable under the Custodian Agreement unless in the event of its negligence, fraud, material violation of applicable law or willful misconduct. The Ether Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Ether Custodian. In the event of potential losses incurred by the Trust as a result of the Ether Custodian losing control of the Trust's ether or failing to properly execute instructions on behalf of the Trust, the Ether Custodian's liability with respect to the Trust will be subject to certain limitations which may allow it to avoid liability for potential losses or may be insufficient to cover the value of such potential losses, even if the Ether Custodian directly caused such losses. Furthermore, the insurance maintained by the Ether Custodian may be insufficient to cover its liabilities to the Trust.

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If the Trustee operationalizes the Additional Ether Custodian, the Trust's holdings at the Additional Ether Custodian would be covered by insurance held by Anchor Labs Inc., the parent company of the Additional Ether Custodian ("Anchor Labs"). Anchor Labs maintains crime insurance coverage for a minimum limit of $100,000,000, which is intended to cover the loss of Trust assets held by the Additional Ether Custodian, including from dishonest or fraudulent acts committed by Anchor Labs and all of its subsidiaries, including the Additional Ether Custodian (collectively Anchor Labs and its subsidiaries are referred to as the "Anchor Labs Insureds") employees, its agents and subcontractors; forgery and alteration; computer crime; wire transfer coverage; physical damage or theft of private key data; social engineering coverage; and security breaches or hacking. The insurance maintained by Anchor Labs may be shared among Anchor Labs Insureds' other customers, is not necessarily exclusive to the Trust or to customers holding ether with the Additional Ether Custodian and may not be available or sufficient to protect the Trust from all possible losses or sources of losses. Alternatively, the Trust may be forced to share such insurance proceeds with other clients or customers of the Anchor Labs Insureds, which could reduce the amount of such proceeds that are available to the Trust. In addition, the digital asset insurance market is limited, and the level of insurance maintained by Anchor Labs may be substantially lower than the assets of the Trust. While the Additional Ether Custodian maintains certain capital reserve requirements depending on the assets under custody, and such capital reserves may provide additional means to cover client asset losses, the Trust cannot be assured that the Additional Ether Custodian will maintain capital reserves sufficient to cover actual or potential losses with respect to the Trust's digital assets. The insurance program does not cover, insure or guarantee the performance of the Trust. The Additional Ether Custodian is neither FDIC-insured nor SIPC-insured.

With respect to the Anchorage Custodian Agreement, other than with respect to claims and losses arising from: (i) fraud or willful misconduct of the Additional Ether Custodian and (ii) the Anchorage Mutually Capped Liabilities (defined below), in no event will the Additional Ether Custodian's liability exceed the value of the cash or affected ether giving rise to such liability. With respect to Anchorage Mutually Capped Liabilities, other than with respect to claims and losses arising from fraud or willful misconduct of the Additional Ether Custodian, in no event will the Additional Ether Custodian's liability exceed the greater of $5 million and the aggregate amount of fees paid by client to the Additional Ether Custodian in the 12-month period prior to the event giving rise to such liability. "Anchorage Mutually Capped Liabilities" means (i) claims and losses arising from a party's breach of its confidentiality obligations under the Anchorage Custodian Agreement, (ii) a party's indemnity obligations under the Anchorage Custodian Agreement (except with respect to the full amount of any Trust ether lost, which shall not constitute an Anchorage Mutually Capped Liability), and (iii) claims and losses arising from the violation, misappropriation, or infringement by a party of any third party intellectual and/or industrial property rights, including patent rights, copyrights, moral rights, trademarks, trade names, service marks, trade secrets, rights in inventions (including applications for, and registrations, extensions, renewals, and re-issuances of the foregoing).

With respect to claims and losses related to a withdrawal or transfer of ether, if the Trust has operationalized Anchorage, the value of such digital assets shall be determined by reference to the benchmark valuation on the date delivery of such ether in connection with such withdrawal or transfer is due in accordance with the terms of the Anchorage Custodian Agreement. In respect of any incidental, indirect, special, punitive, consequential or similar losses, the Additional Ether Custodian is not liable, even if the Additional Ether Custodian has been advised of or knew or should have known of the possibility thereof. The Additional Ether Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Additional Ether Custodian.

Similarly, under the Prime Execution Agent Agreement, the Prime Execution Agent's liability is limited as follows, among others: (i) other than with respect to claims and losses arising from spot trading of ether, or fraud or willful misconduct, or the PB Mutually Capped Liabilities (defined below), the Prime Execution Agent's aggregate liability shall not exceed the greater of (A) the greater of (x) $5 million and (y) the aggregate fees paid by the Trust to the Prime Execution Agent in the 12 months prior to the event giving rise to the Prime Execution Agent's liability, and (B) the value of the cash or affected ether giving rise to the Prime Execution Agent's liability; (ii) in respect of the Prime Execution Agent's obligations to indemnify the Trust and its affiliates against third-party claims and losses to the extent arising out of or relating to, among others, the Prime Execution Agent's gross negligence, violation of its confidentiality, data protection and/or information security obligations, violation of any law, rule or regulation with respect to the provision of its services, or the full amount of the Trust's assets lost due to the insolvency of or security event at a Connected Trading Venue (as defined below) (the "PB Mutually Capped Liabilities"), the Prime Execution Agent's liability shall not exceed the greater of (A) $5 million and (B) the aggregate fees paid by the Trust to the Prime Execution Agent in the 12 months prior to the event giving rise to the Prime Execution Agent's liability; and (iii) in respect of any incidental, indirect, special, punitive, consequential or similar losses, the Prime Execution Agent is not liable, even if the Prime Execution Agent has been advised of or knew or should have known of the possibility thereof. In general, with limited exceptions (such as for failing to execute an order), the Prime Execution Agent is not liable under the Prime Execution Agent Agreement unless in the event of its gross negligence, fraud, material violation of applicable law or willful misconduct. The Prime Execution Agent is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Prime Execution Agent. These and the other limitations on the Prime Execution Agent's liability may allow it to avoid liability for potential losses or may be insufficient to cover the value of such potential losses, even if the Prime Execution Agent directly caused such losses. Both the Trust and the Prime Execution Agent and its affiliates (including the Ether Custodian) are required to indemnify each other under certain circumstances.

Moreover, in the event of an insolvency or bankruptcy of the Prime Execution Agent (in the case of the Trading Balance) or the Ether Custodian (in the case of the Vault Balance), given that the contractual protections and legal rights of customers with respect to digital assets held on their behalf by third parties are relatively untested in insolvency of these types of entities in the digital asset industry, there is a risk that customers' assets – including the Trust's assets – may be considered the property of the estate of the Prime Execution Agent (in the case of the Trading Balance), or the Ether Custodian (in the case of the Vault Balance), and customers – including the Trust – may be at risk of being treated as general unsecured creditors of such entities and subject to the risk of total loss or markdowns on value of such assets.

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The Custodian Agreement contains an agreement by the parties to treat the ether credited to the Trust's Vault Balance as financial assets under Article 8 of the New York Uniform Commercial Code ("Article 8"), in addition to stating that the Ether Custodian will serve as fiduciary and custodian on the Trust's behalf. The Ether Custodian's parent, Coinbase Global, has stated in its most recent public securities filings that in light of the inclusion in its custody agreements of provisions relating to Article 8 it believes that a court would not treat custodied digital assets as part of its general estate in the event the Custodian were to experience insolvency. However, due to the novelty of digital asset custodial arrangements courts have not yet considered this type of treatment for custodied digital assets and it is not possible to predict with certainty how they would rule in such a scenario. If the Ether Custodian became subject to insolvency proceedings and a court were to rule that the custodied ether were part of the Ether Custodian's general estate and not the property of the Trust, then the Trust would be treated as a general unsecured creditor in the Ether Custodian's insolvency proceedings and the Trust could be subject to the loss of all or a significant portion of its assets. Moreover, in the event of the bankruptcy of the Ether Custodian, an automatic stay could go into effect and protracted litigation could be required in order to recover the assets held with the Ether Custodian, all of which could significantly and negatively impact the Trust's operations and the value of the Shares.

With respect to the Prime Execution Agent Agreement, there is a risk that the Trading Balance, in which the Trust's ether and cash is held in omnibus accounts by the Prime Execution Agent (in the latter case, as described below in "—Loss of a critical banking relationship for, or the failure of a bank used by, the Prime Execution Agent could adversely impact the Trust's ability to create or redeem Baskets, or could cause losses to the Trust"), could be considered part of the Prime Execution Agent's bankruptcy estate in the event of the Prime Execution Agent's bankruptcy. The Prime Execution Agent Agreement contains an Article 8 opt-in clause with respect to the Trust's assets held in the Trading Balance. The Prime Execution Agent is not required to hold any of the ether or cash in the Trust's Trading Balance in segregation. Within the Trading Balance, the Prime Execution Agent Agreement provides that the Trust does not have an identifiable claim to any particular ether (and cash). Instead, the Trust's Trading Balance represents an entitlement to a pro rata share of the ether (and cash) the Prime Execution Agent has allocated to the omnibus wallets the Prime Execution Agent holds, as well as the accounts in the Prime Execution Agent's name that the Prime Execution Agent maintains at Connected Trading Venues (the "Connected Trading Venue") (which are typically held on an omnibus, rather than segregated, basis). If the Prime Execution Agent suffers an insolvency event, there is a risk that the Trust's assets held in the Trading Balance could be considered part of the Prime Execution Agent's bankruptcy estate and the Trust could be treated as a general unsecured creditor of the Prime Execution Agent, which could result in losses for the Trust and Shareholders. Moreover, in the event of the bankruptcy of the Prime Execution Agent, an automatic stay could go into effect and protracted litigation could be required in order to recover the assets held with the Prime Execution Agent, all of which could significantly and negatively impact the Trust's operations and the value of the Shares. There are no policies that would limit the amount of ether that can be held temporarily in the Trading Balance maintained by the Prime Execution Agent.

Under the Trust Agreement, the Trustee and the Sponsor will not be liable for any liability or expense incurred, including, without limitation, as a result of any loss of ether by the Ether Custodian or Prime Execution Agent, absent willful misconduct, gross negligence, reckless disregard or bad faith on the part of the Trustee or the Sponsor or breach by the Sponsor of the Trust Agreement, as the case may be. As a result, the recourse of the Trust or the Shareholders to the Trustee or the Sponsor, including in the event of a loss of ether by the Ether Custodian or Prime Execution Agent, is limited.

The Shareholders' recourse against the Sponsor, the Trustee, and the Trust's other service providers for the services they provide to the Trust, including, without limitation, those relating to the holding of ether or the provision of instructions relating to the movement of ether, is limited. For the avoidance of doubt, neither the Sponsor, the Trustee, nor any of their affiliates (including, among others, BlackRock), nor any other party has guaranteed the assets or liabilities, or otherwise assumed the liabilities, of the Trust, or the obligations or liabilities of any service provider to the Trust, including, without limitation, the Ether Custodian and the Prime Execution Agent. The Prime Execution Agent Agreement and Custodian Agreement provide that neither the Sponsor, the Trustee, nor their affiliates shall have any obligation of any kind or nature whatsoever, by guaranty, enforcement or otherwise, with respect to the performance of any the Trust's obligations, agreements, representations or warranties under the Prime Execution Agent Agreement or Custodian Agreement or any transaction thereunder. Consequently, a loss may be suffered with respect to the Trust's ether that is not covered by the Ether Custodian's insurance and for which no person is liable in damages. As a result, the recourse of the Trust or the Shareholders, under applicable law, is limited.

***If the Trade Credits are not available or become exhausted, the Trust may face delays in buying or selling ether that may adversely impact Shareholders; if the Trust does not repay the Trade Credits on time, its assets may be liquidated by the Trade Credit Lender and its affiliates.***

To avoid having to pre-fund purchases or sales of ether in connection with cash creations and redemptions and sales of ether to pay the Sponsor's Fee and any other Trust expenses not assumed by the Sponsor, to the extent applicable, the Trust may borrow ether or cash as trade credit ("Trade Credit") from Coinbase Credit, Inc. (the "Trade Credit Lender") on a short-term basis pursuant to the Coinbase Credit Committed Trade Financing Agreement (the "Trade Financing Agreement"). The Trade Credit Lender is only required to extend Trade Credits to the Trust to the extent such ether or cash is actually available to the Trade Credit Lender. To the extent that Trade Credits are not available or become exhausted or the Trust decides to pre-fund purchases or sales of ether in connection with cash creations and redemptions, (1) there may be delays in the buying and selling of ether related to cash creations and redemptions or the selling of ether related to paying the Sponsor's Fee and any other Trust expenses, to the extent applicable, (2) Trust assets may be held in the Trading Balance for a longer duration than if Trade Credits were available, and (3) the execution price associated with such trades may deviate significantly from the Index price used to determine the net asset value of the Trust. To the extent that the execution price for purchases and sales of ether related to creations and redemptions and sales of ether in connection with paying the Sponsor's Fee and any other Trust expenses deviate significantly from the Index price used to determine the net asset value of the Trust, the Shareholders may be negatively impacted because the added costs of such price deviations would be incurred by the Authorized Participants and may be passed onto the Shareholders in the secondary market. Moreover, this risk factor relating to the unavailability or exhaustion of the Trade Credits should be interpreted as a heightened risk as a result of the Trust being required to conduct cash creations and redemptions in lieu of in-kind creations and redemptions.

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The Trust generally must repay Trade Credits by 6:00 p.m. ET (the "Settlement Deadline") on the calendar day immediately following the day the Trade Credit was extended by the Trade Credit Lender to the Trust (or, if such day is not a Business Day, on the next Business Day). Pursuant to the Trade Financing Agreement, the Trust has granted a security interest, lien on, and right of set off against all of the Trust's right, title and interest, in the Trust's Trading Balance and Vault Balance established pursuant to the Prime Execution Agent Agreement and Custodian Agreement, in order to secure the repayment by the Trust of the Trade Credits to the Trade Credit Lender. Upon a Termination for Cause, as defined in the Prime Execution Agent Agreement, which includes a failure by the Trust to pay and settle in full its obligations to the Trade Credit Lender in respect of the financing it provides to the Trust in the form of Trade Credits, the Ether Custodian and the Prime Execution Agent have agreed to comply with instructions from the Trade Credit Lender with respect to the disposition of the assets in the Trust's Vault Balance and Trading Balance respectively without further consent by the Trust. If the Trust fails to repay the Trade Credits to the Trade Credit Lender on time and in full, the Trade Credit Lender can take control of the Trust's assets and liquidate them to repay the Trade Credit debt owed by the Trust to the Trade Credit Lender.

***Loss of a critical banking relationship for, or the failure of a bank used by, the Prime Execution Agent could adversely impact the Trust***'***s ability to create or redeem Baskets, or could cause losses to the Trust.***

The Prime Execution Agent facilitates the buying and selling or settlement of ether by the Trust in connection with cash creations and redemptions between the Trust and the Authorized Participants, and the sale of ether to pay the Sponsor's Fee, any other Trust expenses, to the extent applicable, and in extraordinary circumstances, to effect the liquidation of the Trust's ether. The Prime Execution Agent relies on bank accounts to provide its trading platform services and including temporarily holding any cash related to a customer's purchase or sale of ether. In particular, the Prime Execution Agent has disclosed that customer cash held by the Prime Execution Agent, including the cash associated with the Trust's Trading Balance, is held in one or more banks' accounts for the benefit of the Prime Execution Agent's customers, or in money market funds in compliance with Rule 2a-7 under the Investment Company Act and rated "AAA" by S&P (or the equivalent from any eligible rating service) ("Money Market Funds"), provided that such investments are held in accounts in Coinbase's name for the benefit of customers and are permitted and held in accordance with state money transmitter laws. The Prime Execution Agent has represented to the Sponsor that it has implemented the following policy with respect to the cash associated with the Trust's Trading Balance. First any cash related to the Trust's purchase or sale of ether will be held in an omnibus account in the Prime Execution Agent's name for the benefit of ("FBO") its customers at each of multiple FDIC-insured banks (an "FBO Account"), or in a Money Market Fund. The amount of Trust cash held at each FBO Account shall be in an amount at each bank that is the lower of (i) the FDIC insurance limit for deposit insurance and (ii) any bank-specific limit set by the Prime Execution Agent for the applicable bank. Deposit insurance does not apply to cash held in a Money Market Fund. The Prime Execution Agent has agreed to title the accounts in a manner designed to enable receipt of FDIC deposit insurance where applicable on a pass-through basis, but it does not guarantee that pass-through insurance will apply since such insurance is dependent on the compliance of the bank. Second, to the extent the Trust's cash in the Trading Balance in aggregate exceeds the amounts that can be maintained at the banks on the foregoing basis, the Prime Execution Agent has represented that it currently conducts an overnight sweep of the excess into U.S. government Money Market Funds. The Sponsor has not independently verified the Prime Execution Agent's representations. To the extent that the Prime Execution Agent faces difficulty establishing or maintaining banking relationships, the loss of the Prime Execution Agent's banking partners or the imposition of operational restrictions by these banking partners and the inability for the Prime Execution Agent to utilize other financial institutions may result in a disruption of creation and redemption activity of the Trust, or cause other operational disruptions or adverse effects for the Trust. In the future, it is possible that the Prime Execution Agent could be unable to establish accounts at new banking partners or establish new banking relationships, or that the banks with which the Prime Execution Agent is able to establish relationships may not be as large or well-capitalized or subject to the same degree of prudential supervision as the existing providers.

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The Trust could also suffer losses in the event that a bank in which the Prime Execution Agent holds customer cash, including the cash associated with the Trust's Trading Balance (which is used by the Prime Execution Agent to move cash flows associated with the Trust's orders to sell ether in connection with payment of the Sponsor's Fee, and to the extent applicable, other Trust expenses), fails, becomes insolvent, enters receivership, is taken over by regulators, enters financial distress, or otherwise suffers adverse effects to its financial condition or operational status. Recently, some banks have experienced financial distress. For example, on March 8, 2023, the California Department of Financial Protection and Innovation ("DFPI") announced that Silvergate Bank had entered voluntary liquidation, and on March 10, 2023, Silicon Valley Bank, ("SVB"), was closed by the DFPI, which appointed the FDIC, as receiver. Similarly, on March 12, 2023, the New York Department of Financial Services took possession of Signature Bank and appointed the FDIC as receiver. A joint statement by the Department of the Treasury, the Federal Reserve and the FDIC on March 12, 2023, stated that depositors in Signature and SVB will have access to all of their funds, including funds held in deposit accounts, in excess of the insured amount. On May 1, 2023, First Republic Bank was closed by the California Department of Financial Protection and Innovation, which appointed the FDIC as receiver. Following a bidding process, the FDIC entered into a purchase and assumption agreement with JPMorgan Chase Bank, National Association, to acquire the substantial majority of the assets and assume certain liabilities of First Republic Bank from the FDIC.

The Prime Execution Agent has historically maintained banking relationships with Silvergate Bank and Signature Bank. While the Sponsor does not believe there is a direct risk to the Trust's assets from the failures of Silvergate Bank or Signature Bank, in the future, changing circumstances and market conditions, some of which may be beyond the Trust's or the Sponsor's control, could impair the Trust's ability to access the Trust's cash held with the Prime Execution Agent in the Trust's Trading Balance or associated with the Trust's orders to sell ether in connection with payment of the Sponsor's Fee, and to the extent applicable, other Trust expenses. If the Prime Execution Agent were to experience financial distress or its financial condition is otherwise affected by the failure of its banking partners, the Prime Execution Agent's ability to provide services to the Trust could be affected. Moreover, the future failure of a bank at which the Prime Execution Agent maintains customer cash, in the Trust's Trading Balance associated with the Trust's orders to sell ether in connection with payment of the Sponsor's Fee, and to the extent applicable, other Trust expenses, could result in losses to the Trust, to the extent the balances are not subject to deposit insurance, notwithstanding the regulatory requirements to which the Prime Execution Agent is subject or other potential protections. Although the Prime Execution Agent has made certain representations to the Sponsor regarding the Prime Execution Agent's maintenance of records in a manner reasonably designed to qualify for FDIC insurance on a pass-through basis in connection with the accounts in which the Prime Execution Agent maintains cash on behalf of its customers (including the Trust), there can be no assurance that such pass-through insurance will ultimately be made available. In addition, the Trust may maintain cash balances with the Prime Execution Agent that are not insured or are in excess of the FDIC's insurance limits, or which are maintained by the Prime Execution Agent at Money Market Funds and subject to the attendant risks (e.g., "breaking the buck"). As a result, the Trust could suffer losses.

***The Prime Execution Agent routes orders through Connected Trading Venues in connection with trading services under the Prime Execution Agent Agreement. The loss or failure of any such Connected Trading Venues may adversely affect the Prime Execution Agent***'***s business and cause losses for the Trust.***

In connection with trading services under the Prime Execution Agent Agreement, the Prime Execution Agent routinely routes customer orders to Connected Trading Venues, which are third-party platforms or other trading venues (including the trading venue operated by the Prime Execution Agent). In connection with these activities, the Prime Execution Agent may hold ether with such Connected Trading Venues in order to effect customer orders, including the Trust's orders. However, the Prime Execution Agent has represented to the Sponsor that no customer cash is held at Connected Trading Venues. If the Prime Execution Agent were to experience a disruption in the Prime Execution Agent's access to these Connected Trading Venues, the Prime Execution Agent's trading services under the Prime Execution Agent Agreement could be adversely affected to the extent that the Prime Execution Agent is limited in its ability to execute order flow for its customers, including the Trust. In addition, while the Prime Execution Agent has policies and procedures to help mitigate the Prime Execution Agent's risks related to routing orders through third-party trading venues, if any of these third-party trading venues experience any technical, legal, regulatory or other adverse events, such as shutdowns, delays, system failures, suspension of withdrawals, illiquidity, insolvency, or loss of customer assets, the Prime Execution Agent might not be able to fully recover the customer's ether that the Prime Execution Agent has deposited with these third parties. As a result, the Prime Execution Agent's business, operating results and financial condition could be adversely affected, potentially resulting in its failure to provide services to the Trust or perform its obligations under the Prime Execution Agent Agreement, and the Trust could suffer resulting losses or disruptions to its operations. The failure of a Connected Trading Venue at which the Prime Execution Agent maintains customer ether, including ether associated with the Trust, could result in losses to the Trust, notwithstanding the regulatory requirements to which the Prime Execution Agent is subject or other potential protections.

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***The Trust may be required, or the Sponsor may deem it appropriate, to terminate and liquidate at a time that is disadvantageous to Shareholders.***

Pursuant to the terms of the Trust Agreement, the Trust is required to dissolve under certain circumstances. In addition, the Sponsor may, in its sole discretion, dissolve the Trust for a number of reasons, including if the Sponsor determines, in its sole discretion, that it is desirable or advisable for any reason to discontinue the affairs of the Trust.

If the Trust is required to terminate and liquidate, or the Sponsor determines in accordance with the terms of the Trust Agreement that it is appropriate to terminate and liquidate the Trust, such termination and liquidation could occur at a time that is disadvantageous to Shareholders, such as when the actual exchange rate of ether at such time is lower than the Index was at the time when Shareholders purchased their Shares. In such a case, when the Trust's ether is sold as part of its liquidation, the resulting proceeds distributed to Shareholders will be less than if the actual exchange rate at such time were higher at the time of sale.

***The Trust Agreement includes provisions that limit Shareholders***' ***voting rights and restrict Shareholders***' ***right to bring a derivative action.***

Under the Trust Agreement, Shareholders generally have no voting rights, and the Trust will not have regular Shareholder meetings. Shareholders take no part in the management or control of the Trust. Accordingly, Shareholders do not have the right to authorize actions, appoint service providers or take other actions as may be taken by shareholders of other trusts or companies where shares carry such rights. The shareholders' limited voting rights give almost all control under the Trust Agreement to the Sponsor and the Trustee. The Sponsor may take actions in the operation of the Trust that may be adverse to the interests of Shareholders and may adversely affect the value of the Shares.

Moreover, pursuant to the terms of the Trust Agreement, Shareholders' statutory right under Delaware law to bring a derivative action (i.e., to initiate a lawsuit in the name of the Trust in order to assert a claim belonging to the Trust against a fiduciary of the Trust or against a third party when the Trust's management has refused to do so) is restricted. Under Delaware law, a shareholder may bring a derivative action if the shareholder is a shareholder at the time the action is brought and either (i) was a shareholder at the time of the transaction at issue or (ii) acquired the status of shareholder by operation of law or the Trust's governing instrument from a person who was a shareholder at the time of the transaction at issue. Additionally, section 3816(e) of the Delaware Statutory Trust Act specifically provides that a "beneficial owner's right to bring a derivative action may be subject to such additional standards and restrictions, if any, as are set forth in the governing instrument of the statutory trust, including, without limitation, the requirement that beneficial owners owning a specified beneficial interest in the statutory trust join in the bringing of the derivative action." In addition to the requirements of applicable law and in accordance with Section 3816(e), the Trust Agreement provides that no Shareholder will have the right, power or authority to bring or maintain a derivative action, suit or other proceeding on behalf of the Trust unless (a) two or more Shareholders who (i) are not "Affiliates" (as defined in the Trust Agreement) of one another and (ii) collectively hold at least 10% of the outstanding Shares join in the bringing or maintaining of such action, suit or other proceeding, and (b) (i) prior to bringing such action, the Shareholder must make a demand upon the Trustee to bring the subject action unless an effort to cause the Trustee to bring such an action is not likely to succeed; and a demand on the Trustee shall only be deemed not likely to succeed and therefore excused if the Trustee has a personal financial interest in the transaction at issue, and the Trustee shall not be deemed interested in a transaction or otherwise disqualified from ruling on the merits of a Shareholder demand by virtue of the fact that the Trustee receives remuneration for its service as the Trustee or as a trustee or director of one or more investment companies that are under common management with or otherwise affiliated with the Trust; and (ii) unless a demand is not required under clause (i) of this paragraph, the Trustee must be afforded a reasonable amount of time to consider such Shareholder request and to investigate the basis of such claim; and the Trustee shall be entitled to retain counsel or other advisors in considering the merits of the request and may require an undertaking by the Shareholder making such request to reimburse the Trust for the expense of any such advisors in the event that the Trustee determines not to bring such action.

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Due to this additional requirement, a Shareholder attempting to bring or maintain a derivative action in the name of the Trust will be required to locate other Shareholders with which it is not affiliated and that have sufficient Shares to meet the 10% threshold based on the number of Shares outstanding on the date the claim is brought and thereafter throughout the duration of the action, suit or proceeding. This may be difficult and may result in increased costs to a Shareholder attempting to seek redress in the name of the Trust in court. Moreover, if Shareholders bringing a derivative action, suit or proceeding pursuant to this provision of the Trust Agreement do not hold 10% of the outstanding Shares on the date such an action, suit or proceeding is brought, or such Shareholders are unable to maintain Share ownership meeting the 10% threshold throughout the duration of the action, suit or proceeding, such Shareholders' derivative action may be subject to dismissal. As a result, the Trust Agreement limits the likelihood that a Shareholder will be able to successfully assert a derivative action in the name of the Trust, even if such Shareholder believes that he or she has a valid derivative action, suit or other proceeding to bring on behalf of the Trust.

***The non-exclusive jurisdiction for certain types of actions and proceedings and waiver of trial by jury clauses set forth in the Trust Agreement may have the effect of limiting a Shareholder***'***s rights to bring legal action against the Trust and could limit a purchaser***'***s ability to obtain a favorable judicial forum for disputes with the Trust.***

The Trust Agreement provides that the courts of the state of Delaware and any federal courts located in Wilmington, Delaware will be the non-exclusive jurisdiction for any claims, suits, actions or proceedings, provided that causes of actions for violations of the Exchange Act or the Securities Act will not be governed by the non-exclusive jurisdiction provision of the Trust Agreement. By purchasing Shares in the Trust, Shareholders waive certain claims that the courts of the state of Delaware and any federal courts located in Wilmington, Delaware is an inconvenient venue or is otherwise inappropriate. As such, Shareholder could be required to litigate a matter relating to the Trust in a Delaware court, even if that court may otherwise be inconvenient for the Shareholder.

The Trust Agreement also waives the right to trial by jury in any such claim, suit, action or proceeding, provided that causes of actions for violations of the Exchange Act or the Securities Act will not be governed by the waiver of the right to trial by jury provision of the Trust Agreement. If a lawsuit is brought against the Trust, it may be heard only by a judge or justice of the applicable trial court, which would be conducted according to different civil procedures and may result in different outcomes than a trial by jury would have, including results that could be less favorable to the plaintiffs in any such action. By purchasing Shares in the Trust, Shareholders waive a right to a trial by jury which may limit a Shareholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with the Trust.

***The Sponsor is solely responsible for determining the value of the net asset value of the Trust and NAV, and any errors, discontinuance or changes in such valuation calculations may have an adverse effect on the value of the Shares.***

The Sponsor has the exclusive authority to determine the net asset value of the Trust and the NAV, which it has delegated to the Trustee under the Trust Agreement. The Trustee has delegated to the Trust Administrator the responsibility to calculate the net asset value of the Trust and the NAV, based on a pricing source selected by the Trustee. The Trust Administrator determines the net asset value of the Trust and NAV as of 4:00 p.m. ET, on each Business Day, as soon as practicable after that time. The Trust Administrator's determination is made utilizing data from the operations of the Trust and the Index, calculated at 4:00 p.m. ET, on such day. If the Trustee determines in good faith that the Index does not reflect an accurate ether price, then the Trustee will instruct the Trust Administrator to employ an alternative method to determine the fair value of the Trust's assets. There are no predefined criteria to make a good faith assessment as to which of the rules the Sponsor will apply, and the Sponsor may make this determination in its sole discretion. The Trust Administrator may calculate the Index in a manner that ultimately inaccurately reflects the price of ether. To the extent that the net asset value of the Trust, NAV, the Index, or the Trustee's, the Trust Administrator's or the Sponsor's other valuation methodology are incorrectly calculated, neither the Sponsor, the Trust Administrator nor the Trustee may be liable for any error and such misreporting of valuation data could adversely affect the value of the Shares and investors could suffer a substantial loss on their investment in the Trust. Moreover, the terms of the Trust Agreement do not prohibit the Sponsor from changing the Index or other valuation method used to calculate the net asset value of the Trust. Any such change in the Index or other valuation method could affect the value of the Shares and investors could suffer a substantial loss on their investment in the Trust.

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To the extent the methodology used to calculate the Index is deemed not to be consistent with GAAP, the Trust's periodic financial statements may not utilize the Trust's net asset value or NAV. The Trust's periodic financial statements will be prepared in accordance with GAAP, including ASC Topic 820, and utilize an exchange-traded price from the Trust's principal market for ether as of 11:59 p.m. ET on the Trust's financial statement measurement date. The Sponsor will determine in its sole discretion the valuation sources and policies used to prepare the Trust's financial statements. To the extent that such valuation sources and policies used to prepare the Trust's financial statements result in an inaccurate price, the value of the Shares could be adversely affected, and investors could suffer a substantial loss on their investment in the Trust. Moreover, the terms of the Trust Agreement do not prohibit the Sponsor from changing the valuation method used to calculate the net asset value to be reported in the Trust's financial statements. Any such change in such valuation method could affect the value of the Shares and investors could suffer a substantial loss on their investment in the Trust.

***Extraordinary expenses resulting from unanticipated events may become payable by the Trust, adversely affecting the value of the Shares.***

In consideration for the Sponsor's Fee, the Sponsor has contractually assumed ordinary course operational and periodic expenses of the Trust, with the exception of those described in "Business of the Trust—Trust Expenses," which are not assumed by the Sponsor and are borne by the Trust. The Sponsor will cause the Trust to either (i) sell ether held by the Trust or (ii) deliver ether in-kind to the Sponsor to pay Trust expenses not assumed by the Sponsor on an as-needed basis. Accordingly, the Trust may be required to sell or otherwise dispose of ether at a time when the trading prices for those assets are depressed. The sale or other disposition of assets of the Trust in order to pay extraordinary expenses could have a negative impact on the value of the Shares for several reasons. These include the following factors:

● The Trust is not actively managed and no attempt will be made to protect against or to take advantage of fluctuations in the prices of ether. Consequently, if the Trust incurs expenses in U.S. dollars, the Trust's ether may be sold at a time when the values of the disposed assets are low, resulting in a negative impact on the value of the Shares.

● To cover the Sponsor's Fee, the Sponsor's Staking Portion and any expenses not assumed by the Sponsor, the Trust will need to sell ether. Any sales of the Trust's assets in connection with the payment of expenses will decrease the amount of the Trust's assets represented by each Share each time its assets are sold or transferred to the Sponsor.

***The Trust***'***s delivery or sale of ether to pay expenses or other operations of the Trust could result in Shareholders incurring tax liability without an associated distribution from the Trust.***

Assuming that the Trust is treated as a grantor trust for U.S. federal income tax purposes, each delivery of ether by the Trust to pay the Sponsor's Fee, the Staking Fee or other expenses and each sale of ether by the Trust to pay Trust expenses not assumed by the Sponsor will be a taxable event to beneficial owners of Shares. Also, the Trust's receipt of staking rewards of ether from Staking Activities would be treated as giving rise to taxable income for U.S. federal income tax purposes under current IRS guidance. Thus, the Trust's payment of expenses and receipt of staking rewards could result in beneficial owners of Shares incurring tax liability without an associated distribution from the Trust. Any such tax liability could adversely affect an investment in the Shares.

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***The value of the Shares will be adversely affected if the Trust is required to indemnify the Sponsor, the Trustee, the Delaware Trustee, the Trust Administrator, the Ether Custodian or the Cash Custodian under the Trust Documents.***

Under the Trust Agreement and the Trust agreements with its service providers ("Trust Documents") each of the Sponsor, the Trustee, the Delaware Trustee, the Trust Administrator and the Custodians has a right to be indemnified by the Trust for certain liabilities or expenses that it incurs without, depending on the applicable Trust Document, gross negligence, bad faith or willful misconduct on its part. Therefore, the Sponsor, Delaware Trustee, the Trust Administrator, or the Custodians may require that the assets of the Trust be sold in order to cover losses or liability suffered by it. Any sale of that kind would reduce the ether holdings of the Trust and the value of the Shares.

***Intellectual property rights claims may adversely affect the Trust and the value of the Shares.***

The Sponsor is not aware of any intellectual property rights claims that may prevent the Trust from operating and holding ether. However, third parties may assert intellectual property rights claims relating to the operation of the Trust and the mechanics instituted for the investment in, holding of and transfer of ether. Regardless of the merit of an intellectual property or other legal action, any legal expenses to defend or payments to settle such claims would be extraordinary expenses that would be borne by the Trust through the sale or transfer of its ether. Additionally, a meritorious intellectual property rights claim could prevent the Trust from operating and force the Sponsor to terminate the Trust and liquidate its ether. As a result, an intellectual property rights claim against the Trust could adversely affect the value of the Shares.

***The Shares may trade at a price that is at, above or below the Trust***'***s NAV as a result of the non-current trading hours between NASDAQ and the digital asset market.***

The Trust's NAV will fluctuate with changes in the market value of ether, and the Sponsor expects the trading price of the Shares to fluctuate in accordance with changes in the Trust's NAV, as well as market supply and demand. However, the Shares may trade on NASDAQ at a price that is at, above or below the Trust's NAV for a variety of reasons. For example, NASDAQ is open for trading in the Shares for a limited period each day, but the digital asset market is a 24-hour marketplace. During periods when NASDAQ is closed but constituent trading platforms are open, significant changes in the price of ether on the digital asset market could result in a difference in performance between the value of ether as measured by the Index and the most recent NAV or closing trading price. For example, if the price of ether on the digital asset market, and the value ether as measured by the Index, move significantly in a negative direction after the close of NASDAQ, the trading price of the Shares may "gap" down to the full extent of such negative price shift when the Exchange reopens. If the price of ether on the digital asset market drops significantly during hours the NASDAQ is closed, Shareholders may not be able to sell their Shares until after the "gap" down has been fully realized, resulting in an inability to mitigate losses in a negative market. Even during periods when the NASDAQ is open, large constituent trading platforms (or a substantial number of smaller constituent trading platforms) may be lightly traded or closed for any number of reasons, which could increase trading spreads and widen any premium or discount on the Shares.

**Risk Factors Related to Staking Activities**

***Staking introduces a risk of loss of ether, which could adversely affect the value of the Shares.***

Staking introduces a risk of loss of ether. None of the Trust's assets, including potentially staked assets, are subject to the protections enjoyed by depositors or customers of institutions with FDIC or Securities Investor Protection Corporation membership. Staking requires the transfer of the Trust's ether by the Ether Custodian from the Vault Account to the Protocol Staking Deposit Contract, and unstaking requires a transfer of the Trust's ether by the Protocol Staking Deposit Contract to the Trust's Vault Account (which Coinbase specifies as the withdrawal address when Coinbase originally deposited the Trust's staked assets with the Protocol Staking Deposit Contract). These transfers could be executed incorrectly or be subject to errors, hacks, cybersecurity vulnerabilities, software defects, outages, bugs, etc., any of which could cause the loss of the Trust's staked assets.

The Ethereum network imposes fault-based sanctions for validator misbehavior, primarily through slashing, which may include correlated slashing penalties. Slashing occurs when a validator engages in malicious or erroneous actions that pose consensus safety violations, such as proposing multiple blocks in a given slot or attesting to conflicting blocks. Slashed validators face an initial slashing penalty and are forcibly exited from the validator set. The exact amount of ether burned in a slashing depends on network conditions, namely the number of other validators slashed around the same time. The protocol applies correlated slashing penalties, which increase the economic impact of large-scale or coordinated slashing events relative to isolated incidents, reflecting the greater risk such events pose to network security. If a validator fails to perform required protocol duties, including submitting timely attestations, it may incur inactivity penalties. Under normal network conditions, these penalties result in a reduction of the validator's staked ether in an amount generally similar to the rewards the validator would have earned had it performed those duties. Validators may also be subject to increased penalties during an inactivity leak. An "inactivity leak" is a protocol-level state that is triggered when the Ethereum network goes into an extended period without achieving finality. Finality requires agreement by validators representing at least two-thirds of the total staked ether. This means that if validators representing more than one-third of the total staked ether are offline or otherwise fail to attest, the network may be unable to finalize blocks. If this condition persists, the protocol activates an inactivity leak under which ether staked by the inactive validators is reduced more rapidly than under normal conditions. This mechanism is intended to incentivize validators to remain online and continue participating, thereby helping restore finality to the network. On May 11 -12, 2023, Ethereum experienced two temporary losses of finality on mainnet; the second incident triggered the protocol's first ever inactivity leak on mainnet. Client teams (including Prysm and Teku) released patches, and finality resumed after participation recovered. On October 11, 2023, 20 validators operated by Launchnodes as part of the Lido protocol were slashed due to infrastructure and signer configuration issues. Lido subsequently published a post mortem and Launchnodes to reimbursing and mitigating the impact on staking rewards. After this initial slashing, the validator is force exited from the Ethereum network's validator "pool," and may be subject to inactivity leak or correlated penalties.

There can be no guarantee that slashing, inactivity penalties, inactivity leaks and resulting losses will not occur as a result of the activities of a Staking Services Provider. Furthermore, a Staking Services Provider's liability to the Trust is expected to be limited, and a Staking Services Provider may lack the assets or insurance in order to support the recovery of any losses incurred. There can be no guarantee that the Trust would recover any of its staked assets, or the value thereof, if it is subject to penalties imposed by the Ethereum network.

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***Staked ether will be inaccessible for a variable period of time, determined by a range of factors, which could result in certain liquidity risk to the Trust.***

Under current Ethereum network protocols, staked ether is permitted to be unstaked by the holder of such ether. "Activation" is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the Ethereum network's proof-of-stake consensus protocol. "Exit" is the request to exit from the active set and no longer participate in the Ethereum network's proof-of-stake consensus protocol. As part of these "activating" and "exiting" processes of staking on the Ethereum network, any staked ether will be inaccessible for a period of time. The duration of activating and exiting periods are dependent on a range of factors, including network conditions.

The Ethereum protocol limits how many validator activations and exits per epoch through "churn limits", which scale with the total number of active validators. These limits govern activations and exits and help preserve network stability. Following recent parameter changes, the protocol allows up to 8 validators per epoch to become active, with activation wait times increasing proportionally as the activation queue grows. Ethereum measures time in 12-second "slots" and 32-slot "epochs" (~6.4 minutes). When queues are minimal, activation to the active validator set can be completed in roughly 14 hours, representing the minimum possible path. Protocol changes, yield shifts, or large inflows, can cause the activation queue to extend for days, weeks, or even months, delaying when staked ether begins accruing consensus rewards. While in the activation queue, the Trust's ether will not accrue rewards.

A no-queue exit typically involves (i) approximately 32 minutes (5 epochs) to exit the active validator set, (ii) a mandatory withdrawable delay of approximately 27 hours (256 epochs) followed by (iii) a round-robin withdrawal "sweep" that, at current validator counts, cycles across the set in roughly ~7–10 days. During periods of elevated exit activity, the exit queue can significantly extend overall unstaking time. As of this prospectus, the longest recorded exit queue for Ethereum was 46.5 days. The total time required to fully unstake ether can fluctuate based on the current conditions of the network. In low demand periods, the process may be completed within hours or days; in high-demand periods, the exit queue alone can extend to multiple weeks before the ~27-hour withdrawable delay and the ~7-10 day sweep begin. The timing of staking and unstaking ether may lead to liquidity risk for the Trust. To address these risks, the Sponsor will implement various risk management strategies. While rewards accrue during the exit, they stop accruing after a validator's exit is complete, the Trust's ether will not earn rewards during the withdrawable delay and the subsequent sweep.

Even in the event of long exit times, the Trust may continue to redeem Baskets. There is a risk that the Trust could become unable to timely meet excessive redemption orders in amounts that are greater than the Trust's Liquidity Sleeve, leading to temporary delays in settlement and, in extreme scenarios, the temporary suspension of redemptions. Moreover, any staked ether which must be unstaked in order to fulfill a redemption (to the extent such redemption cannot be fulfilled utilizing the portion of the Trust's ether that has not been staked) will be unstaked only after the redemption order is approved by the Trust, the Sponsor executes an unstake or withdrawal transaction, and such transaction is processed by the Ethereum network. The Staking Services Provider will not be able to change the addresses on the Ethereum network to which staked ether is to be withdrawn or to which ether rewards shall be sent.

To manage the liquidity and redemption risks associated with staking, the Sponsor intends to maintain a Liquidity Sleeve consisting of a target range of 5%-30% unstaked ether maintained solely to ensure that the Trust has sufficient readily available assets to meet redemption requests. The Liquidity Sleeve will be held by the Ether Custodian and maintained in cold storage in the Vault Account, and will not be held in hot wallets (i.e., the Trading Balance) except to facilitate creation or redemption activity. Except for temporary movements into the Trading Balance solely to facilitate creation or redemption activity, all ether in the Liquidity Sleeve will remain in the custody of the Ether Custodian in cold storage and will be swept back from the Trading Balance into cold storage in the Vault Account on a daily basis. Because the ether in the Liquidity Sleeve is freely transferable, there is no timing mismatch between settlement of Shares in primary market redemptions and the ether transfer time. However, there can be no assurance that the Liquidity Sleeve will contain sufficient unstaked ether to meet all redemption requests, particularly in a scenario where redemption activity is greater than normal or historical levels, such as during stressed market conditions. The percentage of the Trust's ether comprising the Liquidity Sleeve will be dynamic and subject to adjustment based on anticipated primary and secondary market activity of the Shares and the ether de-activation process. Under normal market circumstances, the Sponsor generally seeks to stake as much of the Trust's ether as is practicable at all times, with the remainder of the Trust's ether remaining unstaked in order to address the various liquidity needs described herein. If the Trust's Liquidity Sleeve is insufficient to meet redemption requests, the Trust may seek to delay settlement of redemptions with Authorized Participants until the Trust has sufficient unstaked ether to settle such redemption transactions. However, there is no assurance that Authorized Participants will agree to delay the settlement of redemption requests, and could instead cancel their redemption orders. In addition, Authorized Participants could find the delayed settlement feature or the liquidity risk from staking unattractive commercially, which could cause them to refrain from serving as Authorized Participants to the Trust or participating in creation or redemption activity generally. If Authorized Participants cancel their redemption orders, or refrain from participating in redemption activity generally, this could lead the Trust to be unable to process redemptions, which could lead to a breakdown of the arbitrage mechanism which keeps the trading price of the Trust's Shares in the secondary market in line with the net asset value of the Trust. This could cause the Trust's Shares to trade at a discount or other differential to their net asset value, which could cause holders of Shares to suffer a loss on their investment in the Shares.

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The Trust's Ethereum Staking Liquidity Risk Policy is intended to be consistent with NASDAQ's generic listing standards and the 2025 Staking Tax Guidance. However, there can be no assurance that such arrangements will be available as intended or provide sufficient liquidity to satisfy redemption orders. If the Trust is unsuccessful in managing liquidity, whether through the Liquidity Sleeve or deferred settlement of redemptions with Authorized Participants.

***The Trust will be dependent on third parties to effectively execute the Trust***'***s Staking Activities.***

As the Sponsor currently anticipates that validation activity in connection with Staking Activities will be carried out by the third-party Staking Services Providers, the amount of Staking Consideration that the Trust's Staking Activity will generate will be dependent on the performance of the Staking Services Provider, including the adequacy and reliability of the hardware and software utilized by the Staking Services Provider. In addition, the Trust will be dependent on the Prime Execution Agent, Ether Custodian, and Staking Services Providers to execute staking and unstaking transactions, including withdrawals. If the Prime Execution Agent, Ether Custodian or the Staking Services Providers fail to perform or default on their obligations to the Trust, experience service outages or otherwise are unable to optimally execute validation activity in connection with the Staking of the Trust's ether, the Trust's Staking Consideration, or its ability to successfully execute its staking program, may be adversely affected.

 ***The Staking Services Providers may not optimally execute the Trust***'***s Staking Activities.***

The Trust relies on the resources of the Ether Custodian and the Staking Services Providers to facilitate the 'Trust's Staking Activities. The Staking Services Providers will provide the hardware, software and services necessary to stake the ether from a validator node. The hardware and software utilized by the Staking Services Providers may prove to be inadequate to maximize the Trust's staking rewards. The Trust is dependent on the hardware, software and services of the Staking Services Providers to effectively execute the Trust's Staking Activities. The Sponsor will have no ability to supervise or direct the conduct of the Staking Services Providers.

In addition, the Trust does not have any control over the Staking Services Providers in their staking activities on behalf of the Trust. Although the Trust, under the contractual Staking Arrangements the Prime Execution Agent enters on behalf of the Trust with such Staking Services Providers, requires such Staking Services Providers to represent that they comply with applicable laws, there can be no assurance that such Staking Services Providers will in fact act in accordance with such contractual obligations. If they do not do so, regulators, governmental authorities or others could seek to hold the Trust (rather than such Staking Services Providers) liable, and the Trust could be negatively affected.

In addition, the Trust will use its proceeds from the staking program to compensate the Ether Custodian for its staking services. Such payment will reduce the portion of the staking rewards generated by the Trust's Staking Activities that are actually retained by the Trust. Accordingly, the staking rewards actually retained by the Trust will likely be less than what the Trust would retain if the Sponsor were to administer its own staking activities without the assistance of third-party staking service providers.

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 ***The Protocol Staking Deposit Contract is novel and applicable legal frameworks are unclear.***

The Protocol Staking Deposit Contract to which the Ether Custodian sends the Trust's ether to be staked is a novel technological feature of staking on the Ethereum network. Because of the recency of the advent of proof-of-stake blockchain consensus validation activity and permissionless distributed ledger technology generally, the legal and regulatory frameworks that apply to the Protocol Staking Deposit Contract and activities conducted through it, including by the Trust, are unclear. To conduct the Trust's staking program, the Trust's assets must be moved to and from the Protocol Staking Deposit Contract, in each case, from or to the Trust's Vault Account at the Ether Custodian. The Protocol Staking Deposit Contract does not have private keys (it is a smart contract account, not an Externally Owned Account), and to the Sponsor's knowledge, no person controls the Protocol Staking Deposit Contract. The Protocol Staking Deposit Contract could be subject to undiscovered bugs, software defects, cybersecurity vulnerabilities, or other issues which could cause a loss of the Trust's staked assets. Because the Protocol Staking Deposit Contract is not owned or controlled by the Sponsor, the Ether Custodian, the Prime Execution Agent, or the Approved Validators, none of them may be responsible to the Trust in respect of a loss of funds resulting from some problem with the Protocol Staking Deposit Contract, which could cause losses to holders of Shares in respect of which there is no recourse. Liability and insolvency laws that would apply to a permissionless smart contract are undeveloped or in their infancy, and as such, in the event of some failure or large-scale problem affecting the Protocol Staking Deposit Contract and stakers of ether globally who have staked their ether there, it is unclear what liability or insolvency frameworks, if any, would apply; because of the legal uncertainty, holders of Shares could suffer losses in respect of which no legal recourse is available. Because Ethereum is a permissionless blockchain, none of the Trust, the Ether Custodian, the Prime Execution Agent, or the Approved Validators have any way to prevent any other person from accessing and conducting staking activities through the Protocol Staking Deposit Contract. When assets are staked by different validators on behalf of different holders of ether to the Protocol Staking Deposit Contract, their assets are commingled together at the address of the Protocol Staking Deposit Contract. The Trust, when it stakes assets to the Protocol Staking Deposit Contract, will not receive back the same exact units of ether that the Ether Custodian originally deposited from the Vault Account, but instead will receive units of ether in the quantity that the Trust is entitled to (its staked assets, plus any rewards, minus any slashing losses), which will be different from the exact units the Trust originally deposited and accordingly, of unknown provenance. Because staked assets of all stakers and all validators are commingled within the Protocol Staking Deposit Contract, the Trust could theoretically receive assets that have some legal issue associated with them (such as, for example, having been previously owned at some point by a sanctioned individual). The applicability of legal frameworks to such circumstances in connection with permissionless smart contracts like the Protocol Staking Deposit Contract is unclear. However, it is theoretically possible that at some point in the future, the Trust could suffer some type of liability from a governmental authority or other source, or other problem, in connection with the staked assets it receives back from the Protocol Staking Deposit Contract, which could cause losses to holders of Shares.

***The Trust may vary the amount of ether to be staked and the rewards received may accordingly change from time to time.***

The Trust's staking program seeks to maximize the portion of the Trust's ether available for staking while controlling for liquidity and redemption risks. Under normal market conditions, the Trust generally intends to stake between 70% and 95% of its ether holdings through the Ether Custodian with one or more Staking Services Providers. However, the actual percentage staked may vary based on liquidity needs or other factors, including redemption activity, distributions, regulatory or network concerns, disruptions in custodial or staking arrangements, or other circumstances that could affect the Trust's ability to continue staking. These factors may cause the percentage of ether staked to fluctuate over time.

Accordingly, changes in the percentage of ether holdings that are staked could affect the Trust's ability to generate staking rewards and may impact the value of the Shares.

***The Sponsor***'***s receipt of a portion of staking rewards may create conflicts of interest.***

As of the date of this prospectus, the Sponsor's Staking Portion and the Prime Execution Agent's share of such Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers in respect of their shares of the Staking Consideration) comprise an aggregate of 18% of the gross Staking Consideration. The Trust will retain the remainder of such gross Staking Consideration. This arrangement creates a financial incentive for the Sponsor to maximize the amount of ether staked by the Trust, as higher levels of staked ether would generally result in greater staking rewards to the Sponsor. However, the Sponsor's interest in maximizing staking rewards may conflict with the Trust's need to maintain sufficient liquid ether to meet redemption orders and other operational requirements. If the Sponsor directs the Trust to stake excessive amounts of ether relative to the Trust's liquidity needs, the Trust could become unable to timely meet redemption orders in amounts that are greater than the portion of the Trust's ether that remains unstaked, leading to temporary delays in settlement and, in extreme scenarios, the temporary unavailability of the Trust's suspension of redemptions.

Any inability to meet redemption requests in a timely manner due to excessive staking could harm Authorized Participants' ability to effectively arbitrage the Trust's Shares, potentially causing the Shares to trade at significant premiums or discounts to NAV. This could result in Shareholders being unable to exit their positions at fair value or being forced to accept delays in redemption processing, either of which could cause substantial losses to Shareholders.

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**Risk Factors Related to the Regulation of the Trust and the Shares** 

 ***Digital asset markets in the United States exist in a state of regulatory uncertainty, and adverse legislative or regulatory developments could significantly harm the value of ether or the Shares, such as by banning, restricting or imposing onerous conditions or prohibitions on the use of ether, validator activity, digital wallets, the provision of services related to trading and providing custody service for ether, the operation of the Ethereum network, or the digital asset markets generally.***

There is a lack of consensus regarding the regulation of digital assets, including ether, and their markets. As a result of the growth in the size of the digital asset market, as well as the 2022 Events described below, the U.S. Congress and a number of U.S. federal and state agencies (including FinCEN, SEC, Office of the Comptroller of the Currency (the "OCC"), CFTC, FINRA, the Consumer Financial Protection Bureau ("CFPB"), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, state financial institution regulators, and others) have been examining the operations of digital asset networks, digital asset users and the digital asset markets. Many of these state and federal agencies have brought enforcement actions or issued consumer advisories regarding the risks posed by digital assets to investors. Ongoing and future regulatory actions with respect to digital assets generally or ether in particular may alter, perhaps to a materially adverse extent, the nature of an investment in the Shares or the ability of the Trust to continue to operate. The 2022 Events, including among others the bankruptcy filings of FTX and its subsidiaries, Three Arrows Capital, Celsius Network, Voyager Digital, Genesis, BlockFi and others, and other developments in the digital asset markets, have resulted in calls for heightened scrutiny and regulation of the digital asset industry, with a specific focus on intermediaries such as digital asset platforms, platforms, and custodians. Federal and state legislatures and regulatory agencies may introduce and enact new laws and regulations to regulate crypto asset intermediaries, such as digital asset platforms and custodians. The March 2023 collapses of Silicon Valley Bank, Silvergate Bank, and Signature Bank, which in some cases provided services to the digital asset industry, may amplify and/or accelerate these trends. On January 3, 2023, the federal banking agencies issued a joint statement on crypto-asset risks to banking organizations following events which exposed vulnerabilities in the crypto asset sector, including the risk of fraud and scams, legal uncertainties, significant volatility, and contagion risk. Although banking organizations are not prohibited from crypto asset-related activities, the agencies have expressed significant safety and soundness concerns with business models that are concentrated in crypto asset-related activities or have concentrated exposures to the crypto asset sector.

US federal and state regulators, as well as the White House, have issued reports and releases concerning crypto assets, including ether, and crypto asset markets. Further, in 2023 the House of Representatives formed two new subcommittees: the Digital Assets, Financial Technology and Inclusion Subcommittee and the Commodity Markets, Digital Assets, and Rural Development Subcommittee, each of which were formed in part to analyze issues concerning crypto assets and demonstrate a legislative intent to develop and consider the adoption of federal legislation designed to address the perceived need for regulation of and concerns surrounding the crypto industry. However, the extent and content of any forthcoming laws and regulations are not yet ascertainable with certainty, and may not be ascertainable in the near future. We cannot predict how these and other related events will affect us or the crypto asset business.

It is not possible to predict whether, or when, any of these developments will lead to Congress granting additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how additional legislation and/or regulatory oversight might impact the ability of digital asset markets to function or how any new regulations or changes to existing regulations might impact the value of digital assets generally and ether held by the Trust specifically. The consequences of increased federal regulation of digital assets and digital asset activities could have a material adverse effect on the Trust and the Shares.

FinCEN requires any administrator or exchanger of convertible virtual currency ("CVC") to register with FinCEN as a money transmitter and comply with the anti-money laundering regulations applicable to money transmitters. Entities which fail to comply with such regulations are subject to fines, may be required to cease operations, and could have potential criminal liability. For example, in 2015, FinCEN assessed a $700,000 fine against a sponsor of a digital asset for violating several requirements of the Bank Secrecy Act by acting as an MSB and selling the digital asset without registering with FinCEN, and by failing to implement and maintain an adequate anti-money laundering program. In 2017, FinCEN assessed a $110 million fine against BTC-e, a now defunct digital asset platform, for similar violations. The requirement that exchangers that do business in the United States register with FinCEN and comply with anti-money laundering regulations may increase the cost of buying and selling ether and therefore may adversely affect the price of ether and an investment in the Shares.

The Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury (the "U.S. Treasury Department") has added digital currency addresses, including addresses on the Ethereum network, to the list of Specially Designated Nationals whose assets are blocked, and with whom U.S. persons are generally prohibited from dealing. Such actions by OFAC, or by similar organizations in other jurisdictions, may introduce uncertainty in the market as to whether ether that has been associated with such addresses in the past can be easily sold. This "tainted" ether may trade at a substantial discount to untainted ether. Reduced fungibility in the ether markets may reduce the liquidity of ether and therefore adversely affect their price.

In February 2020, then-U.S. Treasury Secretary Steven Mnuchin stated that digital assets were a "crucial area" on which the U.S. Treasury Department has spent significant time. Secretary Mnuchin announced that the U.S. Treasury Department is preparing significant new regulations governing digital asset activities to address concerns regarding the potential use for facilitating money laundering and other illicit activities. In December 2020, FinCEN, a bureau within the U.S. Treasury Department, proposed a rule that would require financial institutions to submit reports, keep records, and verify the identity of customers for certain transactions to or from so-called "unhosted" wallets, also commonly referred to as self-hosted wallets. In January 2021, then U.S. Treasury Secretary nominee Janet Yellen stated her belief that regulators should "look closely at how to encourage the use of digital assets for legitimate activities while curtailing their use for malign and illegal activities."

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Under regulations from the New York State Department of Financial Services ("NYDFS"), businesses involved in digital asset business activity for third parties in or involving New York, excluding merchants and consumers, must apply for a license, commonly known as a BitLicense, from the NYDFS and must comply with anti-money laundering, cybersecurity, consumer protection, and financial and reporting requirements, among others. As an alternative to a BitLicense, a firm can apply for a charter to become a limited purpose trust company under New York law qualified to engage in certain digital asset business activities. Other states have considered or approved digital asset business activity statutes or rules, passing, for example, regulations or guidance indicating that certain digital asset business activities constitute money transmission requiring licensure.

The inconsistency in applying money transmitting licensure requirements to certain businesses may make it more difficult for these businesses to provide services, which may affect consumer adoption of ether and its price. In an attempt to address these issues, the Uniform Law Commission passed a model law in July 2017, the Uniform Regulation of Virtual Currency Businesses Act, which has many similarities to the BitLicense and features a multistate reciprocity licensure feature, wherein a business licensed in one state could apply for accelerated licensure procedures in other states. It is still unclear, however, how many states, if any, will adopt some or all of the model legislation.

Law enforcement agencies have often relied on the transparency of blockchains to facilitate investigations. However, certain privacy-enhancing features have been, or are expected to be, introduced to a number of digital asset networks. If the Ethereum network was to adopt any of these privacy-enhancing features, these features may provide law enforcement agencies with less visibility into transaction-level data. For example, "privacy pools," zero knowledge proofs, and other technologies that could enhance privacy have been discussed by participants in the Ethereum network. Europol, the European Union's law enforcement agency, released a report in October 2017 noting the increased use of privacy-enhancing digital assets like Zcash and Monero in criminal activity on the internet. In August 2022, OFAC banned all U.S. citizens from using Tornado Cash, a digital asset protocol designed to obfuscate blockchain transactions, by adding certain Ethereum wallet addresses associated with the protocol to its Specially Designated Nationals list. On October 19, 2023, FinCEN published a proposed rulemaking to apply the authorities in Section 311 of the USA PATRIOT Act to impose requirements on financial institutions that engage in CVC transactions with CVC mixers. The proposed rule, if adopted, would require covered financial institutions to report to FinCEN any CVC transactions they process that involves CVC mixing within or involving a jurisdiction outside the United States. The term "CVC mixing" covers more than just transactions that involve CVC mixers like Tornado Cash, and seemingly could cover a broader range of conduct involving technologies, services, or methods that have the effect of obfuscating the source, destination, or amount of a CVC transaction, whether or not the obfuscation was intentional. If the rule were to be adopted as proposed and if the Ethereum network were to be deemed to or were to adopt features which come within the rule's ambit, it could cause covered financial institutions – such as many digital asset platforms, or the Trust's service providers, such as the Prime Execution Agent or Cash Custodian – to reduce support for or cease offering services for ether or to the Trust, which could impair the utility of ether, the value of the Shares and the Trust's ability to operate in compliance with new laws and regulations.

***A determination that ether or any other digital asset is a*** "***security***" ***may adversely affect the value of ether and the value of the Shares, and result in potentially extraordinary, nonrecurring expenses to, or termination of, the Trust.***

Depending on its characteristics, a digital asset may be considered a "security" under the federal securities laws. The test for determining whether a particular digital asset is a "security" is complex and difficult to apply, and the outcome is difficult to predict. Public, though non-binding, statements made in the past by senior officials at the SEC and endorsed by its previous Chairman in a letter to a member of Congress appeared to indicate that the SEC did not consider ether to be a security at that time. However, a recent federal court decision ruled that the SEC has not to date issued a definitive statement of its position on whether ether is a security for purposes of federal law. HODL Law, PLLC v. Securities and Exchange Commission, Case No. 22-cv-1832-L-JLB, 2023 WL 4852322 (Jul. 28, 2023), at \*6. The SEC staff has reportedly provided informal assurances in the past to a handful of promoters that their digital assets are not securities. On the other hand, the SEC has brought enforcement actions against the issuers and promoters of several other digital assets on the basis that the digital assets in question are securities. The CFTC has for years considered ether to be a commodity subject to its regulatory jurisdiction, and ether futures have been listed for years on CFTC-regulated exchanges while cleared ether swaps have been listed for trading on CFTC-regulated swap execution facilities not registered with the SEC without being deemed "mixed swaps" subject to joint CFTC and SEC jurisdiction to the Sponsor's knowledge.

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Whether a digital asset is a security under the federal securities laws depends on whether it is included in the lists of instruments making up the definition of "security" in the Securities Act, the Exchange Act and the Investment Company Act. Digital assets as such do not appear in any of these lists, although each list includes the terms "investment contract" and "note," and the SEC has typically analyzed whether a particular digital asset is a security by reference to whether it meets the tests developed by the federal courts interpreting these terms, known as the *Howey* and *Reves* tests, respectively. For many digital assets, whether or not the *Howey* or *Reves* tests are met is difficult to resolve definitively, and substantial legal arguments can often be made both in favor of and against a particular digital asset qualifying as a security under one or both of the *Howey* and *Reves* tests. Adding to the complexity, the SEC staff has indicated that the security status of a particular digital asset can change over time as the relevant facts evolve.

As part of determining whether ether is a security for purposes of the federal securities laws, the Sponsor takes into account a number of factors, including the various definitions of "security" under the federal securities laws and federal court decisions interpreting elements of these definitions, such as the U.S. Supreme Court's decisions in the *Howey* and *Reves* cases, as well as reports, orders, press releases, public statements and speeches by the SEC and its staff providing guidance on when a digital asset may be a security for purposes of the federal securities laws, and other materials relevant to the status of ether as a security (or not). Finally, the Sponsor discusses the security status of ether with its external securities lawyers. Through this process the Sponsor believes that it is applying the proper legal standards in making a good faith determination that it believes ether is not presently a security under federal law in light of the uncertainties inherent in the *Howey* and *Reves* tests. In light of these uncertainties and the fact-based nature of the analysis, the Sponsor acknowledges that ether may currently be a security, based on the facts as they exist today, or may in the future be found by the SEC or a federal court to be a security under the federal securities laws notwithstanding the Sponsor's prior conclusion; and the Sponsor's prior conclusion, even if reasonable under the circumstances and made in good faith, would not preclude legal or regulatory action based on the presence of a security.

The Sponsor may dissolve the Trust if the Sponsor determines ether is a security under the federal securities laws, whether that determination is initially made by the Sponsor itself, or because the SEC or a federal court subsequently makes that determination. Because the legal tests for determining whether a digital asset is or is not a security often leave room for interpretation, and because the SEC has not taken a definitive position, for so long as the Sponsor believes there to be good faith grounds to conclude that the Trust's ether is not a security, the Sponsor does not intend to dissolve the Trust on the basis that ether could at some future point be determined to be a security.

Any enforcement action by the SEC or a state securities regulator asserting that ether is a security, or a court decision to that effect would be expected to have an immediate material adverse impact on the trading value of ether, as well as the Shares. This is because the business models behind most digital assets are incompatible with regulations applying to transactions in securities. The New York Attorney General alleged in a lawsuit filed in March 2023 that ether was a security under New York and federal securities law and that a crypto asset platform that deals in ether, unlawfully failed to register as a securities dealer under New York state law. However, the New York Attorney General alleged in the alternative in the same case that ether was a commodity under both New York state and federal law.

If a digital asset is determined or asserted to be a security, it is likely to become difficult or impossible for the digital asset to be traded, cleared or custodied in the United States through the same channels used by non-security digital assets, which in addition to materially and adversely affecting the trading value of the digital asset is likely to significantly impact its liquidity and market participants' ability to convert the digital asset into U.S. dollars. For example, in 2020 the SEC filed a complaint against the issuer of XRP, Ripple Labs, Inc., and two of its executives, alleging that they raised more than $1.3 billion through XRP sales that should have been registered under the federal securities laws, but were not. In the years prior to the SEC's action, XRP's market capitalization at times reached over $140 billion. However, in the weeks following the SEC's complaint, XRP's market capitalization fell to less than $10 billion, which was less than half of its market capitalization in the days prior to the complaint. Although the SEC and Ripple reached a settlement in August 2025 to resolve the enforcement action and to dismiss their respective court appeals, which has largely been viewed as positive in the digital assets market, there remains continued uncertainty as to the regulatory framework that will be applied by the SEC and courts to digital assets. Such uncertainty may remain until legislation providing a regulatory framework is adopted.

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In addition, if ether is determined to be a security, the Trust could be considered an unregistered "investment company" under SEC rules, which could necessitate the Trust's liquidation. In this case, the Trust and the Sponsor may be deemed to have participated in an illegal offering of securities and there is no guarantee that the Sponsor will be able to register the Trust under the Investment Company Act at such time or take such other actions as may be necessary to ensure the Trust's activities comply with applicable law, which could force the Sponsor to liquidate the Trust.

Moreover, whether or not the Sponsor or the Trust were subject to additional regulatory requirements as a result of any SEC or federal court determination that its assets include securities, the Sponsor may nevertheless decide to terminate the Trust, in order, if possible, to liquidate the Trust's assets while a liquid market still exists. For example, in response to the SEC's action against the issuer of XRP, certain significant market participants announced they would no longer support XRP and announced measures, including the delisting of XRP from major digital asset trading platforms. The sponsor of the Grayscale XRP Trust subsequently dissolved this trust and liquidated its assets. If the SEC or a federal court were to determine that ether is a security, it is likely that the value of the Shares would decline significantly, and that the Trust itself may be terminated and, if practical, its assets liquidated.

***Competing industries may have more influence with policymakers than the digital asset industry, which could lead to the adoption of laws and regulations that are harmful to the digital asset industry.***

The digital asset industry is relatively new and does not have the same access to policymakers and lobbying organizations in many jurisdictions compared to industries with which digital assets may be seen to compete, such as banking, payments and consumer finance. Competitors from other, more established industries may have greater access to and influence with governmental officials and regulators and may be successful in persuading these policymakers that digital assets require heightened levels of regulation compared to the regulation of traditional financial services. As a result, new laws and regulations may be proposed and adopted in the United States and elsewhere, or existing laws and regulations may be interpreted in new ways, that disfavor or impose compliance burdens on the digital asset industry or digital asset platforms, which could adversely impact the value of ether and therefore the value of the Shares.

***Regulatory changes or actions in foreign jurisdictions may affect the value of the Shares or restrict the use of one or more digital assets, validating activity or the operation of their networks or the digital asset platform market in a manner that adversely affects the value of the Shares.***

Various foreign jurisdictions have, and may continue to adopt laws, regulations or directives that affect digital asset networks (including the Ethereum network), the digital asset markets (including the ether market), and their users, particularly digital asset platforms and service providers that fall within such jurisdictions' regulatory scope. For example, if China or other foreign jurisdictions were to ban or otherwise restrict manufacturers' ability to produce or sell semiconductors or hard drives in connection with ether validating, it would have a material adverse effect on digital asset networks (including the Ethereum network), the digital asset market, and as a result, impact the value of the Shares.

A number of foreign jurisdictions have recently taken regulatory action aimed at digital asset activities. China has made transacting in crypto assets illegal for Chinese citizens in mainland China, and additional restrictions may follow. Both China and South Korea have banned initial coin offerings entirely and regulators in other jurisdictions, including Canada, Singapore and Hong Kong, have opined that initial coin offerings may constitute securities offerings subject to local securities regulations. The United Kingdom's Financial Conduct Authority published final rules in October 2020 banning the sale of derivatives and exchange traded notes that reference certain types of digital assets, contending that they are "ill-suited" to retail investors citing extreme volatility, valuation challenges and association with financial crime. A new bill, the Financial Services and Markets Bill ("FSMB"), has made its way through the House of Commons and is expected to work through the House of Lords and become law in 2023. The FSMB would bring digital asset activities within the scope of existing laws governing financial institutions, markets and assets. In addition, the European Council of the European Union approved the text of Markets in Crypto-Assets ("MiCA") in October 2022, establishing a regulatory framework for digital asset services across the European Union. MiCA is intended to serve as a comprehensive regulation of digital asset markets and imposes various obligations on digital asset issuers and service providers. The main aims of MiCA are industry regulation, consumer protection, prevention of market abuse and upholding the integrity of digital asset markets. MiCA passed the European Parliament in 2023 and will apply from 2024. Foreign laws, regulations or directives may conflict with those of the United States and may negatively impact the acceptance of one or more digital assets by users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the digital asset economy in the European Union, China, Japan, Russia and the United States and globally, or otherwise negatively affect the value of ether. Moreover, other events, such as the interruption in telecommunications or internet services, cyber-related terrorist acts, civil disturbances, war or other catastrophes, could also negatively affect the digital asset economy in one or more jurisdictions. For example, Russia's invasion of Ukraine on February 24, 2022 led to volatility in digital asset prices, with an initial steep decline followed by a sharp rebound in prices. The effect of any future regulatory change or other events on the Trust or ether is impossible to predict, and such change could be substantial and adverse to the Trust and the value of the Shares.

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***If regulators subject the Trust, the Trustee, the Sponsor, Authorized Participants or Ether Trading Counterparties to regulation as a money services business or money transmitter, this could result in extraordinary expenses to the Trust, the Trustee, the Sponsor or the Ether Trading Counterparties and also result in decreased liquidity for the Shares.***

To the extent that the activities of the Trust, the Trustee, the Sponsor, Authorized Participants or Ether Trading Counterparties cause it to be deemed an MSB under the regulations promulgated by FinCEN, the Trust, the Trustee, the Sponsor, Authorized Participants or the Ether Trading Counterparties may be required to comply with FinCEN regulations, make certain reports to FinCEN and maintain certain records. Similarly, the activities of the Trust, the Trustee, the Sponsor, Authorized Participants or Ether Trading Counterparties may require it to be licensed as a money transmitter or as a digital asset business, such as under the New York State Department of Financial Services' BitLicense regulation.

Such additional regulatory obligations may cause the Trust, the Trustee, the Sponsor, Authorized Participants or Ether Trading Counterparties to incur extraordinary expenses. If the Trust, the Trustee, the Sponsor, Authorized Participants or the Ether Trading Counterparties decided to seek the required licenses, there is no guarantee that they will timely receive them. The Trustee may decide to discontinue and wind up the Trust. A dissolution of the Trust in response to the changed regulatory circumstances may be at a time that is disadvantageous to the Shareholders. An Ether Trading Counterparty may also instead decide to terminate its role as an Ether Trading Counterparty of the Trust, which may decrease the liquidity of the Shares.

Additionally, to the extent the Trust, the Trustee, the Sponsor, Authorized Participants, or Ether Trading Counterparties are found to have operated without appropriate state or federal licenses, it may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties, all of which would harm the reputation of the Trust, the Trustee, the Sponsor, Authorized Participants or the Ether Trading Counterparties and have a material adverse effect on the price of the Shares. Although Ether Trading Counterparties represent to the Trust that they have obtained all necessary governmental licenses and approvals and have consulted their own counsel in connection with the activities contemplated by the Ether Trading Counterparty Agreements, if such representations prove inaccurate, such Ether Trading Counterparties may suffer adverse consequences and be unable to perform their obligations or engage in ether transactions with the Trust, or the Trust's operations could be adversely affected and decreased liquidity for the Shares or losses for Shareholders could result.

***Anonymity and illicit financing risk.***

Although transaction details of peer-to-peer transactions are recorded on the Ethereum blockchain, a buyer or seller of digital assets on a peer-to-peer basis directly on the Ethereum network may never know to whom the public key belongs or the true identity of the party with whom it is transacting. Public key addresses are randomized sequences of alphanumeric characters that, standing alone, do not provide sufficient information to identify users. In addition, certain technologies may obscure the origin or chain of custody of digital assets. In August 2022, OFAC banned all U.S. citizens from using Tornado Cash, a digital asset mixing application consisting of a website, user interface and smart contracts designed to obfuscate blockchain transactions, by adding certain Ethereum wallet addresses associated with the protocol to its Specially Designated Nationals list. On October 19, 2023, FinCEN published a proposed rulemaking under authorities in Section 311 of the USA PATRIOT Act that would impose requirements on financial institutions that engage in CVC transactions that involve CVC mixing within or involving a jurisdiction outside the United States. FinCEN's rulemaking states that CVC mixing transactions can play a central role in facilitating the laundering of CVC derived from a variety of illicit activity, and are frequently used by criminals and state actors to facilitate a range of illicit activity, including, but not limited to, money laundering, sanctions evasion and weapons of mass destruction proliferation. Given that the Ethereum network is global and anyone can validate transactions or program dApps or smart contracts that will operate and record transactions on the Ethereum blockchain, and the fact that their operators, creators or programmers sometimes remain anonymous, it is not inconceivable that bad actors, such as those subject to sanctions, could seek to do so.

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The opaque nature of the market poses asset verification challenges for market participants, regulators and auditors and gives rise to an increased risk of manipulation and fraud, including the potential for Ponzi schemes, bucket shops and pump and dump schemes. Digital assets have in the past been used to facilitate illicit activities. If a digital asset was used to facilitate illicit activities, or a digital asset, or prominent dApp or smart contract or network participant, such as validators or users, were associated with bad actors or illicit activity, businesses that facilitate transactions in such digital assets could be at increased risk of potential criminal or civil liability or lawsuits, or of having banking or other services cut off, and such digital asset could be removed from digital asset platforms. Any of the aforementioned or similar occurrences could adversely affect the price of the relevant digital asset, the attractiveness of the respective blockchain network and an investment in the Shares. If the Trust, the Sponsor or the Trustee were to transact with a sanctioned entity, the Trust, the Sponsor or the Trustee would be at risk of potential criminal or civil lawsuits or liability.

The Trust takes measures with the objective of reducing illicit financing risks in connection with the Trust's activities. However, illicit financing risks are present in the digital asset markets, including markets for ether. There can be no assurance that the measures employed by the Trust will prove successful in reducing illicit financing risks, and the Trust is subject to the complex illicit financing risks and vulnerabilities present in the digital asset markets. If such risks eventuate, the Trust, the Sponsor or the Trustee or their affiliates could face civil or criminal liability, fines, penalties, or other punishments, be subject to investigation, have their assets frozen, lose access to banking services or services provided by other service providers, or suffer disruptions to their operations, any of which could negatively affect the Trust's ability to operate or cause losses in value of the Shares.

The Trust and affiliates of the consolidated parent of the Sponsor ("BlackRock") have adopted and implemented policies and procedures that are designed to comply with applicable anti-money laundering laws and sanctions laws and regulations, including applicable know your customer ("KYC") laws and regulations. The Sponsor and the Trust will only interact with known third-party service providers with respect to whom the Sponsor or its affiliates have engaged in a thorough due diligence process and or a thorough KYC process, such as the Authorized Participants, the Ether Trading Counterparties, the Prime Execution Agent and the Ether Custodian. The Prime Execution Agent and the Ether Custodian must undergo counterparty due diligence by BlackRock. Each Authorized Participant must undergo onboarding by BlackRock prior to placing creation or redemption orders with respect to the Trust. Each Ether Trading Counterparty must undergo onboarding by BlackRock prior to entering into ether transactions with the Trust. Each Ether Trading Counterparty who deposits ether as part of a purchase made by the Trust in connection with a cash creation or receives ether from the Trust as part of a sale made by the Trust in connection with a cash redemption must establish an account - and transfer or receive such ether through such account - at the Prime Execution Agent. When trading through the Prime Execution Agent acting in an agency capacity with third parties through its Coinbase Prime service pursuant to the Prime Execution Agent Agreement, the ether delivered to the Trust is delivered through execution with the Prime Execution Agent. As a result, the Sponsor and the Trust have instituted procedures reasonably designed to ensure that a situation would not arise where the Trust would engage in transactions with a counterparty whose identity the Sponsor and the Trust did not know.

Furthermore, Authorized Participants, as broker-dealers, and the Prime Execution Agent, as an entity licensed to conduct digital asset business activity by the New York Department of Financial Services, the Ether Custodian, as a limited purpose trust company subject to New York Banking Law, and the Additional Ether Custodian, as and a national trust bank chartered by the OCC, are "financial institutions" subject to the U.S. Bank Secrecy Act, as amended ("BSA"), and U.S. economic sanctions laws. The Trust will only accept creation and redemption requests from Authorized Participants and trade with Ether Trading Counterparties who have represented to the Trust that they have implemented compliance programs that are designed to ensure compliance with applicable sanctions and anti-money laundering laws. In addition, with respect to all ether delivered by the Ether Trading Counterparties, such Ether Trading Counterparties must represent to the Trust that they will form a reasonable belief (i) as to the identities of, and conduct necessary diligence with respect to, any counterparties from whom such party obtains ether being transferred and (ii) that such ether being transferred by such party to the Trust were not derived from, or associated with, unlawful or criminal activity. The Trust will not hold any ether except those that have been delivered by Ether Trading Counterparties or by execution through the Prime Execution Agent, in connection with Authorized Participant creation requests. Moreover, the Prime Execution Agent has represented to the Trust that it has implemented and will maintain and follow compliance programs that are designed to comply with applicable sanctions and anti-money laundering laws and that it performs both initial and ongoing due diligence on each of its customers as well as ongoing transaction monitoring that is designed to identify and report suspicious activity conducted through customer accounts opened at the Prime Execution Agent, including any opened by the Trust's counterparties for purposes of facilitating ether deposits to and withdrawals from, the Trust's Trading Balance, as required by law.

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The Prime Execution Agent, the Ether Custodian and the Ether Trading Counterparties have adopted and implemented anti-money laundering and sanctions compliance programs, which provide additional protections to ensure that the Sponsor and the Trust do not transact with a sanctioned party. Notably, every Ether Trading Counterparty must establish an account at the Prime Execution Agent through which the Ether Trading Counterparty transfers ether to the Trust during a purchase order or receives ether from the Trust in connection with a redemption order. The Prime Execution Agent performs screening using blockchain analytics to identify, detect, and mitigate the risk of transacting with a sanctioned or other unlawful actor. Pursuant to the Prime Execution Agent's blockchain analytics screening program, any ether that is delivered to the Trust's account will undergo screening designed to assess whether the origins of that ether are illicit.

The Prime Execution Agent Agreement provides, among others, that if the Prime Execution Agent conducts blockchain analytics screening on an ether transaction deposited by an Authorized Participant and such screening results in the ether transaction being suspected or determined to be in violation of certain applicable sanctions laws, the Prime Execution Agent and its affiliates, including the Ether Custodian, will (a) block or reject the deposit of such ether into a customer account of the Trust's counterparties, where required by applicable sanctions laws, and (b) agree to promptly inform the Trust if any fund movement between a customer account of the Trust's counterparties at the Prime Execution Agent and the Trust's account(s) involves such ether, so long as permitted by applicable law.

However, there is no guarantee that such procedures will always prove to be effective or that the Prime Execution Agent and its affiliates will always perform their obligations. Such screening may also result in the ether identified by such screening being blocked or frozen by the Prime Execution Agent, and thus made unavailable to the Trust. Moreover, the Prime Execution Agent Agreement and Custodian Agreement require the Trust to attest that it has performed its own due diligence on the Authorized Participants it has contracted with to source ether from and has confirmed that the Authorized Participants and Ether Trading Counterparties, as applicable, have implemented policies, procedures and controls designed to comply with applicable anti-money laundering and applicable sanctions laws. Although the Trust arranges for such diligence to be performed, including by the Trust's service providers, including the Sponsor or the Trustee or their affiliates, there is no guarantee such diligence will prove effective in identifying all possible sources of illicit financing risks. Ether Trading Counterparties represent to the Trust that they conduct due diligence on their own counterparties from whom they source the ether they deposit with the Trust in creation baskets, and that they have formed a reasonable belief that such ether being transferred by the Ether Trading Counterparty to the Trust were not derived from, or associated with, unlawful or criminal activity. However, there is the risk that Ether Trading Counterparties may not conduct sufficient due diligence processes on the sources of their ether or that their representations to the Trust may turn out to be inaccurate, which could cause the Trust to suffer a loss. If the Authorized Participants or Ether Trading Counterparties have inadequate policies, procedures and controls for complying with applicable anti-money laundering and applicable sanctions laws or the Trust's procedures or diligence prove to be ineffective, violations of such laws could result in regulatory liability for the Trust, the Sponsor, the Trustee or their affiliates under such laws, including governmental fines, penalties, and other punishments, as well as potential liability to or cessation of services by the Prime Execution Agent and its affiliates, including the Ether Custodian, under the Prime Execution Agent Agreement and Custodian Agreement, or the Trust's other service providers and counterparties. Any of the foregoing could result in losses to the Shareholders or negatively affect the Trust's ability to operate.

***Regulatory changes or interpretations could obligate the Trust, the Trustee or the Sponsor to register and comply with new regulations, resulting in potentially extraordinary, nonrecurring expenses to the Trust.***

Current and future federal or state legislation, CFTC and SEC rulemaking and other regulatory developments may impact the manner in which ether is treated. In particular, ether may be classified by the CFTC as a "commodity interest" under the CEA or may be classified by the SEC as a "security" under U.S. federal securities laws. The Sponsor, the Trustee and the Trust cannot be certain as to how future regulatory developments will impact the treatment of ether under the law. In the face of such developments, the required registrations and compliance steps may result in extraordinary, nonrecurring expenses to the Trust. If the Trustee decides to terminate the Trust in response to the changed regulatory circumstances, the Trust may be dissolved or liquidated at a time that is disadvantageous to Shareholders.

To the extent that ether is deemed to fall within the definition of a "commodity interest" under the CEA, the Trust, the Trustee and the Sponsor may be subject to additional regulation under the CEA and CFTC regulations. The Sponsor or the Trustee may be required to register as a commodity pool operator or commodity trading adviser with the CFTC and become a member of the National Futures Association ("NFA") and may be subject to additional regulatory requirements with respect to the Trust, including disclosure and reporting requirements. These additional requirements may result in extraordinary, recurring and/or nonrecurring expenses of the Trust, thereby materially and adversely impacting the Shares. If the Sponsor or the Trustee determines not to comply with such additional regulatory and registration requirements, the Trustee will terminate the Trust. Any such termination could result in the liquidation of the Trust's ether at a time that is disadvantageous to Shareholders.

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To the extent that ether is deemed to fall within the definition of a security under U.S. federal securities laws, the Trust, the Trustee and the Sponsor may be subject to additional requirements under the Investment Company Act and the Sponsor or the Trustee may be required to register as an investment adviser under the Investment Advisers Act. Such additional registration may result in extraordinary, recurring and/or non-recurring expenses of the Trust, thereby materially and adversely impacting the Shares. If the Sponsor or the Trustee determines not to comply with such additional regulatory and registration requirements, the Trustee will terminate the Trust. Any such termination could result in the liquidation of the Trust's ether at a time that is disadvantageous to Shareholders.

The SEC has recently proposed amendments to the custody rules under Rule 406(4)-2 of the Investment Advisers Act. The proposed rule changes would amend the definition of a "qualified custodian" under Rule 206(4)-2(d)(6) and expand the current custody rule in 406(4)-2 to cover all digital assets, including ether, and related advisory activities. If enacted as proposed, these rules would likely impose additional regulatory requirements with respect to the custody and storage of digital assets, including ether. The Sponsor is studying the impact that such amendments may have on the Trust and its arrangements with the Ether Custodian and the Prime Execution Agent. It is possible that such amendments, if adopted, could prevent the Ether Custodian and the Prime Execution Agent from serving as service providers to the Trust, or require potentially significant modifications to existing arrangements under the Custodian Agreement and Prime Execution Agent Agreement, which could cause the Trust to bear potentially significant increased costs. If the Sponsor is unable to make such modifications or appoint successor service providers to fill the roles that the Ether Custodian and the Prime Execution Agent currently play, the Trust's operations (including in relation to creations and redemptions of Baskets and the holding of ether) could be negatively affected, the Trust could dissolve (including at a time that is potentially disadvantageous to Shareholders), and the value of the Shares or an investment in the Trust could be affected.

Further, the proposed amendments could have a severe negative impact on the price of ether and therefore the value of the Shares if enacted, by, among other things, making it more difficult for investors to gain access to ether, or causing certain holders of ether to sell their holdings.

***The treatment of the Trust for U.S. federal income tax purposes is uncertain.***

The Sponsor intends to take the position that the Trust is properly treated as a grantor trust for U.S. federal income tax purposes. Assuming that the Trust is a grantor trust, the Trust will not be subject to U.S. federal income tax. Rather, if the Trust is a grantor trust, each beneficial owner of Shares will be treated as directly owning its pro rata share of the Trust's assets and a pro rata portion of the Trust's income, gain, losses and deductions will "flow through" to each beneficial owner of Shares.

The Trust may take certain positions with respect to the tax consequences of Staking Activities, Incidental Rights and its receipt of IR Digital Asset. If the IRS were to disagree with, and successfully challenge any of these positions, the Trust might not qualify as a grantor trust.

In addition, the Sponsor has committed to cause the Trust to irrevocably abandon any Incidental Rights and IR Digital Asset to which the Trust may become entitled in the future. However, there can be no assurance that these abandonments would be treated as effective for U.S. federal income tax purposes, or that the Sponsor will continue to cause the Trust to irrevocably abandon any Incidental Rights and IR Digital Asset if there are future regulatory developments that would make it feasible for the Trust to retain those assets. If the Trust were treated as owning any asset other than ether (and/or incidental cash) as of any date on which it creates or redeems Shares, it may cease to qualify as a grantor trust for U.S. federal income tax purposes. Because of the evolving nature of digital currencies, it is not possible to predict potential future developments that may arise with respect to digital currencies, including forks, airdrops and other similar occurrences. Assuming that the Trust is currently a grantor trust for U.S. federal income tax purposes, certain future developments could render it impossible, or impracticable, for the Trust to continue to be treated as a grantor trust for such purposes.

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If the Trust is not properly classified as a grantor trust, the Trust might be classified as a partnership for U.S. federal income tax purposes. If the Trust were classified as a partnership for U.S. federal income tax purposes, the tax consequences of owning Shares generally would not be materially different from the tax consequences described herein, although there might be certain differences, including with respect to timing of the recognition of taxable income or loss and (in certain circumstances) withholding taxes. In addition, tax information reports provided to beneficial owners of Shares would be made in a different form. If the Trust were not classified as either a grantor trust or a partnership for U.S. federal income tax purposes, it generally would be classified as a corporation for such purposes. If it were treated as a corporation, the Trust would be subject to entity-level U.S. federal income tax (currently at the rate of 21%), plus possible state and/or local taxes on its net taxable income, and certain distributions made by the Trust to Shareholders would be treated as taxable dividends to the extent of the Trust's current and accumulated earnings and profits. Any such dividend distributed to a beneficial owner of Shares that is a non-U.S. person for U.S. federal income tax purposes generally would be subject to U.S. federal withholding tax at a rate of 30% (or such lower rate as provided in an applicable tax treaty).

***The treatment of digital assets and Staking Activities for U.S. federal income tax purposes is uncertain.***

Assuming that the Trust is properly treated as a grantor trust for U.S. federal income tax purposes, each beneficial owner of Shares will be treated for U.S. federal income tax purposes as the owner of an undivided interest in the ether held in the Trust. Due to the new and evolving nature of digital assets and the absence of comprehensive guidance with respect to digital assets, many significant aspects of the U.S. federal income tax treatment of digital assets (including digital currencies) are uncertain.

In 2014, the IRS released a notice (the "Notice") discussing certain aspects of "convertible virtual currency" (that is, digital currency that has an equivalent value in fiat currency or that acts as a substitute for fiat currency) for U.S. federal income tax purposes and, in particular, stating that such digital currency (i) is "property" (ii) is not "currency" for purposes of the rules relating to foreign currency gain or loss and (iii) may be held as a capital asset. In 2019, the IRS released a revenue ruling and a set of "Frequently Asked Questions" (the "Ruling & FAQs") that provide some additional guidance, including guidance to the effect that, under certain circumstances, hard forks of digital currencies are taxable events giving rise to ordinary income and guidance with respect to the determination of the tax basis of digital currency. Moreover, in 2023, the IRS released a revenue ruling that provided guidance on digital currency staking, including guidance to the effect that staking rewards will, under certain circumstances, be treated as giving rise to taxable income (the "2023 Staking Tax Guidance"). In 2025, the IRS released the 2025 Staking Tax Guidance (together with the 2023 Staking Tax Guidance, the "Staking Tax Guidance") pursuant to which, if all the requirements listed in the 2025 Staking Tax Guidance are satisfied, a trust's authorization pursuant to its trust agreement to stake its digital assets will not prevent the trust from qualifying as a grantor trust for U.S. federal income tax purposes. The Sponsor intends to take the position that the Staking Activities meet the requirements of the 2025 Staking Tax Guidance and are consistent with the Trust's qualification as a grantor trust. However, there can be no assurance that the Staking Activities will be conducted in a manner so as to qualify or remain qualified for the safe harbor of the 2025 Staking Tax Guidance. If the IRS were to successfully challenge the position that the Staking Activities meet the requirements of the 2025 Staking Tax Guidance and are otherwise consistent with the Trust's qualification as a grantor trust, the Trust would not qualify as a grantor trust for U.S. federal income tax purposes.

The Notice, the Ruling & FAQs, and the Staking Tax Guidance do not address other significant aspects of the U.S. federal Income tax treatment of digital assets and staking activities. Moreover, although the Ruling & FAQs address the treatment of hard forks, there continues to be uncertainty with respect to the timing and amount of the income inclusions.

Future developments that may arise with respect to digital assets may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. For example, the Notice addresses only digital currency that is "convertible virtual currency," and it is conceivable that, as a result of a fork, airdrop or similar occurrence, the Trust will hold certain types of digital assets that are not within the scope of the Notice.

There can be no assurance that the IRS will not alter its position with respect to digital assets in the future or that a court would uphold the treatment set forth in the Notice, the Ruling & FAQs and the Staking Tax Guidance. It is also unclear what additional guidance on the treatment of digital assets or staking activities for U.S. federal income tax purposes may be issued in the future. Any future guidance on the treatment of digital assets or staking activities for U.S. federal income tax purposes could increase the expenses of the Trust and could have an adverse effect on the prices of digital currencies, including on the price of ether in the digital asset markets. As a result, any such future guidance could have an adverse effect on the value of the Shares.

Shareholders are urged to consult their tax advisers regarding the tax consequences of owning and disposing of Shares and digital assets, as well as staking activities, in general.

***Future developments regarding the treatment of digital assets and Staking Activities for U.S. federal income tax purposes could adversely affect the value of the Shares.***

As discussed above, many significant aspects of the U.S. federal income tax treatment of digital assets, such as ether, are uncertain, and it is unclear what guidance on the treatment of digital currency for U.S. federal income tax purposes may be issued in the future. It is possible that any such guidance would have an adverse effect on the prices of digital assets, including on the price of ether in digital asset platforms, and therefore may have an adverse effect on the value of the Shares.

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Because of the evolving nature of digital assets, it is not possible to predict potential future developments that may arise with respect to digital assets, including forks, airdrops and similar occurrences. Such developments may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. Moreover, certain future developments could render it impossible, or impracticable, for the Trust to continue to be treated as a grantor trust for U.S. federal income tax purposes.

***Future developments in the treatment of digital currency for tax purposes other than U.S. federal income tax purposes could adversely affect the value of the Shares.***

The taxing authorities of certain states, including New York, (i) have announced that they will follow the Notice with respect to the treatment of digital currencies for state income tax purposes and/or (ii) have issued guidance exempting the purchase and/or sale of digital assets for fiat currency from state sales tax. Other states have not issued any guidance on these points, and could take different positions (e.g., imposing sales taxes on purchases and sales of digital currencies for fiat currency), and states that have issued guidance on their tax treatment of digital currencies (or other digital assets) could update or change their tax treatment of digital currencies (or other digital assets). It is unclear what further guidance on the treatment of digital currencies for state or local tax purposes may be issued in the future. A state or local government authority's treatment of ether may have negative consequences, including the imposition of a greater tax burden on investors in ether or the imposition of a greater cost on the acquisition and disposition of ether generally.

The treatment of digital currencies for tax purposes by non-U.S. jurisdictions may differ from the treatment of digital currencies for U.S. federal, state or local tax purposes. It is possible, for example, that a non-U.S. jurisdiction would impose sales tax or value-added tax on purchases and sales of digital currencies for fiat currency. If a foreign jurisdiction with a significant share of the market of ether users imposes onerous tax burdens on digital currency users, or imposes sales or value-added tax on purchases and sales of digital currency for fiat currency, such actions could result in decreased demand for ether in such jurisdiction.

Any future guidance on the treatment of digital assets for state, local or non-U.S. tax purposes could increase the expenses of the Trust and could have an adverse effect on the prices of digital assets, including on the price of ether in digital asset platforms. As a result, any such future guidance could have an adverse effect on the value of the Shares.

***A U.S. Tax-Exempt Shareholder may recognize*** "***unrelated business taxable income***" ***as a consequence of an investment in Shares.***

Under the guidance provided in the Ruling & FAQs, hard forks, airdrops and similar occurrences with respect to digital currencies will under certain circumstances be treated as taxable events giving rise to ordinary income. Moreover, as separately provided by the IRS in the 2023 Staking Tax Guidance, staking rewards will, under certain circumstances, be treated as giving rise to taxable income. In the absence of guidance to the contrary, it is possible that any such income recognized by a U.S. Tax-Exempt Shareholder (as defined under "U.S. Federal Income Tax Consequences" below) would constitute "unrelated business taxable income" ("UBTI"). U.S. Tax-Exempt Shareholders should consult their tax advisers regarding whether such Shareholder may recognize UBTI as a consequence of an investment in Shares.

***Shareholders could incur a tax liability without an associated distribution of the Trust.***

In the normal course of business, the Trust expects to receive certain staking rewards, and it is possible that the Trust could incur a taxable gain in connection with the sale of ether (such as sales of ether to obtain fiat currency with which to pay the Sponsor's Fee or Trust expenses, and including deemed sales of ether as a result of the Trust using ether to pay the Sponsor's Fee or its expenses). In each case, such event may not be associated with a distribution to Shareholders. Accordingly, Shareholders may be subject to tax due to the grantor trust status of the Trust even though there is not a corresponding distribution from the Trust.

***A hard*** "***fork***" ***of the Ethereum blockchain could result in Shareholders incurring a tax liability.***

If a hard fork occurs in the Ethereum blockchain, the Trust could hold both the original ether and the alternative new ether. The IRS has held that a hard fork resulting in the creation of new units of crypto assets is a taxable event giving rise to ordinary income. Moreover, if such an event occurs, the Trust Agreement provides that the Sponsor shall have the discretion to determine whether the original or the alternative asset shall constitute ether. The Trust shall treat whichever asset the Sponsor determines is not ether as Incidental Rights or IR Digital Asset, which it has committed to irrevocably abandon.

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The Ruling & FAQs do not address whether income recognized by a non-U.S. person as a result of a fork, airdrop or similar occurrence could be subject to the 30% withholding tax imposed on U.S.-source "fixed or determinable annual or periodical" income. Non-U.S. Shareholders (as defined under "U.S. Federal Income Tax Consequences" below) should assume that, in the absence of guidance, a withholding agent (including the Sponsor) is likely to withhold 30% of any such income recognized by a Non-U.S. Shareholder in respect of its Shares, including by deducting such withheld amounts from proceeds that such Non-U.S. Shareholder would otherwise be entitled to receive in connection with a distribution of Incidental Rights or IR Digital Asset. The Sponsor has committed to cause the Trust to irrevocably abandon any Incidental Rights and IR Digital Asset to which the Trust may become entitled in the future. However, there can be no assurance that these abandonments would be treated as effective for U.S. federal income tax purposes, or that the Sponsor will continue to cause the Trust to irrevocably abandon any Incidental Rights and IR Digital Asset if there are future regulatory developments that would make it feasible for the Trust to retain those assets.

The receipt of Incidental Rights or IR Digital Asset may cause Shareholders to incur a U.S. federal, state, and/or local, or non-U.S., tax liability. Any tax liability could adversely impact an investment in the Shares and may require Shareholders to prepare and file tax returns they would not otherwise be required to prepare and file.

**Risk Factors Related to Potential Conflicts of Interest** 

***Potential conflicts of interest may arise among the Sponsor or its affiliates and the Trust. The Sponsor and its affiliates have no fiduciary duties to the Trust and its Shareholders other than as provided in the Trust Agreement, which may permit them to favor their own interests to the detriment of the Trust and its Shareholders.***

The Sponsor will manage the affairs of the Trust. Conflicts of interest may arise among the Sponsor and its affiliates, on the one hand, and the Trust and its Shareholders, on the other hand. As a result of these conflicts, the Sponsor may favor its own interests and the interests of its affiliates over the Trust and its Shareholders. These potential conflicts include, among others, the following:

● the Sponsor has no fiduciary duties to, and is allowed to take into account the interests of parties other than, the Trust and its Shareholders in resolving conflicts of interest, provided the Sponsor does not act in bad faith;

● the Trust has agreed to indemnify the Sponsor, the Delaware Trustee, the Trustee and their respective affiliates pursuant to the Trust Agreement;

● the Sponsor is responsible for allocating its own limited resources among different clients and potential future business ventures, to each of which it may owe fiduciary duties;

● the Sponsor and its staff also service affiliates of the Sponsor, and may also service other digital asset investment vehicles, and their respective clients and cannot devote all of its, or their, respective time or resources to the management of the affairs of the Trust;

● the Sponsor, its affiliates and their officers and employees are not prohibited from engaging in other businesses or activities, including those that might be in direct competition with the Trust;

● affiliates of the Sponsor may start to have substantial direct investments in ether, stablecoins (such as USDC), or other digital assets or companies in the digital assets ecosystem that they are permitted to manage taking into account their own interests without regard to the interests of the Trust or its Shareholders, and any increases, decreases or other changes in such investments could affect the Index price and, in turn, the value of the Shares;

● the Sponsor decides whether to retain separate counsel, accountants or others to perform services for the Trust;

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● BlackRock expects to receive compensation from an affiliate of the Ether Custodian for BlackRock's technology support of such affiliate's enhanced integration with the Aladdin Platform, and a portion of such compensation may be based on the use of such affiliate's products and services by Aladdin clients; and

● the Sponsor may appoint an agent to act on behalf of the Shareholders, which may be the Sponsor or an affiliate of the Sponsor.

By purchasing the Shares, Shareholders agree and consent to the provisions set forth in the Trust Agreement.

***Investment vehicles advised or managed by affiliates of the Sponsor hold a minority interest in Coinbase Global, the parent of Coinbase Inc., which serves as the Trust***'***s Prime Execution Agent and operates one of the digital asset platforms included in the Index price and is the parent of the Ether Custodian.***

Investment vehicles advised or managed by affiliates of the Sponsor own shares in many public companies listed in the United States, including Coinbase Global, the parent of Coinbase Inc. which operates the Coinbase platform and serves as the Trust's Prime Execution Agent. The Sponsor values the digital assets held by the Trust by reference to the Index price. Coinbase is one of the digital asset platforms included in the Index.

Although neither the Sponsor nor any affiliates of the Sponsor nor any investment vehicles managed or advised by any of them exercise control over Coinbase, it is possible that positions of investment vehicles managed by affiliates of the Sponsor in Coinbase may present risks to Shareholders to the extent affiliates of the Sponsor cause the Sponsor to favor Coinbase's interests over the interests of the Trust or its Shareholders with respect to, for example, fees charged, and the quality of service provided by Coinbase as Prime Execution Agent. Similarly, investors could have concerns that the Sponsor or affiliates of the Sponsor could influence market data provided by Coinbase in a way that benefits the Sponsor, for example by artificially inflating the values of ether in order to increase the Sponsor's fees. This could make the Trust's Shares less attractive to investors than the shares of similar vehicles that do not present these concerns, adversely affect investor sentiment about the Trust and negatively affect Share trading prices.

Coinbase Global is also the parent company of the Ether Custodian. The Ether Custodian serves as a fiduciary and custodian on the Trust's behalf, and is responsible for safeguarding digital assets held by the Trust and holding the private keys that provide access to the Trust's digital wallets and vaults. The positions of investment vehicles managed by affiliates of the Sponsor in the parent company of the Ether Custodian may present risks to Shareholders to the extent affiliates of the Sponsor cause the Sponsor to favor the Ether Custodian's interests over the interests of the Trust or its Shareholders with respect to, for example, fees charged, and the quality of service provided by the Ether Custodian. Similarly, it is possible that investors could have concerns that the interests owned by investment vehicles managed by affiliates of the Sponsor in Coinbase could cause it to refrain from taking actions that are in the best interests of the Trust but that could harm the Ether Custodian. This could make the Trust's Shares less attractive to investors than the shares of similar vehicles that do not present these concerns, adversely affect investor sentiment about the Trust and negatively affect Share trading prices.

***Shareholders cannot be assured of the Sponsor***'***s continued services, the discontinuance of which may be detrimental to the Trust.***

Shareholders cannot be assured that the Sponsor will be willing or able to continue to serve as sponsor to the Trust for any length of time. If the Sponsor discontinues its activities on behalf of the Trust and a substitute sponsor is not appointed, the Trust will terminate and liquidate its ether.

Appointment of a substitute sponsor will not guarantee the Trust's continued operation, successful or otherwise. Because a substitute sponsor may have no experience managing a digital asset financial vehicle, a substitute sponsor may not have the experience, knowledge or expertise required to ensure that the Trust will operate successfully or continue to operate at all. Therefore, the appointment of a substitute sponsor may not necessarily be beneficial to the Trust and the Trust may terminate.

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***Although the Ether Custodian is a fiduciary with respect to the Trust***'***s assets, it could resign or be removed by the Sponsor, which may trigger early dissolution of the Trust.***

The Ether Custodian has represented that it is a fiduciary under § 100 of the New York Banking Law. Further, the Ether Custodian is a qualified custodian for purposes of Rule 206(4)-2(d)(6) under the Advisers Act and is licensed to custody the Trust's ether in trust on the Trust's behalf. However, the Ether Custodian may terminate the Custodian Agreement for cause at any time, upon providing the applicable notice provided under the Custodian Agreement. If the Ether Custodian resigns, is removed, or is prohibited by applicable law or regulation to act as custodian, and no successor custodian has been employed and operationalized, the Sponsor may dissolve the Trust in accordance with the terms of the Trust Agreement.

***Coinbase serves as the ether custodian and the prime execution agent for several competing exchange-traded Ethereum products, which could adversely affect the Trust***'***s operations and ultimately the value of the Shares.***

The Prime Execution Agent and the Ether Custodian are both affiliates of Coinbase Global. As of the date hereof, Coinbase Global is one of the largest publicly traded crypto asset company in the world by market capitalization and is also the largest crypto asset custodian in the world by assets under custody. By virtue of its leading market position and capabilities, and the relatively limited number of institutionally-capable providers of crypto asset brokerage and custody services, Coinbase serves as the ether custodian and the prime execution agent for several competing exchange-traded ether products, as well as other companies in the digital asset industry, such as digital asset treasury companies. Similarly, the Additional Ether Custodian serves as the custodian for several competing exchange-traded ether products and other companies in the digital asset industry. Therefore, Coinbase and Anchorage have a critical role in supporting the U.S. spot ether exchange-traded product ecosystem and the digital asset industry generally, and their size and market share creates the risk that they may fail to properly resource its operations to adequately support all such products that use their services that could harm the Trust, the Shareholders and the value of the Shares. If the Ether Custodian or Additional Ether Custodian were to favor the interests of certain products over others, it could result in inadequate attention or comparatively unfavorable commercial terms to less favored products, which could adversely affect the Trust's operations and ultimately the value of the Shares.

As illustrated by the 2022 Events, many of the players in the digital assets markets are interconnected – for example, certain market participants may be active in both borrowing and lending, or engage in a wide variety of trading relationships and transactions, with respect to many of the same counterparties, or with respect to the same digital assets or blockchain networks – which can heighten the contagion risks if one of them defaults on its obligations to others or a given digital blockchain network or digital asset were to stop functioning properly or lose substantial value, as applicable, leading to correlated failures in a wider market downturn or a disruption or market dislocation affecting that particular blockchain network or that particular digital asset, or losses. It is possible that, in circumstances similar to the 2022 Events, this interconnectedness risk affecting the Ether Custodian, the Additional Ether Custodian, the Prime Execution Agent, Authorized Participants, Ether Trading Counterparties, or other service providers to the Trust could adversely affect the Trust or its Shareholders, for instance by disrupting creation and redemption processes, or (in the case of the Prime Execution Agent or the Ether Custodian or Additional Ether Custodian) resulting in a loss of funds, such as (in the event of a large scale system failure or cybersecurity breach) by exhausting available insurance funds.

***The Trust***'***s Authorized Participants act in similar or identical capacities for several competing exchange-traded ether products which may impact the ability or willingness of one or more Authorized Participants to participate in the creation and redemption process, adversely affect the Trust***'***s ability to create or redeem Baskets and adversely affect the Trust***'***s operations and ultimately the value of the Shares.***

Many of the Trust's Authorized Participants, now or in the future, act or may act in the same capacity for several competing exchange-traded ether products. Each Authorized Participant has limited balance sheet capacity, which means that, particularly during times of heightened market trading activity or market volatility or turmoil, Authorized Participants may not be able or willing to submit creation or redemption orders, with the Trust or may do so in limited capacities. The inability or unwillingness of Authorized Participants to do so could lead to the potential for the Shares to trade at premiums or discounts to the NAV, and such premiums or discounts could be substantial.

Furthermore, if creations or redemptions are unavailable due to the inability or unwillingness of one or more of the Trust's Authorized Participants to submit creation or redemption orders with the Trust (or do so in a limited capacity), the arbitrage mechanism may fail to function as efficiently as it otherwise would or be unavailable. This could result in impaired liquidity for the Shares, wider bid/ask spreads in the secondary trading of the Shares and greater costs to investors and other market participants, all of which could cause the Sponsor to halt or suspend the creation or redemption of Shares during such times, among other consequences.

***Shareholders may be adversely affected by the lack of independent advisers representing investors in the Trust.***

The Sponsor has consulted with counsel, accountants and other advisers regarding the formation and operation of the Trust. No counsel was appointed to represent investors in connection with the formation of the Trust or the establishment of the terms of the Trust Agreement and the Shares. Moreover, no counsel has been appointed to represent an investor in connection with the offering of the Shares. Accordingly, an investor should consult his, her or its own legal, tax and financial advisers regarding the desirability of the value of the Shares. Lack of such consultation may lead to an undesirable investment decision with respect to investment in the Shares.

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***Shareholders and Authorized Participants lack the right under the Custodian Agreement to assert claims directly against the Ether Custodian, which significantly limits their options for recourse.***

Neither the Shareholders nor any Authorized Participant have a right under the Custodian Agreement to assert a claim against the Ether Custodian. Claims under the Custodian Agreement may only be asserted by the Trustee on behalf of the Trust.

***There is no guarantee that every employee, officer, director, or similar person associated with the Sponsor, Trustee, or the BlackRock Affiliates will comply with the Policies, duties and training and refrain from engaging in insider trading in violation of their duties to the Trust and Sponsor.***

While the Sponsor has adopted and implemented the Policies (as defined below) and will adopt standard operating practices requiring that certain applicable personnel pre-clear personal trading activity in which ether is the referenced asset, there is no way to guarantee that every employee, officer, director, or similar person associated the Sponsor, Trustee, or the BlackRock Affiliates (as defined in "Conflicts of Interest—General") will comply at all times with such Policies, duties and training and refrain from engaging in insider trading in violation of their duties to the Trust and Sponsor. This risk is present in traditional financial markets and is not unique to ether. If such employees or others affiliated with the Trust, Sponsor, Trustee, or Affiliates respectively do engage in illegal conduct or conduct which fails to meet applicable regulatory standards, the Trust, Sponsor, Trustee or relevant Affiliate respectively could be the target of civil or criminal fines, penalties, punishments, or other regulatory or other sanctions or lawsuits or could be the target of an investigation, whether directly or indirectly, such as on a failure to diligently supervise theory. Any of these outcomes could cause the Trust and Shareholders to suffer harm.

The Sponsor, the Trustee and the BlackRock Affiliates may also participate in transactions related to ether, either for their own account (subject to certain internal employee trading operating practices) or for the account of others, such as clients, and such transactions may occur prior to, during, or after the commencement of this offering. Such transactions may not serve to benefit the Shareholders of the Trust and may have a positive or negative effect on the value of the ether held by the Trust and, consequently, on the market value of ether.

**Risk Factors Related to ERISA**

***In General.***

Notwithstanding the commercially reasonable efforts of the Sponsor, it is possible that the underlying assets of the Trust will be deemed to include "plan assets" for the purposes of Title I of the Employee Retirement Income Security Act of 1974 ("ERISA") or Section 4975 of the Code. If the assets of the Trust were deemed to be "plan assets," this could result in, among other things, (i) the application of the prudence and other fiduciary standards of ERISA to investments made by the Trust and (ii) the possibility that certain transactions in which the Trust might otherwise seek to engage in the ordinary course of its business and operation could constitute non-exempt "prohibited transactions" under Section 406 of ERISA and/or Section 4975 of the Code, which could restrict the Trust from entering into an otherwise desirable investment or from entering into an otherwise favorable transaction. In addition, fiduciaries who decide to invest in the Trust could, under certain circumstances, be liable for "prohibited transactions" or other violations as a result of their investment in the Trust or as co-fiduciaries for actions taken by or on behalf of the Trust or the Sponsor. There may be other federal, state, local, non-U.S. law or regulation that contains one or more provisions that are similar to the foregoing provisions of ERISA and the Code that may also apply to an investment in the Trust.

***Seed Capital Investor***

The Sponsor or one or more of its affiliates may be a party in interest or a disqualified person with respect to one or more Benefit Plan Investors considering an investment in the Trust. Given the Sponsor's or an affiliate's expected initial ownership interest of 50% or more of the Trust (as described in "Seed Capital Investor"), the Trust would be a Party in Interest to any Benefit Plan Investor with respect to which the Sponsor or an affiliate is a party in interest or a disqualified person. Therefore, the purchase by any such Benefit Plan Investor in the Trust would be prohibited under ERISA and/or Section 4975 of the Code absent an exemption. Fiduciaries of Benefit Plan Investors should consider whether a purchase of interests constitutes a non-exempt prohibited transaction under ERISA and/or Section 4975 of the Code. Available exemptions from the prohibited transaction rules of ERISA and the Code include PTCE 84-14, PTCE 90-1, PTCE 91-38, PTCE 95-60, PTCE 96-23, and Section 408(b)(17) of ERISA (and the corresponding provisions of Section 4975(d)(20) of the Code).

**The application of ERISA (including the corresponding provisions of the Code and other relevant laws) may be complex and dependent upon the particular facts and circumstances of the Trust and of each Plan, and it is the responsibility of the appropriate fiduciary of each investing Plan to ensure that any investment in the Trust by such Plan is consistent with all applicable requirements. Each Shareholder, whether or not subject to Title I of ERISA or Section 4975 of the Code, should consult its own legal and other advisors regarding the considerations discussed above and all other relevant ERISA and other considerations before purchasing the Shares.**

**USE OF PROCEEDS**

Proceeds received by the Trust from the issuance and sale of Baskets consist of ether and cash deposits. Staking Consideration received by the Trust from staking is intended to be distributed monthly but no less frequently than quarterly by the Trust. Ether deposits will be held by the Ether Custodian or Prime Execution Agent on behalf of the Trust, during which time they may be employed in Staking Activities, until (i) delivered to Authorized Participants or their designated agent or client in connection with an in-kind redemption or sold in connection with a cash redemption, or (ii) sold to pay the Sponsor's Fee and Trust expenses of liabilities not assumed by the Sponsor. Cash deposits will be held by the Cash Custodian or Prime Execution Agent on behalf of the Trust until (i) transferred in connection with the purchase of ether, (ii) delivered to Authorized Participants in connection with a cash redemption of Baskets or (iii) transferred to pay the Sponsor's Fee and Trust expenses or liabilities not assumed by the Sponsor. See "Business of the Trust—Trust Expenses."

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**OVERVIEW OF THE ETHEREUM INDUSTRY**

**Introduction**

Ether is a digital asset that is created and transmitted through the operations of the peer-to-peer Ethereum network, which is a network of computers, known as nodes, that operates on cryptographic computer-code based logic, called a protocol. No single entity owns or operates the Ethereum network, the infrastructure of which is collectively maintained by a distributed user base, a phenomenon known as decentralization. The Ethereum network allows people to exchange tokens of value, called Ether or ether, which are recorded on a public transaction ledger known as the Ethereum blockchain. Ether can be used to pay for goods and services, including computational power on the Ethereum network, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on digital asset platforms or in individual end-user-to-end-user transactions under a barter system.

The Ethereum network allows users to write and implement computer programs called smart contracts—that is, general-purpose code that executes on every computer in the network and can instruct the transmission of information and value based on a sophisticated set of logical conditions. Using smart contracts, users can create markets, store registries of debts or promises, represent the ownership of property, move funds in accordance with conditional instructions and create digital assets other than ether on the Ethereum network. Smart contract operations are executed on the Ethereum blockchain in exchange for payment of ether. The Ethereum network is one of a number of projects intended to expand blockchain use beyond just a peer-to-peer money system. The Ethereum network is commonly understood to be decentralized and does not require governmental authorities or financial institution intermediaries to create, transmit or determine the value of ether. Rather, following the initial distribution of ether, ether is created, burned and allocated by the Ethereum network protocol through a process that is currently subject to an issuance and burn rate as further described under "—Limits on ether Supply" below. The value of ether is determined by the supply of and demand for ether on the digital asset platforms or in private end-user-to-end-user transactions. There is no hard cap which would limit the number of outstanding ether at any one time to a predetermined maximum.

New ether is created and rewarded to the validators of a block in the Ethereum blockchain for verifying transactions. The Ethereum blockchain is effectively a decentralized database that includes all blocks that have been validated and it is updated to include new blocks as they are validated. Each ether transaction is broadcast to the Ethereum network and, when included in a block, recorded in the Ethereum blockchain. As each new block records outstanding ether transactions, and outstanding transactions are settled and validated through such recording, the Ethereum blockchain represents a complete, transparent and unbroken history of all transactions of the Ethereum network. For further details, see "—Creation of New Ether."

Among other things, ether is used to pay for transaction fees and computational services (i.e., smart contracts) on the Ethereum network; users of the Ethereum network pay for the computational power of the machines executing the requested operations with ether. Requiring payment in ether on the Ethereum network, helps prevent spam, incentivizes developers to write efficient applications because wasteful code costs more, and helps ensures that the Ethereum network remains economically secure by providing fees and rewards to validators that contribute to network security.

An Ethereum client ("Ethereum Client") is a software application that implements the Ethereum network specification and communicates with the Ethereum network. A "node" is a computer or other device that has downloaded the Ethereum Client and is connected to other computers also running the Ethereum Client software, together forming the peer-to-peer Ethereum network. Following the switch to proof-of-stake consensus, discussed below, an Ethereum Client consists of two software programs, an execution-layer client ("Execution Client") and a consensus-layer client ("Consensus Client"). Becoming a validator requires downloading additional software in addition to the Execution Client and Consensus Client.

**History of Ethereum**

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Ether is the digital asset that powers the Ethereum network and serves as the network's native unit of account that is used to pay transaction fees to the protocol itself and to validators. Unlike other digital assets, such as bitcoin, which are solely created through a progressive mining process, 72.0 million ether were created in connection with the launch of the Ethereum network. For additional information on the initial distribution, see "—Creation of New Ether." Coinciding with the network launch, it was decided that EthSuisse would be dissolved, designating the Ethereum Foundation as the sole organization dedicated to protocol development.

***Smart Contracts and Development on the Ethereum network***

Smart contracts are programs that run on a blockchain that can execute automatically when certain conditions are met. Smart contracts facilitate the exchange of anything representative of value, such as money, information, property, or voting rights. Using smart contracts, users can send or receive digital assets, create markets, store registries of debts or promises, represent ownership of property or a company, move funds in accordance with conditional instructions and create new digital assets. Smart contracts and dApps can execute their code on the execution layer of the Layer 1 (as defined below) Ethereum network, through Execution Clients located on the Layer 1 Ethereum network. Alternatively, one proposed path to enabling the Ethereum network to scale - i.e., removing some computational load and thus network congestion from the Layer 1 Ethereum network - is to facilitate smart contracts and dApps executing their code on Layer 2s (as defined below) and rolling up (as defined below) their transactions back to the main Layer 1 Ethereum network through the Layer 1 network's consensus mechanism.

Development on the Ethereum network involves building more complex tools on top of smart contracts, such as dApps; organizations that are autonomous, known as decentralized autonomous organizations ("DAOs"); and entirely new decentralized networks. For example, a company that distributes charitable donations on behalf of users could hold donated funds in smart contracts that are paid to charities only if the charity satisfies certain pre-defined conditions.

Moreover, the Ethereum network has also been used as a platform for creating new digital assets and conducting their associated initial coin offerings. As of the date of this prospectus, a significant percentage of digital assets not issued as the native token on their own blockchains were built on the Ethereum network, with such assets representing a significant amount of the total market value of all digital assets.

More recently, the Ethereum network has been used for DeFi or open finance platforms, which seek to democratize access to financial services, such as borrowing, lending, custody, trading, derivatives and insurance, by removing third-party intermediaries. DeFi can allow users to lend and earn interest on their digital assets, exchange one digital asset for another and create derivative digital assets such as stablecoins, which are digital assets pegged to a reserve asset such as fiat currency. Over the course of 2023, between $20 billion and $30 billion worth of digital assets were locked up as collateral on DeFi platforms on the Ethereum network.

In addition, the Ethereum network and other smart contract platforms have been used for creating NFTs. Unlike digital assets native to smart contract platforms which are fungible and enable the payment of fees for smart contract execution. Instead, NFTs allow for digital ownership of assets that convey certain rights to other digital or real-world assets. This new paradigm allows users to own rights to other assets through NFTs, which enable users to trade them with others on the Ethereum network. For example, an NFT may convey rights to a digital asset that exists in an online game or a dApp, and users can trade their NFT in the dApp or game, and carry them to other digital experiences, creating an entirely new free-market internet-native economy that can be monetized in the physical world.

***The DAO and Ethereum Classic***

In July 2016, the Ethereum network experienced what is referred to as a permanent hard fork that resulted in two different versions of its blockchain: Ethereum and Ethereum Classic.

In April 2016, a blockchain solutions company known as Slock.it announced the launch of a decentralized autonomous organization, known as "The DAO" on the Ethereum network. The DAO was designed as a decentralized crowdfunding model, in which anyone could contribute ether tokens to The DAO in order to become a voting member and equity stakeholder in the organization. Members of The DAO could then make proposals about different projects to pursue and put them to a vote. By committing to profitable projects, members would be rewarded based on the terms of a smart contract and their proportional interest in The DAO. As of May 27, 2016, $150 million, or approximately 14% of all ether outstanding, was contributed to, and invested in, The DAO.

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On June 17, 2016, an anonymous hacker exploited The DAO smart contract code to syphon approximately $60 million, or 3.6 million ether, into a segregated account. Upon the news of the breach, the price of ether was quickly cut in half as investors liquidated their holdings and members of the Ethereum community worked to determine a solution.

In the days that followed, several attempts were made to retrieve the stolen funds and secure the Ethereum network. However, it soon became apparent that direct interference with the protocol (i.e., a hard fork) would be necessary. The argument for the hard fork was that it would create an entirely new version of the Ethereum blockchain, erasing any record of the theft, and restoring the stolen funds to their original owners. The counterargument was that it would be antithetical to the core principle of immutability of the Ethereum blockchain.

The decision over whether or not to hard fork the Ethereum blockchain was put to a vote of Ethereum community members. A majority of votes were cast in favor of a hard fork. On July 15, 2016, a hard fork specification was implemented by the Ethereum Foundation. On July 20, 2016, the Ethereum network completed the hard fork, and a new version of the blockchain, without recognition of the theft, was born.

Many believed that after the hard fork the original version of the Ethereum blockchain would dissipate entirely. However, a group of validators continued to mine the original Ethereum blockchain for philosophical and economic reasons. On July 20, 2016, the original Ethereum protocol was rebranded as Ethereum Classic, and its native token as ether classic (ETC), preserving the untampered transaction history (including The DAO theft). Following the hard fork of Ethereum, each holder of ether automatically received an equivalent number of ETC tokens.

***Overview of the Ethereum Network***'***s Operations***

In order to own, transfer or use ether directly on the Ethereum network on a peer-to-peer basis (as opposed to through an intermediary, such as a custodian or centralized exchange), a person generally must have internet access to connect to the Ethereum network. Ether transactions may be made directly between end-users without the need for a third-party intermediary. To prevent the possibility of double-spending ether, a user must notify the Ethereum network of the transaction by broadcasting the transaction data to its network peers. The Ethereum network provides confirmation against double-spending by memorializing every peer-to-peer transaction in the Ethereum blockchain, which is publicly accessible and transparent. This memorialization and verification against double-spending of peer-to-peer transactions is accomplished through the Ethereum network validation process, which adds "blocks" of data, including recent transaction information, to the Ethereum blockchain.

***Summary of an Ether Transaction***

A "transaction request" refers to a request to the Ethereum network made by a user, in which the requesting user (the "sender") asks the Ethereum network to send some ether or execute some code. A "transaction" refers to a fulfilled transaction request and the associated change in the Ethereum network's state. An Ethereum Client is a software application that implements the Ethereum network specification and communicates with the Ethereum network. A node is a computer or other device, such as a mobile phone, running an individual Ethereum Client that is connected to other computers also running their own Ethereum Clients, which collectively form the Ethereum network.

Any user can broadcast a transaction request to the Ethereum network from a node located on the network. A user can run their own node, or they can connect to a node operated by others. For the transaction request to actually result in a change to the current state of the Ethereum network, it must be validated, executed, and "committed to the network" by another node (specifically, a validator node). Execution of the transaction request by the validator results in a change to Ethereum network's state once the block containing the transaction is broadcast to all other nodes across the Ethereum network and consensus is reached. Once a block is sufficiently confirmed by successive blocks, the change is considered final. Transactions can include, for example, sending ether from one account to another, as discussed below; publishing a new smart contract onto the Ethereum network; or activating and executing the code of an existing smart contract, in accordance with the terms and conditions specified in the sender's transaction request.

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The Ethereum blockchain can be thought of as a ledger recording a history of transactions and the balances associated with individual accounts, each of which has an address on the Ethereum network. An Ethereum network account can be used to store ether. There are two types of Ethereum accounts: "externally owned accounts," which are controlled by a private key, and "smart contract accounts," which are controlled by their own code. Externally owned accounts are controlled by users, do not contain executable code, and are associated with a unique "public key" and "private key" pair, commonly referred to as a "wallet," with the private key being used to execute transactions. Smart contract accounts contain, and are controlled by, their own executable code: every time the smart contract account receives a transaction from, or is "called" by, another user, the smart contract account's code activates, allowing it to read and write to internal storage, send ether, or perform other operations. Both externally owned accounts and smart contract accounts can be used to send, hold, or receive ether, and both can interact with other smart contracts. However, only externally owned accounts have the power to initiate transactions; smart contract accounts can only send transactions of their own after they are first activated or called by another transaction. An externally owned account is associated with both a public address on the Ethereum network and a private key, while a smart contract account is only associated with a public address. While a smart contract account does not use a private key to authorize transactions, including transfers of ether, the developer of a smart contract may hold an "admin key" to the smart contract account, or have special access privileges, allowing the developer to make changes to the smart contract, enable or disable features on the smart contract, or change how the smart contract receives external inputs and data, among others.

Accounts depend on nodes to access the peer-to-peer Ethereum network. Through the node's Ethereum Client, a user's Ethereum wallet and its associated Ethereum network address enable the user to connect to the Ethereum network and transfer ether to, and receive ether from, other users, and interact with smart contracts, on a peer-to-peer basis. A user with an externally owned account can either run their own node (and their own Ethereum Client) and connect that node to their Ethereum wallet, allowing them to make transactions from their Ethereum wallet on the Ethereum network, or a user's wallet can connect to third-party nodes operated as a service (e.g., Infura) and access the Ethereum network that way. Multiple accounts can access the Ethereum network through one node.

Each user's Ethereum wallet is associated with a unique "public key" and "private key" pair. To receive ether in a peer-to-peer transaction, the ether recipient must provide its public key to the sender. This activity is analogous to a recipient for a transaction in U.S. dollars providing a routing address in wire instructions to the payor so that cash may be wired to the recipient's account. The sender approves the transfer to the address provided by the recipient by "signing" a transaction that consists of the recipient's public key with the private key of the address from which the sender is transferring the ether. The recipient, however, does not make public or provide to the sender the recipient's related private key, only its public key.

Neither the recipient nor the sender reveal their private keys in a peer-to-peer transaction, because the private key authorizes transfer of the funds in that address to other users. Therefore, if a user loses their private key, the user may permanently lose access to the ether contained in the associated address. Likewise, ether is irretrievably lost if the private key associated with them is deleted and no backup has been made. When sending ether, a user's Ethereum wallet must sign the transaction with the sender's associated private key. In addition, since every computation on the Ethereum network requires processing power, there is a mandatory transaction fee involved with the transfer that is paid by the sender to the Ethereum network itself ("base fee"), plus additional transaction fees the sender can elect (or not) to pay at their discretion to the validators who validate their transaction ("tip"). The resulting digitally signed transaction is sent by the user's Ethereum wallet, via a node (whether run by the user or operated by others), to other Ethereum network nodes, who in turn broadcast it on a peer-to-peer basis to validators to allow transaction confirmation.

Ethereum network validators record and confirm transactions when they validate and add blocks of information to the Ethereum blockchain. Validators operate through nodes whose Ethereum Clients have an extra piece of software that permits the node to perform validation transactions. In a proof-of-stake consensus protocol like that used by the Ethereum network, validators are randomly selected to validate transactions. Upon the addition of a block included in the Ethereum blockchain, an adjustment to the ether balance in both the sender and recipient's Ethereum network public key will occur, completing the ether transaction. Once a transaction is confirmed on the Ethereum blockchain, it is irreversible.

As a reward for their services in adding the block to the Blockchain, both the proposing validator and the attesting validators receive newly minted ether from the Ethereum network. If the proposing validator's block is determined to be faulty or to break protocol rules by the approving validator committee, the proposer is penalized by having their staked ether reduced. Validators can also be penalized for attesting to transactions that break protocol rules or are inconsistent with the majority of other validators, or for inactivity or missing attestations that the Ethereum network protocol assigned to them. In extreme cases, a proposing or attesting validator can be "slashed", meaning forcibly ejected by other validators, with their staked ether continuously drained, potentially up to the loss of their entire stake. In this way, the Ethereum network attempts to reduce double-spend and other attacks by validators and incentivize validator integrity.

Some ether transactions are conducted "off-blockchain" and are therefore not recorded in the Ethereum blockchain. Some "off-blockchain transactions" involve the transfer of control over, or ownership of, a specific digital wallet holding ether or the reallocation of ownership of certain ether in a digital wallet containing assets owned by multiple persons, such as a digital wallet maintained by a digital assets platform. In contrast to on-blockchain transactions, which are publicly recorded on the Ethereum blockchain, information and data regarding off-blockchain transactions are generally not publicly available. Therefore, off-blockchain transactions are not truly ether transactions in that they do not involve the transfer of transaction data on the Ethereum network and do not reflect a movement of ether between addresses recorded in the Ethereum blockchain. For these reasons, off-blockchain transactions are subject to risks as any such transfer of ether ownership is not protected by the protocol behind the Ethereum network or recorded in, and validated through, the blockchain mechanism.

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**Ether Markets and Platforms**

Ether can be transferred in direct peer-to-peer transactions through the direct sending of ether over the Ethereum blockchain from one ether address to another. Among end-users, ether can be used to pay other members of the Ethereum network for goods and services under what resembles a barter system. Consumers can also pay merchants and other commercial businesses for goods or services through direct peer-to-peer transactions on the Ethereum blockchain or through third-party service providers.

In addition to using ether to engage in transactions, investors may purchase and sell ether to speculate as to the value of ether in the ether market, or as a long-term investment to diversify their portfolio. The value of ether within the market is determined, in part, by the supply of and demand for ether in the global ether market, market expectations for the adoption of ether as a store of value, the number of merchants that accept ether as a form of payment, and the volume of peer-to-peer transactions, among other factors.

Centralized ether spot market platforms typically permit investors to open accounts with the platform and then purchase and sell ether via websites or through mobile applications. Prices for trades on ether spot markets are typically reported publicly. An investor opening a trading account must deposit an accepted government-issued currency into their account with the centralized spot market platform, or a previously acquired digital asset, before they can purchase or sell assets on the spot market. The process of establishing an account with a centralized ether market platform and trading ether is different from, and should not be confused with, the process of users sending ether from one ether address to another spot ether address on the Ethereum blockchain. This latter process is an activity that occurs on the Ethereum network, while the former is an activity that occurs entirely within the order book operated by the spot market platforms. The spot market platform typically records the investor's ownership of ether in its internal books and records, rather than on the Ethereum blockchain. The spot market platform ordinarily does not transfer ether to the investor on the Ethereum blockchain unless the investor makes a request to the platform to withdraw the ether in their platform account to an off-platform ether wallet.

Outside of the spot markets, ether can be traded over the counter ("OTC"). The OTC market is largely institutional in nature, and OTC market participants generally consist of institutional entities, such as fi rms that offer two-sided liquidity for ether, investment managers, proprietary trading firms, high-net-worth individuals that trade ether on a proprietary basis, entities with sizeable ether holdings, and family offices. The OTC market provides a relatively flexible market in terms of quotes, price, quantity, and other factors, although it tends to involve large blocks of ether. The OTC market has no formal structure and no open-outcry meeting place. Parties engaging in OTC transactions will agree upon a price — often via phone or email — and then one of the two parties will then initiate the transaction. For example, a seller of ether could initiate the transaction by sending the ether to the buyer's ether address. The buyer would then wire U.S. dollars to the seller's bank account. OTC trades are sometimes hedged and eventually settled with concomitant trades on ether spot markets.

In addition, ether futures and options trading occurs on platforms in the United States regulated by the CFTC. The market for CFTC-regulated trading of ether derivatives has developed substantially. As of November 30, 2025, ether futures on the Chicago Mercantile Exchange ("CME") traded around $4.4 billion per day in the one year ending November 30, 2025 and represented around $4.8 billion in open interest per trading day. In Q3 2025, regulated ether futures represented approximately $7.1 billion per trading day on average in notional trading volume on the CME (according to The Block). The Exchange or FINRA, on behalf of the Exchange, or both, will communicate as needed regarding trading in the Shares with other markets and other entities that are members of the ISG (including the CME), and the Exchange or FINRA, on behalf of the Exchange, or both, may obtain trading information regarding trading in the Shares and ether derivatives from such markets and other entities. The Exchange also may obtain information regarding trading in the Shares and listed ether derivatives via the ISG, from other platforms who are members or affiliates of the ISG, or with which the Exchange has entered into a comprehensive surveillance sharing agreement. The Exchange's surveillance program includes real-time patterns for price and volume movements (including a pattern to surveil for significant deviation in the Commodity-Based Trust Shares' price from the underlying asset's price) as well as post-trade surveillance patterns (e.g., spoofing, marking the close, pinging, phishing). Trading Shares on the Exchange will be subject to the Exchange's surveillance program for derivative products, including Commodity-Based Trust Shares as defined in Exchange Rule 5711(d). The Exchange has also implemented surveillance procedures that monitor the trading of the Shares on the Exchange during all trading sessions and to deter and detect violations of Exchange rules and the applicable federal securities laws.

***Creation of New Ether***

*Initial Creation of Ether*

Unlike other digital assets such as bitcoin, which are solely created through a progressive mining process, 72.0 million ether were created in connection with the launch of the Ethereum network. The initial 72.0 million ether were distributed as follows:

<u>Initial Distribution</u>: 60.0 million ether, or 83.33% of the supply, was sold to the public in a crowd sale conducted between July and August 2014 that raised approximately $18 million.

<u>Ethereum Foundation</u>: 6.0 million ether, or 8.33% of the supply, was distributed to the Ethereum Foundation for operational costs.

<u>Ethereum Developers</u>: 3.0 million ether, or 4.17% of the supply, was distributed to developers who contributed to the Ethereum network.

<u>Developer Purchase Program</u>: 3.0 million ether, or 4.17% of the supply, was distributed to members of the Ethereum Foundation to purchase at the initial crowd sale price.

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Following the launch of the Ethereum network, ether supply initially increased through a progressive validation process. Following the introduction of EIP-1559, described below, ether supply and issuance rate varies based on factors such as recent use of the network.

*Proof-of-Work Validation Process*

Prior to September 2022, Ethereum operated using a proof-of-work consensus mechanism. Under proof-of-work, in order to incentivize those who incurred the computational costs of securing the network by validating transactions, there was a reward given to the computer (under proof-of-work, validators were known as "miners") that was able to create the latest block on the chain. Every 12 seconds, on average, a new block was added to the Ethereum blockchain with the latest transactions processed by the network, and the miner that generated this block was awarded a variable amount of ether, depending on use of the network at the time. In certain validation scenarios, ether was sometimes sent to another miner if they were also able to find a solution, but their block was not included. This is referred to as an "uncle/aunt reward." Due to the nature of the algorithm for block generation, this process (generating a "proof-of-work") was guaranteed to be random. Prior to the Merge upgrade, described below, miners on the Ethereum network engaged in a set of prescribed complex mathematical calculations in order to add a block to the Ethereum blockchain and thereby confirm ether transactions included in that block's data.

*Proof-of-Stake Process*

In the second half of 2020, the Ethereum network began the first of several stages of an upgrade that was initially known as "Ethereum 2.0" later referred to as the "Merge" to transition the Ethereum network from a proof-of-work consensus mechanism to a proof-of-stake consensus mechanism. The Merge was completed on September 15, 2022 and the Ethereum network has operated on a proof-of-stake model since such time. Since the introduction of staking, the total amount of staked ether has steadily increased, representing 30% of total circulating supply as of November 30, 2025 according to Coin Metrics. This growth reflects the maturation of Ethereum's staking infrastructure, which has enabled broader validator participation and contributed to the expansion of the staking ecosystem.

Unlike proof-of-work, in which validators expend computational resources to compete to validate transactions and are rewarded coins in proportion to the amount of computational resources expended, in proof-of-stake, validators secure the network by risking or "staking," ether as collateral and competing to be randomly selected to perform validation activities.

Under proof-of-stake, Ethereum randomly selects validators to propose and attest to blocks. A validator must stake a minimum of 32 ether to activate a validator key pair. A validator can operate using the same key pair for a balance of up to 2,048 ether.

As part of the "activating", "exiting", and "withdrawal" processes of staking and unstaking, staked ether will be inaccessible for a variable period of time determined by a range of factors, including network congestion, resulting in potential inaccessibility during those periods. "Activation" is the process to activate a validator key pair on the Ethereum network and be included in the active set of validators, thereby allowing the validator to begin participation in validation activities in connection with the Ethereum network's proof-of-stake consensus protocol. During activation, staked ether will not earn rewards. Unstaking consists of two parts, exit and withdrawal. "Exit" is the request to exit from the active set of validators and no longer participate in the Ethereum network's proof-of-stake consensus protocol. During exit, staked ether is still inaccessible to the validator because it remains locked in the Protocol Staking Deposit Contract. "Withdrawal" is when, following exit, a validator's staked ether becomes withdrawable (i.e., unlocked and eligible for a return transfer from the Protocol Staking Deposit Contract to the withdrawal address associated with the validator key pair that was specified at the time of activation), which makes the formerly staked ether accessible again. As part of these "activating", "exiting", and "withdrawal" processes on the Ethereum network, any staked Ether will be inaccessible for a period of time. After the exiting process is complete, and during the withdrawal process, staked ether will not earn rewards. However, depending on network congestion and demand, activation, exiting, and withdrawal can take days, weeks, or months to complete.

The activation process requires (1) transferring the ether deposit to the Protocol Staking Deposit Contract, (2) waiting in the activation queue for new validators, and (3) an additional delay of four epochs (approximately 25 minutes) before rewards start accruing. On the Ethereum network, a maximum of 256 staked ether can be activated as new validators per epoch (approximately every six minutes), or about 57,600 ether per day. As of February 5, 2026, the validator activation queue on the Ethereum network is roughly four million ether, or approximately 70 days.

The exit process, when the validator voluntarily leaves the active validator set (as opposed to being involuntarily removed as a result of slashing), requires waiting in the exit queue for exiting validators. On the Ethereum network, a maximum of 256 staked ether can exit per epoch (approximately every six minutes), or about 57, 6000 ether per day. As of February 5, 2026, the exit queue on the Ethereum network is roughly 20,700 ether, or approximately eight and a half hours. The withdrawal process, after the validator has exited but before their formerly staked ether becomes eligible for a return transfer from the Protocol Staking Deposit Contract to the specified withdrawal address, requires two waiting periods – first, a 256 epoch (roughly 27 hours) programmatic withdrawability delay, and second, waiting for the validator's unstaking request to be processed by the withdrawal sweep, which may take as little as approximately 7-10 days, but can take substantially longer (by weeks to months), depending on the number of other validators who have exited and are eligible for withdrawal. Between the exit process and the withdrawal process, the average time frame for unstaking may be approximately 12 or more days, based on historical data. However, this time frame may increase substantially as exit queues increase.

There are two types of validator duties: (i) proposing blocks ("proposer") and (ii) participating in a committee which approves the block ("attester"). Staking more ether can increase the numerical chances that a given validator will be randomly selected. When a validator is randomly selected by the protocol's algorithm to propose a block, it creates that block, which includes data relating to (i) the verification of newly submitted transaction requests submitted by senders and (ii) a reference to the prior block in the Ethereum blockchain to which the new block is being added. The proposing validator becomes aware of outstanding transaction requests through peer-to-peer data packet transmission and distribution enforced by the Ethereum protocol rules, which connects the proposer to users who want transactions recorded. If – once created – the proposing validator's block is confirmed by a committee of randomly selected attesters, the block is broadcast to the Ethereum network and added to the Ethereum blockchain. Any smart contract code that has been called by the transaction request is also executed (provided the base fee is paid for the Ethereum network's computational power associated with executing the code, and up to the amount of the base fee).

Validators are selected based on a random process. An ether balance less than 32 ether (implying a slashing or inactivity leak penalty) will reduce the probability of being selected providing a bias to the better performing validators and good actors. A single person or entity can increase the numerical chances that any of their validators will be randomly selected by staking ether over multiple validators.

Validator rewards are not fixed and are not guaranteed. The amount of staked ETH earned per validator varies based on multiple factors—including the validator's effective balance, validator performance (e.g., uptime, timely attestations, and block proposals), prevailing network conditions (such as total ETH staked and fee/MEV activity), and the staking method used (solo, pooled/liquid, or staking-as-a-service). Under the Pectra upgrade, EIP-7251 increased the maximum effective balance per validator from 32 ether to up to 2,048 ether, enabling optional validator consolidation and compounding while preserving the long-standing dependency of rewards on effective balance and performance; pooled/liquid staking arrangements (which are not part of the Trust's staking program) would continue to distribute rewards pro-rata to participants based on contributed ETH.

Rewards start to accrue following the validator's activation, and stop accruing following the validator's exit. The amount of ether issued as protocol-level rewards depends on factors defined by the Ethereum protocol, including the total amount of ether staked on the network, the validator's effective staked balance, and the validator's performance. As the total amount of ether staked on the network increases, the base rate of protocol-level rewards generally decreases. There are three types of protocol rewards, which are paid by the Ethereum network programmatically using newly-issued ether: (1) attestation rewards (awarded for correctly voting for source checkpoints, target checkpoints, and voting for chain head blocks); (2) proposer rewards (rewards for proposing a block), and (3) rewards for signing off on blocks in sync committees. All rewards issued by the protocol scale by the amount of aggregate ether staked across the Ethereum network – the more ether that is staked in aggregate, the lower the rewards per validator, while the less ether that is staked, the greater the rewards per validator. Attestation rewards are awarded to validators during every epoch (every validator being selected to make one attestation per epoch), with the validator required to correctly vote for the source checkpoint, target checkpoint, and chain head block, and are generally expected to constitute the majority of a validator's aggregate rewards from staking.

Proposer rewards occur where the validator is selected at random to propose a block; one validator is selected to propose a block every 12 seconds. A validator can go months or years without being selected to propose a block. The validator compiles transactions they have validated into a block and propose it for inclusion in the blockchain. In addition to rewards issued by the protocol, block proposers earn the transaction fees (also known as "tips") and Maximal Extractable Value ("MEV") rewards paid in existing ether by the senders of transactions that are included in the block being proposed. Transaction fees are highly variable, and depend on network usage and market conditions.

Finally, a validator may be selected to serve on a sync committee. Sync committees consist of 512 validators and are reconstituted approximately every 27 hours. Selection is probabilistic and independent of block proposal duties and occurs significantly less frequently than block proposal selection.

Network-wide rewards have evolved materially over time. In 2021, when the validator set was small, total issuance and fee-based rewards corresponded to elevated annualized reward rates of roughly 20% across all active validators. Through 2022, rewards trended lower as validator participation grew. During 2024–2025, the mature staking environment saw annualized reward rates stabilizing between approximately 3.5% and 4.0% on average. Early 2026 reference benchmarks show annualized rates around 3% on average. These historical ranges are descriptive of average network conditions over those periods and do not guarantee future results.

Validators may be subject to penalties for violating protocol rules. The Ethereum network imposes fault-based sanctions for validator misbehavior, primarily through slashing, which may include correlated slashing penalties. Slashing occurs when a validator engages in malicious or erroneous actions that pose consensus safety violations, such as proposing multiple blocks in a given slot or attesting to conflicting blocks. Slashed validators face an initial slashing penalty and are forcibly exited from the validator set. The exact amount of ether burned in a slashing depends on network conditions, namely the number of other validators slashed around the same time. Public sources report approximately 558 validators have been slashed on the Ethereum network as of February 5, 2026, according to beaconcha.in.

The protocol applies correlated slashing penalties, which increase the economic impact of large-scale or coordinated slashing events relative to isolated incidents, reflecting the greater risk such events pose to network security. The exact amount of ether burned and the length of the slashing event are determined by the network. In October 2025, a validator holding 2,020 ether faced correlated penalties, which resulted in a 0.69838 ether penalty.

Separately, if a validator fails to perform required protocol duties, including submitting timely attestations, it may incur inactivity penalties. Under normal network conditions, these penalties result in a reduction of the validator's staked ether in an amount generally similar to the rewards the validator would have earned had it performed those duties. Validators may also be subject to increased penalties during an inactivity leak. An "inactivity leak" is a protocol-level state that is triggered when the Ethereum network goes into an extended period without achieving finality. Finality requires agreement by validators representing at least two-thirds of the total staked ether. This means that if validators representing more than one-third of the total staked ether are offline or otherwise fail to attest, the network may be unable to finalize blocks. If this condition persists, the protocol activates an inactivity leak under which ether staked by the inactive validators is reduced more rapidly than under normal conditions. This mechanism is intended to incentivize validators to remain online and continue participating, thereby helping restore finality to the network. Public sources report there has been at least one inactivity leak in the Ethereum network since the Merge in 2022, which occurred for the first known time in May 2023, according to ethresear.ch.

***Limits on Ether Supply***

The rate at which new ether are issued and put into circulation is expected to vary. In September 2022, the Ethereum network converted from proof-of-work to a new proof-of-stake consensus mechanism. As of November 30, 2025, approximately 2,674 ether were issued in the previous day. The issuance rate varies based on the number of validators on the network and other factors. As of November 30, 2025, approximately 9 ether were burned in the previous day. The burn rate varies by day, time of measurement and other factors. In addition, the issuance of new ether could be partially or completely offset by the burn mechanism introduced by the EIP-1559 modification, under which ether are removed from supply at a rate that varies with network usage. See "—Modifications to the Ethereum Protocol." On occasion, the ether supply has been deflationary over a 24-hour period as a result of the burn mechanism. The attributes of the new consensus algorithm are subject to change, but in sum, the new consensus algorithm and related modifications reduced total new ether issuances and could turn the ether supply deflationary over the long term. However, there can be no assurance that the overall ether supply would be deflationary as a result of the burn mechanism at any given time or in the long term, and the overall ether supply has often proven inflationary (with new issuance of ETH exceeding burning) notwithstanding the burn mechanism and could continue to be so in the future at any given time or permanently.

As of November 30, 2025, approximately 121 million ether were outstanding (according to Coin Metrics). There is no hard cap on the supply of outstanding ether.

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***Modifications to the Ethereum Protocol***

The Ethereum network operates using open-source protocols, meaning that any user can become a node by downloading the Ethereum Client and participating in the Ethereum network, and no permission of a central authority or body is needed to do so. In addition, anyone can propose a modification to the Ethereum network's source code and then propose that the Ethereum network community support the modification. These proposed modifications to the Ethereum network's source code, if adopted, can lead to forks (referred to as "planned forks" because they take place through a formal process).

In the case of planned forks, the core developers, including those associated with or funded by the Ethereum Foundation, are able to access and alter the Ethereum network source code and, as a result, they are typically responsible for proposing quasi-official or widely publicized releases of updates and other changes to the Ethereum network's source code called EIPs. Any user can propose an idea for modifying the Ethereum network's source code, and the core developers are responsible for merging the proposed idea into the EIP repository on GitHub, where it formally becomes an EIP. However, the release of proposed updates to the Ethereum network's source code by core developers does not guarantee that the updates will be automatically adopted. The developers of each Ethereum Client must agree to implement the EIP's changes to the Ethereum network in the source code for their respective client software, nodes must accept the changes made available by the developers of the Ethereum Client software they use by choosing to individually download the modified Ethereum Client software, and ultimately a critical mass of validators and users – such as dApp and smart contract developers, as well as end users of dApps and smart contracts, and anyone else who transacts on the Ethereum blockchain or Ethereum network – must support the shift, or the upgrades will lack adoption.

Typically in the case of a planned fork, once the EIPs are formally introduced by being merged into the EIP repository on GitHub, a robust debate within the Ethereum community as to the advisability of the proposed change ordinarily follows. Assuming the core developers at the protocol level and the developers of individual Ethereum Clients reach a broad consensus among themselves in favor of introducing the change into the respective source code they are responsible for developing and maintaining, the source code modification will be introduced and made available to download. A modification of the Ethereum network's source code is only effective with respect to the Ethereum nodes that download it and modify their Ethereum Clients accordingly, and in practice such decisions are heavily influenced by the preferences of validators and users. Typically, after a modification is introduced and if a sufficiently broad critical mass of users and validators support the modification and nodes download the modification into their individual Ethereum Clients, the change is implemented and the Ethereum network continues to operate uninterrupted, assuming there are no software issues (e.g., bugs, outages, etc.). However, if less than a sufficiently broad critical mass (in practice, amounting to a substantial majority) of users and validators support the proposed modification and nodes refuse to download the modification to their Ethereum Clients, and the modification is not backwards compatible with the Ethereum blockchain or network or the Ethereum Clients of nodes prior to their modification, the consequence would be what is known as a "hard fork" of the Ethereum network, with one group of nodes running the pre-modified software, with users and validators continuing to use the pre-modified software, while the other group would adopt and run the modified software. See "Risk Factors—Risk Factors Related to Digital Assets—A temporary or permanent "fork" could adversely affect an investment in the Shares."

For example, in 2019 the Ethereum network completed a network upgrade called Metropolis that was designed to enhance the usability of the Ethereum network and was introduced in two stages. The first stage, called Byzantium, was implemented in October 2017. The purpose of Byzantium was to increase the network's privacy, security, and scalability and reduce the block reward for validators (at that time, validators on the proof-of-work consensus version of Ethereum were known as "miners") who created new blocks in proof-of-work consensus from 5.0 ether to 3.0 ether. The second stage, called Constantinople, was implemented in February 2019, along with another upgrade, called St. Petersburg. Another network upgrade, called Istanbul, was implemented in December 2019. The purpose of Istanbul was to make the network more resistant to denial-of-service attacks, enable greater ether and Zcash interoperability as well as other Equihash-based proof-of-work digital assets, and to increase the scalability and performance for solutions on zero-knowledge privacy technology like SNARKs and STARKs. The purpose of these upgrades was to prepare the Ethereum network for the introduction of a proof-of-stake algorithm and reduce the block reward from 3.0 ether to 2.0 ether.

In the second half of 2020, the Ethereum network began the first of several stages of an upgrade culminating in the Merge. The Merge amended the Ethereum network's consensus mechanism to include proof-of-stake, and was intended to address the perceived shortcomings of the proof-of-work consensus mechanism in terms of labor intensity and duplicative computational effort expended by validators (known under proof-of-work as miners) who did not win the race, under proof of work, to be the first in time to solve the cryptographic puzzle that would allow them to be the only validator permitted to validate the block and receive the resulting block reward (which was only given to the first validator to successfully solve the puzzle and hash a given block, and not to others).

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Following the Merge, core development of the Ethereum source code has increasingly focused on modifications of the Ethereum protocol to increase speed, throughput and scalability and also improve existing or next generation uses. Future upgrades to the Ethereum protocol and Ethereum blockchain to address scaling issues – such as network congestion, slow throughput and periods of high transaction fees owing to spikes in network demand – have been discussed by network participants, such as sharding. The purpose of sharding, which has been discussed for years, is to increase scalability of the Layer 1 Ethereum network by splitting the blockchain into subsections, called shards, and dividing validation responsibility so that a defined subset of validators would be responsible for each shard, rather than all validators being responsible for the entire blockchain, allowing for parallel processing and validation of transactions. However, there appears to be uncertainty and a lack of existing widespread consensus among network participants about how to solve the scaling challenges faced by the Ethereum network.

The rapid development of other competing scalability solutions, such as those which would rely on handling the bulk of computational work relating to transactions or smart contracts and decentralized applications ("DApps") outside of the main Ethereum network and Ethereum blockchain, has caused alternatives to sharding to emerge. "Layer 2" is a collective term for solutions which are designed to help increase throughput and reduce transaction fees by handling or validating transactions off the main Ethereum network (known as "Layer 1") and then attempting to take advantage of the perceived security and integrity advantages of the Layer 1 Ethereum network by uploading the transactions validated on the Layer 2 protocol back to the Layer 1 Ethereum network. The details of how this is done vary significantly between different Layer 2 technologies and implementations. For example, "rollups" perform transaction execution outside the Layer 1 Ethereum network and then post the data, typically in batches, back to the Layer 1 Ethereum network where consensus is reached. "Zero knowledge rollups" are generally designed to run the computation needed to validate the transactions off-chain, on the Layer 2 protocol, and submit a proof of validity of a batch of transactions (not the entire transactions themselves) that is recorded on the Layer 1 Ethereum network. By contrast, "optimistic rollups" assume transactions are valid by default and only run computation, via a fraud proof, in the event of a challenge. Other proposed Layer 2 scaling solutions include, among others, "state channels", which are designed to allow participants to run a large number of transactions on the Layer 2 side channel protocol and only submit two transactions to the main Layer 1 Ethereum network (the transaction opening the state channel, and the transaction closing the channel), "side chains", in which an entire Layer 2 blockchain network with similar capabilities to the existing Layer 1 Ethereum network runs in parallel with the existing Layer 1 Ethereum network and allows smart contracts and dApps to run on the Layer 2 side chain without burdening the main Layer 1 network, and others. To date, the Ethereum network community has not coalesced overwhelmingly around any particular Layer 2 solution, though this could change.

Apart from solutions designed to address scalability challenges, there have been other upgrades as well. In 2021, the Ethereum network implemented the EIP-1559 upgrade. EIP-1559 changed the methodology used to calculate the fees paid to validators. EIP 1559 resulted in the splitting of fees into two components: a base fee and tip. Ether used to pay the base fee is as a result of EIP 1559 removed from circulation, or "burnt," and the tip is paid to validators. EIP-1559 has reduced the total net issuance of ether fees to validators. Future updates may impact the supply of or demand for ether or its price.

On March 13, 2024, the Ethereum network underwent a planned fork called "Dencun" implementing a series of EIPs. EIP 4844, which some commentators perceive to be the most significant EIP within the Dencun series, is intended to improve the economics of Layer 2s by reducing transaction fees for Layer 2s who batch transactions executed on the Layer 2s and upload them as a batch (or as a single proof) onto the main Layer 1 Ethereum network. Among other objectives, the Dencun software upgrade was designed to provide Layer 2 scaling solutions a designated storage space on the Layer 1 Ethereum network, called Binary Large Objects ("blobs"), which attach large data chunks to transactions on the Layer 1 Ethereum network and are recorded on its blockchain. The data in blobs become inaccessible on the Layer 1 Ethereum network after a temporary period of time (three weeks), unlike the previous method of storing batched data from Layer 2s on the Layer 1 Ethereum network, which was stored permanently. The cost of accessing the temporary storage in blobs is expected by proponents of the Dencun upgrade to be substantially lower than the cost of storing the data on the Ethereum Layer 1 network permanently, making Layer 2s more cost-efficient to operate and, some commentators hope, making them more attractive as a scaling solution.

On May 7, 2025, "Pectra" which is a combination of the Prague execution layer hard fork and the Electra consensus layer upgrade, went live. Pectra, among other changes, increased the maximum amount of ether that a validator can stake from 32 to 2,048, allowing validators to manage higher balances with the goal of potentially reducing costs; introduce account abstraction, allowing externally owned accounts (EOAs) to temporarily function like smart contracts; and potentially reduce security risks and shorten the wait time for new validators. For more information, see "Risk Factors—Risk Factors Related to Digital Assets—A temporary or permanent "fork" could adversely affect an investment in the Shares."

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The Trust's activities will not directly relate to scalability or upgrade projects, though such projects may potentially increase demand for ether and the utility of the Ethereum network as a whole. Conversely, if they are unsuccessful or they cause users or application or smart contract developers to migrate away from the Ethereum blockchain, demand for ether could potentially be reduced. Also, projects that operate and are built within the Layer 1 Ethereum blockchain and network may increase the data flow on the Ethereum network and could either "bloat" the size of the Ethereum blockchain or slow confirmation times.

**Forms of Attack Against the Ethereum Network**

All networked systems are vulnerable to various kinds of attacks. As with any computer network, the Ethereum network contains certain flaws. For example, the Ethereum network is currently vulnerable to a "51% attack" where, if a validator or group of validators acting in concert were to gain control of more than the relevant threshold of the staked ether, a malicious actor would be able to gain full control of the network and the ability to manipulate the Ethereum blockchain. Although referred to generically as "51% attacks", in the post-Merge Ethereum network, there are different thresholds that could lead to different types of attack on the consensus process. For more information, see "Risk Factors--If a malicious actor or botnet obtains control of more than 33% of the validating stake on the Ethereum network, or otherwise obtains control over the Ethereum network through its influence over core developers or otherwise, such actor or botnet could delay or manipulate the Ethereum blockchain in the short term, which could adversely affect the value of the Shares or the ability of the Trust to operate." As of the date of this prospectus, the top three largest staking pools controlled nearly 50% of the ether staked on the Ethereum network.

In addition, many digital asset networks have been subjected to a number of denial-of-service attacks, which has led to temporary delays in block creation and in the transfer of Ethereum. Any similar attacks on the Ethereum network that impact the ability to transfer ether could have a material adverse effect on the price of ether and the value of the Shares.

This is not intended as an exhaustive list of all forms of attack against the Ethereum network. For additional information, see the "Risk Factors" section of this prospectus.

***Market Participants***

*Validators*

In proof-of-stake, validators risk or stake coins to compete to be randomly selected to validate transactions and are rewarded for performing their responsibilities and behaving in accordance with protocol rules. Any malicious activity, such as validating multiple blocks, disagreeing with the eventual consensus or otherwise violating protocol rules, results in the penalization or, in extreme cases, slashing of a portion of the staked coins.

Validators range from Ethereum enthusiasts to professional operations that design and build dedicated machines and data centers. For example, in blockchain networks that facilitate DeFi protocols in particular, such as the Ethereum network, users may attempt to gain an advantage over other users by increasing offered transaction fees to incentivize validators to give their submitted transaction requests priority. Certain software services, such as Flashbots, have been developed which facilitate validators in capturing MEV produced by these increased fees.

 *Investment and Speculative Sector*

This sector includes the investment and trading activities of both private and professional investors and speculators. Historically, larger financial services institutions are publicly reported to have limited involvement in investment and trading in digital assets, although the participation landscape is beginning to change. Currently, there is relatively limited use of digital assets in the retail and commercial marketplace in comparison to relatively extensive use by speculators, and a significant portion of demand for digital assets is generated by speculators and investors seeking to profit from the short- or long-term holding of digital assets.

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 *Retail Sector*

The retail sector includes users transacting in direct peer-to-peer ether transactions through the direct sending of ether over the Ethereum network, as well as users accessing ether through digital asset platforms. The retail sector also includes transactions in which consumers pay for goods or services from commercial or service businesses through direct transactions or third-party service providers, although the use of ether as a means of payment is still developing and has not been accepted in the same manner as bitcoin due to ether's relative nascency and because ether has a generally different purpose than bitcoin. In addition, end users of dApps and smart contracts built on the Layer 1 Ethereum network can access many types of goods and services and engage in a variety of transactions using the functionality of the relevant dApp or smart contract.

 *Service Sector*

This sector includes companies that provide a variety of services including the buying, selling, payment processing and storing of ether. For example, Coinbase, Kraken, Bitstamp, Gemini, and LMAX Digital are some of the larger ether trading platforms by volume traded. Coinbase Custody Trust Company, LLC, the Ether Custodian, and Anchorage Digital Bank N.A., the Additional Ether Custodian for the Trust, are digital asset custodians that provide custodial accounts that store ether for users. If the Ethereum network grows in adoption, it is anticipated that service providers may expand the currently available range of services and that additional parties will enter the service sector for the Ethereum network.

 ***Competition***

As of June 30, 2024, at least 14,000 other digital assets, as tracked by CoinGecko.com, have been developed since the inception of ether, which is currently the second largest digital asset by market capitalization because of the length of time ether has been in existence, the investment in the infrastructure that supports it, and the network of individuals and entities that are using ether in transactions. While ether has enjoyed some success in its limited history, the aggregate value of outstanding ether is smaller than that of bitcoin and may be eclipsed by the more rapid development of other digital assets. In addition, while ether was the first digital asset with a network that served as a smart contract platform, a number of newer digital assets also function as smart contracts platforms, including Solana, Avalanche, Polkadot, BNB Chain, Tron, and Cardano. Some industry groups are also creating private, permissioned blockchain versions of Ethereum. For example, J.P. Morgan is developing a platform called Onyx, which is described as a blockchain-based platform designed for use by the financial services industry.

 ***Government Oversight, Though Increasing, Remains Limited***

As digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies (including FinCEN, SEC, CFTC, the FINRA, the Consumer Financial Protection Bureau ("CFPB"), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, the OCC, the Federal Deposit Insurance Corporation, the Federal Reserve and state financial institution and securities regulators) have been examining the operations of digital asset networks, digital asset users and the Digital Asset Markets, with particular focus on the extent to which digital assets can be used to launder the proceeds of illegal activities or fund criminal or terrorist enterprises and the safety and soundness of trading platforms or other service providers that hold or custody digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors. Federal and state agencies, and other countries and international bodies have issued rules or guidance about the treatment of digital asset transactions or requirements for businesses engaged in digital asset activity. Moreover, the failure of FTX Trading Ltd. ("FTX") in November 2022 and the resulting market turmoil substantially increased regulatory scrutiny in the United States and globally and led to SEC and criminal investigations, enforcement actions and other regulatory activity across the digital asset ecosystem.

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In addition, the SEC, U.S. state securities regulators and several foreign governments have issued warnings and instituted legal proceedings in which they argue that certain digital assets may be classified as securities and that both those digital assets and any related initial coin offerings or other primary and secondary market transactions are subject to securities regulations. For example, in June 2023, the SEC brought charges against Binance and Coinbase, and in November 2023, the SEC brought charges against Kraken, alleging that they operated unregistered securities exchanges, brokerages and clearing agencies. In its complaints, the SEC asserted that several digital assets are securities under the federal securities laws. The outcomes of these proceedings, as well as ongoing and future regulatory actions, have had a material adverse effect on the digital asset industry as a whole and on the price of ether, and may alter, perhaps to a materially adverse extent, the nature of an investment in the Shares and/or the ability of the Trust to continue to operate. Additionally, U.S. state and federal, and foreign regulators and legislatures have taken action against digital asset businesses or enacted restrictive regimes in response to adverse publicity arising from hacks, consumer harm, or criminal activity stemming from digital asset activity.

The CFTC has regulatory jurisdiction over the ether futures markets. In addition, because the CFTC has determined that ether is a "commodity" under the CEA and the rules thereunder, it has jurisdiction to prosecute fraud and manipulation in the cash, or spot, market for ether. The CFTC has pursued enforcement actions relating to fraud and manipulation involving ether and ether markets. Beyond instances of fraud or manipulation, the CFTC generally does not oversee cash or spot market exchanges or transactions involving ether that do not use collateral, leverage, or financing.

On February 8, 2021, the CME, a designated contract market ("DCM") registered with the CFTC launched new contracts for ether futures products. DCMs are boards of trades (or exchanges) that operate under the regulatory oversight of the CFTC, pursuant to Section 5 of the Commodity Exchange Act. To obtain and maintain designation as a DCM, an exchange must comply on an initial and ongoing basis with twenty-three Core Principles established in Section 5(d) of the CEA. Among other things, DCMs are required to establish self- regulatory programs designed to enforce the DCM's rules, prevent market manipulation and customer and market abuses, and ensure the recording and safe storage of trade information. The CFTC engaged in a "heightened review" of the self-certification of ether futures, which required DCMs to enter direct or indirect information sharing agreements with spot market platforms to allow access to trade and trader data; monitor data from cash markets with respect to price settlements and other ether prices more broadly, and identify anomalies and disproportionate moves in the cash markets compared to the futures markets; engage in inquiries, including at the trade settlement level when necessary; and agree to regular coordination with CFTC surveillance staff on trade activities, including providing the CFTC surveillance team with trade settlement data upon request.

Various foreign jurisdictions have, and may continue to, in the near future, adopt laws, regulations or directives that may affect the Ethereum network, digital asset platforms, and their users, particularly digital asset platforms and service providers that fall within such jurisdictions' regulatory scope.<u> </u>

There remains significant uncertainty regarding foreign governments' future actions with respect to the regulation of digital assets and digital asset platforms. Such laws, regulations or directives may conflict with those of the United States and may negatively impact the acceptance of ether by users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the ether economy in their jurisdictions or globally, or otherwise negatively affect the value of ether. The effect of any future regulatory change on the Trust or ether is impossible to predict, but such change could be substantial and adverse to the Trust and the value of the Shares.

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 **BUSINESS OF THE TRUST**

The activities of the Trust are limited to (1) issuing Baskets in exchange for the ether and cash deposited with the Ether Custodian and Cash Custodian as consideration, (2) selling or delivering ether as necessary to cover the Sponsor's Fee, Trust expenses not assumed by the Sponsor and other liabilities, (3) delivering, receiving, buying and selling ether in exchange for Baskets in connection with creations and redemptions and (4) using a third party to stake a portion of the Trust's ether.

The Trust is not actively managed. It does not engage in any activities designed to obtain a profit from, or to ameliorate losses caused by, changes in the price of ether.

 **Trust Objective**

The Trust seeks to reflect generally the performance of the price of ether and rewards from staking a portion of the Trust's ether, to the extent the Sponsor in its sole discretion determines that the Trust may do so without incurring undue legal or regulatory risk, including, without limitation, any risk to the Trust's qualification as a grantor trust for U.S. federal income tax purposes. The Trust seeks to reflect such performance before payment of the Trust's expenses and liabilities. The Shares are intended to constitute a simple means of making an investment similar to an investment in ether rather than by acquiring, holding and trading ether directly on a peer-to-peer or other basis or via a digital asset platform. The Shares have been designed to remove the obstacles represented by the complexities and operational burdens involved in a direct investment in ether, while at the same time having an intrinsic value that reflects, at any given time, the investment exposure to ether owned by the Trust at such time, less the Trust's expenses and liabilities.

To effectuate the Trust's Staking Activities, pursuant to the Staking Services Agreement, the Sponsor will direct, or may from time to time direct, the Ether Custodian to enter into Staking Arrangements with one or more Staking Services Providers, which may be either affiliates of the Ether Custodian or other approved third-party validators, to conduct Staking Activities through Provider-Facilitated Staking. The Sponsor anticipates that the Trust's Staking Activities will be executed exclusively by means of Provider-Facilitated Staking. The Sponsor will direct the Ether Custodian to stake the Trust's ether with one or more third-party Staking Services Providers based on a range of factors, including, but not limited to, the performance, reliability, and reputation of each Staking Services Provider, as well as ongoing monitoring of their uptime, slashing history, and other operational metrics.

The Trust expects to receive certain staking rewards of ether from Staking Activities, which would be treated as giving rise to taxable income for U.S. federal income tax purposes under current "IRS" guidance. See "U.S. Federal Income Tax Consequences" for further description of the tax implications of the activities of the Trust. The Staking Services Provider shall exercise no discretion as to the amount of the Trust's ether to be staked or the timing of the Trust's Staking Activities. The Ether Custodian will maintain exclusive possession and control of the private keys associated with transferring any staked ether at all times while Staking Service Providers will maintain exclusive possession and control of the private keys associated with ether validation activities at all times. Staking activity on the Ethereum network involves the delegation of ether to validators and carries certain risks. Misbehavior or poor performance by validators may result in such validators receiving reduced staking rewards for an epoch during which they misbehaved or performed poorly. Additionally, as part of the "activating" and "exiting" (followed by withdrawal) processes of staking, staked ether will be inaccessible for a variable period of time determined by a range of factors, including network congestion, resulting in potential inaccessibility during those periods. During activation, exit, and withdrawal, the Trust's staked assets will not earn any rewards. "Activation" is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the Ethereum network's proof-of-stake consensus protocol. "Exit" is the request to exit from the active set and no longer participate in the Ethereum network's proof-of-stake consensus protocol, and is followed by a protocol-administered withdrawal process, which takes additional time to complete. As part of these "activation", "exiting" and withdrawal processes of staking on the Ethereum network, any staked ether will be inaccessible for a period of time. The duration of activation and exit/withdrawal periods are dependent on a range of factors, including network conditions. In periods of low demand, unstaking may be completed within days, while in periods of elevated exit activity the process may take multiple weeks or months to complete.

Although the Shares are not the exact equivalent of a direct investment in ether, they provide investors with an alternative method of achieving investment exposure to ether through the securities market, which may be more familiar to them.

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An investment in Shares is:

*Backed by ether held by the Ether Custodian on behalf of the Trust.*

The Shares are backed by the assets of the Trust. The Ether Custodian will keep custody of all of the Trust's ether, other than that which is maintained in the Trading Balance with the Prime Execution Agent, in the Vault Balance. The Ether Custodian will keep all of the private keys associated with the Trust's ether in the Vault Balance. The Trust is not required to hold any particular amount of assets at either the Ether Custodian or the Additional Ether Custodian, and the Sponsor shall, in its sole discretion, determine the amounts held at either custodian from time to time as permitted by the Trust Agreement. The Sponsor has not established any specific criteria that it would consider in making this decision. As of the date of this prospectus, the Trust's ether is held with the Ether Custodian, and the Sponsor has no plans to move any of the Trust's ether to the Additional Ether Custodian, though such plans are subject to ongoing review. The addition of the Additional Ether Custodian as an available alternative custodian of the Trust's ether reflects the Sponsor's ongoing risk management approach as part of the Trust's growing size and the Sponsor's expanding presence in the digital asset space. The hardware, software, systems, and procedures of the Ether Custodian may not be available or cost-effective for many investors to access directly. The Trust's ether holdings and cash holdings from time to time may be held with the Prime Execution Agent, an affiliate of the Ether Custodian, in the Trading Balance, in connection with creations and redemptions of Baskets and the sale of ether to pay the Sponsor's Fee and any other Trust expenses not assumed by the Sponsor, to the extent applicable, and in extraordinary circumstances, in connection with the liquidation of the Trust's ether. These periodic holdings held in the Trading Balance with the Prime Execution Agent represent an omnibus claim on the Prime Execution Agent's ether (and cash) held on behalf of clients; these ether holdings exist across a combination of omnibus hot wallets, omnibus cold wallets or in accounts in the Prime Execution Agent's name on a trading venue (including third-party venues and the Prime Execution Agent's own execution venue) where the Prime Execution Agent executes orders to buy and sell ether on behalf of clients.

*As convenient and easy to handle as any other investment in shares.*

Investors may purchase and sell Shares through traditional securities brokerage accounts and can avoid the complexities of handling ether directly (e.g., managing wallets and public and private keys themselves, or interfacing with a trading platform), which some investors may not prefer or may find unfamiliar.

*Listed.*

The Shares will be listed and traded on NASDAQ under the ticker symbol "ETHB".

**Competition**

The Trust and the Sponsor face competition with respect to the creation of competing exchange-traded ether products. There can be no assurance that the Trust will achieve initial market acceptance and scale due to competition.

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**Secondary Market Trading**

While the Trust seeks to reflect generally the performance of the price of ether and rewards from staking a portion of the Trust's ether, to the extent the Sponsor in its sole discretion determines that the Trust may do so without incurring undue legal or regulatory risk, including, without limitation, any risk to the Trust's qualification as a grantor trust for tax purposes, before the payment of the Trust's expenses and liabilities, Shares may trade at, above or below their NAV. The NAV will fluctuate with changes in the market value of the Trust's assets. The trading prices of Shares will fluctuate in accordance with changes in their NAV as well as market supply and demand. The amount of the discount or premium in the trading price relative to the NAV may be influenced by non-concurrent trading hours between the major ether markets and NASDAQ. While the Shares will trade on NASDAQ until 4:00 p.m. ET, liquidity in the market for ether may be reduced, negatively affecting the trading volume; alternatively, developments in ether markets (which operate around the clock), including the price volatility, declines in trading volumes, and the closing of ether trading platforms due to fraud, failures, security breaches or otherwise that occur outside of NASDAQ trading hours will not be reflected in trading prices of the Shares until trading on the NASDAQ opens. As a result, during this time, trading spreads, and the resulting premium or discount, on Shares may widen. However, given that Baskets can be created and redeemed in exchange for the underlying amount of ether, and that the Trust will utilize a Basket of 40,000 Shares which would equate to $1 million (assuming an initial NAV of $25.00 compared to the average daily trading volume of ether in excess of $1 billion), the Sponsor believes that the Basket size of 40,000 Shares will enable Authorized Participants and Ether Trading Counterparties to manage inventory and facilitate an effective arbitrage mechanism for the Trust. The Sponsor believes that the arbitrage opportunities may provide a mechanism to mitigate the effect of such premium or discount.

The Trust is not registered as an investment company for purposes of U.S. federal securities laws and is not subject to regulation by the SEC as an investment company. Consequently, the owners of Shares do not have the regulatory protections provided to investors in registered investment companies. For example, the provisions of the Investment Company Act that limit transactions with affiliates, prohibit the suspension of redemptions (except under certain limited circumstances) or limit sales loads, among others, do not apply to the Trust. The Sponsor is not registered with the SEC as an investment adviser and is not subject to regulation by the SEC as such in connection with its activities with respect to the Trust. Consequently, the owners of Shares do not have the regulatory protections provided to advisory clients of SEC-registered investment advisers.

The Trust does not hold or trade in commodity futures contracts or any other instruments regulated by the Commodity Exchange Act as administered by the CFTC. Furthermore, the Trust is not a commodity pool for purposes of the CEA. Consequently, the Trustee and the Sponsor are not subject to registration as commodity pool operators or commodity trading advisors with respect to the Trust. The owners of Shares do not receive the CEA disclosure document and certified annual report required to be delivered by the registered commodity pool operator with respect to a commodity pool, and the owners of Shares do not have the regulatory protections provided to investors in commodity pools operated by registered commodity pool operators.

**Net Asset Value**

The net asset value of the Trust will be equal to the total assets of the Trust, which will consist solely of ether and cash, less total liabilities of the Trust, each determined by the Trustee pursuant to policies established from time to time by the Trustee or otherwise described herein. The methodology used to calculate the Index price to value ether in determining the net asset value of the Trust may not be deemed consistent with GAAP.

The Sponsor has the exclusive authority to determine the net asset value of the Trust, which it has delegated to the Trustee under the Trust Agreement. The Trustee has delegated to the Trust Administrator the responsibility to calculate the net asset value of the Trust and the NAV, based on a pricing source selected by the Trustee. The Trust Administrator will determine the net asset value of the Trust each Business Day. In determining the net asset value of the Trust, the Trust Administrator values the ether held by the Trust based on the Index, unless the Sponsor in its sole discretion determines that the Index is unreliable. The CF Benchmarks Index shall constitute the Index, unless the CF Benchmarks Index is not available or the Sponsor in its sole discretion determines CF Benchmarks Index is unreliable as the Index and therefore determines not to use the CF Benchmarks Index as the Index. If the CF Benchmarks Index is not available or the Sponsor determines, in its sole discretion, that the CF Benchmarks Index is unreliable (together a "Fair Value Event"), the Trust's holdings may be fair valued on a temporary basis in accordance with the fair value policies approved by the Trustee. Additionally, the Trust Administrator will monitor for unusual prices, and escalate to the Trustee if detected. If the CF Benchmarks Index is not used, the Trust will notify Shareholders in a prospectus supplement, in its periodic Exchange Act reports and/or on the Trust's website.

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The Trust Administrator calculates the NAV of the Trust once each Business Day. The NAV for a normal trading day will be released after 4:00 p.m. ET. Trading during the core trading session on the Exchange typically closes at 4:00 p.m. ET. However, NAVs are not officially released until after the completion of a comprehensive review of the NAV and prices utilized to determine the NAV of the Trust by the Trust Administrator. Upon the completion of the end of day reviews by the Trust Administrator the NAV is released to the public typically by 5:30 p.m. ET and generally no later than 8:00 p.m. ET. The period between 4:00 p.m. ET and the NAV release after 5:30 p.m. ET (or later) provides an opportunity for the Trust Administrator and the Trustee to detect, flag, investigate, and correct unusual pricing should it occur and implement a Fair Value Event, if necessary. Any such correction could adversely affect the value of the Shares.

A Fair Value Event value determination will be based upon all available factors that the Trustee deems relevant at the time of the determination, and may be based on analytical values determined by the Sponsor using third-party valuation models.

Fair value policies approved by the Trustee will seek to determine the fair value price that the Trust might reasonably expect to receive from the current sale of that asset or liability in an arm's-length transaction on the date on which the asset or liability is being valued consistent with Relevant Transactions. In the instance of a Fair Value Event and pursuant the Trustee's fair valuation policies and procedures, the FTSE DAR Reference Price - Ethereum ("Secondary Index") will be utilized as a secondary source. BlackRock, on behalf of the Trust, has a license agreement with the Secondary Index. The Secondary Index is calculated daily at 4:00 p.m. ET and is compliant with both the EU and UK BMR, adhering to the IOSCO Principles for Financial Benchmarks. FTSE International Limited, a UK-incorporated entity, oversees the index as an authorized Benchmark Administrator regulated by the UK's FCA. The Secondary Index sets the daily benchmark rate of the U.S. dollar price of ether (USD/ETH). It aggregates the executed trades of vetted digital asset platforms, during an observation window between 3:00:15 p.m. and 4:00:00 p.m. ET into the U.S. dollar price of one ether at 4:00 p.m. ET. Specifically, the index calculates a simple average of 240, 15 second volume-weighted average price ("VWAP") of ether, encompassing all eligible exchanges. As of September 30, 2025, the participating ether platforms are Bitfinex, Bitflyer, Bitstamp, Gemini, itBit, Kraken, LMAX, and Luno. If a Secondary Index is not available or the Sponsor in its sole discretion determines the Secondary Index is unreliable the price set by the Trust's principal market as of 4:00 p.m. ET, on the valuation date would be utilized. In the event the principal market price is not available or the Sponsor in its sole discretion determines the principal market valuation is unreliable the Sponsor will use its best judgement to determine a good faith estimate of fair value. In accordance with the approved valuation policies, the Sponsor compares the CF Benchmarks Index price to the Trust's Secondary Index price each Business Day. If the deviation between the Index and Secondary Index exceeds a threshold, as established by the Sponsor based on historical data, the Sponsor in its sole discretion will investigate and determine if the CF Benchmarks Index is deemed unreliable and implement Fair Value Event procedures.

For financial reporting purposes only, the Trustee of the Trust has adopted a valuation policy that outlines the methodology for valuing the Trust's assets. The policy also outlines the methodology for determining the principal market (or in the absence of a principal market, the most advantageous market) in accordance with ASC 820-10. The Trustee will determine the Trust's principal market (or in the absence of a principal market the most advantageous market) at least quarterly to determine whether any changes have occurred in ether markets and the Trust's operations that would require a change in the Trustee's determination of the Trust's principal market.

The Trustee identifies and determines the Trust's principal market (or in the absence of a principal market, the most advantageous market) for ether consistent with the application of fair value measurement framework in FASB ASC 820-10. The principal market is the market where the reporting entity would normally enter into a transaction to sell the asset or transfer the liability. The reporting entity must be available to and be accessible by the principal market. The reporting entity is the Trust.

Under ASC 820-10, a principal market is generally the market with the greatest volume and activity level for the asset or liability. The determination of the principal market will generally be based on the market with the greatest volume and level of activity that can be accessed.

ASC 820-10 determines fair value to be the price that would be received for ether in a current sale, which assumes an exit price resulting from an orderly transaction between market participants on the measurement date. ASC 820-10 requires the assumption that ether is sold in its principal market to market participants (or in the absence of a principal market, the most advantageous market). Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact.

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The Trust expects to transact in an exchange market, when necessary, to buy and sell ether in association with cash creations and redemptions and to sell ether to satisfy the Trust's operating liabilities. As such, the Trust expects to use an exchange market (as defined by ASC 820-10) as the principal market. Although Authorized Participants (and their liquidity providers) may transact in other ether markets, their market accessibility is not considered because they are not part of the reporting entity.

The Sponsor intends to engage a third-party vendor to obtain a price from the Trust's principal market for ether. The third-party vendor is expected to follow the Trust's valuation policies and obtain relevant reliable volume and relevant activity information to identify the principal market. The information will be reviewed in the following order:

● First, a list of exchange markets operating in compliance with applicable laws and regulations are scoped into the principal market determination. Market accessibility and transactability are considered as part of this process.

● Second, the remaining exchange markets are sorted from high to low based on relevant reliable volume and activity information of ether traded on these exchange markets.

● Third, pricing fluctuations and the degree of variances in price on exchange markets are reviewed to identify any material notable variances that may impact the volume or price information of a particular exchange market.

● Fourth, an exchange market is selected as the principal market based on the highest relevant market-based volume, level of activity, and price stability in comparison to the other exchange markets on the list. In comparison to other markets, exchange markets have the greatest reliable volume and level of activity for ether. As a result, an exchange market will be the Trust's principal market as opposed to a brokered market, a dealer market, and principal-to-principal market.

For purposes of the Trust's periodic financial statements, it is expected that an exchange-traded price from the Trust's principal market for ether as of 11:59 p.m. ET will be utilized on the Trust's financial statement measurement date.

The website for the Trust, which will be publicly accessible at no charge, will contain the following information: (a) the prior Business Day's NAV; (b) the prior Business Day's NASDAQ official closing price; (c) calculation of the premium or discount of such NASDAQ official closing price against such NAV; (d) data in chart form displaying the frequency distribution of discounts and premiums of the NASDAQ official closing price against the NAV, within appropriate ranges for each of the four previous calendar quarters (or for the life of the Trust, if shorter); (e) the prospectus; and (f) other applicable quantitative information. The Trust Administrator will also disseminate the Trust's holdings on a daily basis on the Trust's website. The NAV for the Trust will be calculated by the Trust Administrator once a day and will be disseminated daily to all market participants at the same time. Quotation and last sale information regarding the Shares will be disseminated through the facilities of the Consolidated Tape Association ("CTA").

**Valuation of Ether; The CF Benchmarks Index**

On each Business Day, as soon as practicable after 4:00 p.m. ET, the Trust evaluates the ether held by the Trust as reflected by the CF Benchmarks Index and determines the net asset value of the Trust and the NAV. For purposes of making these calculations, a Business Day means any day other than a day when NASDAQ is closed for regular trading.

CF Benchmarks Index is calculated as of 4:00 p.m. ET. The CF Benchmarks Index is designed based on the IOSCO Principles for Financial Benchmarks and is a Registered Benchmark under UK BMR. The Index Administrator is CF Benchmarks Ltd a UK incorporated company authorized and regulated by the UK FCA as a Benchmark Administrator.

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The CF Benchmarks Index was created to facilitate financial products based on ether. It serves as a once-a-day benchmark rate of the U.S. dollar price of ether (USD/ETH), calculated as of 4:00 p.m. ET. The CF Benchmarks Index aggregates the trade flow of several ether platforms, during an observation window between 3:00 p.m. and 4:00 p.m. ET into the U.S. dollar price of one ether at 4:00 p.m. ET. Specifically, the CF Benchmarks Index is calculated based on the "Relevant Transactions" (as defined below) of all of its Constituent Platforms, as follows:

● All Relevant Transactions are added to a joint list, recording the time of execution, and trade price for each transaction.

● The list is partitioned by timestamp into 12 equally-sized time intervals of 5 (five) minute length.

● For each partition separately, the volume-weighted median trade price is calculated from the trade prices and sizes of all Relevant Transactions, i.e., across all Constituent Platforms. A volume-weighted median differs from a standard median in that a weighting factor, in this case trade size, is factored into the calculation.

● The ETHUSD_RR is then determined by the equally-weighted average of the volume medians of all partitions.

The CF Benchmarks Index is solely calculated from spot Ether-USD transactions conducted on Constituent Platforms within the observation window of 3:00 p.m. to 4:00 p.m. ET, it does not include any futures prices in its methodology. A "Relevant Transaction" is any crypto-asset versus U.S. dollar spot trade that occurs during the observation window between 3:00 p.m. and 4:00 p.m. ET on a Constituent Platform in the ETH/USD pair that is reported and disseminated by a Constituent Platform through its publicly available API and observed by the Index Administrator. Although the CF Benchmarks Index is intended to accurately capture the market price of ether, third parties may be able to purchase and sell ether on public or private markets and such transactions may take place at prices materially higher or lower than the CF Benchmarks Index price.

The following provides a hypothetical example of the CF Benchmarks Index calculation\*:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. On a given calculation day, the below Relevant Transactions are observed in Constituent Platform APIs by CF Benchmarks at 4:01 p.m. ET:

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| | | | | |
|:---|:---|:---|:---|:---|
| **<u>Partition</u>** | **<u>Time (New York)</u>** | **<u>Price ($)</u>** | **<u>Volume (ETH)</u>** | **<u>Constituent</u>** <br> **<u>Platform</u>** |
| <u>1</u>  | <u>15:00:00:640</u>  | <u>2777.911</u>  | <u>0.368549</u>  | <u>Coinbase</u>  |
| <u>1</u>  | <u>15:00:19:920</u>  | <u>2776.622</u>  | <u>0.217384</u>  | <u>Kraken</u>  |
| <u>1</u>  | <u>15:00:21:291</u>  | <u>2778.132</u>  | <u>1.12461</u>  | <u>LMAX Digital</u>  |
| <u>1</u>  | <u>15:00:24:490</u>  | <u>2777.895</u>  | <u>0.381697</u>  | <u>Gemini</u>  |
| <u>1</u>  | <u>15:00:40:321</u>  | <u>2777.911</u>  | <u>0.286672</u>  | <u>itBit</u>  |
| <u>1</u>  | <u>15:01:02:241</u>  | <u>2776.622</u>  | <u>0.145404</u>  | <u>Coinbase</u>  |
| <u>1</u>  | <u>15:01:02:340</u>  | <u>2777.911</u>  | <u>0.01</u>  | <u>Bitstamp</u>  |
| <u>1</u>  | <u>15:01:02:912</u>  | <u>2769.937</u>  | <u>0.116554</u>  | <u>Kraken</u>  |
| <u>1</u>  | <u>15:04:02:241</u>  | <u>2776.622</u>  | <u>0.1107</u>  | <u>Bitstamp</u>  |
| <u>2</u>  | <u>15:07:12:187</u>  | <u>2774.168</u>  | <u>0.858513</u>  | <u>LMAX Digital</u>  |
| <u>2</u>  | <u>15:08:34:412</u>  | <u>2769.994</u>  | <u>0.204653</u>  | <u>Gemini</u>  |
| <u>2</u>  | <u>15:09:02:241</u>  | <u>2769.814</u>  | <u>0.471316</u>  | <u>itBit</u>  |
| <u>3</u>  | <u>15:11:32:342</u>  | <u>2769.937</u>  | <u>0.2423</u>  | <u>Bitstamp</u>  |
| <u>3</u>  | <u>15:11:41:243</u>  | <u>2771.932</u>  | <u>0.338709</u>  | <u>LMAX Digital</u>  |
| <u>3</u>  | <u>15:12:04:288</u>  | <u>2768.433</u>  | <u>0.632132</u>  | <u>itBit</u>  |
| <u>3</u>  | <u>15:12:34:342</u>  | <u>2769.739</u>  | <u>0.239057</u>  | <u>Coinbase</u>  |
| <u>3</u>  | <u>15:12:51:423</u>  | <u>2772.144</u>  | <u>0.310399</u>  | <u>Kraken</u>  |
| <u>3</u>  | <u>15:13:00:012</u>  | <u>2772</u>  | <u>0.55687</u>  | <u>LMAX Digital</u>  |
| <u>3</u>  | <u>15:13:16:798</u>  | <u>2772.144</u>  | <u>1.0346</u>  | <u>Bitstamp</u>  |
| <u>3</u>  | <u>15:14:02:117</u>  | <u>2772.634</u>  | <u>0.02145</u>  | <u>Kraken</u>  |
| <u>3</u>  | <u>15:14:22:911</u>  | <u>2772.634</u>  | <u>0.7898</u>  | <u>Bitstamp</u>  |
| <u>4</u>  | <u>15:17:26:008</u>  | <u>2771.996</u>  | <u>0.746878</u>  | <u>LMAX Digital</u>  |
| <u>4</u>  | <u>15:18:51:181</u>  | <u>2769.963</u>  | <u>0.400451</u>  | <u>LMAX Digital</u>  |
| <u>5</u>  | <u>15:20:10:721</u>  | <u>2774.232</u>  | <u>1.066456</u>  | <u>LMAX Digital</u>  |
| <u>5</u>  | <u>15:20:16:621</u>  | <u>2773.021</u>  | <u>0.009045</u>  | <u>Kraken</u>  |
| <u>5</u>  | <u>15:21:01:046</u>  | <u>2772.965</u>  | <u>0.320625</u>  | <u>Coinbase</u>  |
| <u>5</u>  | <u>15:21:06:621</u>  | <u>2773.021</u>  | <u>0.3116</u>  | <u>Bitstamp</u>  |
| <u>5</u>  | <u>15:21:06:621</u>  | <u>2772.433</u>  | <u>0.338928</u>  | <u>itBit</u>  |
| <u>5</u>  | <u>15:21:11:046</u>  | <u>2773.924</u>  | <u>0.073699</u>  | <u>LMAX Digital</u>  |
| <u>5</u>  | <u>15:22:54:746</u>  | <u>2774.128</u>  | <u>0.902612</u>  | <u>itBit</u>  |
| <u>5</u>  | <u>15:23:04:946</u>  | <u>2776.036</u>  | <u>0.5123</u>  | <u>Bitstamp</u>  |
| <u>5</u>  | <u>15:23:21:946</u>  | <u>2774.132</u>  | <u>0.100123</u>  | <u>Kraken</u>  |
| <u>6</u>  | <u>15:28:01:756</u>  | <u>2776.194</u>  | <u>0.6871</u>  | <u>Bitstamp</u>  |
| <u>6</u>  | <u>15:28:01:756</u>  | <u>2776.124</u>  | <u>0.219149</u>  | <u>Kraken</u>  |
| <u>6</u>  | <u>15:28:06:119</u>  | <u>2776.334</u>  | <u>0.545019</u>  | <u>Gemini</u>  |
| <u>6</u>  | <u>15:29:06:256</u>  | <u>2776.209</u>  | <u>0.171909</u>  | <u>Coinbase</u>  |
| <u>7</u>  | <u>15:30:01:079</u>  | <u>2779.087</u>  | <u>0.037664</u>  | <u>Gemini</u>  |
| <u>7</u>  | <u>15:30:56:299</u>  | <u>2776.967</u>  | <u>0.438336</u>  | <u>LMAX Digital</u>  |
| <u>7</u>  | <u>15:31:02:447</u>  | <u>2779.166</u>  | <u>0.457816</u>  | <u>Coinbase</u>  |
| <u>7</u>  | <u>15:32:29:991</u>  | <u>2780.434</u>  | <u>0.031638</u>  | <u>Coinbase</u>  |
| <u>7</u>  | <u>15:32:29:991</u>  | <u>2778.166</u>  | <u>1.015881</u>  | <u>Gemini</u>  |
| <u>7</u>  | <u>15:33:02:448</u>  | <u>2780.131</u>  | <u>0.3684</u>  | <u>Bitstamp</u>  |
| <u>7</u>  | <u>15:33:26:912</u>  | <u>2770.968</u>  | <u>0.935746</u>  | <u>Kraken</u>  |
| <u>8</u>  | <u>15:37:18:465</u>  | <u>2778.822</u>  | <u>0.720667</u>  | <u>LMAX Digital</u>  |
| <u>8</u>  | <u>15:38:10:645</u>  | <u>2774.236</u>  | <u>0.213356</u>  | <u>Kraken</u>  |
| <u>8</u>  | <u>15:38:44:651</u>  | <u>2773.926</u>  | <u>0.350778</u>  | <u>Kraken</u>  |

---

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---

| | | | | |
|:---|:---|:---|:---|:---|
| <u>8</u>  | <u>15:38:48:651</u>  | <u>2778.898</u>  | <u>0.966563</u>  | <u>LMAX Digital</u>  |
| <u>8</u>  | <u>15:39:00:901</u>  | <u>2779.621</u>  | <u>0.518239</u>  | <u>LMAX Digital</u>  |
| <u>8</u>  | <u>15:39:01:001</u>  | <u>2776.236</u>  | <u>0.150552</u>  | <u>Kraken</u>  |
| <u>9</u>  | <u>15:40:39:008</u>  | <u>2780.126</u>  | <u>1.380141</u>  | <u>LMAX Digital</u>  |
| <u>9</u>  | <u>15:41:29:990</u>  | <u>2780.009</u>  | <u>0.9811</u>  | <u>Bitstamp</u>  |
| <u>9</u>  | <u>15:42:29:990</u>  | <u>2781.128</u>  | <u>0.329528</u>  | <u>Kraken</u>  |
| <u>10</u>  | <u>15:45:18:506</u>  | <u>2779.322</u>  | <u>0.0678</u>  | <u>Bitstamp</u>  |
| <u>10</u>  | <u>15:48:41:659</u>  | <u>2779.428</u>  | <u>0.01334</u>  | <u>Coinbase</u>  |
| <u>11</u>  | <u>15:51:22:904</u>  | <u>2779.166</u>  | <u>0.147674</u>  | <u>Coinbase</u>  |
| <u>11</u>  | <u>15:51:36:004</u>  | <u>2780.001</u>  | <u>0.175802</u>  | <u>Gemini</u>  |
| <u>11</u>  | <u>15:51:52:917</u>  | <u>2781.866</u>  | <u>0.384795</u>  | <u>Gemini</u>  |
| <u>11</u>  | <u>15:52:01:017</u>  | <u>2780.162</u>  | <u>0.323228</u>  | <u>Coinbase</u>  |
| <u>11</u>  | <u>15:52:04:056</u>  | <u>2783.122</u>  | <u>1.407056</u>  | <u>Kraken</u>  |
| <u>11</u>  | <u>15:52:11:750</u>  | <u>2781.194</u>  | <u>0.095376</u>  | <u>LMAX Digital</u>  |
| <u>11</u>  | <u>15:52:24:561</u>  | <u>2780.136</u>  | <u>1.380156</u>  | <u>Coinbase</u>  |
| <u>11</u>  | <u>15:53:42:407</u>  | <u>2784.084</u>  | <u>1.546942</u>  | <u>LMAX Digital</u>  |
| <u>11</u>  | <u>15:53:45:078</u>  | <u>2780.736</u>  | <u>0.314685</u>  | <u>Coinbase</u>  |
| <u>11</u>  | <u>15:53:55:081</u>  | <u>2782.961</u>  | <u>1.074128</u>  | <u>Kraken</u>  |
| <u>12</u>  | <u>15:57:11:747</u>  | <u>2780.834</u>  | <u>0.643043</u>  | <u>Gemini</u>  |
| <u>12</u>  | <u>15:57:41:874</u>  | <u>2780.934</u>  | <u>0.062376</u>  | <u>itBit</u>  |
| <u>12</u>  | <u>15:57:49:994</u>  | <u>2781.126</u>  | <u>0.517372</u>  | <u>Coinbase</u>  |
| <u>12</u>  | <u>15:57:51:924</u>  | <u>2784.469</u>  | <u>0.423776</u>  | <u>Kraken</u>  |
| <u>12</u>  | <u>15:58:02:227</u>  | <u>2782.977</u>  | <u>2.35678</u>  | <u>LMAX Digital</u>  |
| <u>12</u>  | <u>15:58:22:781</u>  | <u>2781.001</u>  | <u>1.0117</u>  | <u>itBit</u>  |
| <u>12</u>  | <u>15:59:32:011</u>  | <u>2783.384</u>  | <u>0.693902</u>  | <u>Coinbase</u>  |
| <u>12</u>  | <u>15:59:41:811</u>  | <u>2783.102</u>  | <u>0.374625</u>  | <u>Gemini</u>  |
| <u>12</u>  | <u>15:59:52:197</u>  | <u>2785.197</u>  | <u>0.696728</u>  | <u>Kraken</u>  |
| <u>12</u>  | <u>15:59:56:228</u>  | <u>2783.936</u>  | <u>0.270142</u>  | <u>Coinbase</u>  |
| <u>12</u>  | <u>15:59:58:690</u>  | <u>2784.436</u>  | <u>0.719425</u>  | <u>Coinbase</u>  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The Index Administrator segments these transactions by their timestamp into 12 partitions of equal 5-minute length as shown in the first column in the above table.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The Index Administrator calculates the volume weighted median price for each partition, the result of which is shown below:

---

| | | |
|:---|:---|:---|
| **Partition** | **Volume (ether)** | **Volume** <br> **Weighted**<br> **Median Price**<br> **($)** |
| **1** | 2.7616 | 2777.91 |
| **2** | 1.5345 | 2774.17 |
| **3** | 4.1653 | 2772.14 |
| **4** | 1.1473 | 2772.00 |
| **5** | 3.6354 | 2774.13 |
| **6** | 1.6232 | 2776.19 |
| **7** | 3.2855 | 2778.17 |
| **8** | 2.9202 | 2778.9 |
| **9** | 2.6908 | 2780.13 |
| **10** | 0.0811 | 2779.32 |
| **11** | 6.8498 | 2782.96 |
| **12** | 7.7699 | 2.782.98 |

---

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The average of the 12 volume weighted medians is calculated to be $2,777.42.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The volume weighted medians for all transactions observed from each Constituent Platform is then calculated individually, the median of these six volume weighted medians and the percentage deviation of each Constituent Platform volume weighted median from this median is also calculated to determine whether the deviation is greater than 10% where in accordance with the potentially erroneous data provisions of the Index methodology the transaction data for any Constituent Platform that exhibits this is removed from the calculation. As shown in the below table, the deviation exhibited by each Constituent Platform is well within 10% and hence all Constituent Platform transaction data is used to determine the Index:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Constituent Platform Volume Weighted Medians versus Potentially Erroneous Data Threshold (10%)** | **Constituent Platform Volume Weighted Medians versus Potentially Erroneous Data Threshold (10%)** | **Constituent Platform Volume Weighted Medians versus Potentially Erroneous Data Threshold (10%)** | **Constituent Platform Volume Weighted Medians versus Potentially Erroneous Data Threshold (10%)** | **Constituent Platform Volume Weighted Medians versus Potentially Erroneous Data Threshold (10%)** | **Constituent Platform Volume Weighted Medians versus Potentially Erroneous Data Threshold (10%)** | **Constituent Platform Volume Weighted Medians versus Potentially Erroneous Data Threshold (10%)** | **Constituent Platform Volume Weighted Medians versus Potentially Erroneous Data Threshold (10%)** |
| | **Bitstamp** | **Coinbase** | **Gemini** | **itBit** | **Kraken** | **LMAX** <br> **Digital** | **Median of VWMs** |
| **Volume Weighted Median** <br> **($)** | 2776.04 | 2780.14 | 2778.17 | 2774.13 | 2782.96 | 2778.90 | 2778.54 |
| **Deviation to Median** | 0.09% | 0.06% | 0.01% | 0.16% | 0.16% | 0.01% |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. The Index price for this given calculation date is $2,777.42

\* Source: CF Benchmarks

In seeking to ensure that the CF Benchmarks Index is administered through the Index Administrator's codified policies for CF Benchmarks Index integrity, the Index is subject to oversight by the CME CF Oversight Committee, whose Founding Charter and quarterly meeting minutes are publicly available.

As of the date of this prospectus, the Constituent Platforms included in the CF Benchmarks Index that are utilized by the Trust are Coinbase, Bitstamp, itBit, Kraken, Gemini, LMAX Digital, Bullish and Crypto.com.

*Coinbase* is a U.S.-based platform registered as an MSB with FinCEN and licensed as a digital asset business under the NYDFS BitLicense as well as a money transmitter in various U.S. states.

*Bitstamp* is a U.K.-based platform registered as an MSB with FinCEN and licensed as a digital asset business under the NYDFS BitLicense as well as money transmitter in various U.S. states.

*itBit is* a U.S.-based platform that is licensed as a digital asset business under the NYDFS BitLicense. It is also registered FinCEN as an MSB and is licensed as a money transmitter in various U.S. states.

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*Kraken* is a U.S.-based platform that is registered as an MSB with FinCEN in various U.S. states, Kraken is registered with the FCA and is authorized by the Central Bank of Ireland as a Virtual Asset Service Provider ("VASP"). Kraken also holds a variety of other licenses and regulatory approvals, including those from the Japan Financial Services Agency (JFSA) and the Canadian Securities Administrators (CSA).

*Gemini* is a U.S.-based platform that is licensed as a virtual currency business under the NYDFS BitLicense. It is also registered with FinCEN as an MSB and is licensed as a money transmitter in various U.S. states.

*LMAX Digital* is a Gibraltar based platform regulated by the Gibraltar Financial Services Commission (‟GFSCˮ) as a DLT provider for execution and custody services. LMAX Digital does not hold a BitLicense and is part of LMAX Group, a U.K-based operator of an FCA regulated Multilateral Trading Facility and Broker-Dealer.

*Crypto.com* is a Singapore-based platform that offers various financial services, including a digital asset platform, a DeFi wallet, NFT Marketplace, and direct crypto payments.

*Bullish* is a Gibraltar based platform operated by Bullish (GI) Limited and regulated by the GFSC as a DLT.

The eight Constituent Platforms that contribute transaction data to the CF Benchmarks Index with the aggregate volumes traded on their respective ETH/USD markets over the preceding four calendar quarters listed in the table below:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Period**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  |
|  | **Bitstamp**  | **Bullish Exchange\***  | **Coinbase**  | **Crypto.com\***  | **Gemini**  | **itBit**  | **Kraken**  | **LMAX Digital**  |
| Q1 2025  | 1.52%  | N/A  | 20.83%  | 0.21%  | 1.45%  | 0.25%  | 2.79%  | 2.15%  |
| Q2 2025  | 2.19%  | N/A  | 31.98%  | 47.16%  | 2.85%  | 0.51%  | 5.33%  | 4.78%  |
| Q3 2025  | 3.28%  | 1.07%  | 42.85%  | 32.84%  | 3.48%  | 0.36%  | 7.95%  | 4.59%  |
| Q4 2025  | 4.56%  | 3.14%  | 32.01%  | 42.27%  | 1.87%  | 0.38%  | 7.41%  | 4.16%  |

---

\*Crypto.com became a CME CF Constituent Platform on 31 March 2025 and thus its aggregate volume is that observed for 1 day (31 March 2025). <br> \*Bullish Exchange became a CME CF Constituent Platform on 14 July 2025 <br> \*\*Source: CFBenchmarks

The market share for ETH/USD trading of the eight Constituent Platforms over the past four calendar quarters is shown in the table below:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Period**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  | **Spot Trading Platforms Market Share of ETH-USD Trading**  |
|  | **Bitstamp**  | **Bullish Exchange\***  | **Coinbase**  | **Crypto.com\***  | **Gemini**  | **itBit**  | **Kraken**  | **LMAX Digital**  |
| Q1 2025  | 2675817473  | N/A  | 36568524172  | 368564044  | 2554135858  | 443530412  | 4896094186  | 3780719230  |
| Q2 2025  | 1979175201  | N/A  | 28874814906  | 42586515294  | 2572804409  | 459699772  | 4817009997  | 4314282048  |
| Q3 2025  | 5672103210  | 1846515375  | 74032127753  | 56752292165  | 6013344787  | 620755543  | 13734507708  | 7923651874  |
| Q4 2025  | 5864751187  | 4037516263  | 41208309727  | 54425124611  | 2404069228  | 482852818  | 9545251658  | 5351763324  |

---

---

| |
|:---|
| \*Crypto.com became a CME CF Constituent Platform on 31 March 2025 and thus its share is that observed for 1 day (31 March 2025) within the quarter. |
| \*\*Bullish Exchange became a CME CF Constituent Platform on 14 July 2025 |
| \*\*\*Other exchanges include: Bitfinex; OKX; BinanceUS<br> \*\*\*\*Source: CFBenchmarks |

---

The list of platforms on which the Trust executes transactions may change from time to time, and the Index Administrator may make changes to the Constituent Platforms comprising the Index from time to time. The platforms on which the Trust executes transactions do not impact the Constituent Platforms. Once the Trust has actual knowledge of material changes to the Constituent Platforms used to calculate the Index or the CF Benchmarks Index's methodology to calculate the Index price, the Trust will notify Shareholders in a prospectus supplement, in its periodic Exchange Act reports and/or on the Trust's website.

The selection of platforms for use in the CF Benchmarks Index is selected by the Oversight Committee of the Index Administrator (the "Oversight Committee"). A trading platform is eligible as a "Constituent Platform" in any of the CME CF Cryptocurrency Pricing Products if it offers a market that facilitates the spot trading of the relevant cryptocurrency base asset against the corresponding quote asset, including markets where the quote asset is made fungible with accepted assets (the "Relevant Pair") and makes trade data and order data available through an API with sufficient reliability, detail and timeliness. The Oversight Committee considers a trading venue to offer sufficiently reliable, detailed and timely trade data and order data through an API when: (i) the API for the "Constituent Platform" does not fall or become unavailable to a degree that impacts the integrity of the Index given the frequency of calculation; (ii) the data published is at the resolution required so that the benchmark can be calculated, with the frequency and dissemination precision required; and (iii) the data is broadcast and available for retrieval at the required frequency (and not negatively impacted by latency) to allow the methodologies to be applied as intended.

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Furthermore, it must, in the opinion of the Oversight Committee, fulfill the following criteria:

1. The platform's Relevant Pair spot trading volume for an index must meet the minimum thresholds as detailed below for it to be admitted as a constituent platform: The average daily volume the venue would have contributed during the observation window for the ETHUSD_RR of the Relevant Pair exceeds 3% for two consecutive calendar quarters.

2. The platform has policies to ensure fair and transparent market conditions at all times and has processes in place to identify and impede illegal, unfair or manipulative trading practices.

3. The platform does not impose undue barriers to entry or restrictions on market participants, and utilizing the venue does not expose market participants to undue credit risk, operational risk, legal risk or other risks.

4. The platform complies with applicable law and regulations, including, but not limited to capital markets regulations, money transmission regulations, client money custody regulations, KYC regulations and anti-money-laundering regulations.

5. The venue cooperates with inquiries and investigations of regulators and CF Benchmarks upon request and must execute data sharing agreements with CME Group.

Once admitted, a Constituent Platform must demonstrate that it continues to fulfil the criteria 2 – 5. Should the average daily contribution of a Constituent Platform fall below 3% for any ETHUSD_RR then the continued inclusion of the venue as a Constituent Platform to the Relevant Pair shall be assessed by the CME CF Oversight Committee.

The Index Administrator may make changes to the Constituent Platforms comprising the Index from time to time. Once it has actual knowledge of material changes to the Constituent Platforms used to calculate the Index, the Trust will notify Shareholders in a prospectus supplement, in its periodic Exchange Act reports and/or on the Trust's website.

The Sponsor believes that the use of the CF Benchmarks Index is reflective of a reasonable valuation of the spot price of ether and that resistance to manipulation is a priority aim of its design methodology. The methodology: (i) takes an observation period and divides it into equal partitions of time; (ii) then calculates the volume-weighted median of all transactions within each partition; and (iii) the value is determined from the arithmetic mean of the volume-weighted medians, equally weighted. By employing the foregoing steps and specifically doing so over a one hour period, the CF Benchmarks Index thereby seeks to ensure that transactions in ether conducted at outlying prices do not have an undue effect on the index value, large trades or clusters of trades transacted over a short period of time will not have an undue influence on the index value, and the effect of large trades at prices that deviate from the prevailing price are mitigated from having an undue influence on the benchmark level.

In addition, the Sponsor notes that to ensure the integrity of the CF Benchmarks Index, it is subject to the UK BMR regulations, compliance with which regulations has been subject to a Limited Assurance Audit under the ISAE 3000 standard as of September 12, 2022, which is publicly available at <u>www.cfbenchmarks.com</u>.

The CF Benchmarks Index is administered under the CF Benchmarks Control Framework to ensure compliance with UK BMR. Specifically, provisions within the following the policies in combination are designed to ensure the integrity of its benchmarks, including the CF Benchmarks Index:

● CF Benchmarks Input Data Policy - Governs CF Benchmarks use of input data, input data sources, the determination of data sufficiency and relevant controls that are applied to ensure the integrity of its benchmarks.

● CF Benchmarks Surveillance Policy - Governs the aims, design, potential susceptibility and implementation of the measures CF Benchmarks has in place in impede, detect and report on potential and actual benchmark manipulation and ensure the integrity of its benchmarks.

● CF Benchmarks Conflict of Interest Policy - Governs the measures by which CF Benchmarks identifies, records, mitigates and escalates potential and actual conflicts of interest that might impact the integrity of its benchmarks.

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● CF Benchmarks Governance & Oversight Framework - Lays out the measures by which CF Benchmarks manages the benchmark life cycle including the relevant junctures where Oversight Committee notification, escalation, review and resolution is relevant and required including the manner in which CF Benchmarks identifies risks to benchmark integrity and the processes and procedures it follows to mitigate and eliminate such risks.

The domicile, regulation and legal compliance of the ether platforms included in the CF Benchmarks Index varies. Further information regarding each ether platform may be found, where available, on the websites for such ether platforms and public registers for compliance with local regulations, among other places.

CF BENCHMARKS LTD LICENSOR PRODUCT(S) IS USED UNDER LICENSE AS A SOURCE OF INFORMATION FOR CERTAIN BLACKROCK FUND ADVISORS PRODUCTS. CF BENCHMARKS LTD, ITS LICENSORS AND AGENTS HAVE NO OTHER CONNECTION TO BLACKROCK FUND ADVISORS PRODUCTS AND SERVICES AND DO NOT SPONSOR, ENDORSE, RECOMMEND OR PROMOTE ANY BLACKROCK FUND ADVISORS PRODUCTS OR SERVICES. CF BENCHMARKS ITS LICENSORS AND AGENTS HAVE NO OBLIGATION OR LIABILITY IN CONNECTION WITH THE BLACKROCK FUND ADVISORS PRODUCTS AND SERVICES. CF BENCHMARKS ITS LICENSORS AND AGENTS DO NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF ANY INDEX LICENSED TO BLACKROCK FUND ADVISORS AND SHALL NOT HAVE ANY LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN.

**Trust Expenses**

The Trust's only ordinary recurring expenses are expected to be the Sponsor's Fee and the Staking Fee. In exchange for the Sponsor's Fee, the Sponsor has agreed to assume the marketing and the following administrative expenses of the Trust: the fees of the Trustee, the Delaware Trustee and the Trust Administrator, the Custodians' Fee, NASDAQ listing fees, SEC registration fees, printing and mailing costs, tax reporting fees, audit fees, license fees and expenses and up to $500,000 per annum in ordinary legal fees and expenses. The Sponsor may determine in its sole discretion to assume legal fees and expenses of the Trust in excess of the $500,000 per annum required under the Trust Agreement. To the extent that the Sponsor does not voluntarily assume such fees and expenses, they will be the responsibility of the Trust. The Sponsor will also pay the costs of the Trust's organization and the initial sale of the Shares.

The Sponsor's Fee is accrued daily at an annualized rate equal to 0.25% of the net asset value of the Trust and is payable at least quarterly in arrears in U.S. dollars or in-kind or any combination thereof. The Sponsor may, at its sole discretion and from time to time, waive all or a portion of the Sponsor's Fee for stated periods of time. The Sponsor is under no obligation to waive any portion of its fees and any such waiver shall create no obligation to waive any such fees during any period not covered by the waiver. For a twelve-month period commencing on the day the Shares are initially listed on NASDAQ, the Sponsor will waive a portion of the Sponsor's Fee so that the Sponsor's Fee after the fee waiver will be equal to 0.12% of the net asset value of the Trust. In the future, if the Sponsor decides to waive all or a portion of the Sponsor's Fee, Shareholders will be notified in a prospectus supplement, in its periodic Exchange Act reports and/or on the Trust's website.

The Trust will pay a "Staking Fee", which will include (i) the Sponsor's Staking Portion and (ii) the Prime Execution Agent's share of Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers for their respective shares of the Trust's Staking Consideration), in accordance with the Staking Services Agreement. As of the date hereof, the Sponsor's Staking Portion and the Prime Execution Agent's share of such Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers in respect of their shares of the Staking Consideration) comprise an aggregate of 18% of the gross Staking Consideration. The Trust will retain the remainder of such gross Staking Consideration.

The Trust may incur certain extraordinary, non-recurring expenses that are not assumed by the Sponsor, including but not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, Ethereum network fees and similar transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders, any indemnification of the Cash Custodian, the Ether Custodian, the Additional Ether Custodian, Prime Execution Agent, Trust Administrator, or other agents, service providers or counterparties of the Trust, and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters or legal fees, costs or expenses incurred by the Trust or Coinbase (when acting as agent on behalf of the Trust) in enforcing the Trust's rights against Staking Services Providers. Because the Trust does not have any income, it will need to sell ether to cover the Sponsor's Fee and expenses not assumed by the Sponsor, if any. Trust expenses not assumed by the Sponsor and not included in trade execution costs paid by the Trust shall accrue daily and be payable by the Trust to the Sponsor at least quarterly in arrears. The Trust may also be subject to other liabilities (for example, as a result of litigation) that have also not been assumed by the Sponsor. The only source of funds to cover those liabilities will be sales of ether held by the Trust. Even if there are no expenses other than those assumed by the Sponsor, and there are no other liabilities of the Trust, the Trust still needs to sell ether to pay the Sponsor's Fee. The result of these sales is a decrease in the amount of ether represented by each Share.

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To cover the Sponsor's Fee and expenses not assumed by the Sponsor, the Sponsor or its delegate will cause the Trust (or its delegate) to convert ether into U.S. dollars at the price available through the Prime Execution Agent's Coinbase Prime service (less applicable trading fees) through the Trading Platform which the Sponsor is able to obtain using commercially reasonable efforts. The number of ether represented by a Share will decline each time the Trust pays the Sponsor's Fee or any Trust expenses not assumed by the Sponsor by transferring or selling ether. The Trust cannot reinvest any cash received from such sales into ether, and must use that cash to pay the Sponsor's Fee and/or other Trust expenses not assumed by the Sponsor, and/or distribute any excess cash to investors.

The quantity of ether to be sold to permit payment of the Sponsor's Fee or Trust expenses not assumed by the Sponsor, will vary from time to time depending on the level of the Trust's expenses and the value of ether held by the Trust. Assuming that the Trust is a grantor trust for U.S. federal income tax purposes, each delivery or sale of ether by the Trust for the payment of expenses generally will be a taxable event to Shareholders. See "U.S. Federal Income Tax Consequences."

In the event that any of the foregoing fees and expenses are incurred with respect to the Trust and other Client Accounts (as defined in "Conflicts of Interest"), the Sponsor will allocate the costs across the entities on a pro rata basis, except to the extent that certain expenses are specifically attributable to the Trust or another Client Account. The Trust expects that any trading commissions associated with block trading, if applicable, will be allocated across the relevant entities on a pro rata basis.

**Impact of Trust Expenses on the Trust**'**s Net Asset Value**

The Trust sells ether to raise the funds needed for the payment of the Sponsor's Fee and all Trust expenses or liabilities not assumed by the Sponsor. See "The Sponsor—The Sponsor's Fee." The purchase price received as consideration for such sales is the Trust's sole source of funds to cover its liabilities. The Trust does not engage in any activity designed to derive a profit from changes in the price of ether. As a result of the recurring sales of ether necessary to pay the Sponsor's Fee and the Trust expenses or liabilities not assumed by the Sponsor, the net asset value of the Trust and, correspondingly, the fractional amount of ether represented by each Share will decrease over the life of the Trust. New deposits of ether received in exchange for new Baskets or purchases of ether utilizing cash proceeds for new Shares issued by the Trust do not reverse this trend.

The following table, prepared by the Sponsor, illustrates the anticipated impact of the sales of ether discussed above on the fractional amount of ether represented by each outstanding Share. It assumes that the only sales of ether will be those needed to pay the Sponsor's Fee and that the price of ether, the ether balance, and the number of Shares remain constant during the three-year period covered. The table does not show the impact of any staking rewards, Staking Fee, or extraordinary expenses the Trust may incur. Any such extraordinary expenses, if and when incurred, will accelerate the decrease in the fractional amount of ether represented by each Share.

**Hypothetical Calculation of NAV:**

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Sponsor**'**s** <br> **Fee of 0.25%**  | **Sponsor**'**s** <br> **Fee of 0.25%**  | **Sponsor**'**s** <br> **Fee of 0.25%**  | **Sponsor**'**s Fee of 0.25% with a 12-Month** <br> **Waiver to 0.12% for the First $2.5 billion in Trust**'**s Assets\*\***  | **Sponsor**'**s Fee of 0.25% with a 12-Month** <br> **Waiver to 0.12% for the First $2.5 billion in Trust**'**s Assets\*\***  | **Sponsor**'**s Fee of 0.25% with a 12-Month** <br> **Waiver to 0.12% for the First $2.5 billion in Trust**'**s Assets\*\***  |
|  | **Year 1** | **Year 2** | **Year 3** | **Year 1** | **Year 2** | **Year 3** |
| **Hypothetical ether price**  | $2500 | $2500 | $2500 | $2500 | $2500 | $2500 |
| **Sponsor**'**s Fee**  | 0.25% | 0.25% | 0.25% | 0.12% | 0.25% | 0.25% |
| **Shares of Trust, beginning**  | 4000000 | 4000000 | 4000000 | 4000000 | 4000000 | 4000000 |
| **Ether in Trust, beginning**  | 40000.00000 | 39900.00000 | 39800.25000 | 40000.00000 | 39952.00000 | 39852.12000 |
| **Beginning net asset value of the Trust**  | $100000000 | $99750000 | $99500625 | $100000000 | $99880000 | $99630300 |
| **Ether to be sold to cover the Sponsor**'**s Fee\***  | 100.00000 | 99.75000 | 99.50063 | 48.00000 | 99.88000 | 99.63030 |
| **Ether in Trust, ending**  | 39900.00000 | 39800.25000 | 39700.74938 | 39952.00000 | 39852.12000 | 39752.48970 |
| **Ending net asset value of the Trust**  | $99750000.00 | $99500625.00 | $99251873.44 | $99880000.00 | $99630300.00 | $99381224.25 |
| **Ending NAV**  | $24.94 | $24.88 | $24.81 | $24.97 | $24.91 | $24.85 |

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<sup>\*</sup> The calculation assumes that the sale of ether and the payment of the Sponsor's Fee occur only at the end of each year even though in actuality sales occur at least quarterly to cover the Sponsor's Fee, which is accrued daily and payable at least quarterly in arrears.

<sup>\*</sup> For a twelve-month period commencing on the day the Shares are initially listed on NASDAQ, the Sponsor will waive a portion of the Sponsor's Fee so that the Sponsor's Fee after the fee waiver will be equal to 0.12% of the net asset value of the Trust for the first $2.5 billion of the Trust's assets. Assumes that the net asset value of the Trust at the beginning of Year 1 is $100 million and the number of Shares remain constant during the three-year period covered. 

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**Intraday Indicative Value**

In order to provide updated information relating to the Trust for use by Shareholders, the Trust intends to publish an IIV using the ETHUSD_RTI. One or more major market data vendors will provide an IIV updated every 15 seconds, as calculated by the Exchange or a third-party financial data provider during the Regular Market Session. The IIV will be calculated by using the prior day's closing NAV as a base and updating that value during the Regular Market Session to reflect changes in the value of the Trust's NAV during the trading day.

The IIV's dissemination during the Regular Market Session should not be viewed as an actual real time update of the NAV, which will be calculated only once at the end of each trading day. The IIV will be widely disseminated every 15 seconds during the Regular Market Session by one or more major market data vendors. In addition, the IIV will be available through online information services.

All aspects of the Index Methodology are publicly available at the website of Index Provider, CF Benchmarks (www.cfbenchmarks.com). The CME CF Ether-Dollar Real Time Index is calculated once per second, in real time by utilizing the Order Books of ether - U.S. dollar trading pairs operated by all Constituent Platforms. An "Order Book" is a list of buy and sell orders with associated limit prices and sizes that have not yet been matched, that is reported and disseminated by CF Benchmarks Ltd., as the ETHUSD_RTI calculation agent. The Order Books are aggregated into one consolidated order book by the ETHUSD_RTI calculation agent. The mid-price volume curve, which is the average of the bid price-volume curve (which maps transaction volume to the marginal price per crypto asset unit a seller is required to accept in order to sell this volume to the consolidated order book) and the ask price-volume curve (which maps a transaction volume to the marginal price per crypto asset unit a buyer is required to pay in order to purchase this volume from the consolidated order book). The mid price-volume curve is weighted by the normalized probability density of the exponential distribution up to the utilized depth (utilized depth being calculated as the maximum cumulative volume for which the mid spread-volume curve does not exceed a certain percentage deviation from the mid price). The ETHUSD_RTI is then given by the sum of the weighted mid price-volume curve obtained in the previous step.

**DESCRIPTION OF THE SHARES AND THE TRUST AGREEMENT**

The Trust was formed on November 19, 2025. The purpose of the Trust is to own ether transferred to or purchased by the Trust in exchange for Shares issued by the Trust, as well as ether earned through Staking Activities. The Trust is governed by the Trust Agreement among the Sponsor, the Trustee, the Delaware Trustee, the registered holders and beneficial owners of Shares and all persons that deposit ether for the purpose of creating Shares. The Trust Agreement sets out the rights of depositors of ether and registered holders of Shares and the rights and obligations of the Sponsor, the Trustee and the Delaware Trustee. Delaware law governs the Trust Agreement, the Trust and the Shares. The following is a summary of material provisions of the Trust Agreement. It is qualified by reference to the entire Trust Agreement, which is filed as an exhibit to the registration statement of which the prospectus is a part.

Each Share represents a fractional undivided beneficial interest in the net assets of the Trust. Upon redemption of the Shares, the applicable Authorized Participant shall be paid solely out of the funds and property of the Trust. All Shares are transferable, fully paid and non-assessable. The assets of the Trust consist primarily of ether, whose private keys are held by the Ether Custodian on behalf of the Trust. However, the Trust is expected to buy or sell ether in connection with cash creations or redemptions of Baskets on an ongoing basis and sell ether at least quarterly to pay the Sponsor's Fee and to cover expenses and liabilities not assumed by the Sponsor. Such purchases or sales result in the Trust holding cash for brief periods of time. In addition, there may be other situations where the Trust may hold cash. For example, a claim may arise against the Ether Custodian, an Authorized Participant, or any other third party, which is settled in cash. If the Trust receives cash (other than in connection with purchase orders) or any property other than cash or ether, the Trust Agreement provides that the Trustee will, as soon as commercially feasible, (i) sell and/or distribute all the property (other than cash) received or otherwise dispose of the property (other than cash) in a manner that it determines is commercially reasonable, (ii) if the Trust will not distribute all of the cash (other than cash received in connection with purchase orders) received (including all cash received from the sale of other property), determine the amount of cash that will be promptly used by the Trust to pay the Sponsor's Fee and/or expenses and liabilities not assumed by the Sponsor, and (iii) distribute any cash (other than cash received in connection with purchase orders) that will not be promptly used as described in the preceding prong (ii). If the Trust does not sell or distribute the cash (other than cash received in connection with purchase orders) or other property accordingly, the Trust Agreement provides that no deposits of ether or cash will be accepted (i.e., there will be no issuance of new Shares). The Trustee will distribute such cash or other assets to DTC, and registered holders of Shares are entitled to receive such distributions in proportion to the number of shares owned. See "—Cash and Other Distributions." The Trust issues and redeems Shares only in Baskets of 40,000 or integral multiples thereof, based on the quantity of ether attributable to each Share (net of accrued but unpaid Sponsor's Fee and any accrued but unpaid expenses or liabilities). Baskets may be redeemed by the Trust in exchange for the amount of ether represented by the aggregate number of Shares redeemed or cash proceeds from selling the amount of ether represented by the aggregate number of Shares redeemed. These transactions take place in exchange for cash or ether. The Trust is not a registered investment company under the Investment Company Act and is not required to register under such act. The Sponsor is not registered with the SEC as an investment adviser and is not subject to regulation by the SEC as such in connection with its activities with respect to the Trust.

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**Creation and Redemption**

The Trust expects to create and redeem Shares on a continuous basis but only in Baskets of 40,000 Shares. Only Authorized Participants, which are registered broker-dealers who have entered into written agreements with the Sponsor and the Trustee, can place orders to receive Baskets in exchange for cash.

In connection with cash creations and redemptions, the Trust will engage in ether transactions for converting cash into ether (in association with purchase orders) and ether into cash (in association with redemption orders). The Trust will conduct its ether purchase and sale transactions by, in its sole discretion, choosing to trade directly with third parties (each, a "Ether Trading Counterparty"), pursuant to written agreements between such Ether Trading Counterparties and the Trust, or choosing to trade through the Prime Execution Agent through its Coinbase Prime service pursuant to the Prime Execution Agent Agreement. As of the date of this prospectus, the Ether Trading Counterparty is Virtu Financial Singapore Pte. Ltd. In connection with cash creations and redemptions, each Ether Trading Counterparty represents to the Trust that it is acting for itself and not for another person. Upon receipt of an order from an Authorized Participant to create or redeem Baskets, the Trust may obtain quotes for a price to purchase or sell ether from one or more an Ether Trading Counterparties. An Ether Trading Counterparty may respond to the Trust's request with an offer of a quote at which it is willing to sell the specified quantity of ether or a portion thereof, in the case of a creation, or a quote at which it is willing to buy the specified quantity of ether, or a portion thereof, in the case of a redemption, as indicated in such offer. The Ether Trading Counterparties are not contractually obligated to participate in cash orders for creations or redemptions by placing any offers to buy or sell ether with the Trust. The Trust then determines, in its sole discretion, whether to utilize one of the Ether Trading Counterparties that provided a quote or to trade through the Prime Execution Agent to execute an ether trade, subject to customary exceptions. Once an offer is accepted, it becomes a trade that is binding on both the Trust and the Ether Trading Counterparty. Each Ether Trading Counterparty is required to comply with U.S. federal and/or state laws including licensing and registration requirements or similar laws in non-U.S. jurisdictions and maintain practices and policies designed to comply with anti-money laundering and KYC regulations or similar laws in non-U.S. jurisdictions.

The Authorized Participants will deliver only ether or cash to create Shares and will receive only ether or cash when redeeming Shares.

The Prime Execution Agent facilitates the purchase and sale or settlement of the Trust's ether transactions. Ether Trading Counterparties settle trades with the Trust using their own accounts at the Prime Execution Agent when trading with the Trust.

**Issuance of Baskets** – **Transaction Fees**

A standard creation transaction fee is imposed to offset the transfer and other transaction costs associated with the issuance of Baskets. Under an ETF Services Agreement (the "ETF Services Agreement"), the Trust has retained BRIL, an affiliate of the Trustee, to perform ETF Services. BRIL will receive from an Authorized Participant a standard transaction fee on each purchase order, which consists of (1) the ETF Servicing Fee and (2) the Custody Transaction Costs. BRIL is entitled to retain the ETF Servicing Fee pursuant to the ETF Services Agreement, but BRIL will reimburse any Custody Transaction Costs to the Ether Custodian according to the amounts invoiced by the Ether Custodian. The ETF Servicing Fee is a flat fee per order regardless of the number of Baskets being purchased. The Custody Transactions Costs is a flat fee per order regardless of the number of Baskets being purchased.

**Issuance of Baskets - In-Kind Creations**

In connection with an in-kind creation, an Authorized Participant will be required to submit the creation order by an order cutoff time (the "In-Kind Order Cutoff Time"). The In-Kind Order Cutoff Time is 3:59 p.m. ET on the trade date. The Authorized Participant must submit an in-kind purchase order through BRIL's electronic order entry system, indicating the number of Baskets it intends to acquire. BRIL will acknowledge the in-kind purchase order unless the Trustee or the Sponsor decides to refuse the deposit as described below under "—Requirements for Trustee Actions."

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The date BRIL receives the in-kind purchase order will determine the basket ether amount (the "Basket Ether Amount") the Authorized Participant or its designated agent or client needs to deposit. However, orders received by BRIL after the In-Kind Order Cutoff Time will not be accepted and should be resubmitted on the following Business Day. Fractions of ether smaller than .00000001 ether (equivalent to 10 "gwei") are disregarded for purposes of the computation of the Basket Ether Amount.

If the Trustee accepts the in-kind purchase order, BRIL will transmit to the Authorized Participant, via electronic mail message or other electronic communication, no later than 8:00 p.m. ET on the date such purchase order is received, or deemed received, a copy of the purchase order endorsed "Accepted" by the Trustee and indicating the Basket Ether Amount that the Authorized Participant or its designated agent or client must deliver to the Prime Execution Agent in exchange for each Basket. In the case of purchase orders submitted via BRIL's electronic order entry system, the Authorized Participant will receive an automated email indicating the acceptance of the purchase order and the purchase order will be marked "Accepted" in BRIL's electronic order entry system. Prior to the Trustee's acceptance as specified above, a purchase order will only represent the Authorized Participant's unilateral offer to deposit ether in exchange for Baskets and will have no binding effect upon the Trust, the Trustee, the Trust Administrator, BRIL, the Ether Custodian, the Prime Execution Agent or any other party.

The Basket Ether Amount necessary for the creation of a Basket changes from day to day. As of [__], a Basket requires delivery of [__] ether. On each day that NASDAQ is open for regular trading, the Trust Administrator will adjust the quantity of ether constituting the Basket Ether Amount as appropriate to reflect sales of ether, any loss of ether that may occur, and accrued expenses. The computation is made by the Trustee as promptly as practicable after 4:00 p.m. ET. See "Business of the Trust—Net Asset Value" and "Business of the Trust— Valuation of Ether; the CF Benchmarks Index" for a description of how the CF Benchmarks Index is determined, and description of how the Trustee determines the NAV. BRIL will determine the Basket Ether Amount for a given day by multiplying the NAV by the number of Shares in each Basket (40,000) and dividing the resulting product by that day's CF Benchmarks Index. The Basket Ether Amount so determined will be made available to all Authorized Participants and will be made available on the Trust's website for the Shares.

The Authorized Participant or its designated agent or client will deposit ether related to the Authorized Participant's purchase order to the Trust's Trading Balance. This transfer is an "off-chain" transaction that is represented in the books and records of the Prime Execution Agent. In the event the Authorized Participant, its designated agent or client, has not deposited the ether to the Trust's Trading Account at the Prime Execution Agent by the applicable time on the settlement date of the in-kind creation order, the Authorized Participant will be given the option to (1) cancel the in-kind creation order, (2) delay settlement of the order to enable delivery of ether at a later date approved by the Trustee, or (3) accept that the Trust will execute a ether transaction required for the creation and the Authorized Participant will deliver the U.S. dollars required for this purchase. The Authorized Participant is liable to the Trust for and shall bear all slippage costs as well as all other costs, expenses, liabilities, and losses, suffered or incurred by the Trust in connection with the events described in the foregoing sentence, including, without limitation, the dollar cost of the difference between the ether price utilized in calculating NAV on the trade date and the price at which the Trust acquires the ether to the extent the price realized in buying the ether is higher than the ether price utilized in the NAV. To the extent the price realized in buying the ether is lower than the price utilized in the NAV, the Authorized Participant shall get to keep the dollar impact of any such difference.

**Issuance of Baskets - Cash Creations**

In connection with a cash creation, the Authorized Participant will be required to submit the purchase order by an early order cutoff time (the "Cash Order Cutoff Time"). The Cash Order Cutoff Time is 6:00 p.m. ET on the Business Day prior to the trade date. The Authorized Participant must submit a purchase order through BRIL's electronic order entry system, indicating the number of Baskets it intends to acquire. BRIL will acknowledge the purchase order unless the Trustee or the Sponsor decides to refuse the deposit as described below under "—Requirements for Trustee Actions."

In connection with cash creation, the date BRIL receives that order will determine the estimated cash amount (the "Basket Amount") the Authorized Participant needs to deposit and the basket ether amount the Trust needs to purchase from the Ether Trading Counterparty or through the Prime Execution Agent. The final cash amounts will be determined after the net asset value of the Trust is struck and the Trust's ether transactions have settled. However, orders received by BRIL after the Cash Order Cutoff Time on a Business Day will not be accepted and should be resubmitted on the following Business Day. Fractions of an ether smaller than 0.00000001 (known as a 10 "gwei") are disregarded for purposes of the computation of the Basket Ether Amount.

If the Trustee accepts the cash purchase order, BRIL will transmit to the Authorized Participant, via electronic mail message or other electronic communication, no later than 8:00 p.m. ET on the date such purchase order is received, or deemed received, a copy of the purchase order endorsed "Accepted" by the Trustee and indicating the Basket Amount that the Authorized Participant must deliver to the Custodians or the Prime Execution Agent in exchange for each Basket. In the case of purchase orders submitted via BRIL's electronic order entry system, the Authorized Participant will receive an automated email indicating the acceptance of the purchase order and the purchase order will be marked "Accepted" in BRIL's electronic order entry system. Prior to the Trustee's acceptance as specified above, a purchase order will only represent the Authorized Participant's unilateral offer to deposit cash in exchange for Baskets and will have no binding effect upon the Trust, the Trustee, the Trust Administrator, BRIL, the Ether Custodian or any other party.

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The Basket Ether Amount necessary for the creation of a Basket changes from day to day. As of [ ], a Basket requires delivery of approximately $[ ]. On each day that NASDAQ is open for regular trading, the Trust Administrator will adjust the cash amount constituting the Basket Amount and the quantity of ether constituting the Basket Ether Amount as appropriate to reflect sales of ether, any loss of ether that may occur, and accrued expenses. The computation is made by the Trustee as promptly as practicable after 4:00 p.m. ET. See "Business of the Trust—Net Asset Value" and "Business of the Trust—Valuation of Ether; the CF Benchmarks Index" for a description of how the CF Benchmarks Index is determined, and description of how the Trustee determines the NAV. BRIL will determine the Basket Amount for a given day by multiplying the NAV by the number of Shares in each Basket (40,000) and determine the Basket Ether Amount for a given day by dividing the Basket Amount for that day by that day's CF Benchmarks Index. The Basket Amount and the Basket Ether Amount so determined will be made available to all Authorized Participants and Ether Trading Counterparties and will be made available on the Trust's website for the Shares.

On the date of the Cash Order Cutoff Time, the Trust will choose, in its sole discretion, to enter into a transaction with an Ether Trading Counterparty or the Prime Execution Agent to buy ether in exchange for the cash proceeds from such purchase order. For settlement of a cash creation, the Trust delivers Shares to the Authorized Participant in exchange for cash received from the Authorized Participant. Meanwhile, the Ether Trading Counterparty or the Prime Execution Agent, as applicable, delivers the required ether pursuant to its trade with the Trust into the Trust's Trading Balance with the Prime Execution Agent in exchange for cash. In the event the Trust has not been able to successfully execute and complete settlement of an ether transaction by the settlement date of the purchase order, the Authorized Participant will be given the option to (1) cancel the purchase order, or (2) accept that the Trust will continue to attempt to complete the execution, which will delay the settlement date of the purchase order. With respect to a purchase order, as between the Trust and the Authorized Participant, the Authorized Participant is responsible for the dollar cost of the difference between the ether price utilized in calculating NAV on the trade date and the price at which the Trust acquires the ether to the extent the price realized in buying the ether is higher than the ether price utilized in the NAV. To the extent the price realized in buying the ether is lower than the price utilized in the NAV, the Authorized Participant shall keep the dollar impact of any such difference.

Whether the purchase of ether was entered into with an Ether Trading Counterparty or via the Prime Execution Agent, such party will deliver ether related to such transaction to the Trust's Trading Balance. This transfer is an "off-chain" transaction that is recorded in the books and records of the Prime Execution Agent.

Because the Trust's Trading Balance may not be funded with cash on the trade date for the purchase of ether associated with the cash purchase order, the Trust may borrow Trade Credits in the form of cash from the Trade Credit Lender pursuant to the Trade Financing Agreement or may require the Authorized Participant to deliver the required cash for the cash purchase order on the trade date. The extension of Trade Credits on the trade date allows the Trust to purchase ether through the Prime Execution Agent on the trade date, with such ether being deposited in the Trust's Trading Balance. For settlement of a cash creation, the Trust delivers Shares to the Authorized Participant in exchange for cash received from the Authorized Participant. To the extent Trade Credits were utilized, the Trust uses the cash to repay the Trade Credits borrowed from the Trade Credit Lender.

**Issuance of Baskets** – **Settlement and Ether Vault Transfers**

Upon the deposit by the Authorized Participant or its designated agent or client in connection with an in-kind purchase order or the Ether Trading Counterparty or the Prime Execution Agent in connection with a cash purchase order of the corresponding amount of ether with the Trust's Trading Balance, and the payment of the applicable ETF Servicing Fee, and of any expenses, taxes or charges (such as stamp taxes or stock transfer taxes or fees), the Cash Custodian will deliver the appropriate number of Baskets to the DTC account of the depositing Authorized Participant. As of the date of this prospectus, the Authorized Participant is Virtu Americas LLC. Additional Authorized Participants may be added at any time, subject to the discretion of the Sponsor.

In connection with the paragraph above, the deposit of ether will initially be credited to the Trust's Trading Balance with the Prime Execution Agent before being swept to the Trust's Vault Balance with the Ether Custodian pursuant to a regular end-of-day sweep process. Transfers of ether into the Trust's Trading Balance are off-chain transactions and transfers from the Trust's Trading Balance to the Trust's Vault Balance are "on-chain" transactions represented on the Ethereum blockchain. Any costs related to transactions and transfers from the Trust's Trading Balance to the Trust's Vault Balance are borne by the Prime Execution Agent (and not the Trust or its Shareholders).

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Because the Sponsor has assumed what are expected to be most of the Trust's expenses, and the Sponsor's Fee accrues daily at the same rate, in the absence of any extraordinary expenses or liabilities, the amount of ether by which the Basket Ether Amount will decrease each day will be predictable. In connection with a cash purchase order, the Trustee intends to have the Trust Administrator make available on each Business Day an indicative Basket Amount for the next Business Day. Authorized Participants may use that indicative Basket Amount as guidance regarding the amount of cash that they may expect to have to deposit with the Trust Administrator in respect of cash purchase orders placed by them on such next Business Day and accepted by the Trustee. The agreement entered into with each Authorized Participant provides, however, that once a purchase order has been accepted by the Trustee, the Authorized Participant will be required to deposit with the Trust Administrator the Basket Amount in connection with a cash purchase order or the Basket Ether Amount in connection with an in-kind purchase order, as determined by the Trustee on the effective date of the purchase order.

No Shares will be issued unless and until the Prime Execution Agent has informed the Trustee that it has allocated to the Trust's account the corresponding amount of ether. Disruption of services at the Prime Execution Agent or Ether Custodian would have the potential to delay settlement of the ether related to Share creations.

Ether transactions that occur on the blockchain are susceptible to delays due to Ethereum network outage, congestion, spikes in transaction fees demanded by miners, or other problems or disruptions. To the extent that ether transfers from the Trust's Trading Balance to the Trust's Vault Balance are delayed due to congestion or other issues with the Ethereum network, such ether will not be held in cold storage in the Vault Balance until such transfers can occur.

The Trustee may, and upon the direction of the Sponsor shall, suspend the acceptance of in-kind or cash purchase orders or the delivery or registration of transfers of Shares, or may, and upon the direction of the Sponsor shall, refuse a particular purchase order, delivery or registration of Shares (i) during any period when the transfer books of the Trustee are closed or (ii) at any time, if the Sponsor thinks it advisable for any reason. The Trustee and BRIL shall reject any purchase order or redemption order that is not in proper form.

**Redemption of Baskets** – **Transaction Fees**

Authorized Participants, acting on authority of the registered holder of Shares, may surrender Baskets in exchange for the corresponding Basket Ether Amount in connection with an in-kind redemption or Basket Amount in connection with a cash redemption announced by the Trustee.

A standard redemption transaction fee is imposed to offset transfer and other transaction costs that may be incurred by the Trust. As described above, under an ETF Services Agreement, the Trust has retained BRIL, an affiliate of the Trustee, to perform certain ETF Services. BRIL will receive from an Authorized Participant a standard transaction fee on each redemption order, which consists of (1) the ETF Servicing Fee and (2) the Custody Transaction Costs. BRIL is entitled to retain the ETF Servicing Fee pursuant to the ETF Services Agreement, but BRIL will reimburse any Custody Transaction Costs to the Ether Custodian according to the amounts invoiced by the Ether Custodian. The ETF Servicing Fee is a flat fee per order regardless of the number of Baskets being redeemed. The Custody Transaction Costs is a flat fee per order regardless of the number of Baskets being redeemed.

**Redemption of Baskets** – **In-Kind Redemptions**

In connection with an in-kind redemption, an Authorized Participant will be required to submit a redemption order by the In-Kind Order Cutoff Time. An Authorized Participant must submit an in-kind redemption order through BRIL's electronic order entry system indicating the number of Baskets it intends to redeem. The date BRIL receives that order determines the Basket Ether Amount in connection with an in-kind redemption to be received in exchange. However, orders received by BRIL after the In-Kind Order Cutoff Time on a Business Day will not be accepted and should be resubmitted on the following Business Day.

On the order date the Trust instructs the Ether Custodian to prepare to move the associated ether from the Trust's Vault Balance with the Ether Custodian to the Trust's Trading Balance with the Prime Execution Agent. For settlement of a redemption, the Authorized Participant delivers the necessary Shares to the Trust, the Trustee instructs the Prime Execution Agent to deliver ether to the account of the Authorized Participant or its designated agent or client's account at the Prime Execution Agent.

Transfers of ether from the Trust's Vault Balance to the Trust's Trading Balance are "on-chain" transactions represented on the Ethereum blockchain.

Ether transactions that occur on the blockchain are susceptible to delays due to Ethereum network outages, congestion, spikes in transaction fees demanded by miners, or other problems or disruptions. To the extent that ether transfers from the Trust's Vault Balance to the Trust's Trading Balance are delayed due to congestion or other issues with the Ethereum network or the Trust's operations, redemptions in the Trust could be delayed.

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Disruption of services at the Prime Execution Agent or Ether Custodian would have the potential to delay settlement of the ether related to Share redemptions.

**Redemption of Baskets** – **Cash Redemptions**

In connection with a cash redemption, an Authorized Participant will be required to submit a cash redemption order by the Cash Order Cutoff Time. An Authorized Participant must submit a redemption order through BRIL's electronic order entry system indicating the number of Baskets it intends to redeem. The date BRIL receives that order determines the Basket Amount in connection with a cash redemption to be received in exchange. However, orders received by BRIL after the Cash Order Cutoff Time on a Business Day will not be accepted and should be resubmitted on the following Business Day.

On the date of the Cash Order Cutoff Time, the Trust may choose, in its sole discretion, to enter into a transaction with an Ether Trading Counterparty or the Prime Execution Agent, to sell ether in exchange for cash. Also on the date of the Cash Order Cutoff, the Trust instructs the Ether Custodian to prepare to move the associated ether from the Trust's Vault Balance with the Ether Custodian to the Trust's Trading Balance with the Prime Execution Agent. For settlement of a redemption, the Authorized Participant delivers the necessary Shares to the Trust, an Ether Trading Counterparty or the Prime Execution Agent, as applicable, delivers the cash to the Trust associated with the Trust's sale of ether, the Trustee delivers ether to the Ether Trading Counterparty's account at the Prime Execution Agent or directly to the Prime Execution Agent, as applicable, and the Trust delivers cash to the Authorized Participant. In the event the Trust has not been able to successfully execute and complete settlement of an ether transaction by the settlement date, the Authorized Participant will be given the option to (1) cancel the redemption order, or (2) accept that the Trust will continue to attempt to complete the execution, which will delay the settlement date. With respect to a redemption order, between the Trust and the Authorized Participant, the Authorized Participant will be responsible for the dollar cost of the difference between the ether price utilized in calculating the NAV on trade date and the price realized in selling the ether to raise the cash needed for the cash redemption order to the extent the price realized in selling the ether is lower than the ether price utilized in the NAV. To the extent the price realized is selling the ether is higher than the price utilized in the NAV, the Authorized Participant shall get to keep the dollar impact of any such difference.

The transfers of ether from the Trust's Trading Balance to the Ether Trading Counterparty's account at the Prime Execution Agent or to the Prime Execution Agent is an "off-chain" transaction that is recorded in the books and records of the Prime Execution Agent.

The Trust's Trading Balance with the Prime Execution Agent may not be funded with ether on the trade date for the sale of ether in connection with the redemption order when ether remains in the Trust's Vault Balance with the Ether Custodian at the point of intended execution of a sale of ether. In those circumstances the Trust may borrow Trade Credits in the form of ether from the Trade Credit Lender, which allows the Trust to sell ether through the Prime Execution Agent on the trade date, and the cash proceeds are deposited in the Trust's Trading Balance with the Prime Execution Agent. For settlement of a redemption where Trade Credits were utilized, the Trust delivers cash to the Authorized Participant in exchange for Shares received from the Authorized Participant. In the event Trade Credits were used, the Trust will use the ether moved from the Trust's Vault Balance with the Ether Custodian to the Trading Balance with the Prime Execution Agent to repay the Trade Credits borrowed from the Trade Credit Lender.

Transfers of ether from the Trust's Vault Balance to the Trust's Trading Balance are "on-chain" transactions represented on the Ethereum blockchain.

Ether transactions that occur on the blockchain are susceptible to delays due to Ethereum network outages, congestion, spikes in transaction fees demanded by miners, or other problems or disruptions. To the extent that ether transfers from the Trust's Vault Balance to the Trust's Trading Balance are delayed due to congestion or other issues with the Ethereum network or the Trust's operations, redemptions in the Trust could be delayed.

Disruption of services at the Prime Execution Agent, the Ether Custodian, the Cash Custodian or the Authorized Participant's banks would have the potential to delay settlement of the ether related to Share redemptions.

**Redemption of Baskets - Settlement**

Upon the surrender of Shares and the payment of the applicable ETF Servicing Fee, Custody Transaction Costs and of any expenses, taxes or charges (such as stamp taxes or stock transfer taxes or fees) by the redeeming Authorized Participant, and the completion of the sale of ether for cash by the Trust in connection with a cash redemption order, the Trustee will (1) instruct the Prime Execution Agent to deliver from the Trust's Trading Balance to the account of the Authorized Participant or its agent or client, the amount of ether corresponding to the redeemed Baskets in connection with an in-kind redemption order or (2) instruct the delivery of cash to the Authorized Participant in connection with a cash redemption order.

If the Redemption fails to settle, the Authorized Participant shall have the option to cancel the Redemption Order, in which case the Trust will retain its ether and the Authorized Participant will retain the associated Shares and will not receive any ether, or the Sponsor may use an alternative execution method for the Trust to sell ether, in which case the Authorized Participant will receive cash, and the Authorized Participant agrees and acknowledges it is responsible for any Redemption Slippage and Cash Amount relating to such alternative execution method. Notwithstanding the forgoing, the Sponsor may extend the period for delivery of redemption proceeds in connection with stressed liquidity conditions resulting from the Trust's staking program.

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Shares can only be surrendered for redemption in Baskets of 40,000 Shares each.

All taxes incurred in connection with the delivery of ether to the Ether Custodian or cash to the Cash Custodian in exchange for Baskets (including any applicable value added tax) will be the sole responsibility of the Authorized Participant making such delivery.

Redemptions may be suspended only (1) during any period in which regular trading on NASDAQ is suspended or restricted or the exchange is closed (other than scheduled holiday or weekend closings), or (2) during a period when the Sponsor determines, in its sole discretion, that conditions exist as a result of which delivery, disposal, unstaking or deactivation, or evaluation of ether is not reasonably practicable (for example, as permitted by the Ethereum Staking Liquidity Risk Policy or as a result of an interruption in services or availability of the Prime Execution Agent, the Ether Custodian, the Cash Custodian, the Trust Administrator, or other service providers to the Trust, act of God, catastrophe, civil disturbance, government prohibition, war, terrorism, strike or other labor dispute, fire, force majeure, interruption in telecommunications, iShares order entry system, internet services, or network provider services, unavailability of Fedwire, SWIFT or banks' payment processes, significant technical failure, bug, error, disruption or fork of the Ethereum network, hacking, cybersecurity breach, or power, internet, or Ethereum network outage, or similar event). The Trustee and BRIL shall reject any purchase order or redemption order that is not in proper form. If the Trust suspends redemptions, Shareholders will be notified in a prospectus supplement, in its periodic Exchange Act reports and/or on the Trust's website.

 **The Trust's Staking Program**

 *Overview of Staking Program*

Pursuant to the Trust's investment objective, the Trust intends to engage in Staking Activities with respect to a portion of its ether holdings in order to earn staking rewards.On a daily basis, the Trust will disclose on its website the current percentage of the Trust's ether being staked (as of the prior business day).

To effectuate the Trust's Staking Activities, the Sponsor will direct, or may from time to time direct, the Ether Custodian to enter into Staking Arrangements with one or more Staking Services Providers, which may be either affiliates of the Ether Custodian or other approved third-party validators, to conduct Staking Activities through Provider-Facilitated Staking. The Sponsor anticipates that the Trust's Staking Activities will be executed exclusively by means of Provider-Facilitated Staking, and the Trust will not operate its own validator infrastructure.

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Under the Trust's staking program, the Sponsor instructs the Ether Custodian to stake the Trust's ether. The Ether Custodian, who controls the private keys to the Trust's ether, locks the Trust's Staked Assets from the Trust's Vault Account to the Ethereum network's Protocol Staking Deposit Contract, and designates (i) the Staking Services Provider as the validator in connection with a specified amount of the Trust's Staked Assets, allowing the Staking Services Provider to generate a set of Validator Keys relating to such Staked Assets that the Staking Services Provider can use to perform Validation Activities, and (ii) the Trust's own Vault Account as the withdrawal address for both applicable staking rewards and the underlying staked assets themselves after they are unstaked by the Ether Custodian at the Sponsor's instruction. The Staking Services Provider then uses the Validator Keys to perform Validation Activities, operating validator software, including validator nodes, with the Trust's Staked Assets staked with such Staking Services Provider subject to slashing if the Staking Services Provider commits certain forms of misconduct when performing Validation Activities. The Staking Services Provider does not control the cold storage private keys and thus cannot transfer or take possession or ownership of the Trust's Staked Assets when staked with such Staking Services Provider. Instead, the Staked Assets are locked in the Ethereum network's Protocol Staking Deposit Contract until unstaked by the Ether Custodian or the Staking Services Provider at the Sponsor's instruction, at which point the Trust's Staked Assets (and any related rewards) are returned programmatically to the Vault Account at the Ether Custodian. The Staking Services Provider is the node operator and is obligated to perform Validation Activities with the Trust's Staked Assets consistent with the terms of the Trust's agreements with Staking Services Providers. The Trust retains control and ownership of the Trust's staked ether because (1) the Ether Custodian controls the private keys to the Trust's Staked Assets (Validator Keys do not give the Staking Services Provider the ability to transfer the Trust's Staked Assets, and the Trust's Staked Assets are never transferred to a wallet address of the Staking Services Provider; furthermore, the Protocol Staking Deposit Contract is a smart contract that has no associated private keys and, upon unstaking, programmatically transfers the Trust's Staked Assets back to the Trust's Vault Account at the Ether Custodian), (2) the Trust (rather than the Staking Services Provider) will retain the legal ability through the Ether Custodian to unstake its ether at any time (subject to Ethereum network processes and delays), and (3) the Trust's Staking Arrangements specifically provide that the Staked Assets belong to the Trust and neither the Staking Services Providers nor Coinbase have any ownership or property interest in the Trust's Staked Assets. The Trust's agreements with Staking Services Providers require each Staking Services Provider to maintain Validator Keys that solely correspond to Staked Assets of the Trust and not commingle the staked assets of any other person (such as the Staking Services Provider or others who stake to the Staking Services Provider) with the Staked Assets of the Trust, despite the Trust delegating the validation rights to the Trust's Staked Assets to the Staking Services Provider, which may serve as a staking services provider for other persons and, as a result, hold other validator keys and perform validation activities corresponding to staked ether belonging to other ether holders. Staking will be a passive activity for the Trust, as it relies on Provider-Facilitated Staking, and will not operate its own node or perform validation activities on its own. Moreover, the Trust's role will be limited to (i) selecting the Staking Services Provider(s) and the allocation of assets to Staking Service Providers, and (ii) determining, from time to time, what portion of the Trust's ether to stake and unstake so as to maintain sufficient Trust assets to satisfy all outstanding redemption orders, and informing the Staking Services Provider(s) of those determinations. Under normal market circumstances, the Sponsor intends to stake 70% - 95% of the Trust's ether.

 *Staking Services Providers*

The Sponsor will direct the Ether Custodian to stake the Trust's ether with one or more third-party Staking Services Providers based on a range of factors, including, but not limited to, the performance, reliability, and reputation of each Staking Services Provider, as well as quarterly reporting to the Trust on Staking Service Providers' performance and reliability, including uptime, slashing history, and rewards earned. Staking Services Providers are required to operate validators in accordance with industry-standard performance and security practices, including maintaining high validator uptime and implementing software designed to optimize staking rewards, such as MEV-Boost; however, such requirements do not eliminate the risk of missed rewards, slashing, or other protocol-level penalties.

The Staking Services Provider shall exercise no discretion as to the amount of the Trust's ether to be staked or the timing of the Trust's Staking Activities. The Ether Custodian will maintain exclusive possession and control of the private keys associated with transferring any staked ether at all times while Staking Service Providers will maintain exclusive possession and control of the private keys associated with ether validation activities at all times. Staking activity on the Ethereum network involves the delegation of ether to validators and carries certain risks. Misbehavior or poor performance by validators may result in such validators receiving reduced staking rewards for an epoch during which they misbehaved or performed poorly. Should any of the Trust's Staking Services Providers engage in malicious activity or perform poorly, then such Staking Services Provider may be removed which could negatively impact the Trust's abilities to engage in Staking Activities and/or otherwise result in the Trust earning reduced staking rewards. Additionally, as part of the "activating" and "exiting" (followed by withdrawal) processes of staking, staked ether will be inaccessible for a variable period of time determined by a range of factors, including network congestion, resulting in potential inaccessibility during those periods. During activation, exit, and withdrawal, the Trust's staked assets will not earn any rewards. "Activation" is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the Ethereum network's proof-of-stake consensus protocol. "Exit" is the request to exit from the active set and no longer participate in the Ethereum network's proof-of-stake consensus protocol, and is followed by a protocol-administered withdrawal process, which takes additional time to complete. As part of these "activation", "exiting" and withdrawal processes of staking on the Ethereum network, any staked ether will be inaccessible for a period of time. The duration of activation and exit/withdrawal periods are dependent on a range of factors, including network conditions. In periods of low demand, unstaking may be completed within days, while in periods of elevated exit activity the process may take multiple weeks or months to complete.

In certain circumstances, a Staking Services Provider may be obligated to compensate the Trust for losses resulting from slashing events attributable to the validator's failure to perform its obligations in accordance with applicable standards. Such compensation, if any, is subject to conditions, exclusions, evidentiary requirements, and timing delays, may not apply to protocol-wide events or software failures, and may not fully offset the Trust's losses. There can be no assurance that any such compensation will be available, in whole, in part, or at all, timely, or sufficient.

 *Allocation of Staking Rewards*

The Trust expects to receive certain staking rewards of ether from Staking Activities, which would be treated as giving rise to taxable income for U.S. federal income tax purposes under current IRS guidance. See "U.S. Federal Income Tax Consequences" for further description of the tax implications of the activities of the Trust. There is no guarantee that the Trust will receive any rewards with respect to staked ether. Past rewards are not indicative of future returns. The Trust will pay a "Staking Fee", which will include (i) the Sponsor's Staking Portion (ii) the Prime Execution Agent's share of Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers for their respective shares of the Trust's Staking Consideration), in accordance with the Staking Services Agreement. As of the date of this prospectus, the Sponsor's Staking Portion and the Prime Execution Agent's share of such Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers in respect of their shares of the Staking Consideration) comprise an aggregate of 18% of the gross Staking Consideration. The Trust will retain the remainder of such gross Staking Consideration.

 *Liquidity Risk Management* 

The Trust's staking program seeks to maximize the portion of the Trust's ether available for staking while controlling for liquidity and redemption risks. To manage the liquidity and redemption risks associated with staking, the Sponsor intends to maintain a Liquidity Sleeve designed to accommodate anticipated redemption activity.

In connection with these objectives, an Ethereum Staking Liquidity Risk Policy has been adopted by the Sponsor on behalf of the Trust. This Ethereum Staking Liquidity Risk Policy sets forth the procedures and considerations the Trust's Staking Activities in a manner designed to protect and conserve the Trust's property while mitigating the liquidity risks associated with such staking. To manage the liquidity and redemption risks associated with staking, the Sponsor intends to maintain a Liquidity Sleeve consisting of a target range of 5%-30% unstaked ether maintained solely to ensure that the Trust has sufficient readily available assets to meet redemption requests. The Liquidity Sleeve will be held by the Ether Custodian and maintained in cold storage and will not be held in hot wallets. Except for temporary movements into a trading balance solely to facilitate creation or redemption activity, all ether in the Liquidity Sleeve will remain in the custody of the Ether Custodian in cold storage and will be swept back into cold storage on a daily basis.

In determining the size of the Liquidity Sleeve, the Sponsor will consider factors identified in the Ethereum Staking Liquidity Risk Policy, including expected creation and redemption dynamics, current and anticipated Ethereum protocol entry and exit times, liquidity conditions (including the availability of other liquidity tools), and Ethereum network factors that may affect exit and activation timing. The Sponsor may convene an internal committee under the Ethereum Staking Liquidity Risk Policy to review the size of the Liquidity Sleeve and may rebalance the Trust's staked and unstaked ether to maintain the Liquidity Sleeve within the applicable target range as soon as reasonably practicable.

The Sponsor will convene an internal committee to periodically review the size of the Liquidity Sleeve based on the factors described above. The Trust's objective is to maximize the percentage of staked assets while managing liquidity solely to support sufficient liquidity for redemptions. The committee may be convened at any time to determine the range for the Liquidity Sleeve that the Sponsor deems prudent to enable the Trust to meet redemptions. The Ethereum Staking Liquidity Risk Policy may be revised from time to time to reflect changes adopted by the committee with respect to the Liquidity Sleeve parameters or procedures.

In addition to maintaining the Liquidity Sleeve, the Trust may hold ether in unstaked form. First, the Trust may hold ether in unstaked form on a short-term, temporary basis in connection with: (i) the sale of ether for cash to pay Trust expenses; (ii) creation and redemption orders; (iii) the receipt of staking rewards; or (iv) the sale of ether for shareholder distributions. Second, the Trust may hold ether in unstaked form in connection with:

(i) obtaining or disposing of ether through a "contingent liquidity arrangement" described in Section 6.02(12) of IRS Rev. Proc. 2025-31; (ii) the sale of ether for cash in connection with the Trust's liquidation; (iii) the need to take protective measures against potential systemic vulnerabilities in the Ethereum <u>network</u><u>'</u><u>s</u> protocol, the staking smart contracts, or the validator client software; (iv) the cessation of the arrangement between the Trust and an Ether Custodian (including any temporary suspension or unstaking instruction intended to protect the Trust's assets against the risk of loss of ownership of the staked digital assets), but only with respect to the ether affected by the cessation; (v) the cessation of the arrangement between an Ether Custodian and a Staking Services Provider (including any temporary suspension or unstaking instruction intended to protect the Trust's assets against the risk of loss of ownership of the staked digital assets), but only with respect to the staked digital assets affected by the cessation; or (vi) a change in applicable law or regulation.

 *Delayed Settlement*

Based on market conditions, or in order to act in the interest of shareholders, in a Reduced Buffer Scenario, the Trust may, in its sole discretion, require cash-in-lieu redemption orders until the Liquidity Sleeve has been restored.

In stressed conditions, there remains a risk that redemptions exhaust the Liquidity Sleeve, liquidity management policies are unable to sufficiently adjust, and the Trust is unable to meet redemptions in the typical settlement cycle. In that situation, the Sponsor plans to initiate a coordinated redemption workflow where the Sponsor will alert the Trust's Authorized Participants in a timely fashion and transparently work with Authorized Participants to facilitate an orderly settlement of redemption orders when stressed conditions may affect the availability of ether. The Trust will file a Current Report on Form 8-K if such stressed conditions occur.

In stressed conditions where the Trust has limited unstaked ether remaining or does not have enough unstaked ether available to meet in-kind redemptions, as determined by the Sponsor in its sole discretion, the Sponsor may, in its sole discretion, determine to either (1) continue processing in-kind redemptions, but delay settlement of such in-kind redemptions beyond the ordinary settlement cycle for in-kind redemptions, or (2) solely permit cash redemptions, until the in-kind policy cutoff. During stressed conditions, the Sponsor plans to prioritize redemptions over distribution of staking rewards and payment of fees. Staking reward distributions and fees will continue to accrue during the delayed redemption period. After redemptions have been paid and the Sponsor has determined, in its discretion, that stressed conditions no longer persist, the Sponsor will resume its ordinary procedures to pay the Sponsor's Fee, Staking Fee and distributions of staking rewards, including, in each case, any delinquent amounts.

Furthermore, in stressed conditions where the Trust has limited unstaked ether remaining or does not have enough unstaked ether available to meet cash redemptions, as determined by the Sponsor in its sole discretion, and the Sponsor has invoked the in-kind policy cutoff and is solely permitting cash redemptions, the Sponsor may further, in its sole discretion, determine to either (1) process cash redemptions on the ordinary settlement cycle for cash redemptions, or (2) delay settlement of cash redemptions beyond the ordinary settlement cycle for cash redemptions.

Upon submission of either Delayed Settlement Scenario, the Sponsor will alert the Authorized Participant and allow the Authorized Participant to choose whether to (1) cancel the redemption order, or (2) accept delayed settlement in accordance with the Delayed Settlement Scenario and proceed with the redemption. The Sponsor shall determine, in its sole discretion, the time at which settlement occurs in a Delayed Settlement Scenario, whether a Delayed Cash Redemption or a Delayed In-Kind Redemption. An Authorized Participant who chooses to proceed with redemption in a Delayed Settlement Scenario shall be bound by the Sponsor's determination and shall not be entitled to choose a different time when their redemption order shall settle, other than the time determined by the Sponsor. If the Authorized Participant decides to proceed with redemption following a Delayed Settlement Scenario that is a Delayed Cash Redemption, the Authorized Participant will deliver the appropriate number of Shares to the Trust. In a Delayed Settlement Scenario that is a Delayed Cash Redemption, the Sponsor will initiate unstaking sufficient to satisfy all redemptions that have not been cancelled and prioritize orders by order date placed then sell pro-rata amounts of liquid ether available each day to the relevant orders (prioritized by order date placed) until all orders are satisfied. Redemptions may be satisfied by any unstaked ether balance, including unstaked ether received via creation orders.

In the event an Authorized Participant submits a Delayed In-Kind Redemption before the Sponsor enables the in-kind policy cutoff, Authorized Participants will be allowed to (1) cancel, (2) accept delayed settlement in-kind in accordance with the Delayed Settlement Scenario, and proceed with the redemption, or (3) replace with a cash order at the next cash order window. If the Authorized Participant decides to proceed with a Delayed In-Kind Redemption, the Authorized Participant will deliver the appropriate number Shares to the Trust. In a Delayed In-Kind Redemption, the Sponsor will initiate unstaking transactions sufficient to satisfy all redemptions that have not been cancelled and prioritize orders by order date. When sufficient liquid ether is available to satisfy all prioritized in-kind orders, as determined by the Sponsor in its sole discretion, the Sponsor will settle the full amount the following business day.

Neither the Sponsor, nor the Trust, nor the Administrative Trustee, nor the Prime Execution Agent, nor the Delaware Trustee, nor any other person shall have any liability of any kind whatsoever to an Authorized Participant in connection with a Delayed Settlement Scenario.

**Certificates Evidencing the Shares**

The Shares are evidenced by certificates executed and delivered by the Trustee on behalf of the Trust. It is expected that DTC will accept the Shares for settlement through its book-entry settlement system. So long as the Shares are eligible for DTC settlement, there will be only one global certificate evidencing Shares that will be registered in the name of a nominee of DTC. Investors will be able to own Shares only in the form of book-entry security entitlements with DTC or direct or indirect participants (the "Indirect Participant") in DTC. No investor will be entitled to receive a separate certificate evidencing Shares. Because Shares can only be held in the form of book-entries through DTC and its participants ("DTC Participants"), investors must rely on DTC, a DTC Participant and any other financial intermediary through which they hold Shares to receive the benefits and exercise the rights described in this section. Investors should consult with their broker or financial institution to find out about the procedures and requirements for securities held in DTC book-entry form.

**Cash and Other Distributions**

If the Sponsor and the Trustee determine that there is more cash being held in the Trust than is needed to pay the Trust's expenses for the next month, (or, if later, the end of the current calendar quarter) the Trustee will distribute the extra cash to DTC.

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If the Trust receives cash (other than in connection with purchase orders) the Trustee will distribute that property to DTC by any means the Sponsor thinks is lawful, equitable and feasible. If it cannot make the distribution in that way, the Trustee will sell the property or otherwise dispose of the property (other than cash) in a manner that it determines is commercially reasonable, and distribute the net proceeds (if any) in the same way as it does with cash (as described in the preceding paragraph). The Trustee and the Sponsor shall not be liable for any loss or depreciation resulting from any sale or other disposition of property made by the Trustee pursuant to the Sponsor's instruction or otherwise made by the Trustee in good faith.

Registered holders of Shares are entitled to receive these distributions in proportion to the number of Shares owned. Before making a distribution, the Trustee may deduct any applicable withholding taxes and any fees and expenses of the Trust that have not been paid. The Trustee distributes only whole U.S. dollars and cents and is not required to round fractional cents to the nearest whole cent. The Sponsor is not responsible if it decides that it is unlawful or impractical to make a distribution available to registered holders.

**Voting Rights**

Owners of Shares do not generally have any voting rights, take no part in the management or control, and have no voice in, the Trust's operations or business. The Shares do not represent a traditional investment and are not similar to shares of a corporation operating a business enterprise with management and a board of directors. All Shares are of the same class with equal rights and privileges. Each Share entitles the holder to vote on the limited matters upon which Shareholders may vote under the Trust Agreement. The Shares do not entitle their holders to any conversion or pre-emptive rights or any redemption rights.

**Share Splits**

If the Sponsor believes that the per-Share price in the secondary market for Shares has fallen outside a desirable trading price range or if the Sponsor determines that it is advisable for any reason, the Sponsor may cause the Trust to declare a split or reverse split in the number of Shares outstanding and to make a corresponding change in the number of Shares constituting a Basket.

**Management of the Trust**

The Trust does not have a board of directors or an audit committee but does have oversight from the Board of Directors and audit committee of the Sponsor. See "The Sponsor—Key Personnel of the Sponsor."

**Fees and Expenses of the Trustee**

Each deposit of cash for the creation of Baskets and each surrender of Baskets for the purpose of withdrawing Trust property (including if the Trust Agreement terminates) must be accompanied by a payment to BRIL of the ETF Servicing Fee.

The Trustee is entitled to reimburse itself from the assets of the Trust for all expenses and disbursements incurred by it for extraordinary services it may provide to the Trust or in connection with any discretionary action the Trustee may take to protect the Trust or the interests of the holders.

**Trust Expenses and Ether Sales**

In addition to the Sponsor's Fee and the Staking Fee, the following expenses will be paid out of the assets of the Trust:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● any expenses or liabilities of the Trust that are not assumed by the Sponsor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● any taxes and other governmental charges that may fall on the Trust or its property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● any expenses of any extraordinary services performed by the Trustee or the Sponsor on behalf of the Trust or expenses of any action taken by the Trustee or the Sponsor to protect the Trust or the rights and interests of holders of Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● any indemnification of the Sponsor and its shareholders, directors, officers, employees, affiliates (as such term is defined under the Securities Act of 1933, as amended) and subsidiaries and agents, the Cash Custodian, the Ether Custodian, the Staking Services Provider the Prime Execution Agent, the Trust Administrator, or other agents, service providers or counterparties of the Trust as described below; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters or legal fees, costs or expenses incurred by the Trust or Coinbase (when acting as agent on behalf of the Trust) in enforcing the Trust's rights against Staking Services Providers.

The Trustee will, when directed by the Sponsor, and in the absence of such direction, may in its discretion sell the Trust's ether from time to time as necessary to permit payment of the fees and expenses that the Trust is required to pay. See "Business of the Trust—Trust Expenses."

The Trustee is not responsible for any depreciation or loss incurred by reason of sales of ether made in compliance with the Trust Agreement.

**Payment of Taxes**

The Trustee may deduct the amount of any taxes owed from any distributions it makes. It may also sell Trust assets, by public or private sale, to pay any taxes owed. Registered holders of Shares will remain liable if the proceeds of the sale are not enough to pay the taxes.

**Evaluation of Ether and the Trust Assets**

See "Business of the Trust—Net Asset Value" and "Business of the Trust—Valuation of Ether; the CF Benchmarks Index."

**Amendment and Dissolution**

The Sponsor and the Trustee may agree to amend the Trust Agreement without the consent of the holders of Shares. If an amendment imposes or increases fees or charges, except for taxes and other governmental charges, or prejudices a substantial right of holders of Shares, it will not become effective for outstanding Shares until 30 days after the Trustee notifies DTC of the amendment. At the time an amendment becomes effective, by continuing to hold Shares or an interest therein, investors are deemed to agree to the amendment and to be bound by the Trust Agreement as amended.

The Trustee will dissolve the Trust if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● the Trustee is notified that the Shares are delisted from NASDAQ and are not approved for listing on another national securities exchange within five Business Days of their delisting;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● a U.S. federal or state court or regulator, or applicable law or regulatory requirements, requires the Trust to shut down, or forces the Trust to liquidate its ether, or seizes, impounds or otherwise restricts access to Trust assets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● The Sponsor notifies the Trustee in writing that it has determined, in its sole discretion, that the dissolution of the Trust is advisable or desirable for any reason; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● DTC is unable or unwilling to continue to perform its functions, and a comparable replacement is unavailable.

The Sponsor, may, in its sole discretion, dissolve the Trust if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● 60 days have elapsed since the Trustee notified the Sponsor of the Trustee's election to resign or since the Sponsor removed the Trustee, and a successor trustee has not been appointed and accepted its appointment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● the SEC (or its staff) or a court of competent jurisdiction determines that the Trust is an investment company under the Investment Company Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● the CFTC determines that the Trust is a commodity pool under the Commodity Exchange Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● FinCEN determines that the Trust or the Sponsor is required to register as an MSB, or the New York Department of Financial Services determines the Trust or the Sponsor is required to obtain BitLicense;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● if any state regulator or court of competent authority determines the Sponsor or the Trust is required to obtain a money transmitter license or other state license;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● the Index Administrator ceases to maintain the Index or any ongoing event exists that prevents or makes impractical the determination of the Index price and, in the opinion of the Sponsor, no successor or similar pricing source is reasonably available;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● the net assets of the Trust in relation to the operating expenses of the Trust is at a level at which continued operation of the Trust is unreasonable or imprudent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● any ongoing event exists that either prevents the Trust from or makes impractical the Trust's holding of ether, or prevents the Trust from converting or makes impractical the Trust's reasonable efforts to convert ether to U.S. dollars;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● the Trust fails to qualify for treatment, or ceases to be treated, for U.S federal income tax purposes, as a grantor trust, and the Trustee receives notice from the Sponsor that the Sponsor has determined that, because of that tax treatment or change in tax treatment, termination of the Trust is advisable; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● any custodian (including, for the avoidance of doubt, any of the Custodians) or prime execution agent (including, for the avoidance of doubt, the Prime Execution Agent) then acting resigns, is removed, is prohibited by applicable law or regulation to act as or otherwise ceases to act as custodian or prime execution agent, and, in the opinion of the Sponsor, no successor custodian or prime execution agent has been employed and/or operationalized prior to, at the Sponsor's election, (i) the effective date of such resignation, removal, prohibition or cessation, or (ii) in the case of the Ether Custodian or the Prime Execution Agent, the final date as of which the Ether Custodian or the Prime Execution Agent will cease to hold any of the Trust's assets, to the extent different from (i).

The term of the Trust is perpetual (unless terminated earlier in certain circumstances). On and after dissolution of the Trust, the Trustee will wind up the business and affairs of the Trust and deliver Trust property upon surrender and cancellation of Shares. The Trustee will not accept any purchase order or redemption order after the date of dissolution. If any Shares remain outstanding after the date of dissolution of the Trust, the Trustee thereafter will (i) discontinue the registration of transfer of Shares; (ii) continue to collect distributions pertaining to Trust property and hold proceeds thereof uninvested, without liability for interest; and (iii) pay the Trust's expenses and may sell Trust property as necessary to meet those expenses. After the dissolution of the Trust, the Trustee will sell or otherwise liquidate the Trust property then held and after deducting any fees, expenses, taxes or other governmental charges payable by the Trust and any expenses for the account of DTC of such Shares and any applicable taxes or other governmental charges, promptly distribute the net proceeds from such sale to DTC. The Trustee and the Sponsor shall not be liable for any loss or depreciation resulting from any sale or other disposition of property made by the Trustee pursuant to the Sponsor's instruction or otherwise made by the Trustee in good faith. The proceeds of the liquidation of the Trust's assets will be distributed in cash. Shareholders are not entitled to any of the Trust's underlying ether holdings upon the dissolution of the Trust.

Upon the dissolution of the Trust, the Trustee would conduct sales of ether for cash through the Prime Execution Agent over a reasonable wind-down period in order to limit market impact, as feasible under the circumstances. Under this process, the Trustee would instruct the Ether Custodian to move a pre-determined amount of ether from the Vault Balance to the Trading Balance at the start of each day in which liquidations were to occur. The Trustee would then instruct the Prime Execution Agent to execute sales of the ether for cash based on optimal achievable execution. The cash proceeds would be delivered to the Cash Custodian at the end of each day.

In the event that the dissolution of the Trust was caused by, or coincided with, the failure or bankruptcy of the Ether Custodian or the Prime Execution Agent, the Trustee would engage with the relevant bankruptcy, insolvency, or resolution process for the Ether Custodian or the Prime Execution Agent with the goal of preserving and recovering the Trust's ether and cash in accordance with, and to the extent permitted by, the bankruptcy, insolvency or resolution process. If permitted by the relevant bankruptcy or resolution process to take control of the Trust's property, the Trustee would then seek to liquidate the Trust's property (through a method or agent other than the Prime Execution Agent and in accordance with applicable law) as quickly as reasonably practicable thereafter and distribute the proceeds of the liquidation to Shareholders. Alternatively, the Trustee may be required to assert a monetary claim in the relevant bankruptcy or resolution process. Thereafter, the Trustee would seek to resolve and liquidate that claim as quickly as reasonably practicable in order to distribute the proceeds to Shareholders. The bankruptcy, insolvency or resolution process could be lengthy and could result in the relevant court or resolution authority returning only a fraction of the Trust's property or recovering only a fraction of the Trust's legal claim to the Trust, for example if the Trust is deemed to be an unsecured creditor. For more information, see "Risk Factors—The lack of full insurance and Shareholders' limited rights of legal recourse against the Trust, the Delaware Trustee, the Sponsor, the Trust Administrator, the Cash Custodian and the Ether Custodian expose the Trust and its Shareholders to the risk of loss of the Trust's ether for which no person or entity is liable."

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Following the liquidation of the Trust's ether, any remaining outstanding Shares will be redeemed for cash and distributed to Shareholders in accordance with the provisions of the Trust Agreement. Upon the dissolution of the Trust and the winding up of the Trust by the Sponsor and the Trustee, the Delaware Trustee shall, upon receipt of written direction of the Trustee or the Sponsor, execute and cause a certificate of cancellation of the Certificate of Trust to be filed with the Secretary of State in accordance with the Delaware Statutory Trust Act (the "DSTA"). After making such filing, the Trustee and the Delaware Trustee shall be discharged from all obligations under the Trust Agreement.

**Limitations on Obligations and Liability**

The Trust Agreement expressly limits the obligations and liabilities of the Sponsor and the Trustee. As further set out in the Trust Agreement, the Sponsor and the Trustee:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● are obligated to take only the actions specifically set forth in the Trust Agreement without willful misconduct, gross negligence or bad faith;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● are not liable if either of them is prevented or delayed by law or circumstances beyond their control from performing their respective obligations under the Trust Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● are not liable if they exercise or fail to exercise discretion permitted under the Trust Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● have no obligation to prosecute a lawsuit or other proceeding related to the Shares or the Trust's property on behalf of any holders of Shares or on behalf of any other person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● are not liable for any loss of ether occurring prior to the delivery of ether to the Ether Custodian or the Prime Execution Agent, as applicable, or after the delivery of ether by the Ether Custodian or the Prime Execution Agent, as applicable (and for the avoidance of doubt, are not liable for the loss of ether while held by the Ether Custodian or the Prime Execution Agent or for any loss of ether occurring during the transfer of ether from the Ether Custodian or the Prime Execution Agent to the Additional Ether Custodian or vice versa, absent willful misconduct, gross negligence, reckless disregard or bad faith by the Sponsor and Trustee); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● may rely upon any advice or information from other persons they believe in good faith to be competent to provide such advice or information.

In addition, as further set out in the Trust Agreement, the Sponsor, the Trustee, the Delaware Trustee and their respective affiliates:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● are not liable for any loss suffered by the Trust that arises out of any of action or inaction of such person if such person, in good faith, determined that such course of conduct was in the best interest of the Trust and such course of conduct did not constitute willful misconduct, gross negligence or bad faith of such person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● are not personally liable for the return or repayment of all or any portion of the capital or profits of any person, and any such return of capital or profits made will be made solely from the assets of the Trust without any rights of contribution from any of the Sponsor, the Trustee, the Delaware Trustee or their respective affiliates; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● are not liable for the conduct or misconduct of any delegee selected by the Trustee; provided, however, that in the case of the Trustee, the foregoing only applies if the Trustee made such selection with reasonable care.

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In addition, under the Trust Agreement, the Trust is obligated to indemnify the Sponsor and its shareholders, directors, officers, employees, affiliates and subsidiaries and agents shall be indemnified from the Trust and held harmless against any loss, liability, claim, cost, expense or judgment of any kind whatsoever (including the reasonable fees and expenses of counsel) arising out of or in connection with the performance of their obligations under the Trust Agreement or any actions taken in accordance with the provisions of the Trust Agreement and incurred without their (1) willful misconduct, gross negligence or, bad faith or (2) reckless disregard of their obligations and duties under the Trust Agreement.

**Requirements for Trustee Actions**

Before the Trustee delivers or registers a transfer of Shares, makes a distribution on Shares, or permits withdrawal of Trust property, the Trustee may require:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any Shares or Trust property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● compliance with regulations it may establish, from time to time, consistent with the Trust Agreement, including presentation of transfer documents.

The Trustee may, and upon the direction of the Sponsor shall, suspend the acceptance of purchase orders or the delivery or registration of transfers of Shares, or may, and upon the direction of the Sponsor shall, refuse a particular purchase order, delivery or registration of Shares (i) during any period when the transfer books of the Trustee are closed or (ii) at any time, if the Sponsor thinks it advisable for any reason. The Trustee may, in its sole discretion, and upon the direction of the Sponsor will, suspend the right to surrender Shares or postpone the delivery date of ether or other Trust property generally or with respect to a particular redemption order (i) during any period in which regular trading on NASDAQ is suspended or restricted, or the exchange is closed (other than scheduled holiday or weekend closings), or (ii) during a period when the Sponsor determines that delivery, disposal or evaluation of ether is not reasonably practicable (for example, as a result of an interruption in services or availability of the Prime Execution Agent, the Ether Custodian, the Cash Custodian, the Trust Administrator, or other service providers to the Trust, act of God, catastrophe, civil disturbance, government prohibition, war, terrorism, strike or other labor dispute, fire, force majeure, interruption in telecommunications, iShares order entry system, internet services, or network provider services, unavailability of Fedwire, SWIFT or banks' payment processes, significant technical failure, bug, error, disruption or fork of the Ethereum network, hacking, cybersecurity breach, or power, internet, or Ethereum network outage, or similar event). The Trustee shall reject any purchase order or redemption order that is not in proper form. If the Trust suspends creations or redemptions, Shareholders will be notified in a prospectus supplement, in its periodic Exchange Act reports and/or on the Trust's website.

**Delegation by the Trustee to the Trust Administrator or Other Agent**

The Trustee may delegate all or some of its duties under the Trust Agreement to an agent, including the Trust Administrator, without the consent of the Sponsor, any Authorized Participant or any Shareholders. The Trustee is not required to appoint a new Trust Administrator or other agent upon any termination of any of these delegations.

**Venue Provision**

The Trust Agreement provides that the courts of the state of Delaware and any federal courts located in Wilmington, Delaware will be the non-exclusive jurisdiction for any claims, suits, actions or proceedings, provided that causes of actions for violations of the Exchange Act or the Securities Act will not be governed by the non-exclusive jurisdiction provision of the Trust Agreement.

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**Waiver of Jury Trial Provision**

The Trust Agreement also waives the right to trial by jury in any such claim, suit, action or proceeding, provided that causes of actions for violations of the Exchange Act or the Securities Act will not be governed by the waiver of the right to trial by jury provision of the Trust Agreement.

**Limitations on the Right to Bring Derivative Actions**

Pursuant to the terms of the Trust Agreement, Shareholders' statutory right under Delaware law to bring a derivative action (i.e., to initiate a lawsuit in the name of the Trust in order to assert a claim belonging to the Trust against a fiduciary of the Trust or against a third party when the Trust's management has refused to do so) is restricted. Under Delaware law, a shareholder may bring a derivative action if the shareholder is a shareholder at the time the action is brought and either (i) was a shareholder at the time of the transaction at issue or (ii) acquired the status of shareholder by operation of law or the Trust's governing instrument from a person who was a shareholder at the time of the transaction at issue. Additionally, Section 3816(e) of the Delaware Statutory Trust Act specifically provides that a "beneficial owner's right to bring a derivative action may be subject to such additional standards and restrictions, if any, as are set forth in the governing instrument of the statutory trust, including, without limitation, the requirement that beneficial owners owning a specified beneficial interest in the statutory trust join in the bringing of the derivative action." In addition to the requirements of applicable law and in accordance with Section 3816(e), the Trust Agreement provides that no Shareholder will have the right, power or authority to bring or maintain a derivative action, suit or other proceeding on behalf of the Trust unless (a) two or more Shareholders who (i) are not "Affiliates" (as defined in the Trust Agreement) of one another and (ii) collectively hold at least 10% of the outstanding Shares join in the bringing or maintaining of such action, suit or other proceeding, and (b) (i) prior to bringing such action, the Shareholder must make a demand upon the Trustee to bring the subject action unless an effort to cause the Trustee to bring such an action is not likely to succeed; and a demand on the Trustee shall only be deemed not likely to succeed and therefore excused if the Trustee has a personal financial interest in the transaction at issue, and the Trustee shall not be deemed interested in a transaction or otherwise disqualified from ruling on the merits of a Shareholder demand by virtue of the fact that the Trustee receives remuneration for its service as the Trustee or as a trustee or director of one or more investment companies that are under common management with or otherwise affiliated with the Trust; and (ii) unless a demand is not required under clause (i) of this paragraph, the Trustee must be afforded a reasonable amount of time to consider such Shareholder request and to investigate the basis of such claim; and the Trustee shall be entitled to retain counsel or other advisors in considering the merits of the request and may require an undertaking by the Shareholder making such request to reimburse the Trust for the expense of any such advisors in the event that the Trustee determines not to bring such action. This provision applies to any derivative actions brought in the name of the Trust other than claims under the U.S. federal securities laws and the rules and regulations thereunder. Notwithstanding the foregoing, however, if the relevant provision of the Trust Agreement is found to violate the U.S. federal securities laws, then such provision shall not apply to any claims asserted under such U.S. federal securities laws.

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**THE SECURITIES DEPOSITORY; BOOK-ENTRY-ONLY SYSTEM; GLOBAL SECURITY**

DTC will act as securities depository for the Shares. DTC is a limited-purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act. DTC was created to hold securities of its participants and to facilitate the clearance and settlement of transactions in those securities among DTC Participants through electronic book-entry changes. This eliminates the need for physical movement of securities certificates. DTC Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations, some of whom (and/or their representatives) own DTC. Access to the DTC system is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a DTC Participant, either directly or indirectly. DTC agrees with and represents to its participants that it will administer its book-entry system in accordance with its rules and by-laws and requirements of law.

Individual certificates will not be issued for the Shares. Instead, a global certificate will be signed by the Trustee on behalf of the Trust, registered in the name of Cede & Co., as nominee for DTC, and deposited with the Trustee on behalf of DTC. The global certificate represents all of the Shares outstanding at any time.

Upon the settlement date of any creation, transfer or redemption of Shares, DTC will credit or debit, on its book-entry registration and transfer system, the number of Shares so created, transferred or redeemed to the accounts of the appropriate DTC Participants. The Trustee and the DTC Participants will designate the accounts to be credited and charged in the case of creation or redemption of Shares.

Beneficial ownership of the Shares will be limited to DTC Participants, Indirect Participants and persons holding interests through DTC Participants and Indirect Participants. Owners of beneficial interests in the Shares will be shown on, and the transfer of ownership will be effected only through, records maintained by DTC, with respect to DTC Participants; the records of DTC Participants, with respect to Indirect Participants; and the records of Indirect Participants, with respect to beneficial owners that are not DTC Participants or Indirect Participants. Beneficial owners are expected to receive from or through a DTC Participant a written confirmation relating to their purchase of the Shares.

Investors may transfer Shares through DTC by instructing the DTC Participant or Indirect Participant through which they hold their Shares to transfer the Shares. Transfers will be made in accordance with standard securities industry practice.

DTC may decide to discontinue providing its service for the Shares by giving notice to the Trustee and the Sponsor. Under these circumstances, the Sponsor will either find a replacement for DTC to perform its functions at a comparable cost or, if a replacement is unavailable, deliver separate certificates for Shares to a successor authorized depositary identified by the Sponsor and available to act, or, if no successor is identified and able to act, the Trustee shall terminate the Trust.

The rights of the Shareholders generally must be exercised by DTC Participants acting on their behalf in accordance with the rules and procedures of DTC.

The Trust Agreement provides that, as long as the Shares are represented by a global certificate registered in the name of DTC or its nominee, the Trustee will be entitled to treat DTC as the holder of the Shares.

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**THE SPONSOR**

The Sponsor of the Trust is iShares Delaware Trust Sponsor LLC, a Delaware limited liability company and a consolidated subsidiary of BlackRock. The Sponsor's principal office is located at 400 Howard Street, San Francisco, CA 94105.

**The Sponsor**'**s Role**

The Sponsor will arrange for the creation of the Trust, the registration of the Shares for their public offering in the United States and the listing of the Shares on NASDAQ. The Sponsor has agreed to assume the marketing and the following administrative and marketing expenses incurred by the Trust: the fees of the Trustee, the Delaware Trustee and the Trust Administrator, the Custodians' Fee, NASDAQ listing fees, SEC registration fees, printing and mailing costs, tax reporting fees, audit fees, license fees and expenses and up to $500,000 per annum in ordinary legal fees and expenses. The Sponsor may determine in its sole discretion to assume legal fees and expenses of the Trust in excess of the $500,000 per annum required under the Trust Agreement. To the extent that the Sponsor does not voluntarily assume such fees and expenses, they will be the responsibility of the Trust. The Sponsor will also pay the costs of the Trust's organization and the initial sale of the Shares.

The Trust may incur certain extraordinary, non-recurring expenses that are not assumed by the Sponsor, including but not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, Ethereum network fees and similar transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of the Shareholders, any indemnification of the Cash Custodian, the Ether Custodian, the Prime Execution Agent, the Trust Administrator or other agents, service providers or counterparties of the Trust, and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters or legal fees, costs or expenses incurred by the Trust or Coinbase (when acting as agent on behalf of the Trust) in enforcing the Trust's rights against Staking Services Providers.

The Sponsor is responsible for oversight and overall management of the Trust but has delegated day-to-day administration of the Trust to the Trustee under the Trust Agreement. The Sponsor may remove the Trustee and appoint a successor trustee, if the Trustee ceases to meet certain objective requirements or if, having received written notice of a material breach of its obligations under the Trust Agreement, the Trustee has not cured the breach within thirty days. The Sponsor may also replace the Trustee during the 90 days following any merger, consolidation or conversion in which the Trustee is not the surviving entity or, in its discretion.

The Sponsor is responsible for preparing and filing periodic reports on behalf of the Trust with the SEC and will provide any required certification for such reports. The Sponsor will designate the independent registered public accounting firm of the Trust and may from time to time employ legal counsel for the Trust.

**Key Personnel of the Sponsor**

The Trust does not have any directors, officers or employees. The following persons, in their respective capacities as directors or executive officers of the Sponsor, a Delaware limited liability company, perform certain functions with respect to the Trust that, if the Trust had directors or executive officers, would typically be performed by them.

Shannon Ghia is the President and Chief Executive Officer, and Bryan Bowers is the Chief Financial Officer of the Sponsor.

The Sponsor is managed by the board of directors composed of Philip Jensen, Peter Landini, Lindsey Haswell, Shannon Ghia and Bryan Bowers.

 *Shannon Ghia,* 49, has served as a Director of the Sponsor since March 2022 and became a principal of the Sponsor on April 18, 2022. Ms. Ghia is a Managing Director of BlackRock and has served as Global Co-Head of ETF Markets since January 1, 2022. ETF Markets encompasses the Global Markets and Product Engineering teams within EII Markets and Investments ("the Engine") of BlackRock's ETF and Index Investing organization. The Engine teams drive investment integrity and market quality in BlackRock's ETF and index portfolios. Global Markets and Product Engineering together strive to safeguard ETF trading, evolve the ETF ecosystem and develop best-in-class products with enduring integrity that promote clients' financial well-being. From January 1, 2016 to December 31, 2021, Ms. Ghia served as the U.S. Head of iShares Global Markets and was responsible for overseeing primary and secondary trading of the iShares ETF suite and developing the ETF ecosystem. In this capacity, Ms. Ghia built out the ETF trading platform and operational best practices to support a greater complexity of products and an acceleration in trading volumes. She also worked closely with exchanges, ETF service providers and liquidity providers to promote ETF market quality. Ms. Ghia's service with BlackRock or its affiliates dates to 2002, including her years with Barclays Global Investors. Ms. Ghia earned a BA degree in Business / Economics with an emphasis in Accounting from the University of California, Santa Barbara.

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 *Bryan Bowers*, 51, has been employed by BlackRock or its affiliates since September 6, 2011, performing supervisory and managerial functions. Mr. Bowers is a Managing Director of BlackRock and is a member of the Product Governance & Reporting Team within BlackRock's Global Accounting and Product Services ("GAAPS") function. Mr. Bowers serves as the Chief Trust Officer of BlackRock Institutional Trust Company ("BTC") and the Chief Financial Officer for the US iDTS trusts. From 2021 to 2025, Mr. Bowers oversaw fund accounting operations, strategic product initiatives, fund certifications, accounting policies and provides support to the audit committee of the board for each iShares Trust, iShares, Inc. and iShares U.S. ETF Trust. From September 1, 2014 to October 3, 2021, Mr. Bowers served as a Director on the Global Financial Reporting on the Business Operations & Technology team within BlackRock's GAAPS function. From September 6, 2011 to August 31, 2014, Mr. Bowers served as a Vice President on BlackRock's Fund Administration team. Prior to joining BlackRock, Mr. Bowers served as an Assistant Vice President of State Street Corporation or its affiliates, where he served as a Unit Manager within the Global and Corporate Bond Accounting Units from September 1, 2007 to September 4, 2011. Mr. Bowers earned his B.S. degree in accounting from Stockton University.

 *Philip Jensen*, 67, is Chairman of the Sponsor's audit committee. In June 2001, Mr. Jensen joined Paul Capital Partners, an investment firm focusing on the secondary private equity and healthcare markets, for which he presently serves as Partner and previously served as Chief Operating Officer from 2002 to 2020. Mr. Jensen received his Bachelor of Science from San Francisco State University and practiced as a California Certified Public Accountant through 1992.

 *Peter Landini,* 74, is a member of the Sponsor's audit committee. In January 2003, Mr. Landini joined RBP Investment Advisors, Inc., a financial planning consultancy firm, for which he presently serves as Partner and Wealth Manager. Mr. Landini received his Bachelor of Science in accounting from Santa Clara University and an MBA in finance from Golden Gate University. Mr. Landini is a certified financial planner.

 *Lindsey Haswell*, 47, is the Chief Legal Officer of Tempo Labs, a layer-one blockchain designed specifically for payments that was incubated by Stripe and Paradigm that she joined in August 2025. She is also on the board of ProCap Acquisition Corp., a fintech-focused special purpose acquisition company. She served as the Chief Legal and Administrative Officer for crypto payments firm MoonPay from February 2023 to August 2025, and the Chief Legal and Administrative Officer for crypto-asset firm Blockchain.com from May 2021 to February 2023. Since July 2022, she also has served on the founding team of the Core blockchain network, a Bitcoin-powered layer-one blockchain. Ms. Haswell was the Chief Legal and Administrative Officer of mobility company Lime from September 2018 to May 2021 and was a founding member of Uber's Legal team, on which she served from January 2015 to November 2017. In November 2017, she founded a venture-backed company in the autonomous vehicle space. From August 2003 to January 2015, Ms. Haswell worked at the law firm Gibson, Dunn & Crutcher LLP, where she focused on tech counseling and litigation. Ms. Haswell earned a degree in Political Science and Journalism from the University of Southern California and a law degree from the University of Southern California.

The Sponsor has a code of ethics (the "Code of Ethics") that applies to its executive officers, including its Chief Executive Officer, President, Chief Financial Officer and Treasurer, who perform certain functions with respect to the Trust that, if the Trust had executive officers would typically be performed by them. The Code of Ethics is available by writing the Sponsor at 400 Howard Street, San Francisco, CA 94105 or calling the Sponsor at (415) 670-2000. The Sponsor's Code of Ethics is intended to be a codification of the business and ethical principles that guide the Sponsor, and to deter wrongdoing, to promote (1) honest and ethical conduct (including the ethical handling of actual or apparent conflicts of interest), (2) full, fair, accurate, timely and understandable disclosure in public reports, documents and communications, (3) compliance with applicable laws and governmental rules and regulations, (4) the prompt internal reporting of violations of the Code of Ethics and (5) accountability for adherence to the Code of Ethics.

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**The Sponsor**'**s Fee**

The Sponsor's Fee accrues daily and is paid at least quarterly in arrears in U.S. dollars or in-kind or any combination thereof at an annualized rate equal to 0.25% of the net asset value of the Trust. The Sponsor may, at its discretion and from time to time, waive all or a portion of the Sponsor's Fee for stated periods of time. The Sponsor is under no obligation to waive any portion of its fees and any such waiver shall create no obligation to waive any such fees during any period not covered by the waiver. For a twelve-month period commencing on the day the Shares are initially listed on NASDAQ, the Sponsor will waive a portion of the Sponsor's Fee so that the Sponsor's Fee after the fee waiver will be equal to 0.12% of the net asset value of the Trust for the first $2.5 billion of the Trust's assets. See "Risk Factors—The Sponsor and the Trustee may agree to amend the Trust Agreement without the consent of the Shareholders."

**THE TRUSTEE**

The Trustee is BlackRock Fund Advisors, a California corporation that is wholly-owned subsidiary of BlackRock. The Trustee's principal office is located at 400 Howard Street, San Francisco, CA 94105. The Trustee has authority to delegate some of its responsibilities under the Trust Agreement to the Trust Administrator or other agents. The Trustee also maintains certain books and records of the Sponsor relating to communications with Shareholders at the offices of the Trustee.

Although the Trustee is a registered commodity pool operator and a commodity trading advisor, the Trust will not hold or trade in commodity futures contracts or other derivative contracts regulated pursuant to the Commodity Exchange Act, as amended, and regulations promulgated by the CFTC, as administered by the CFTC. As the Trust's assets will not include "commodity interests" as defined in the CEA, the Trustee does not believe the Trust is a commodity pool and therefore the Trustee is not acting as a commodity pool operator or commodity trading advisor in connection with its role as Trustee.

THE TRUSTEE IS A MEMBER OF THE NFA AND IS SUBJECT TO NFA'S REGULATORY OVERSIGHT AND EXAMINATIONS. HOWEVER, YOU SHOULD BE AWARE THAT THE NFA DOES NOT HAVE REGULATORY OVERSIGHT AUTHORITY OVER UNDERLYING OR SPOT DIGITAL ASSET PRODUCTS OR TRANSACTIONS OR DIGITAL ASSET PLATFORMS, CUSTODIANS OR MARKETS.

The Bank of New York Mellon currently serves as the Trust Administrator. The Bank of New York Mellon's principal office is located at 240 Greenwich Street, New York, NY 10286. Information regarding creation and redemption of Shares, the net asset value of the Trust and transaction fees may be obtained from The Bank of New York Mellon. Basket composition and the names of the parties that have executed an Authorized Participant Agreement may be obtained from iShares by calling the following number: 1-800-474-2737. A copy of the Trust Agreement is available for inspection at the Trust Administrator's office identified above. Books and records of the Sponsor with respect to the Trust are maintained at this office of The Bank of New York Mellon (other than records maintained by the Trustee as described herein).

The Trustee is responsible for the day-to-day administration of the Trust. Day-to-day administration includes (1) processing orders for the creation and redemption of Baskets, (2) coordinating with the Ether Custodian and the Prime Execution Agent the receipt and delivery of ether purchased or sold by or otherwise transferred to, or by, the Trust and with the Cash Custodian the receipt and delivery of cash transferred to or by the Trust in connection with each issuance and redemption of Baskets, (3) calculating the net asset value of the Trust on any Business Day, and (4) selling the Trust's ether as needed to cover the Trust's expenses. The Trustee has delegated certain day-to-day responsibilities to the Trust Administrator.

The Trustee's fees and the Trust Administrator's fees are paid by the Sponsor.

The Trustee and any of its affiliates may from time to time purchase or sell Shares for their own account, as agent for their customers and for accounts over which they exercise investment discretion.

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**THE TRUST ADMINISTRATOR**

The Bank of New York Mellon serves as the Trust Administrator. The Trust Administrator has been engaged to provide certain administrative services, including, but not limited to, arranging for the computation of the net asset value of the Trust and NAV; preparing the Trust's financial statements and annual and quarterly reports; and recording payment of fees and expenses on behalf of the Trust.

The Trust Administrator's services are governed under the BFA Master Services Agreement between The Bank of New York Mellon and the Trustee, on behalf of itself and the Trust (the "Services Agreement"). The Services Agreement consists of a master services agreement supplemented by related service modules and other documentation specifying the service levels provided by, and related fees payable to, the Trust Administrator in connection with its services. The fees of the Trust Administrator are paid by the Trustee on behalf of the Trust. The Trust Administrator is exculpated and indemnified by the Trust under the terms of the Services Agreement.

Under the Services Agreement, the Trust Administrator has agreed to provide its services for an initial term of two years with an automatic renewal of successive one-year terms unless earlier terminated pursuant to the Services Agreement. In addition, the Trust Administrator may terminate its services for certain material breaches of the Services Agreement or for failure to pay fees within a specified grace period and terminations as may be required or occasioned by law. The Trust may terminate the Services Agreement for, among others, cause, certain enduring force majeure events, terminations as may be required or occasioned by law, and for certain corporate events affecting the Trust Administrator.

**THE DELAWARE TRUSTEE**

Wilmington Trust, National Association, acts as the trustee of the Trust for the purpose of creating a Delaware statutory trust in accordance with the Delaware Statutory Trust Act ("DSTA"). The Delaware Trustee is appointed to serve as a trustee of the Trust in the State of Delaware and for the sole and limited purpose of fulfilling the requirements of Section 3807 of the DSTA and shall at all times satisfy the requirements of Section 3807(a) of the DSTA that the Trust have at least one trustee with a principal place of business in the State of Delaware.

**General Duty of Care of Delaware Trustee**

Wilmington Trust, National Association serves as the Delaware Trustee of the Trust. The Delaware Trustee is not entitled to exercise any of the powers, or have any of the duties or responsibilities, of the Trustee. The Delaware Trustee is a trustee of the Trust for the sole and limited purpose of fulfilling the requirements of the Delaware Statutory Trust Act.

**Resignation, Discharge or Removal of Delaware Trustee; Successor Delaware Trustees**

The Delaware Trustee may resign at any time by giving at least 60 days' notice to the Sponsor. The Sponsor may remove the Delaware Trustee at any time. Upon effective resignation or removal, the Delaware Trustee will be discharged of its duties and obligations.

If the Delaware Trustee resigns or is removed, the Sponsor shall appoint a successor Delaware trustee by delivering a written instrument to the outgoing Delaware Trustee. Any successor Delaware Trustee must satisfy the requirements of Section 3807 of the DSTA. The successor will become fully vested with the rights, powers, duties and obligations of the outgoing Delaware Trustee under the Trust Agreement, with like effect as if originally named as Delaware Trustee, and the outgoing Delaware Trustee shall be discharged of its duties and obligations under the Trust Agreement. If no successor Delaware Trustee shall have been appointed within 60 days after the giving of such notice of resignation or removal, the Delaware Trustee may petition the Court of Chancery of the State of Delaware for the appointment of a successor Delaware Trustee.

If the Delaware Trustee resigns and no successor Delaware Trustee is appointed within 90 days after the date the Delaware Trustee issues its notice of resignation, the Sponsor may, in its sole discretion, dissolve the Trust and distribute its remaining assets.

**Separate Trustees**

At any time, including for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Trust assets may at the time be located or for the purpose of performing certain duties and obligations of the Trust, the Sponsor shall have the power and may execute and deliver all instruments to appoint one or more persons to act as a separate trustee or separate trustees of the Trust and to vest in any such person, in such capacity, such powers, duties, obligations, rights and trusts as the Sponsor may consider necessary or desirable. No separate trustee under the Trust Agreement shall be required to meet the terms of eligibility as a Delaware Trustee and no notice of the appointment of any separate trustee shall be required. Each separate trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions:

(a) all rights, powers, duties, and obligations conferred or imposed upon a trustee under the DSTA or the Trust may be conferred upon and exercised or performed by the separate trustee (without the Delaware Trustee joining in such act), solely at the written direction of the Sponsor;

(b) no trustee under the Trust Agreement shall be personally liable by reason of any act or omission of any other trustee under the Trust Agreement;

(c) the Sponsor may at any time accept the resignation of or remove any separate trustee; and

(d) if any separate trustee shall die, become incapable of acting, resign or be removed, all its estates, properties, rights, remedies and trusts shall vest in and may be exercised by the Sponsor, to the extent permitted by law, without the appointment of a new or successor separate trustee.

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**THE CUSTODIANS AND THE STAKING SERVICES PROVIDERS**

**The Cash Custodian**

The Cash Custodian is the Bank of New York Mellon. Pursuant to the Services Agreement between the Cash Custodian, the Trustee and the Trust, the Cash Custodian will establish and maintain cash account(s) for the Trust and, upon instructions from the Trustee acting on behalf of the Trust, facilitate cash transfers and cash payments from the Trust's account(s). The fees of the Cash Custodian are paid by the Trustee on behalf of the Trust.

Under the Services Agreement, the Cash Custodian has agreed to provide its services for an initial term of two years with an automatic renewal of successive one-year terms unless earlier terminated pursuant to the Services Agreement. In addition, the Cash Custodian may terminate its services for certain material breaches of the Services Agreement or for failure to pay fees within a specified grace period and terminations as may be required or occasioned by law. The Trust may terminate the Services Agreement for, among others, cause, certain enduring force majeure events, terminations as may be required or occasioned by law, and for certain corporate events affecting the Cash Custodian.

The Cash Custodian will exercise the following standard of care: (1) with the exercise of that level of care at least at the same standard of care as the Cash Custodian provides for itself and/or its affiliates with respect to similar services, and without the exercise of any bad acts, (2) in a manner reasonably designed to satisfy the Cash Custodian's obligations under the Services Agreement; and (3) with the skill and care that may reasonably be expected of a first class international financial services provider of asset processing and related services.

Except as otherwise expressly provided in the Services Agreement, the Cash Custodian's liability arising out of or relating to the Services Agreement shall be limited solely to those direct damages that are caused by the Cash Custodian's failure to perform its obligations under the Services Agreement in accordance with such standard of care. The Trust agrees to indemnify the Cash Custodian and hold the Cash Custodian harmless from and against all losses, expenses, damages and liabilities (including reasonable counsel fees and expenses) incurred by the Cash Custodian arising out of or relating to the Cash Custodian's performance under the Cash Custody Agreement, except to the extent resulting from the Cash Custodian's failure to perform its obligations under the Cash Custody Agreement in accordance with such standard of care.

The Trust may retain additional cash custodians from time to time pursuant to a cash custodian agreement to perform certain services that are typical of a cash custodian. The Sponsor may, in its sole discretion, add or terminate cash custodians at any time.

The Services Agreement is governed by the laws of the State of New York.

**The Ether Custodian and Additional Ether Custodian** 

The Ether Custodian for the Trust's ether holdings is Coinbase Custody Trust Company, LLC, and the Additional Ether Custodian for the Trust's ether holdings is Anchorage Digital Bank N.A. The Trust has entered into the Custodian Agreement with the Ether Custodian and the Anchorage Custodian Agreement with the Additional Ether Custodian. The Ether Custodian will maintain the Liquidity Sleeve in cold storage. The Sponsor may, in its sole discretion, add or terminate ether custodians. The Sponsor may, in its sole discretion, change or add custodians for the Trust's ether holdings, but it will have no obligation whatsoever to do so or to seek any particular terms for the Trust from other such custodians.

The Trust is not required to hold any particular amount of assets at either the Ether Custodian or the Additional Ether Custodian, and the Sponsor shall, in its sole discretion, determine the amounts held at either custodian from time to time as permitted by the Trust Agreement. The Sponsor has not established any specific criteria it would consider in making this decision.<u> </u>As of the date of this prospectus, the Trust's ether is held with the Ether Custodian, and the Sponsor has no plans to move any of the Trust's ether to the Additional Ether Custodian, though such plans are subject to ongoing review. The addition of the Additional Ether Custodian as an available alternative custodian of the Trust's ether reflects the Sponsor's ongoing risk management approach as part of the Trust's growing size and the Sponsor's expanding presence in the digital asset space.

**Coinbase Custody** – **The Ether Custodian** 

The Ether Custodian will keep custody of all of the Trust's ether in segregated accounts in the Vault Balance, other than the Trust's ether which is temporarily maintained in the Trading Balance with the Prime Execution Agent as described below in "—The Prime Execution Agent". Trust assets held in the Vault Balance are held in segregated wallets, and are not commingled with the Ether Custodian's or its affiliates' assets, or the assets of the Ether Custodian's other customers. The Vault Balance is held at Ethereum blockchain addresses at which only the Trust's assets are held.

The Ether Custodian will keep all of the private keys associated with the Trust's ether held at the Ether Custodian in the Vault Balance in cold storage. Cold storage is a safeguarding method by which the private key(s) corresponding to ether is (are) generated and stored in an offline manner. Private keys are generated in offline computers or devices that are not connected to the internet so that they are more resistant to being hacked. By contrast, in hot storage, the private keys are held online, where they are more accessible, leading to more efficient transfers, though they are potentially more vulnerable to being hacked.

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Cold storage of private keys may involve keeping such keys on a non-networked computer or electronic device or storing the public key and private keys on a storage device or printed medium and deleting the keys from all computers. The Ether Custodian may receive deposits of ether but may not send ether without use of the corresponding private keys. Such private keys are stored in cold storage facilities within the United States and Europe, exact locations of which are not disclosed for security reasons. A limited number of employees at the Ether Custodian are involved in private key management operations, and the Ether Custodian has represented that no single individual has access to full private keys. The Ether Custodian's internal audit team performs periodic internal audits over custody operations, and the Ether Custodian has represented that Systems and Organizational Control ("SOC") attestations covering private key management controls are also performed on the Ether Custodian by an external provider.

Coinbase Global has informed the Sponsor that it maintains an institutional insurance program, which is intended to cover the loss of client assets held by Coinbase Insureds, including from employee collusion or fraud, physical loss including theft, damage of key material, security breach or hack, and fraudulent transfer. The insurance maintained by Coinbase Global is shared among all of Coinbase's customers, is not specific to the Trust or to customers holding ether with the Ether Custodian or the Prime Execution Agent and may not be available or sufficient to protect the Trust from all possible losses or sources of losses.

In the event of a fork, the Custodian Agreement provides that the Ether Custodian may temporarily suspend services, and may, in their sole discretion, determine whether or not to support (or cease supporting) either branch of the forked protocol entirely, provided that the Ether Custodian shall use commercially reasonable efforts to avoid ceasing to support both branches of such forked protocol and will support, at a minimum, the original digital asset. The Custodian Agreement provides that, other than as set forth therein, and provided that the Ether Custodian shall make commercially reasonable efforts to assist the Trust to retrieve and/or obtain any assets related to a fork, airdrop or similar event the Ether Custodian shall have no liability, obligation or responsibility whatsoever arising out of or relating to the operation of the underlying software protocols relating to the Ethereum network or an unsupported branch of a forked protocol and, accordingly, Client acknowledges and assumes the risk of the same. The Custodian Agreement further provides that, unless specifically communicated by the Ether Custodian and its affiliates through a written public statement on the Coinbase website, the Ether Custodian does not support airdrops, metacoins, colored coins, side chains, or other derivative, enhanced or forked protocols, tokens or coins, which supplement or interact with ether. The Sponsor has committed to cause the Trust to permanently and irrevocably abandon any Incidental Rights and IR Digital Asset to which the Trust may become entitled in the future. The Trust has no right to receive any Incidental Right or IR Digital Asset. Furthermore, the Custodian has no authority, pursuant to the Custodian Agreement or otherwise, to exercise, obtain or hold, as the case may be, any such abandoned Incidental Right or IR Digital Asset on behalf of the Trust or to transfer any such abandoned Incidental Right or IR Digital Asset to the Trust if the Trust terminates its custodial arrangement with the Custodian. For more information on the Trust's and Sponsor's policies on forked or airdropped assets, see "The Offering—Forks" and "Risk Factors—A temporary or permanent "fork" could adversely affect the value of the Shares. In addition, Shareholders will not receive the benefits of any Incidental Rights and any IR Digital Asset, including any forked or airdropped assets." Neither the Ether Custodian nor any other Coinbase entity is permitted to withdraw the Trust's ether from the Trust's Vault Balance, engage in Staking Activities, or loan, hypothecate, pledge or otherwise encumber the Trust's ether, without the consent of the Trust. The Vault Balance is subject to the lien to secure outstanding Trade Credits in favor of the Trade Credit Lender discussed below.

Under the Custodian Agreement, the Ether Custodian's liability is limited as follows, among others: (i) other than with respect to claims and losses arising from spot trading of ether, or fraud or willful misconduct, among others, the Ether Custodian's aggregate liability under the Custodian Agreement shall not exceed the greater of (A) the greater of (x) $5 million and (y) the aggregate fees paid by the Trust to the Ether Custodian in the 12 months prior to the event giving rise to the Ether Custodian's liability, and (B) the value of the affected ether or cash giving rise to the Ether Custodian's liability; (ii) the Ether Custodian's aggregate liability in respect of each cold storage address shall not exceed $100,000,000; (iii) in respect of the Ether Custodian's obligations to indemnify the Trust and its affiliates against third-party claims and losses to the extent arising out of or relating to, among others, the Ether Custodian's violation of any law, rule or regulation with respect to the provision of its services, the Ether Custodian's liability shall not exceed the greater of (A) $5 million and (B) the aggregate fees paid by the Trust to the Ether Custodian in the 12 months prior to the event giving rise to the Ether Custodian's liability; and (iv) in respect of any incidental, indirect, special, punitive, consequential or similar losses, the Ether Custodian is not liable, even if the Ether Custodian has been advised of or knew or should have known of the possibility thereof. In managing the Vault Balance of the Trust, the Ether Custodian has processes in place to create and utilize new cold storage wallets in order to limit the dollar value of ether in any specific cold storage wallet in accordance with the Ether Custodian's insurance limit.<u> </u>

The Ether Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Ether Custodian. Under the Custodian Agreement, except in the case of its negligence, fraud, material violation of applicable law or willful misconduct, the Ether Custodian shall not have any liability, obligation, or responsibility for any damage or interruptions caused by any computer viruses, spyware, scareware, Trojan horses, worms or other malware that may affect the Trust's computer or other equipment, or any phishing, spoofing or other attack, unless the Ether Custodian fails to have commercially reasonable policies, procedures and technical controls in place to prevent such damages or interruptions.

The Ether Custodian may terminate the Custodian Agreement for any reason upon providing the applicable notice to the Trust, or immediately for Cause (as defined in the Custodian Agreement), including, among others, if the Trust: materially breaches the Prime Execution Agent Agreement and such breach remains uncured, undergoes a Bankruptcy Event, or fails to repay Trade Credits. The Ether Custodian may terminate the Custodian Agreement for any reason upon providing 180 days' notice to the Trust, or immediately for Cause (as defined below). The Custodian Agreement forms a part of the Prime Execution Agent Agreement and is subject to the termination provisions in the Prime Execution Agent Agreement. These termination provisions are described in more detail in "-The Prime Execution Agent" below.

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**The Ether Custodian and The Staking Services Providers**

Pursuant to the Staking Services Agreement between the Prime Execution Agent, as agent for the Ether Custodian, and the Trust, the Prime Execution Agent will act as the Trust's agent (except in the case of the Coinbase Approved Validator Schedule (defined below), which the Trust enters directly with the Prime Execution Agent, and in which case the Prime Execution Agent acts as Approved Validator, in a principal capacity) in facilitating the staking of the Trust's ether. In accordance with instructions provided by the Trust (the "Staking Instructions"), the Ether Custodian will make the Trust's ether available to one or more Staking Services Providers for staking, in accordance with agreements between the Prime Execution Agent, on behalf of the Trust, and such Staking Services Providers (such agreements, "Approved Validator Schedules" or "Staking Arrangements"). In the case of one Approved Validator Schedule (the "Coinbase Approved Validator Schedule"), into the Prime Execution Agent itself is the Approved Validator, acting in a principal capacity, and the Trust enters such Approved Validator Schedule directly. The Staking Instructions may specify, among other things, the amount of ether to be staked or unstaked, the selection of the applicable Staking Services Provider, and the timing of such actions.

The Ether Custodian will at all times maintain exclusive possession and control of the Trust's private keys used to withdraw or otherwise transfer any ether, including ether that has been staked. These withdrawal private keys remain in the Custodian's cold-storage environment and are not used in connection with validator operations. By contrast, each Staking Services Provider will mai ntain exclusive possession and control of the validator private keys necessary to perform validator duties on the Ethereum network. Validator private keys are not stored within, accessible to, or managed by the Ether Custodian. Rather, they reside entirely within the Staking Services Providers' validator infrastructure. Because validator private keys are required to sign validation transactions and conduct validator operations during each epoch and in connection with each block, validator private keys must be held in Internet-connected storage to ensure they are available to conduct validation activities. These validator private keys are used solely to authorize validator-related messages and do not permit the withdrawal or transfer of any of the Trust's ether. The Ether Custodian's withdrawal private keys, held in cold storage, remain the exclusive means of accessing or moving staked or unstaked ether.

The Prime Execution Agent, as agent for the Ether Custodian, acts under the Staking Addendum strictly as agent for the Trust in connection with each Approved Validator Schedule (except in the case of the Coinbase Approved Validator Schedule, which the Trust enters directly with the Prime Execution Agent, and in which the Prime Execution Agent acts as Approved Validator in a principal capacity), and is responsible for determining the suitability of, onboarding, and monitoring Staking Services Providers, among other services it provides to the Trust. The Trust selects which Staking Services Provider to use, which may be either affiliates of the Ether Custodian or other approved validators, to conduct Staking Activities. The Sponsor's choice of third-party Staking Services Providers, and its decision to allocate ether amongst chosen Staking Services Providers, will be based on a range of factors, including but not limited to the performance, reliability, and reputation of the Staking Services Provider, such as monitoring their uptime and slashing history. To conduct staking activities, and in particular, to accomplish withdrawals, the Trust depends on the performance of third parties (the Ethereum protocol, the Prime Execution Agent, the Ether Custodian, and the Staking Services Providers), any of which can fail to perform, default, suffer outages, bugs, software defects, or failures, or otherwise cause the withdrawal of ether to be delayed or unavailable, or the partial or total loss of the Trust's staked ether.

 *Staking Addendum*

As of the date of this prospectus and pursuant to the Staking Services Agreement, the Ether Custodian and the Staking Services Provider are entitled to receive a portion of the gross Staking Consideration generated under the Staking Arrangements, reflecting the Prime Execution Agent's share of the Trust's Staking Consideration and any amounts payable by the Prime Execution Agent to Staking Services Providers for their respective shares of the Trust's Staking Consideration. As of the date of this Prospectus, the Sponsor's Staking Portion and the Prime Execution Agent's share of such Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers for their respective shares of the Trust's Staking Consideration) comprise an aggregate of 18% of the gross Staking Consideration generated under the Staking Arrangements. The Trust will retain the remainder of such gross Staking Consideration.

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The Staking Addendum provides that the Trust may instruct the Prime Execution Agent to make ether in the Trust's Vault Account available to an Approved Validator for staking. The Staking Addendum provides that the Trust is not required to instruct the Prime Execution Agent to make any assets available for staking to any Approved Validator, and the Trust shall determine the amount of assets to engage in staking (or unstaking) at any time, and may issue an instruction to reduce the amount of staked digital assets. Pursuant to the Staking Addendum, the Prime Execution Agent and Ether Custodian, as applicable, represent, warrant, and covenant that the Trust's staked assets shall remain at the blockchain address associated with the Trust's Vault Account with the Ether Custodian at all times, except that, the Prime Execution Agent shall ensure that, upon receiving a staking instruction from the Trust, the Prime Execution Agent will commence the transfer from the Trust's Vault Account to the Protocol Staking Deposit Contract of the amount of assets the Trust has instructed the Prime Execution Agent to stake as of the time specified in the instruction, excepting delays due to Ethereum network restrictions and processes. The Staking Addendum provides that the Prime Execution Agent shall ensure that, upon receiving an unstaking instruction from the Trust, the unstaking process for the instructed amount of the Trust's staked assets is initiated as promptly as possible in accordance with the Service Level Agreement (which specifies in relevant part that Coinbase must submit the unstaking transaction to the Ethereum blockchain within ten hours of receiving the unstaking instruction from the Trust), excepting delays due to Ethereum network restrictions and processes.

The Staking Addendum provides that the Trust may instruct the Prime Execution Agent to terminate an Approved Validator Schedule as instructed by the Trust, and that any assets made available to the Prime Execution Agent or an Approved Validator for staking will remain credited to the Trust's Vault Balance, except to the extent debited as a result of any slashing loss. The Staking Addendum provides that the Prime Execution Agent shall not, and shall ensure that any Approved Validator does not, commingle or pool the Trust's staked assets with the digital assets of any other person, and each validator keypair associated with the Trust's staked ether shall only be associated with the assets of the Trust and not the assets of any other person; provided, that the Trust's assets shall not be deemed commingled when transferred by the Prime Execution Agent to the Protocol Staking Deposit Contract if any validator keypair associated with the Trust's assets is associated only with the Trust's assets (and not those of another person).

The Staking Addendum provides that the Prime Execution Agent has entered or will enter an agreement specific to the Trust with each Approved Validator pursuant to which such Approved Validator agrees to provide staking services to the Trust, provided that, in the case of the Coinbase Approved Validator Schedule, Coinbase, as Approved Validator shall enter such Approved Validator agreement with the Trust directly. If Coinbase has a preexisting agreement with an Approved Validator that governs the terms on which the Approved Validator provides staking services to all clients of Coinbase (including, but not limited to, the Trust), then Coinbase shall ensure such preexisting agreement is consistent with the Trust's Approved Validator Schedule. Only the Trust, and no other person, may provide staking and unstaking instructions relating to the Trust's ether. If Coinbase or an Approved Validator makes amendments to an Approved Validator Schedule, the Trust must be notified and approve the amendment at least ten days before its effective date. Coinbase shall take all actions required under the Approved Validator Schedule to effectuate staking and unstaking the Trust's ether under the Staking Addendum.

Under the Staking Addendum, if an Approved Validator breaches the Approved Validator Schedule (other than the Coinbase Approved Validator Schedule), then the Trust may request that Coinbase enforce the Approved Validator Schedule or otherwise exercise rights or remedies on behalf of Coinbase's staking clients relating to such breach (an "Enforcement Request"). While Coinbase is required to diligently pursue any claims against Approved Validators, nothing prevents the Trust from taking any action or enforcing any right or claim it has against an Approved Validator in relation to such breach. In the case of the Coinbase Approved Validator Schedule, the Trust shall pursue any claims against Coinbase as Approved Validator (or under the Staking Addendum) directly. In the Staking Addendum, the Trust agrees that Coinbase shall have no responsibility whatsoever for an Approved Validator's performance of such validator's obligations under an Approved Validator Schedule, or for any action or inaction of such Approved Validator, except that in the case of the Coinbase Approved Validator Schedule, Coinbase shall be fully responsible and liable to the Trust for its obligations thereunder. Except as otherwise set forth in the Staking Addendum, Coinbase makes no representation as to the fitness, capacity, or ability of any Approved Validator to perform services or comply with the terms of any Approved Validator Schedule, though such statement is without prejudice to Coinbase's obligations under the Staking Addendum or the Coinbase Approved Validator Schedule.

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The Staking Addendum requires Coinbase to abide by the standard of care and limitations of liability in the Coinbase Prime Broker Agreement in discharging Coinbase's obligations under the Staking Addendum. Coinbase (or Coinbase Custody, as applicable) is responsible for losses suffered by Client arising from Coinbase's (or Coinbase Custody's, as applicable) errors in executing a Staking Instruction or Unstaking Instruction (e.g., if Coinbase or Coinbase Custody erroneously sends Client's Staked Digital Assets to the wrong destination address).

The Staking Addendum provides that Coinbase is responsible for performing the initial review of each Approved Validator's suitability to provide staking services and in the case of the Coinbase Approved Validator Schedule, Coinbase shall certify to the Trust and shall be responsible for performing the initial review of Coinbase's suitability to provide the staking services to the Trust. Following such review, Coinbase shall be responsible for the onboarding and ongoing monitoring thereof (including, in the case of the Coinbase Approved Validator Schedule, Coinbase) in accordance with Coinbase's internal procedures, based on the Approved Validator's (including, in the case of the Coinbase Approved Validator Schedule, Coinbase's) implementation of industry best practices, including with respect to cybersecurity and safeguarding of the Trust's staked ether from loss, hacking or misappropriation while engaged in staking with such Approved Validator, and the Approved Validator's design and implementation of policies and procedures to ensure compliance with legal and regulatory requirements applicable to such Approved Validator in the conduct of its business. Coinbase shall conduct, at minimum, an annual review of each Approved Validator's suitability to provide staking services. In the case of the Coinbase Approved Validator Schedule, Coinbase represents and warrants to the Trust as to Coinbase's suitability as Approved Validator on each of the matters specified in the foregoing sentence, and further represents to the Trust that it has in place policies and procedures to manage and mitigate the effects on the Trust of any conflicts of interest.

The Staking Addendum requires Coinbase to maintain an appropriate level of supervision of each Approved Validator and make appropriate enquiries, periodically, to confirm that the obligations of the Approved Validator continue to be adequately discharged; provided that, in the case of the Coinbase Approved Validator Schedule, Coinbase shall be liable to Client for Coinbase's obligations to Client as Approved Validator. Coinbase represents, warrants and covenants that each Approved Validator (including Coinbase) is and will continue to be subject to a third party risk review in accordance with Coinbase's Third Party Risk Management Policy, including but not limited to the review of the Approved Validators network and data security, financial wherewithal and insurance coverages. On a semi-annual basis, Coinbase will provide the Trust with certain information, as reasonable under the circumstances, regarding the performance and reliability of the Approved Validator (i.e., Approved Validator's rewards earned and slashing history) (including, for the avoidance of doubt, Coinbase, where Coinbase is acting as such Approved Validator pursuant to the Coinbase Approved Validator Schedule), to enable the Trust to evaluate whether to allocate the Trust's ether for staking to such Approved Validator, provided that the foregoing obligation shall not be deemed to require disclosure of other client information in circumvention of Coinbase's confidentiality obligations.

In the event of a material breach or failure to perform by an Approved Validator, Coinbase will use commercially reasonable efforts to pursue claims against such Approved Validator. Without prejudice to Coinbase's responsibilities under the foregoing sentence, Coinbase shall have final authority and sole discretion over the decision to initiate, manage, or settle any such legal proceedings. Any legal proceedings initiated at the specific request of the Client shall be subject to a separate agreement regarding the allocation of costs and expenses, which shall be borne by the Client unless otherwise agreed in writing. For the avoidance of doubt, nothing in this paragraph shall apply to, limit, or restrict Client's ability to pursue Coinbase directly in its capacity hereunder or in its capacity as Approved Validator under the Coinbase Approved Validator Schedule.

Coinbase is not a guarantor of any Approved Validator's performance (except where Coinbase is acting as such Approved Validator pursuant to the Coinbase Approved Validator Schedule) and shall have no liability for any losses, including but not limited to slashing penalties or loss of staked ether, resulting from the acts, omissions, or insolvency of an Approved Validator (except where Coinbase is acting as such Approved Validator pursuant to the Coinbase Approved Validator Schedule), except as otherwise set forth in the Staking Addendum or in an Approved Validator Schedule. Without prejudice to the foregoing, Coinbase shall only be liable for such losses to the extent they are caused by Coinbase's breach, acts or omissions, negligence, or willful misconduct in connection with its obligations.

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The Staking Addendum requires the Trust to acknowledge that there is no assurance that any Approved Validator, smart contract, or blockchain network or protocol will be available, function, or operate as expected, and the Trust may not receive any rewards regardless of the amount of time or the number of ether that the Trust instructs Coinbase to make available to an Approved Validator. Coinbase bears no responsibility whatsoever with respect to any decision made by the Trust to make ether available for staking, instructing the use of any Approved Validator, or any losses, damages, or liabilities arising therefrom; provided that nothing in this paragraph shall relieve Coinbase of its obligations under the Staking Addendum.

Under the Staking Addendum, Coinbase shall: (i) enter into agreements with each Approved Validator that are legally binding and enforceable; (ii) require each Approved Validator to represent to Coinbase that it possesses and maintains the licenses and authorizations required for its business and has implemented a program reasonably designed to comply with applicable laws, including anti-money laundering and sanctions laws, including, at minimum and without limitation, policies, procedures, and controls to (A) identify and prevent transactions involving addresses or wallets designated by sanctions laws from being confirmed or processed into blocks by the Approved Validator (as well as preventing the receipt of fees in connection therewith), and to conduct periodic testing and audits to measure the effectiveness of such controls and remediate any identified issues, and (B) comply with laws applicable to Maximal Extractable Value ("MEV"); (iii) require each Approved Validator to maintain an information security program consistent with its internal policies and designed to protect the Trust's ether; and (iv) require that each Approved Validator provide information reasonably necessary for the Trust's regulatory compliance, provided that Coinbase shall not be liable for any Validator's failure or refusal to provide such information so long as Coinbase acts in accordance with the terms of any Enforcement Request.

The Staking Addendum requires the Trust to acknowledge that all rewards are calculated and disbursed by the underlying blockchain network or protocol, and Coinbase shall not be liable to the Trust for any errors, losses, or lost rewards at the protocol level due to no fault of Coinbase. These include, without limitation, any losses due to changes to the underlying blockchain network or protocol, "double spend", "51%" or other attacks, hard or soft forks, software bugs, errors, technical difficulties, or scheduled network upgrades or maintenance activities. Coinbase does not guarantee that any rewards shall be awarded by the underlying blockchain network or protocol, regardless of the amount of staked ether or length of time staked. Participation in any staking activities and use of any Approved Validator is done at the Trust's discretion, subject to Coinbase's obligations related to Approved Validators set forth under the Staking Addendum.

The Staking Addendum requires the Trust to acknowledge that Coinbase's role with respect to reward payments is strictly as a pass-through intermediary. Coinbase shall have no liability or obligation to indemnify the Trust for any slashing, error by the Approved Validator, or loss by such Approved Validator, in each case, outside of Coinbase's control, nor for any failure of an Approved Validator to provide sufficient (or any) compensatory payments to cover such losses. Client understands that any recovery of lost rewards is dependent solely on the Approved Validator's performance and payment, and Coinbase is not responsible for any shortfall between the amount of the lost rewards and the amount actually paid by the Approved Validator. In case of any future upgrade to a blockchain network or protocol, the Staking Addendum requires the Trust to acknowledge it may lose all, or a portion of, its staked ether, and Coinbase will not be responsible for any loss of such staked ether in such a circumstance to the extent Coinbase has performed its obligations under the Staking Addendum. Except as set forth in the Staking Addendum or an Approved Validator Schedule and to the extent Coinbase meets its obligations, Coinbase will not provide any compensation for any slashing penalties or missed rewards, or other losses that arise out of or in connection with the Trust's staking. Coinbase shall not be liable for the failure of any Approved Validator to abide by the terms of an Approved Validator Schedule or the terms set forth therein so long as such failure does not arise from Coinbase's negligence, fraud, breach, material violation of applicable law, or willful misconduct.

The Trust is solely responsible for the payment of all applicable taxes, if any, to which the Trust's share of rewards might be subject, and the Trust agrees to indemnify and hold Coinbase and its affiliates harmless against all liabilities, costs, and expenses in connection with any such taxes. The indemnification and force majeure provisions in the Coinbase Prime Broker Agreement apply to the Staking Addendum.

Either party may terminate the Staking Services Agreement upon 180 days' advance written notice to the other party.

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 *Approved Validator Schedule*

The Approved Validator Schedules provide that Approved Validators are responsible for performing staking and giving effect to unstaking in accordance with the Trust's instructions that are communicated by Coinbase to the Approved Validator. The Trust is dependent on Coinbase to communicate instructions to the Approved Validator, including in connection with withdrawals, and if Coinbase fails to do so, the Trust could be adversely impacted. Approved Validators shall not be responsible or liable for any delay in unstaking that results from the standards, rules, requirements or ordinary course of operations of the Ethereum network. Approved Validators represent, warrant, and agree that the activities relating to staking will be performed outside the United States.

Approved Validators agree they shall receive the rewards they are entitled to pursuant to the Staking Addendum as their sole compensation for performing staking on behalf of the Trust.

Staked assets may be subject to slashing penalties imposed by the protocol due to validator misconduct or failure to meet network standards. Any slashed assets will be debited from the Vault Account. In some cases, validators may make compensatory payments to Coinbase for the benefit of affected clients, which the Staking Services Provider will allocate in accordance with validator instructions or on a pro rata basis. Such payments may not be made at all, or if made, may not offset losses to the Trust, fully or in part, or in timely fashion, and protracted legal proceedings could result without any assurance of successful recovery or compensation from the Approved Validator. There can be no guarantee that the Trust would recover any of its staked assets, or the value thereof, if it is subject to penalties imposed by the Ethereum network.

Pursuant to the Approved Validator Schedules, Approved Validators make certain representations and warranties to the Trust. Approved Validators could fail to abide by, default on, or breach any such representations to the Trust.

Either Coinbase (with the Trust's consent) or the Approved Validator may terminate the Validator Schedule upon 180 days notice, or sooner, if required by applicable law. In addition, Coinbase may, with the Trust's consent (or shall, if instructed by the Trust) terminate the Approved Validator Schedule following a material breach by the Approved Validator and the expiration of a 20 day cure period (except that no cure period is required in the case of breach of applicable law by the Approved Validator). Termination shall be treated as an unstaking instruction that the Approved Validator Schedule requires the Approved Validator to give effect to promptly, subject to Ethereum network delays and unstaking (exit, withdrawal) processes.

Except to the extent caused directly by the Approved Validator's gross negligence, breach, willful misconduct, or fraud, or as otherwise expressly provided herein, the Approved Validator shall have no liability to Coinbase or the Trust, whether in contract, tort, or otherwise, for any losses, claims, liabilities, or damages arising out of or relating to the Approved Validator Schedule (collectively, the "Damages"), including, without limitation, any of the following: (i) acting in accordance with, or relying upon, instructions or information provided by either Coinbase or the Trust; (ii) any errors, inaccuracies, or omissions in the wallet address, account information, or other instructions provided by Coinbase or the Trust; (iii) any loss, penalty, or reduction in rewards resulting from slashing, validator downtime, missed attestations, or other protocol-related events, except as expressly set forth in the Approved Validator Schedule; (iv) any delay, failure, or malfunction of the blockchain network, validator software, client software, or any third-party infrastructure, including Coinbase; or (v) any force majeure event. A force majeure event means any event outside the reasonable control of Approved Validator that prevents or delays Approved Validator from complying with its obligations under the Approved Validator Schedule, and which Approved Validator could not have avoided, impeded or overcome, including, but not limited to war, terrorist attacks, acts of nature, fire, sabotage, epidemics, quarantine, government sanctions, collective actions, strike, lock-outs, failure of telecommunications carriers, utility company failures, computer viruses and intentional attacks of hackers on computer systems, any material disruption to a relevant blockchain network, including hard forks, soft forks, chain reorganizations, or network splits that affect consensus or transaction finality (including, but not limited to, material delays or inability to process transactions due to sustained network congestion, gas fee spikes, or network downtime); any material failure, bug, exploit, vulnerability, or unintended behavior in the applicable blockchain protocol, smart contract, virtual machine, or governance mechanism that impairs normal network operations (including, but not limited to, material disruptions caused by validator outages, node failures, or censorship at the protocol level); any failure, delay, or corruption in data feeds from on-chain or off-chain oracles relied upon for pricing, collateral valuation, or other automated functionality; or any other similar causes beyond the reasonable control of Approved Validator (each, a "Force Majeure Event"); provided that, Approved Validator is without fault in failing to prevent or causing such default or delay, and such default or delay could not reasonably be circumvented by Approved Validator through the use of alternate sources, workaround plans or other means. In such event, Approved Validator shall be excused from further performance of services so affected for as long as such circumstances prevail and Approved Validator continues to use commercially reasonable efforts to recommence performance of the services, to the extent possible, without undue delay.

***Security and Controls***

The Ether Custodian has multiple layers of security protocols designed to protect the Trust's assets from unauthorized access or transfer, which remain in place when the Trust's ether is staked.

The Trust's ether is staked directly from the Trust's Vault Balance administered by the Ether Custodian, and the Staking Services Provider performs any related validation activities. The Ethereum protocol limits the activities of the Staking Services Provider to executing only those activities specified by the protocol, such as staking, unstaking and performing validation activities. Accordingly, the Staking Services Provider does not have any control over, and cannot transfer, the Trust's staked ether. Only the Ether Custodian will be able to stake or unstake ether at the direction of the Sponsor. In particular, the Staking Services Provider is not authorized to leverage or rehypothecate the Trust's ether. The Staking Services Provider is also not able to change the designated wallet addresses on the Ethereum network to which staked ether is to be withdrawn or to which Staking Consideration shall be sent.

In addition, the Staking Arrangements do not alter the Trust's custody environment or security procedures. The controls currently in place between the Sponsor and the Ether Custodian also govern the activities related to staking and unstaking ether, as outlined in the Staking Services Agreement.

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**Anchorage** – **The Additional Ether Custodian**

The Additional Ether Custodian is Anchorage Digital Bank N.A., a national trust bank regulated by the OCC. The Trust is not required to hold any particular amount of assets at either the Ether Custodian or the Additional Ether Custodian, and the Sponsor shall, in its sole discretion, determine the amounts held at either custodian from time to time as permitted by the Trust Agreement. The Sponsor has not established any specific criteria that it would consider in making this decision. As of the date of this prospectus, the Trust's ether is held with the Ether Custodian, and the Sponsor has no plans to move any of the Trust's ether to the Additional Ether Custodian, though such plans are subject to ongoing review. The addition of the Additional Ether Custodian as an available alternative custodian of the Trust's ether reflects the Sponsor's ongoing risk management approach as part of the Trust's growing size and the Sponsor's expanding presence in the digital asset space. If the Sponsor chooses to utilize the Additional Ether Custodian in the future, the Additional Ether Custodian will receive ether for storage in the Trust's account at the Additional Ether Custodian by generating private keys and their public key pairs, with the Additional Ether Custodian retaining custody of such private keys. Upon receipt, the Additional Ether Custodian would keep custody of all of the Trust's ether that it holds in segregated accounts in the Anchorage Vault Balance. Trust assets held in the Anchorage Vault Balance would be held in segregated wallets and would not be commingled with the Additional Ether Custodian's or its affiliates' assets, or the assets of the Additional Ether Custodian's other customers. The Anchorage Vault Balance would be held at the Ethereum blockchain addresses at which only the Trust's assets are held.

Anchor Labs maintains crime insurance coverage for a minimum limit of $100,000,000, which is intended to cover the loss of Trust assets held by the Anchor Labs Insureds, including from dishonest or fraudulent acts committed by the Anchor Labs Insureds' employees, its agents and subcontractors; forgery and alteration; computer crime; wire transfer coverage; physical damage or theft of private key data; social engineering coverage; and security breaches or hacking. The insurance maintained by Anchor Labs may be shared among Anchor Labs Insureds' other customers, is not necessarily exclusive to the Trust or to customers holding ether with Anchorage and may not be available or sufficient to protect the Trust from all possible losses or sources of losses. Anchor Lab's insurance may not cover the type of losses experienced by the Trust. Alternatively, the Trust may be forced to share such insurance proceeds with other clients or customers of the Anchor Labs Insureds, which could reduce the amount of such proceeds that are available to the Trust. In addition, the digital asset insurance market is limited, and the level of insurance maintained by Anchorage may be substantially lower than the assets of the Trust. While Anchorage maintains certain capital reserve requirements depending on the assets under custody, and such capital reserves may provide additional means to cover client asset losses, the Trust cannot be assured that Anchorage will maintain capital reserves sufficient to cover actual or potential losses with respect to the Trust's digital assets. The insurance program does not cover, insure or guarantee the performance of the Trust.

In the event of a fork, the Anchorage Custodian Agreement provides that the Additional Ether Custodian may temporarily suspend services, and may, in their sole discretion, determine whether or not to support (or cease supporting) either branch of the forked protocol entirely, provided that the Additional Ether Custodian would use commercially reasonable efforts to timely select, in its sole discretion, at least one branch of such forked protocol to support. The Sponsor has committed to cause the Trust to permanently and irrevocably abandon any Incidental Rights and IR Digital Asset to which the Trust may become entitled in the future. The Trust has no right to receive any Incidental Right or IR Digital Asset. For more information on the Trust's and Sponsor's policies on forked or airdropped assets, see "The Offering—Forks" and "Risk Factors—A temporary or permanent "fork" could adversely affect the value of the Shares. In addition, Shareholders will not receive the benefits of any Incidental Rights and any IR Digital Asset, including any forked or airdropped assets."

With respect to the Anchorage Custodian Agreement, other than with respect to claims and losses arising from: (i) fraud or willful misconduct of the Additional Ether Custodian and (ii) the Anchorage Mutually Capped Liabilities (defined below), in no event will the Additional Ether Custodian's liability exceed the value of the cash or affected ether giving rise to such liability. With respect to Anchorage Mutually Capped Liabilities, other than with respect to claims and losses arising from fraud or willful misconduct of the Additional Ether Custodian, in no event will the Additional Ether Custodian's liability exceed the greater of $5 million and the aggregate amount of fees paid by client to Anchorage in the 12-month period prior to the event giving rise to such liability.

Under the Anchorage Custodian Agreement, Anchorage Mutually Capped Liabilities means (i) claims and losses arising from a party's breach of its confidentiality obligations under the Anchorage Custodian Agreement, (ii) a party's indemnity obligations under the Anchorage Custodian Agreement (except with (except with respect to the full amount of any Trust ether lost), which shall not constitute an Anchorage Mutually Capped Liability), and (iii) claims and losses arising from the violation, misappropriation, or infringement by a party of any third party intellectual and/or industrial property rights, including patent rights, copyrights, moral rights, trademarks, trade names, service marks, trade secrets, rights in inventions (including applications for, and registrations, extensions, renewals, and re-issuances of the foregoing).

With respect to claims and losses related to a withdrawal or transfer of digital assets, the value of such digital assets would be determined by reference to the benchmark valuation on the date delivery of such digital assets in connection with such withdrawal or transfer is due in accordance with the terms of the Anchorage Custodian Agreement. In respect of any incidental, indirect, special, punitive, consequential or similar losses, the Additional Ether Custodian is not liable, even if the Additional Ether Custodian has been advised of or knew or should have known of the possibility thereof. The Additional Ether Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Additional Ether Custodian.

The Additional Ether Custodian may elect not to renew the Anchorage Custodian Agreement by providing written notice of cancellation and non-renewal no less than one hundred eighty (180) days prior to the expiration of the term, or may terminate the Anchorage Custodian Agreement immediately for Cause. A "Termination for Cause" is defined in the Anchorage Custodian Agreement as: (i) the Trust materially breaches any provision of the Anchorage Custodian Agreement and such breach remains uncured for a period of 30 calendar days after notice of such breach is provided by Anchorage to the Trust; or (ii) the Trust becomes bankrupt or insolvent.

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**THE PRIME EXECUTION AGENT AND THE TRADE CREDIT LENDER**

**The Prime Execution Agent**

Pursuant to the Prime Execution Agent Agreement, the Trust's ether holdings and cash holdings from time to time may be temporarily held with the Prime Execution Agent, an affiliate of the Ether Custodian, in the Trading Balance, for certain limited purposes, including in connection with creations and redemptions of Baskets, and the sale of ether to pay the Sponsor's Fee and any other Trust expenses not assumed by the Sponsor, to the extent applicable, and in extraordinary circumstances, in connection with the liquidation of the Trust's ether. The Sponsor may, in its sole discretion, add or terminate prime execution agents at any time. The Sponsor may, in its sole discretion, change the prime execution agent for the Trust, but it will have no obligation whatsoever to do so or to seek any particular terms for the Trust from other such prime execution agents.

Within the Trust's Trading Balance, the Prime Execution Agent Agreement provides that the Trust does not have an identifiable claim to any particular ether (and cash). Instead, the Trust's Trading Balance represents an entitlement to a pro rata share of the ether (and cash) the Prime Execution Agent holds on behalf of customers who hold similar entitlements against the Prime Execution Agent. In this way, the Trust's Trading Balance represents an omnibus claim on the Prime Execution Agent's ether (and cash) held on behalf of the Prime Execution Agent's customers. There are no policies that would limit the amount of ether that can be held temporarily in the Trading Balance maintained by the Prime Execution Agent. However, ether is only moved into the Trading Balance in connection with and to the extent of purchases and sales of ether by the Trust and such ether is swept from the Trust's Trading Balance to the Trust's Vault Balance each trading day pursuant to a regular end-of-day sweep process. The Trust's use of Trade Credits and order cutoffs are also designed to limit the amount of time that any of the Trust's ether is held in the Trust's Trading Balance.

The Prime Execution Agent holds the ether associated with customer entitlements across a combination of omnibus cold wallets, omnibus "hot wallets" (meaning wallets whose private keys are generated and stored online, in internet-connected computers or devices) or in omnibus accounts in the Prime Execution Agent's name on a trading venue (including third-party venues and the Prime Execution Agent's own execution venue) where the Prime Execution Agent executes orders to buy and sell ether on behalf of its clients.

Within such omnibus hot and cold wallets and accounts, the Prime Execution Agent has represented to the Sponsor that it keeps the majority of assets in cold wallets, to promote security, while the balance of assets is kept in hot wallets to facilitate rapid withdrawals. However, the Sponsor has no control over, and for security reasons the Prime Execution Agent does not disclose to the Sponsor, the percentage of ether that the Prime Execution Agent holds for customers holding similar entitlements as the Trust which are kept in omnibus cold wallets, as compared to omnibus hot wallets or omnibus accounts in the Prime Execution Agent's name on a trading venue. The Prime Execution Agent has represented to the Sponsor that the percentage of assets maintained in cold versus hot storage is determined by ongoing risk analysis and market dynamics, in which the Prime Execution Agent attempts to balance anticipated liquidity needs for its customers as a class against the anticipated greater security of cold storage.

The Prime Execution Agent is not required by the Prime Execution Agent Agreement to hold any of the ether in the Trust's Trading Balance in cold storage or to hold any such ether in segregation, and neither the Trust nor the Sponsor can control the method by which the Prime Execution Agent holds the ether credited to the Trust's Trading Balance.

The Prime Execution Agent relies on bank accounts to provide its trading platform services and including temporarily holding any cash related to a customer's purchase or sale of ether. In particular, the Prime Execution Agent has disclosed that customer cash held by the Prime Execution Agent, including the cash associated with the Trust's Trading Balance, is held in one or more banks' accounts for the benefit of the Prime Execution Agent's customers, or in Money Market Funds in compliance with Rule 2a-7 under the Investment Company Act and rated "AAA" by S&P (or the equivalent from any eligible rating service), provided that such investments are held in accounts in Coinbase's name for the benefit of customers and are permitted and held in accordance with state money transmitter laws. The Prime Execution Agent has represented to the Sponsor that it has implemented the following policy with respect to the cash associated with the Trust's Trading Balance. First any cash related to the Trust's purchase or sale of ether will be held in an FBO Account or in a Money Market Fund. The amount of Trust cash held at each FBO Account shall, unless otherwise agreed by the Sponsor in writing, be in an amount at each bank that is the lower of (i) the FDIC insurance limit for deposit insurance and (ii) any bank-specific limit set by the Prime Execution Agent for the applicable bank. Deposit insurance does not apply to cash held in a Money Market Fund. The Prime Execution Agent has agreed to title the accounts in a manner designed to enable receipt of FDIC deposit insurance where applicable on a pass-through basis. Second, to the extent the Trust's cash in the Trading Balance in aggregate exceeds the amounts that can be maintained at the banks on the foregoing basis, the Prime Execution Agent has represented that it currently conducts an overnight sweep of the excess into U.S. government Money Market Funds. The Sponsor has not independently verified the Prime Execution Agent's representations.

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To the extent the Trust sells ether through the Prime Execution Agent, the Trust's orders will be executed at the Connected Trading Venues that have been approved in accordance with the Prime Execution Agent's due diligence and risk assessment process. The Prime Execution Agent has represented that its due diligence on Connected Trading Venues include reviews conducted by the legal, compliance, security, privacy and finance and credit-risk teams, The Connected Trading Venues, which are subject to change from time to time, currently include Bitstamp, LMAX, Kraken, the platform operated by the Prime Execution Agent, as well as four additional non-bank market makers ("NBMMs"). The Prime Execution Agent has represented to the Trust that it is unable to name the NBMMs due to confidentiality restrictions.

Pursuant to the Prime Execution Agent Agreement, the Trust may engage in sales of ether by placing orders with the Prime Execution Agent. The Prime Execution Agent will route orders placed by the Sponsor through the prime execution agent execution platform (the "Trading Platform") to a Connected Trading Venue where the order will be executed. Each order placed by the Sponsor will be sent, processed and settled at each Connected Trading Venue to which it is routed. The Prime Execution Agent Agreement provides that the Prime Execution Agent is subject to certain conflicts of interest, including: (i) the Trust's orders may be routed to the Prime Execution Agent's own execution venue where the Trust's orders may be executed against other customers of the Prime Execution Agent or with the Coinbase acting as principal, (ii) the beneficial identity of the counterparty purchaser or seller with respect to the Trust's orders may be unknown and therefore may inadvertently be another client of the Prime Execution Agent, (iii) the Prime Execution Agent does not engage in front-running, but is aware of the Trust's orders or imminent orders and may execute a trade for its own inventory (or the account of an affiliate) while in possession of that knowledge and (iv) the Prime Execution Agent may act in a principal capacity with respect to certain orders. As a result of these and other conflicts, when acting as principal, the Prime Execution Agent may have an incentive to favor its own interests and the interests of its affiliates over the Trust's interests.

Subject to the foregoing, and to certain policies and procedures that the Prime Execution Agent Agreement requires the Prime Execution Agent to have in place to mitigate conflicts of interest when executing the Trust's orders, the Prime Execution Agent Agreement provides that the Prime Execution Agent shall have no liability, obligation, or responsibility whatsoever for the selection or performance of any Connected Trading Venue, and that other Connected Trading Venues and/or trading venues not used by Coinbase may offer better prices and/or lower costs than the Connected Trading Venue used to execute the Trust's orders.

Coinbase Global has informed the Sponsor that it maintains an institutional insurance program, which is intended to cover the loss of client assets held by Coinbase Global and all of its subsidiaries, including the Prime Execution Agent, including from employee collusion or fraud, physical loss including theft, damage of key material, security breach or hack, and fraudulent transfer. The insurance maintained by the Coinbase Insureds is shared among all of Coinbase's customers, is not specific to the Trust or to customers holding ether with the Ether Custodian or the Prime Execution Agent and may not be available or sufficient to protect the Trust from all possible losses or sources of losses.

Once the Sponsor places an order to purchase or sell ether on the Trading Platform, the associated ether or cash used to fund or fill the order, if any, will be placed on hold and will generally not be eligible for other use or withdrawal from the Trust's Trading Balance. The Trust's Vault Balance may be used directly to fund orders. With each Connected Trading Venue, the Prime Execution Agent shall establish an account in the Prime Execution Agent's name, or in its name for the benefit of clients, to trade on behalf of its clients, including the Trust, and the Trust will not, by virtue of the Trading Balance the Trust maintains with the Prime Execution Agent, have a direct legal relationship, or account with, any Connected Trading Venue. The Prime Execution Agent is permitted to suspend or terminate the Prime Execution Agent Agreement under certain circumstances. The Prime Execution Agent, for itself or as agent for the Ether Custodian and Trade Credit Lender, may not terminate the Prime Execution Agent Agreement (including the Custodian Agreement) or suspend, restrict terminate or modify the Prime Execution Agent Services (as defined below) on less than 180 days' notice, except in the event of (i) a Change in Law (defined below) or (ii) a Cause event (as defined below). The Prime Execution Agent Agreement defines "Prime Execution Agent Services" as (i) the custody of the Trust's ether in its Vault Balance, the processing of deposits and withdrawals and other custody transactions, (ii) access to the Prime Execution Agent's trading platform and the execution and settlement of all orders for the sale of ether submitted by the Trust, and (iii) the extension of credit to the Trust by the Trade Credit Lender pursuant to the Trade Financing Agreement.

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The Prime Execution Agent Agreement defines a "Change in Law" as any change in or adoption of any applicable law, rule, or regulation which, in the reasonable opinion of counsel to the Prime Execution Agent would prohibit or materially impede some or all of the arrangement contemplated by the Prime Execution Agent Agreement. Upon the occurrence of a Change in Law, the parties will negotiate to agree on modifications to the Prime Execution Agent Agreement or the Prime Execution Agent Services that would enable compliance with such Change in Law or, in the case of a material impediment, reduce the impact to the parties of such Change in Law and the Coinbase Entities (defined in the Prime Execution Agent Agreement as the Prime Execution Agent, Ether Custodian and Trade Credit Lender) shall continue to provide the Prime Execution Agent Services unless prohibited from doing so by the Change in Law. If the parties cannot agree on modifications within thirty (30) days following notice from the Prime Execution Agent or if the Change in Law requires that Coinbase immediately ceases providing any Prime Execution Agent Services, the Prime Execution Agent may, upon written notice, suspend, restrict or terminate the Prime Execution Agent Services solely to the extent necessary to account for the Change in Law, provided that any such suspension, restriction, termination or modification is narrowly tailored and, to the extent not prohibited by the Change in Law, the Coinbase Entities will continue to provide, at a minimum, the Transition Services (as defined below) following any Change in Law.

Upon the occurrence and continuation of a Cause event, and after giving effect to any notice requirement and cure period that may apply, the Prime Execution Agent may in its reasonable discretion, terminate the Prime Execution Agent Agreement and accelerate the Trust's obligations, and/or take certain other actions. The Prime Execution Agent Agreement defines "Cause" to mean, (i) a material breach of the Prime Execution Agent Agreement (other than the Custodian Agreement) which is uncured for 10 days; (ii) a material breach of the Custodian Agreement which is uncured for 30 days; (iii) a Bankruptcy Event (as defined below); and (iv) the failure by the Trust to repay Trade Credits by the applicable deadline specified in the Trade Financing Agreement which, in the event the failure results solely from an error or omission of an administrative or operational nature, remains uncured for a period of 1 business day.

Notwithstanding any termination of the Prime Execution Agent Agreement by the Prime Execution Agent for Cause, during any Transition Period (as defined below) the Coinbase Entities or their affiliates shall continue to provide the Transition Services (as defined below) and render such assistance as the Trust may reasonably request to enable the continuation and orderly assumption of the Transition Services to be effected by the Trust, its affiliate or any alternative service provider and shall continue to provide the Transition Services pursuant to the Prime Execution Agent Agreement, except to the extent any Transition Service is prohibited under applicable law (including but not limited to applicable sanctions programs) or by a facially valid subpoena, court order, or binding order of a government authority; provided that the Coinbase Entities will continue to have the right to exercise its right of set-off under the Prime Execution Agent Agreement with respect to any sale proceeds during the Transition Period for any fees or other amounts owed by the Trust and (ii), notwithstanding any provision in the Prime Execution Agent Agreement to the contrary, in no event shall any Coinbase Entity, its affiliates, or their respective officers, directors, agents, employees and representatives have any liability to the Trust or Sponsor for any claims or losses arising out of or relating to the Prime Execution Agent Agreement during (A) with respect to any Transition Services described in clause (i) of the definition of Transition Services, the 91st day through the end of the Transition Period (as defined below) and (B) with respect to any Transition Services described in clause (ii) of the definition of Transition Services, the 16th day through the end of the Transition Period, which do not result from its gross negligence, fraud, material violation of applicable law or willful misconduct; provided that throughout the Transition Period the Coinbase Entities shall act in good faith and in a commercially reasonable manner to provide the same level of service with respect to the Transition Services as was provided prior to the start of the Transition Period. For the avoidance of doubt, during the Transition Period, the fees set forth in the Prime Execution Agent Agreement will continue to apply to the Transition Services.

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"Transition Period" is defined in the Prime Execution Agent Agreement to mean a 180-day period (or such extended period as agreed in writing by the Coinbase Entities and the Trust) commencing on the date the Trust is notified of any termination of the Prime Execution Agent Agreement pursuant to a Cause event.

"Transition Services" means the Prime Execution Agent services consisting of (i) the custody of Trust's ether on the Trust's behalf, the processing of deposits and withdrawals and other custody transactions, and (ii) access to the Prime Execution Agent's trading platform and the execution and settlement of all orders for the sale of ether submitted by the Trust. For the avoidance of doubt, the Transition Services shall not include the extension of credit, and the obligation to execute and settle any Orders for the purchase of Digital Assets.

"Bankruptcy Event" is defined in the Prime Execution Agent Agreement to mean the party is (i) dissolved (other than pursuant to a consolidation, amalgamation or merger); (ii) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (iii) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (iv) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors' rights, or a petition is presented for its winding-up or liquidation, and in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (I) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (II) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (v) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (vi) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (vii) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (viii) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (i) to (vii) (inclusive); or (ix) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts.

The Trust may terminate the Prime Execution Agent Agreement, including the Custodian Agreement, in whole or in part for any reason upon 30 days' notice to the Prime Execution Agent, for itself or as agent on behalf of the Ether Custodian or Trade Credit Lender, or upon a Coinbase Termination Event. The Prime Execution Agent Agreement defines a "Coinbase Termination Event" to mean the occurrence and continuance of (i) a Bankruptcy Event with respect to any Coinbase Entity, (ii) the failure of any Coinbase Entity to sell or withdraw or transfer the Trust's ether in accordance with the Trust's instructions within the time periods set forth in the Prime Execution Agent Agreement and such failure is not cured within two (2) business days following the Trust providing written notice to the relevant Coinbase Entity ("CB Return Cure"); provided, however, that (A) if, prior to the expiration of the CB Return Cure, the Prime Execution Agent transfers cash to the Trust in an amount equal to the value of the ether based on the Benchmark Valuation (defined as the CME CF Ether Dollar Reference Rate New York) as of the time that the request to sell, transfer or withdraw was originally made by the Trust (the "ETH Cash Value") or if the Prime Execution Agent delivers cash collateral to an account designated by the Trust and in which the Trust has a perfected, first priority security interest and in an amount equal to the ETH Cash Value until the relevant ether is sold, withdrawn or transferred or the Trust elects to receive such amount in cash in lieu of the Prime Execution Agent's obligation to sell, withdraw or transfer the relevant ether, in each cash, such failure will be deemed cured; provided, further that, the Trust shall have the right to choose whether to receive the ETH Cash Value in lieu of the relevant ether or receive the ETH Cash Value as cash collateral, or (B) if such failure is due to a technology or security issue where, in the commercially reasonable opinion of the Prime Execution Agent, returning the relevant ether would result in material risk to the Trust or the Prime Execution Agent or may result in the relevant ether being lost or otherwise not successfully returned and the Prime Execution Agent promptly notifies the Trust promptly upon Client's notice of such failure, (1) the Trust may request that the Prime Execution Agent still sell, withdraw or transfer the ether, but the Prime Execution Agent will have no liability with respect to any such sell, withdrawal or transfer (unless the Prime Execution Agent or any of the Coinbase Entities act with negligence unrelated to such technology or security issue) and any failure to withdraw or transfer shall not result in a Coinbase Termination Event if the Trust does not receive the withdrawn or transferred ether or the proceeds of any such sale due to such technology or security issue, or (2) if the Trust does not elect to have the Prime Execution Agent still make the sale, withdrawal or transfer, a Coinbase Termination Event shall not occur while the relevant security or technology event is occurring and continuing, (iii) the failure of any Coinbase Entity to withdraw or transfer cash to the Trust in accordance with the Trust's instructions within the time periods set forth in the Prime Execution Agent Agreement and such failure is not cured within one (1) Business Day following the Trust providing written notice to the relevant Coinbase Entity, (iv) a Coinbase Entity intentionally or willfully, materially breaches any provision of the Prime Execution Agent Agreement (other than the provisions of the Custodian Agreement) and such breach remains uncured for a period of 10 calendar days after notice of such breach is provided by the Trust to the Prime Execution Agent; or (v) a Coinbase Entity intentionally or willfully, materially breaches any provision of the Custodian Agreement and such breach remains uncured for a period of 30 calendar days after notice of such breach is provided by the Trust to the Prime Execution Agent.

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The Prime Execution Agent does not guarantee uninterrupted access to the Trading Platform or the services it provides to the Trust. Under certain circumstances, the Prime Execution Agent is permitted to halt or suspend trading on the Trading Platform, or impose limits on the amount or size of, or reject, the Trust's orders, including in the event of, among others, (a) delays, suspension of operations, failure in performance, or interruption of service that are directly due to a cause or condition beyond the reasonable control of the Prime Execution Agent, (b) the Trust has engaged in unlawful or abusive activities or fraud, or (c) a security or technology issue occurred and is continuing that results in the Prime Execution Agent being unable to provide trading services or accept the Trust's order, in each case, subject to certain protections for the Trust.

Neither the Prime Execution Agent nor any other Coinbase entity is permitted to withdraw the Trust's ether from the Trust's Vault Balance, engage in Staking Activities, or loan, hypothecate, pledge or otherwise encumber the Trust's ether, without the consent of the Trust. The Trading Balance is subject to the lien to secure outstanding Trade Credits in favor of the Trade Credit Lender discussed below.

Under the Prime Execution Agent Agreement, the Prime Execution Agent's liability is limited as follows, among others: (i) other than with respect to claims and losses arising from spot trading of ether, or fraud or willful misconduct, among others, the Prime Execution Agent's aggregate liability shall not exceed the greater of (A) the greater of (x) $5 million and (y) the aggregate fees paid by the Trust to the Prime Execution Agent in the 12 months prior to the event giving rise to the Prime Execution Agent's liability, and (B) the value of the cash or affected ether giving rise to the Prime Execution Agent's liability; (ii) in respect of the Prime Execution Agent's obligations to indemnify the Trust and its affiliates against third-party claims and losses to the extent arising out of or relating to, among others, the Prime Execution Agent's violation of any law, rule or regulation with respect to the provision of its services, or the full amount of the Trust's assets lost due to the insolvency of or security event at a Connected Trading Venue, the Prime Execution Agent's liability shall not exceed the greater of (A) $5 million and (B) the aggregate fees paid by the Trust to the Prime Execution Agent in the 12 months prior to the event giving rise to the Prime Execution Agent's liability; and (iii) in respect of any incidental, indirect, special, punitive, consequential or similar losses, the Prime Execution Agent is not liable, even if the Prime Execution Agent has been advised of or knew or should have known of the possibility thereof. The Prime Execution Agent is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Prime Execution Agent. Both the Trust and the Prime Execution Agent and its affiliates (including the Ether Custodian) are required to indemnify each other under certain circumstances. The Prime Execution Agent Agreement is governed by New York law and provides that disputes arising under it are subject to arbitration.

The Prime Execution Agent Agreement provides that the Coinbase Entities may have actual or potential conflicts of interest in connection with providing the Prime Execution Agent Services including that (i) orders to buy or sell ether may be routed to the Prime Execution Agent's platform ("Coinbase Platform") where such orders may be executed against other Coinbase customers or with Coinbase acting as principal, (ii) the beneficial identity of the purchaser or seller with respect to an order is unknown and therefore may inadvertently be another Coinbase customer, (iii) the Prime Execution Agent does not engage in front-running, but is aware of orders or imminent orders and may execute a trade for its own inventory (or the account of an affiliate) while in possession of that knowledge and (iv) Coinbase may act in a principal capacity with respect to certain orders (e.g., to fill residual order size when a portion of an order may be below the minimum size accepted by the Connected Trading Venues). As a result of these and other conflicts, when acting as principal, the Coinbase Entities may have an incentive to favor their own interests and the interests of their affiliates over the Trust's interests and have in place certain policies and procedures that are designed to mitigate such conflicts. The Prime Execution Agent will maintain appropriate and effective arrangements to eliminate or manage conflicts of interest, including segregation of duties, information barriers and training. The Prime Execution Agent will notify the Trust of changes to its business that have a material adverse effect on the Prime Execution Agent's ability to manage its conflicts of interest. The Coinbase Entities shall execute trades pursuant to such policies and procedures; provided that the Coinbase Entities (a) shall execute in a commercially reasonable amount of time (i) any marketable orders appropriately entered by the Trust and (ii) any other pending orders by the Trust received by the Coinbase Entities that become marketable, (b) for any order that the Prime Execution Agent receives from the Trust, the Prime Execution Agent will make commercially reasonable efforts to route orders for execution to the Connected Trading Venue offering the most favorable price for the Trust's ether sale orders, including consideration of any gas fees or similar fees related to a particular blockchain at the time that such orders are routed for execution, and (c) shall not knowingly enter into a transaction for the benefit of (x) the Coinbase Entities, or (y) any other client received after the Trust's order, ahead of any order received from the Trust. For purposes of the foregoing, a marketable order is a sell order equivalent to or better than the best bid price on any Connected Trading Venue (or any venue that a Coinbase Entity may use) at a given moment. The Prime Execution Agent agrees to direct the Trust's orders in a manner that does not systematically favor the Coinbase Platform or Connected Trading Venues that provide financial incentives to the Prime Execution Agent; provided, however, that under certain circumstances the Prime Execution Agent may choose to intentionally route to the Coinbase Platform due to temporary conditions affecting Connected Trading Venues (e.g. connectivity problems of the Connected Trading Venue or funding constraints).

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**The Trade Credit Lender**

The Sponsor does not intend to fund the Trading Balance at the Prime Execution Agent with sufficient ether to pay fees and expenses and instead intends to utilize the Trade Financing Agreement for such fees and expenses. To avoid having to pre-fund purchases or sales of ether in connection with cash creations and redemptions and sales of ether to pay the Sponsor's Fee and any other Trust expenses not assumed by the Sponsor, to the extent applicable, the Trust may borrow ether or cash as Trade Credit from the Trade Credit Lender on a short-term basis. This allows the Trust to buy or sell ether through the Prime Execution Agent in an amount that exceeds the cash or ether credited to the Trust's Trading Balance at the Prime Execution Agent at the time such order is submitted to the Prime Execution Agent, which is expected to facilitate the Trust's ability to process cash creations and redemptions and pay the Sponsor's Fee and any other Trust expenses not assumed by the Sponsor, to the extent applicable, in a timely manner by seeking to lock in the ether price on the trade date for creations and redemptions or the payment date for payment of the Sponsor's Fee or any other Trust expenses not assumed by the Sponsor, rather than waiting for the funds associated with the creation to be transferred by the Cash Custodian to the Prime Execution Agent prior to purchasing the ether or for the ether held in the Vault Balance to be transferred to a Trading Balance prior to selling the ether. The Trust is required by the terms of the Coinbase Credit Committed Trade Financing Agreement, which is part of the Prime Execution Agent Agreement, to repay any extension of Trade Credit by the Trade Credit Lender by 6:00 p.m. ET on the business day following the day that the Trade Credit was extended to the Trust. The Trade Credit Lender is only required to extend Trade Credits to the Trust to the extent such ether or cash is actually available to the Trade Credit Lender. For example, if the Trade Credit Lender is unable to itself borrow ether to lend to the Trust as a Trade Credit, or there is a material market disruption (as determined by the Trade Credit Lender in good faith and in its sole discretion), the Trade Credit Lender is not obligated to extend Trade Credits to the Trust. To secure the repayment of Trade Credits, the Trust has granted a first-priority lien to the Trade Credit Lender over the assets in its Trading Balance and Vault Balance. If the Trust fails to repay a Trade Credit within the required deadline, the Trade Credit Lender is permitted to take control of ether or cash credited to the Trust's Trading Balance and Vault Balance (though it is required to exhaust the Trading Balance prior to taking control of assets in the Vault Balance) and liquidate them to repay the outstanding Trade Credit. Trade Credits do not bear any interest. The Trust pays a variable rate for each executed order based on the Trust's prior month's trading volume as determined by the Prime Execution Agent.

The Trust's ether holdings are maintained with the Ether Custodian rather than the Prime Execution Agent, except in the limited circumstances of ether that is held temporarily in the Trading Balance for purchases and sales of ether in connection with cash creation and cash redemption Basket settlement, or the payment of Sponsor's Fee and any other Trust expenses not assumed by the Sponsor, to the extent applicable. In connection with a redemption order or to pay the Sponsor's Fee and expenses not assumed by the Sponsor, the Trust will first borrow ether from the Trade Credit Lender using the Trade Financing Agreement, and then sell the borrowed ether. In connection with a purchase order, the Trust will first borrow cash from the Trade Credit Lender using the Trade Financing Agreement, and then purchase ether. The purpose of borrowing the ether or cash used in connection with cash creation and redemption or to pay these fees and expenses from the Trade Credit Lender is to lock in the ether price on the trade date or the payment date, as applicable, rather than waiting for the funds associated with the creation to be transferred by the Cash Custodian to the Prime Execution Agent prior to purchasing the ether or for the ether held in the Vault Balance to be transferred to a Trading Balance prior to selling the ether (a process which may take up to twenty four hours, or longer if the Ethereum blockchain is experiencing delays in transaction confirmation, or if there are other delays).

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In the event Trade Credits are unavailable from the Trade Credit Lender or become exhausted, the Sponsor would require the Authorized Participant to deliver cash on the trade date so that a purchase order can be settled in a timely manner. For a redemption order, the Trust may use financing when the ether remains in the Trust's Custody Account at the point of intended execution of a sale of ether. In the event Trade Credits are unavailable or become exhausted in this situation, the Sponsor would instruct the Ether Custodian to move ether out of the Vault Balance into the Trading Balance so that it could be sold directly in response to a redemption order or to pay fees and expenses. Under these circumstances, the Trust may not be able to lock in the ether price on the trade date or the payment date, as applicable, and would instead have to wait until the transfer from the Vault Balance to the Trading Balance was completed before selling the ether. The Trade Credit amount, combined with the Trust requiring delivery of cash for creations on the trade date when Trade Credits are unavailable and the ability of the Trust to delay redemption settlement until the Trust is able to transfer ether from the Vault Balance to the Trading Balance, is sufficient, in the Sponsor's view, to support the needs of the Trust.

The Trade Financing Agreement is in effect commencing on the date of execution and terminating on the earlier of (i) the date of termination of the Prime Execution Agent Agreement, subject to any required notice or notice period thereunder and (ii) following a Change of Agent Event, immediately upon delivery to the Trust of written notice of the occurrence of such Change of Agent Event or the close of business on such later date as the Trade Credit Lender may specify in any such written notice. "Change of Agent Event" is defined in the Trade Financing Agreement to occur when the authority of the Trustee to act on behalf of the Trust in connection with the Prime Execution Agent Agreement is terminated for any reason at any time and a successor investment advisor, reasonably acceptable (such acceptance not to be unreasonably withheld) to Coinbase, has not been concurrently appointed on behalf of the Trust with respect to all matters thereunder; provided that, subject to applicable law, the Trustee is permitted to transfer and assign its obligations to act on behalf of the Trust to any of its affiliates and any such transfer or assignment shall not constitute a Change of Agent Event. Except as otherwise provided above, the terms of the Prime Execution Agent Agreement govern any suspension, restriction, termination or modification of the Trade Financing Agreement. For additional information, see "—The Prime Execution Agent." All obligations of the Trust with respect to outstanding Trade Credits, and rights of the Trade Credit Lender in connection therewith, shall survive the termination of the Trade Financing Agreement, including Trade Credit Lender's security interest in the Trading Balance and the Vault Balance; provided that, for the avoidance of doubt, if the Trade Financing Agreement is terminated such security interest shall be terminated immediately upon the repayment of the Trade Credits in full.

This could cause the execution price associated with such trades, following the completion of the transfer, to materially deviate from the execution price that would have existed on the original trade or payment date, which could negatively impact Shareholders.

In addition, to the extent that the execution price for purchases and sales of ether related to creations and redemptions and sales of ether in connection with paying the Sponsor's Fee and any other Trust expenses, to the extent applicable, deviate significantly from the Index price used to determine the NAV of the Trust, the Shareholders may be negatively impacted.

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**U.S. FEDERAL INCOME TAX CONSEQUENCES**

The following is a discussion of the material U.S. federal income tax consequences that generally will apply to the purchase, ownership and disposition of Shares. The discussion below is based on the Internal Revenue Code of 1986, as amended (the "Code"), Treasury Regulations promulgated thereunder and judicial and administrative interpretations of the Code, all as in effect on the date of this Prospectus and all of which are subject to change either prospectively or retroactively. The tax treatment of Shareholders may vary depending upon their own particular circumstances. Certain Shareholders (including but not limited to banks, financial institutions, insurance companies, regulated investment companies, real estate investment trusts, U.S. Tax-Exempt Shareholders (as defined below) who acquire their Shares with acquisition indebtedness, tax-exempt or tax-advantaged retirement plans or accounts, brokers or dealers, traders, partnerships or S corporations for U.S. federal income tax purposes, persons holding Shares as a position in a "hedging," "straddle," "conversion," "constructive sale" or other integrated transaction for U.S. federal income tax purposes, persons whose "functional currency" is not the U.S. dollar, persons required for U.S. federal income tax purposes to accelerate the recognition of any item of gross income with respect to the Shares as a result of such income being recognized on an applicable financial statement, or other investors with special circumstances) may be subject to special rules not discussed below. In addition, the following discussion applies only to investors who will hold Shares as "capital assets" (generally, property held for investment). Moreover, the discussion below does not address the effect of any state, local or foreign tax, or any U.S. federal non-income tax law consequences that may apply to an investment in Shares, or the Medicare contribution tax imposed on certain net investment income. Purchasers of Shares are urged to consult their own tax advisers with respect to all U.S. federal, state, local and foreign tax law considerations potentially applicable to their investment in Shares.

For purposes of this discussion, a "U.S. Shareholder" is a Shareholder that is (or is treated as), for U.S. federal income tax purposes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● an individual who is a citizen or resident of the United States;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● a corporation created or organized in or under the laws of the United States, any state thereof or the District of Columbia;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust.

For purposes of this discussion, a "U.S. Tax-Exempt Shareholder" is a U.S. Shareholder that is exempt from tax under Section 501(a) of the Code.

For purposes of this discussion, a "Non-U.S. Shareholder" is a Shareholder that is (or is treated as), for U.S. federal income tax purposes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● a nonresident alien individual;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● a foreign corporation; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● an estate or trust whose income is not subject to U.S. federal income tax on a net income basis.

If an entity or arrangement treated as a partnership for U.S. federal income tax purposes holds Shares, the tax treatment of a partner generally depends upon the status of the partner and the activities of the partnership. If you are a partner of a partnership holding Shares, the discussion below may not be applicable and we urge you to consult your own tax adviser for the U.S. federal income tax implications of the purchase, ownership and disposition of such Shares.

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**Taxation of the Trust**

The Sponsor will treat the Trust as a "grantor trust" for U.S. federal income tax purposes. In the opinion of Clifford Chance US LLP, although not free from doubt due to the lack of directly governing authority, the Trust should be classified as a "grantor trust" for U.S. federal income tax purposes (and the following discussion assumes such classification). If the Trust is properly treated as a grantor trust for U.S. federal income tax purposes, the Trust itself should not be subject to U.S. federal income tax. Instead, the Trust's income and expenses should "flow through" to the Shareholders, and the Trustee will report the Trust's income, gains, losses and deductions to the IRS on that basis. The opinion of Clifford Chance US LLP is not binding on the IRS or any court. Accordingly, there can be no assurance that the IRS will agree with the conclusions of counsel's opinion and it is possible that the IRS or another tax authority could assert a position contrary to one or all of those conclusions and that a court could sustain that contrary position. Neither the Sponsor nor the Delaware Trustee intends to request a ruling from the IRS with respect to the classification of the Trust for U.S. federal income tax purposes or with respect to any other matter.

If the IRS were to assert successfully that the Trust is not classified as a "grantor trust," the Trust might be classified as a partnership for U.S. federal income tax purposes. If the Trust were classified as a partnership for U.S. federal income tax purposes, the tax consequences of owning Shares generally would not be materially different from the tax consequences described herein, although there might be certain differences, including with respect to timing of the recognition of taxable income or loss and (in certain circumstances) withholding taxes. In addition, tax information reports provided to beneficial owners of Shares would be made in a different form. If the Trust were not classified as either a grantor trust or a partnership for U.S. federal income tax purposes, it generally would be classified as a corporation for such purposes. If it were treated as a corporation, the Trust would be subject to entity-level U.S. federal income tax (currently at the rate of 21%), plus possible state and/or local taxes on its net taxable income, and certain distributions made by the Trust to Shareholders would be treated as taxable dividends to the extent of the Trust's current and accumulated earnings and profits. Any such dividend distributed to a beneficial owner of Shares that is a non-U.S. person for U.S. federal income tax purposes generally would be subject to U.S. federal withholding tax at a rate of 30% (or such lower rate as provided in an applicable tax treaty). Except as otherwise indicated, the remainder of this discussion assumes that the Trust is classified as a grantor trust for U.S. federal income tax purposes.

**Taxation of U.S. Shareholders** 

Shareholders will be treated, for U.S. federal income tax purposes, as if they directly owned a pro rata share of the underlying assets held in the Trust. Shareholders also will be treated as if they directly received their respective pro rata shares of the Trust's income, if any, and as if they directly incurred their respective pro rata shares of the Trust's expenses. In the case of a Shareholder that purchases Shares for cash, its initial tax basis in its pro rata share of the assets held in the Trust at the time it acquires its Shares will be equal to its cost of acquiring the Shares. In the case of a Shareholder that acquires its Shares as part of the creation of a Basket, the delivery of ether to the Trust in exchange for the underlying ether represented by the Shares will not be a taxable event to the Shareholder, and the Shareholder's tax basis and holding period for the Shareholder's pro rata share of the ether held in the Trust will be the same as its tax basis and holding period for the ether delivered in exchange therefor. For purposes of this discussion, and unless stated otherwise, it is assumed that all of a Shareholder's Shares are acquired on the same date and at the same price per Share. Shareholders that hold multiple lots of Shares, or that are contemplating acquiring multiple lots of Shares, should consult their own tax advisers as to the determination of the tax basis and holding period for the underlying ether related to such Shares.

Any ether acquired by the Trust as staking rewards would be treated as giving rise to taxable income under the 2023 Staking Tax Guidance. Additionally, such ether will have a separate tax basis and holding period. It is likely that a Shareholder will have a tax basis for its share of any ether acquired by the Trust as staking rewards equal to the amount of income that it recognizes and the Shareholder's holding period for such ether will begin as of the time it recognizes such income.

Current IRS guidance on the treatment of convertible virtual currencies classifies ether as "property" that is not currency for U.S. federal income tax purposes and clarifies that ether could be held as a capital asset, but it does not address several other aspects of the U.S. federal income tax treatment of ether. Because ether is a recent technological innovation, the U.S. federal income tax treatment of ether or transactions relating to investments in ether may evolve and change from those discussed below, possibly with retroactive effect. In this regard, the IRS indicated that it has made it a priority to issue additional guidance related to the taxation of digital asset transactions, such as transactions involving ether. While it has started to issue such additional guidance, whether any future guidance will adversely affect the U.S. federal income tax treatment of an investment in ether or in transactions relating to investments in ether is unknown. Moreover, future developments that may arise with respect to digital assets may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. This discussion assumes that any ether the Trust may hold is properly treated for U.S. federal income tax purposes as property that may be held as a capital asset and is not currency for purposes of the provisions of the Code relating to foreign currency gain and loss.

The Trust expects to sell ether in connection with the periodic distribution of staking rewards, to pay certain expenses of the Trust or to fund cash redemptions, though the Trust does not intend to sell ether for other purposes. If the Trust sells ether (for example to generate cash to pay fees or expenses) or is treated as selling ether (for example by using ether to pay fees or expenses), a Shareholder generally will recognize gain or loss in an amount equal to the difference between (a) the Shareholder's pro rata share of the amount realized by the Trust upon the sale and (b) the Shareholder's tax basis for its pro rata share of the ether that was sold. A Shareholder's tax basis for its share of any ether sold by the Trust should generally be determined by multiplying the Shareholder's total basis for its share of all of the ether held in the Trust immediately prior to the sale, by a fraction the numerator of which is the amount of ether sold, and the denominator of which is the total amount of the ether held in the Trust immediately prior to the sale. After any such sale, a Shareholder's tax basis for its pro rata share of the ether remaining in the Trust should be equal to its tax basis for its share of the total amount of the ether held in the Trust immediately prior to the sale, less the portion of such basis allocable to its share of the ether that was sold.

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Upon a Shareholder's sale of some or all of its Shares (other than a redemption), the Shareholder will be treated as having sold the portion or all, respectively, of its pro rata share of the ether held in the Trust at the time of the sale that is attributable to the Shares sold. Accordingly, the Shareholder generally will recognize gain or loss on the sale in an amount equal to the difference between (a) the amount realized pursuant to the sale of the Shares, and (b) the Shareholder's tax basis for the portion of its pro rata share of the ether held in the Trust at the time of sale that is attributable to the Shares sold, as determined in the manner described in the preceding paragraph. Based on current IRS guidance, such gain or loss (as well as any gain or loss realized by a Shareholder on account of the Trust selling ether) will generally be long-term or short-term capital gain or loss, depending upon whether the Shareholder has a holding period of greater than one year in its pro rata share of the ether that was sold.

Gains or losses from the sale of ether to fund cash redemptions are expected to be treated as incurred by the Shareholder that is being redeemed, and the amount of such gain or loss generally will equal the difference between (a) the amount realized pursuant to the sale of the ether, and (b) the Shareholder's tax basis for the portion of its pro rata share of the ether held in the Trust that is sold to fund the redemption, as determined in the manner described in the paragraph that is two paragraphs above this one. A redemption of some or all of a Shareholder's Shares in exchange for the cash received from such sale is not expected to be treated as a separate taxable event to the Shareholder.

An in-kind redemption of some or all of a Shareholder's Shares in exchange for the underlying ether represented by the Shares redeemed generally will not be a taxable event to the Shareholder. The Shareholder's tax basis for the ether received in the in-kind redemption generally will be the same as the Shareholder's tax basis for the portion of its pro rata share of the ether held in the Trust immediately prior to the redemption that is attributable to the Shares redeemed. The Shareholder's holding period with respect to the ether received generally should include the period during which the Shareholder held the Shares redeemed in kind. A subsequent sale of the ether received by the Shareholder generally will be a taxable event, unless a nonrecognition provision of the Code or Treasury Regulations applies to such sale.

After any sale or redemption of less than all of a Shareholder's Shares, the Shareholder's tax basis for its pro rata share of the ether held in the Trust immediately after such sale or redemption generally will be equal to its tax basis for its share of the total amount of the ether held in the Trust immediately prior to the sale or redemption, less the portion of such basis which is taken into account in determining the amount of gain or loss recognized by the Shareholder upon such sale or redemption for money or, in the case of an in-kind redemption, that is treated as the basis of the ether received by the Shareholder in the redemption.

If a hard fork occurs in the Ethereum blockchain, the Trust could temporarily hold both the original ether and the alternative new asset as the Sponsor determines, in its sole discretion, which asset it believes is generally accepted as ether. The other asset will be treated as an Incidental Right and/or IR Digital Asset, in accordance with the procedures specified herein. The IRS has held that a hard fork resulting in the creation of new units of crypto assets is a taxable event giving rise to ordinary income. The receipt, distribution and/or sale of the new alternative asset may cause Shareholders to incur a U.S. federal income tax liability. While the IRS has not addressed all situations in which airdrops occur, it is clear from the reasoning of the IRS's current guidance that it generally would treat an airdrop as a taxable event giving rise to ordinary income, and it is anticipated that any gain or loss from disposition of any assets received in the airdrop would generally be treated as giving rise to capital gain or loss that generally would be short-term capital gain or loss, unless the holding period of those assets were treated as being greater than one year as of the time they are sold. The Sponsor has committed to cause the Trust to permanently and irrevocably abandon any Incidental Rights and IR Digital Assets to which the Trust may become entitled in the future. However, there can be no assurance that these abandonments would be treated as effective for U.S. federal income tax purposes, or that the Sponsor will continue to cause the Trust to permanently and irrevocably abandon any Incidental Rights and IR Digital Assets if there are future regulatory developments that would make it feasible for the Trust to retain those assets.

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**Brokerage Fees and Trust Expenses**

Any brokerage, financing or other transaction fee incurred by a Shareholder in purchasing Shares will be treated as part of the Shareholder's tax basis in the underlying assets of the Trust. Similarly, any brokerage fee incurred by a Shareholder in selling Shares will reduce the amount realized by the Shareholder with respect to the sale.

Shareholders will be required to recognize the full amount of gain or loss upon a sale or deemed sale of ether by the Trust (as discussed above), even though some or all of the proceeds of such sale are used by the Sponsor to pay Trust expenses. Shareholders may deduct their respective pro rata shares of each expense incurred by the Trust to the same extent as if they directly incurred the expense. However, most expenses incurred by the Trust are expected to be treated as "miscellaneous itemized deductions." As a result, Shareholders who are individuals, estates or trusts Generally will not be able to deduct such expenses for U.S. federal income tax purposes.

**Investment by U.S. Tax-Exempt Shareholders**

Individual retirement accounts ("IRAs") and participant-directed accounts under tax-qualified retirement plans are limited in the types of investments they may make under the Code. Potential purchasers of Shares that are IRAs or participant-directed accounts under a Code section 401(a) plan should consult with their own tax advisors as to the ability to purchase Shares and the tax consequences of a purchase of Shares.

**Taxation of U.S. Tax-Exempt Shareholders**

Income recognized by U.S. Tax-Exempt Shareholders is generally exempt from U.S. federal income tax except to the extent of such Shareholders' UBTI. UBTI is defined generally as income from a trade or business regularly carried on by a tax-exempt entity that is unrelated to the entity's exempt purpose. Dividends, interest and, with certain exceptions, gains or losses from the sale, exchange or other disposition of property are generally excluded from UBTI (so long as not derived from debt-financed property). When a U.S. Tax-Exempt Shareholder owns an interest in a grantor trust, such as the Trust, the activities of the Trust (and any pass-through entities or disregarded entities in which the Trust owns an interest) are attributed to the U.S. Tax-Exempt Shareholder for purposes of determining whether such Shareholder's share of income of the grantor trust is UBTI.

The Trust's investments and activities relating thereto may cause a U.S. Tax-Exempt Shareholder to realize UBTI. In the absence of any guidance on the matter, a U.S. Tax-Exempt Shareholder's share of income from Staking Activities, a fork, airdrop, or similar event may be treated as UBTI. If the Trust were to incur liabilities, and thus, be treated as holding property constituting debt-financed property (generally, assets purchased with borrowed funds), income attributable to such property generally would constitute UBTI.

UBTI generally is separately calculated for each trade or business of a U.S. Tax-Exempt Shareholder. Thus, a U.S. Tax Exempt Shareholder generally cannot use deductions relating to one trade or business to offset income from another trade or business.

A U.S. private foundation considering an investment should be aware that, if such a foundation acquires a sufficiently large number of Shares, such Shares could become an "excess business holding" that could subject the foundation to a U.S. excise tax. A private foundation should consult its tax advisors regarding the excess business holdings provisions of the Code and other respects in which the provisions of Chapter 42 of the Code could affect the consequences to such foundation of acquiring and holding Shares.

Investors who are U.S. Tax Exempt Shareholders should consult their tax advisors with respect to the U.S. federal income tax consequences of an investment in Shares.

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**Taxation of Non-U.S. Shareholders**

The Trust expects (though no assurance can be given) that it should not be treated as engaged in a trade or business within the United States or recognize income that is treated as "effectively connected" with the conduct of a trade or business in the United States ("ECI"). With regard to Staking Activities, as described above in "—The Ether Custodian and The Staking Services Providers — Approved Validator Schedule", each Staking Service Provider has represented that the personnel and equipment involved in the performance of such activities will be physically located outside of the United States, with the exception of certain monitoring and maintenance functions that can be performed within the United States. The Trust expects that those activities should not cause the Trust to be engaged in a trade or business within the United States; however, no assurance can be given in this regard. Additionally, while it is unlikely that any income that the Trust might recognize as a result of a fork, airdrop or similar event would give rise to ECI, there has been no guidance as to how such events may be treated. Therefore, there can be no assurance that the Trust will not be treated as engaged in a U.S. trade or business or will not otherwise generate ECI for U.S. federal income tax purposes.

Provided that the Trust is not engaged in the conduct of a U.S. trade or business, and that it does not otherwise generate ECI, the U.S. federal income tax liability of a Non-U.S. Shareholder with respect to that Shareholder's Shares generally will be limited to withholding tax on certain gross income from U.S. sources (if any) generated by the Trust.

A Non-U.S. Shareholder's allocable share of U.S. source dividend, interest, rental and other "fixed or determinable annual or periodical gains, profits and income" ("FDAP") that is not ECI generally will be subject to U.S. federal withholding tax at a rate of 30% (unless reduced or eliminated by an applicable income tax treaty or statutory exemption). There is currently no guidance as to whether income recognized by the Trust from Staking Activities or as a result of a fork, airdrop or similar event would constitute U.S. source FDAP. Although not free from doubt due to the lack of directly governing authority and no assurance can be given that a withholding agent will not take a contrary position, the Trust expects that staking rewards should not be treated as U.S. source FDAP. As noted above, each Staking Service Provider has represented that the personnel and equipment involved in the performance of Staking Activities will be physically located outside of the United States, with the exception of certain monitoring and maintenance functions that can be performed within the United States.

A Non-U.S. Shareholder resident in a jurisdiction with which the U.S. has an income tax treaty may be entitled to the benefits of that treaty in order to reduce or eliminate the 30% U.S. withholding tax with respect to that Shareholder's distributive share of income that is treated as U.S. source FDAP if under the laws of that non-U.S. jurisdiction, the Trust is treated as tax-transparent and certain other conditions are met. In order to secure the benefits of an applicable income tax treaty through a reduction or elimination of withholding, Non-U.S. Shareholders will generally be required to certify their non-U.S. status by providing an executed IRS Form W-8BEN or W-8BEN-E. If a Non-U.S. Shareholder fails to provide such IRS Forms, U.S. federal tax at a full 30% rate may be withheld from the Non-U.S. Shareholder's share of U.S. source FDAP, in which case the Non-U.S. Shareholder must file a refund claim with the IRS in order to obtain the benefit of a reduced rate or exemption.

If the proper amounts are withheld and remitted to the U.S. government and the Trust does not recognize ECI, Non-U.S. Shareholders that are individuals or corporations will generally not be required to file U.S. federal income tax returns or pay additional U.S. federal income taxes solely as a result of their investments in the Trust (though Non-U.S. Shareholders treated as trusts for U.S. federal income purposes are subject to special rules).

If the Trust is treated as a partnership (for U.S federal income tax purposes), a Non-U.S. Shareholder is treated as disposing of Shares, and any portion of the gain realized on the disposition would be treated as ECI, such Shares may be subject to a withholding tax equal to 10% of the amount realized on the disposition (subject to reduction or elimination in certain circumstances). Non-U.S. Shareholders are urged to consult with their tax advisers regarding the application of this withholding tax.

If the Trust is treated as having any ECI (or any portion of the gain realized on a Non-U.S. Shareholder's disposition of Shares is treated as ECI), then if such Non-U.S. Shareholder is treated as a corporation, it may also be subject to U.S. federal branch profits tax on its effectively connected earnings and profits (which, with respect to the Shares, would generally be such Non-U.S. Shareholder's share of ECI from such Shares, reduced by deductions taken into account by the Shareholder in computing its ECI, and further reduced by the U.S. federal income taxes imposed on such ECI). U.S. federal branch profits tax is generally imposed at a 30% rate, though it may be reduced under the Code or pursuant to an applicable income tax treaty.

**U.S. Information Reporting and Backup Withholding**

The Trust or the appropriate broker will file certain information returns with the IRS, and provide certain tax-related information to Shareholders, in connection with the Trust. Shareholders may be required to provide certain information or make certain certifications in order to avoid certain information reporting and backup withholding requirements. U.S. Shareholders generally may comply with these requirements by providing a duly completed and executed IRS Form W-9 (Request for Taxpayer Identification Number and Certification). Non-U.S. Shareholders generally may comply with these requirements by providing the relevant IRS Form W-8, duly completed and executed.

The amount of any backup withholding will be allowed as a credit against a Shareholder's U.S. federal income tax liability and may entitle the Shareholder to a refund, provided that the required information is furnished to the IRS in a timely manner.

Individual U.S. Shareholders will generally be required to report on their federal income tax return the receipt, acquisition, sale, or exchange of any financial interest in virtual currency, which includes a Shareholder's interest in ether held by the Trust.

PROSPECTIVE SHAREHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISERS TO DISCUSS ALL TAX CONSIDERATIONS THAT MAY BE RELEVANT TO THEM ASSOCIATED WITH ANY PURCHASE, HOLDING, SALE, REDEMPTION OR OTHER DEALING IN THE SHARES BEFORE DECIDING WHETHER TO INVEST IN THE SHARES.

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**ERISA AND RELATED CONSIDERATIONS**

ERISA and/or Section 4975 of the Code impose certain requirements on: (i) employee benefit plans and certain other plans and arrangements, including individual retirement accounts and annuities, Keogh plans and certain collective investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to Title I of ERISA and/or Section 4975 of the Code (collectively, "Plans"); and (ii) persons who are fiduciaries with respect to the investment of assets treated as "plan assets" within the meaning of U.S. Department of Labor (the "DOL") regulation 29 C.F.R. § 2510.3-101, as modified by Section 3(42) of ERISA (the "Plan Assets Regulation"), of a Plan. Investments by Plans are subject to the fiduciary requirements and the applicability of prohibited transaction restrictions under ERISA and the Code.

"Governmental plans" within the meaning of Section 3(32) of ERISA, certain "church plans" within the meaning of Section 3(33) of ERISA and "non-U.S. plans" described in Section 4(b)(4) of ERISA, while not subject to the fiduciary responsibility and prohibited transaction provisions of Title I of ERISA or Section 4975 of the Code, may be subject to any federal, state, local, non-U.S. or other law or regulation that is substantially similar to the foregoing provisions of ERISA and the Code. Fiduciaries of any such plans are advised to consult with their counsel prior to an investment in the Shares.

In contemplating an investment of a portion of Plan assets in the Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts and circumstances of the Plan, the "Risk Factors" discussed above and whether such investment is consistent with its fiduciary responsibilities. The Plan fiduciary should consider, among other issues, whether: (1) the fiduciary has the authority to make the investment under the appropriate governing plan instrument; (2) the investment would constitute a direct or indirect non-exempt prohibited transaction with a "party in interest" or "disqualified person" within the meaning of ERISA and Section 4975 of the Code respectively; (3) the investment is in accordance with the Plan's funding objectives; and (4) such investment is appropriate for the Plan under the general fiduciary standards of investment prudence and diversification, taking into account the overall investment policy of the Plan, the composition of the Plan's investment portfolio and the Plan's need for sufficient liquidity to pay benefits when due. When evaluating the prudence of an investment in the Shares, the Plan fiduciary should consider the DOL's regulation on investment duties, which can be found at 29 C.F.R. § 2550.404a-1.

It is intended that (a) none of the Sponsor, the Trustee, the Delaware Trustee, the Custodians or any of their respective affiliates (the "Transaction Parties") has through this prospectus and related materials provided any investment advice within the meaning of Section 3(21) of ERISA to the Plan in connection with the decision to purchase or acquire such Shares and (b) the information provided in this prospectus and related materials will not make a Transaction Party a fiduciary to the Plan.

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**SEED CAPITAL INVESTOR**

BlackRock Financial Management, Inc. (the "Seed Capital Investor") purchased $100,000 in Shares on January 14, 2026, and on January 14, 2026 took delivery of 4,000 Shares at a per-Share price of $25.00 (the "Seed Creation Baskets"). Total proceeds to the Trust from the sale of the Seed Creation Baskets were $100,000. On [ ], 2026, the Trust purchased [ ] ether with the proceeds of the Seed Creation Baskets using the Prime Execution Agent. The costs incurred in connection with the purchase of ether with the proceeds of the Seed Creation Baskets were borne by the Trust. The Seed Capital Investor may offer all of the Shares comprising the Seed Creation Baskets to the public pursuant to this prospectus.

The Seed Capital Investor will not receive from the Trust, the Sponsor or any of their affiliates any fee or other compensation in connection with the sale of the Seed Creation Baskets. The Seed Capital Investor will be acting as a statutory underwriter with respect to the Seed Creation Baskets.

The Sponsor and the Trust have agreed to indemnify the Seed Capital Investor against certain liabilities, including liabilities under the Securities Act, and to contribute to payments that the Seed Capital Investor may be required to make in respect thereof.

**PLAN OF DISTRIBUTION**

In addition to, and independent of the initial purchase by the Seed Capital Investor (described above), the Trust issues Shares in Baskets to Authorized Participants in exchange for deposits of ether and cash on a continuous basis. As of the date of this prospectus, the Authorized Participant is Virtu Americas LLC. Additional Authorized Participants may be added at any time, subject to the discretion of the Sponsor. These transactions take place in exchange for cash or ether. Because new Shares can be created and issued on an ongoing basis, at any point during the life of the Trust, a "distribution," as such term is used in the Securities Act, will be occurring. The Seed Capital Investor will be deemed to be a statutory underwriter. Authorized Participants, other broker-dealers and other persons are cautioned that some of their activities will result in their being deemed participants in a distribution in a manner which would render them statutory underwriters and subject them to the prospectus-delivery and liability provisions of the Securities Act. For example, an Authorized Participant, other broker-dealer firm or its client will be deemed a statutory underwriter if it purchases a Basket from the Trust, breaks the Basket down into the constituent Shares and sells the Shares to its customers; or if it chooses to couple the creation of a supply of new Shares with an active selling effort involving solicitation of secondary market demand for the Shares. A determination of whether a particular market participant is an underwriter must take into account all the facts and circumstances pertaining to the activities of the broker-dealer or its client in the particular case, and the examples mentioned above should not be considered a complete description of all the activities that would lead to designation as an underwriter.

By executing an Authorized Participant Agreement, an Authorized Participant becomes part of the group of parties eligible to purchase Baskets from, and put Baskets for redemption to, the Trust. An Authorized Participant is under no obligation to create or redeem Baskets, and an Authorized Participant is under no obligation to offer to the public Shares of any Baskets it does create.

Investors that purchase Shares through a commission/fee-based brokerage account may pay commissions/fees charged by the brokerage account. We recommend that investors review the terms of their brokerage accounts for details on applicable charges. Dealers that are not "underwriters" but are participating in a distribution (as contrasted to ordinary secondary trading transactions), and thus dealing with Shares that are part of an "unsold allotment" within the meaning of Section 4(a)(3)(C) of the Securities Act, would be unable to take advantage of the prospectus- delivery exemption provided by Section 4(a)(3) of the Securities Act.

The Sponsor intends to qualify the Shares in states selected by the Sponsor and that sales be made through broker-dealers who are members of FINRA. Investors intending to create or redeem Baskets through Authorized Participants in transactions not involving a broker-dealer registered in such investor's state of domicile or residence should consult their legal advisor regarding applicable broker-dealer or securities regulatory requirements under the state securities laws prior to such creation or redemption.

Because FINRA views the Shares as interests in a direct participation program, no FINRA-member, or person associated with a member, will participate in a public offering of Shares except in compliance with Rule 2310 of the FINRA Rules. The Authorized Participants do not receive from the Trust or the Sponsor any compensation in connection with an offering of the Shares.

The Seed Capital Investor will not act as an Authorized Participant with respect to the Seed Creation Baskets, and its activities with respect to the Seed Creation Baskets will be distinct from those of an Authorized Participant. Unlike most Authorized Participants, the Seed Capital Investor is not in the business of purchasing and selling securities for its own account or the accounts of others. The Seed Capital Investor will not act as an Authorized Participant to purchase (or redeem) Baskets in the future.

The Shares will be listed and traded on NASDAQ under the ticker symbol "ETHB".

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**CONFLICTS OF INTEREST**

**General**

Prospective investors should be aware that the Sponsor and the Trustee intend to assert that Shareholders have, by purchasing Shares, consented to the following conflicts of interest in the event of any proceeding alleging that such conflicts violated any duty owed by the Sponsor or the Trustee to the Shareholders.

The Sponsor and the Trustee want you to know that there are certain entities with which the Sponsor or the Trustee may have relationships that may give rise to conflicts of interest, or the appearance of conflicts of interest. These entities include the following: affiliates of the Sponsor and the Trustee (including, without limitation, BlackRock, and each of its or their affiliates, directors, partners, trustees, managing members, officers and employees, collectively, the "BlackRock Affiliates").

The activities of the Sponsor, the Trustee and the BlackRock Affiliates in the management of, or their interest in, their own accounts and other accounts they manage, may present conflicts of interest that could disadvantage the Trust and its Shareholders. One or more of the Sponsor, the Trustee or the BlackRock Affiliates provide investment management services to other investment vehicles, funds and discretionary managed accounts that may follow an investment program similar to that of the Trust. The Sponsor, the Trustee and the BlackRock Affiliates collectively are involved worldwide with a broad spectrum of financial services and asset management activities and may engage in the ordinary course of business in activities in which their interests or the interests of their clients may conflict with those of the Trust and its Shareholders. One or more of the Sponsor, the Trustee or the BlackRock Affiliates act or may act as an investor, investment banker, research provider, investment manager, financier, underwriter, advisor, market maker, trader, prime execution agent, lender, agent and principal, and have other direct and indirect interests, in assets in which the Trust directly and indirectly invest. Additionally, various funds managed by affiliates of the Sponsor may have from time to time held long positions in the CME cash-settled ether futures market. Further, various officers and employees of the Sponsor may hold or have exposures to ether in various degrees given the current state of global adoption of ether.

The Trustee has adopted and implemented policies and procedures that are reasonably designed to ensure compliance with applicable law, including a Compliance Manual and Code of Business Conduct and Ethics, which address conflicts of interest (together, the "Policies"). Consistent with the requirements of the Policies, the Trustee will implement standard operating protocols under which personnel who have access to information about creation and redemption activity in the Shares ("Ether Access Persons") pre-clear personal trading activity in ether. All of the Sponsor's employees will be required to preclear personal transactions in the Shares. Finally, trading on behalf of clients in the Shares will be subject to controls embedded in BlackRock's portfolio compliance systems. The Policies and any underlying procedures will be amended as necessary to reflect these protocols.

The Sponsor, the Trustee and the BlackRock Affiliates may participate in transactions related to ether, either for their own account (subject to certain internal employee trading operating practices) or for the account of others, such as clients, and such transactions may occur prior to, during, or after the commencement of this offering. Such transactions may not serve to benefit the Shareholders of the Trust and may have a positive or negative effect on the value of the ether held by the Trust and, consequently, on the market value of ether.

Because these parties may trade ether for their own accounts at the same time as the Trust, prospective Shareholders should be aware that such persons may take positions in ether which are opposite, or ahead of, the positions taken for the Trust. There can be no assurance that any of the foregoing will not have an adverse effect on the performance of the Trust.

Thus, it is likely that the Trust will have multiple business relationships with and will engage in transactions with or obtain services from entities for which the Sponsor, the Trustee or an Affiliate performs or seeks to perform investment banking or other services.

BlackRock expects to receive compensation from an affiliate of the Ether Custodian for BlackRock's technology support of such affiliate's enhanced integration with the Aladdin Platform, and a portion of such compensation may be based on the use of such affiliate's products and services by Aladdin clients.

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An affiliate of the Sponsor acts as investment manager to a money market fund, the Circle Reserve Fund, which the issuer of USDC uses to hold cash, U.S. Treasury bills, notes and other obligations issued or guaranteed as to principal and interest by the U.S. Treasury, and repurchase agreements secured by such obligations or cash, which serve as reserves backing USDC stablecoins. An affiliate of the Sponsor has a minority equity interest in the issuer of USDC. See "Risk Factors—Prices of ether may be affected due to stablecoins (including Tether and USDC), the activities of stablecoin issuers and their regulatory treatment."

**Resolution of Certain Conflicts**

The Trust Agreement provides that in the case of a conflict of interest between the Trustee, the Sponsor and their affiliates, on the one hand, and the holders of Shares, on the other, the Trustee and the Sponsor will use commercially reasonable efforts to resolve such conflict considering the relevant interests of each party (including their own interests) and related benefits and burdens, any customary or accepted industry practices, and any applicable generally accepted accounting practices or principles. The Trust Agreement provides that in the absence of bad faith by the Sponsor or Trustee, such a resolution will not constitute a breach of the Trust Agreement or any duty or obligation of the Sponsor or Trustee. Notwithstanding the foregoing, in no event will the Sponsor or the Trustee or their respective affiliates be required to divest themselves of, or restrict their services or other activities with respect to, any assets they currently or may hold, manage or control on their own behalf or on behalf of any customer, client or any other person.

**Issues Relating to the Valuation of Assets**

The Sponsor will value the Trust's assets in accordance with the valuation policies of the Sponsor; however, the manner in which the Sponsor exercises its discretion with respect to valuation decisions will impact the valuation of assets of the Trust. To the extent that fees are based on valuations, the exercise of discretion in valuation by the Sponsor will give rise to conflicts of interest including in connection with the calculation of Sponsor's Fees. In addition, various divisions and units within BlackRock are required to value assets, including in connection with managing or advising other accounts for clients, such as registered and unregistered funds and owners of separately managed accounts ("Client Accounts"). These various divisions, units and affiliated entities may, but are under no obligation to, share information regarding valuation techniques and models or other information relevant to the valuation of a specific asset or category of assets. Regardless of whether or not the Sponsor has access to such information, to the extent the Sponsor values the assets held by the Trust, the Sponsor will value investments according to its valuation policies and may value an identical asset differently than such other divisions, units or affiliated entities.

The Sponsor reserves the right to utilize third-party vendors to perform certain functions, including valuation services, and these vendors may have interests and incentives that differ from those of Shareholders.

**Conflicts of Interest for the Prime Execution Agent, the Ether Custodian and the Trade Credit Lender**

The Prime Execution Agent, the Ether Custodian and the Trade Credit Lender are affiliates of Coinbase Global. As affiliates, the Coinbase Entities may have actual or potential conflicts of interest when executing the Trust's orders. As a result of these and other conflicts, when acting as principal, the Coinbase Entities may have an incentive to favor their own interests and the interests of their affiliates over the Trust's interests and have in place certain policies and procedures that are designed to mitigate such conflicts. For additional information on the conflicts of interest of the Coinbase Entities, see "The Prime Execution Agent and the Trade Credit Lender—The Prime Execution Agent."

**GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION**

The rights of the Sponsor, the Trust, DTC (as registered owner of the Trust's global certificate for Shares) and the Shareholders are governed by the laws of the State of Delaware. The Sponsor, the Trust and DTC and, by accepting Shares, each DTC Participant and each Shareholder, consent to the non-exclusive jurisdiction of the courts of the State of Delaware and any federal courts located in Delaware, provided that causes of actions for violations of the Exchange Act or the Securities Act will not be governed by the non-exclusive jurisdiction provision of the Trust Agreement. Such consent is not required for any person to assert a claim of Delaware jurisdiction over the Sponsor or the Trust.

**LEGAL MATTERS**

Certain matters of Delaware law relating to the validity of the Shares has been passed upon for the Sponsor by Morris, Nichols, Arsht & Tunnell LLP, Wilmington, DE. Clifford Chance US LLP, New York, NY, who, as special U.S. tax counsel to the Sponsor, has rendered an opinion regarding the material federal income tax consequences relating to the Shares.

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**EXPERTS**

The financial statement as of January 14, 2026 included in this prospectus has been so included in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

**WHERE YOU CAN FIND MORE INFORMATION**

The Sponsor has filed on behalf of the Trust a registration statement on Form S-1 with the SEC under the Securities Act. This prospectus does not contain all of the information set forth in the registration statement (including the exhibits to the registration statement), parts of which have been omitted in accordance with the rules and regulations of the SEC. For further information about the Trust or the Shares, please refer to the registration statement, which you may inspect, without charge, online at www.sec.gov. Information about the Trust or the Shares can also be obtained from the Trust's website at http://www.iShares.com. This internet address is only provided here as a convenience to you, and the information contained on or connected to the Trust's website is not considered part of this prospectus. We will make available, free of charge, on our website our Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K (including any amendments thereto), proxy statements and other information filed with, or furnished to, the SEC, as soon as reasonably practicable after such documents are so filed or furnished.

The Trust will be subject to the informational requirements of the Exchange Act and the Sponsor will, on behalf of the Trust, file certain reports and other information with the SEC. These filings will contain certain important information that does not appear in this prospectus. For further information about the Trust, you may read and copy these filings at the SEC's internet site (www.sec.gov), which also contains reports and other information regarding issuers that file electronically with the SEC.

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**GLOSSARY**

In this prospectus, each of the following terms has the meaning set forth below:

"Affiliate" — With respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person.

"airdrop" — An occurrence where holders of a particular digital asset may be entitled to claim a certain amount of a new digital asset for free, based on the fact that they hold such particular digital asset.

"Additional Ether Custodian" or "Anchorage" — Anchorage Digital Bank N.A.

"Additional Ether Custodian Agreement" or "Anchorage Custodian Agreement" — The agreement, governed by New York law, between the Trust and the Additional Ether Custodian regarding the custody of the Trust's ether.

"Anchorage Vault Balance" — Accounts storing the Trust's ether that are required to be segregated from the assets held by the Additional Ether Custodian as principal and the assets of its other customers.

"Anchor Labs" — Anchor Labs, Inc., the parent company of Anchorage Digital Bank N.A., the Additional Ether Custodian.

"Anchor Labs Insureds" — Anchor Labs and all of its subsidiaries, including the Additional Ether Custodian.

"API" — Application Programming Interface.

"Article 8" — Article 8 of the New York Uniform Commercial Code.

"ASC Topic 820" — The Financial Accounting Standards Board Accounting Standards Codification Topic 820, "Fair Value Measurements and Disclosures."

"Authorized Participant" — A person who, at the time of submitting an order to create or redeem one or more Baskets (i) is a registered broker-dealer, (ii) is a DTC Participant or an Indirect Participant, and (iii) has in effect a valid Authorized Participant Agreement.

"Authorized Participant Agreement" — An agreement entered into by an Authorized Participant, the Sponsor and the Trustee that provides the procedures for the creation and redemption of Baskets.

"Basket" — A block of 40,000 Shares.

"Basket Amount" — The amount of cash to be delivered in a cash creation or received in a cash redemption which BRIL will adjust as determined on each Business Day as promptly as practicable after 4:00 p.m. ET, by multiplying the NAV by the number of Shares in each Basket (40,000).

"Basket Ether Amount" — The amount of ether to be (i) deposited or received by the Authorized Participant or its designated agent or client in connection with an in-kind creation or redemption, as applicable and (ii) purchased or sold by the Trust in connection with a cash creation or redemption, as applicable. BRIL will adjust the amount of ether as determined on each Business Day as promptly as practicable after 4:00 p.m. ET, by multiplying the NAV by the number of Shares in each Basket (40,000) and dividing the resulting product by that day's CF Benchmarks Index. Fractions of an ether smaller than 10 gwei are disregarded for purposes of the computation of the Basket Ether Amount.

"BitLicense" — A business license under 23 New York Codes, Rules and Regulations (NYCRR) Part 200.

"Blackrock" — Blackrock, Inc.

"BlackRock Affiliate" — Any affiliates of the Sponsor and the Trustee (including, without limitation, Blackrock, and each of its or their affiliates, directors, partners, trustees, managing members, officers and employees).

"BMR" —The UK Benchmarks Regulation.

"BRIL" — BlackRock Investments, LLC.

"BSA" — U.S. Bank Secrecy Act, as amended.

"Business Day" — Any day other than: (1) a Saturday or a Sunday, or (2) a day on which NASDAQ is closed for regular trading.

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"Cash Custodian" — The Bank of New York Mellon and any substitute or additional custodian of the Trust's cash pursuant to a written agreement with the Trust or Trustee on behalf of the Trust.

"Cash Order Cutoff Time" —The required deadline for an Authorized Participant to submit a cash purchase order for the creation of Baskets or a cash redemption order for the redemption of Baskets. The Cash Order Cutoff Time is 6:00 p.m. ET on the Business Day prior to trade date.

"CBDCs" — Digital forms of legal tender, called central bank digital currencies, introduced by central banks in various countries.

"CB Return Cure" — the failure of any Coinbase Entity to sell or withdraw or transfer the Trust's ether in accordance with the Trust's instructions within the time periods set forth in the Prime Execution Agent Agreement and such failure is not cured within two (2) business days following the Trust providing written notice to the relevant Coinbase Entity.

"CFPB" — The Consumer Financial Protection Bureau.

"CFTC" — The Commodity Futures Trading Commission.

"CF Benchmarks Index" — The CME CF Ether–Dollar Reference Rate – New York Variant for Ether – U.S. Dollar trading pair.

"Client Account" — Other accounts for clients, such as registered and unregistered funds and owners of separately managed accounts that various divisions and units within BlackRock manage or advise.

"CME" — Chicago Mercantile Exchange.

"Code" — The United States Internal Revenue Code of 1986, as amended.

"Code of Ethics" — The codification of the Sponsor's business and ethical principles that applies to its executive officers.

"Coinbase Entities" — The Prime Execution Agent, Ether Custodian and Trade Credit Lender.

"Coinbase Custody" — Coinbase Custody Trust Company, LLC.

"Cold storage" — a safeguarding method by which the private keys corresponding to the Trust's ether are generated and stored in an offline manner using computers or devices that are not connected to the internet, which is intended to make them more resistant to hacking.

"Coinbase Insureds" — Coinbase Global and all of its subsidiaries, including the Ether Custodian and the Prime Execution Agent.

"Commodity Exchange Act" or "CEA" — The Commodity Exchange Act of 1936, as amended.

"Connected Trading Venue"— A venue (including third-party venues and the Prime Execution Agent's own execution venue) where the Prime Execution Agent executes orders to buy and sell ether on behalf of the Trust.

"Connected Trading Venue or Authorized Participant Account" — All customer accounts opened at Coinbase, including any opened by (a) Connected Trading Venues, (b) Authorized Participants or (c) agents/partners of such Authorized Participants.

"Consensus Client" — A consensus-layer client software program.

"Constituent Platforms" — The constituent digital asset platforms of the CF Benchmarks Index, which are chosen by the Index Administrator and could change over time.

"CTA" — The Consolidated Tape Association.

"Custodian Agreement" — The agreement, governed by New York law, between the Trust, the Ether Custodian, the Prime Execution Agent, and the Trade Credit Lender regarding the custody of the Trust's ether.

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"Custodians" —The Cash Custodian and Ether Custodian, collectively.

"Custodians' Fee" — The fees payable to the Custodians.

"Custody Transaction Costs" — Transfer, processing and other transaction costs charged by the Ether Custodian in connection with the issuance of Baskets for such purchase order. BRIL will reimburse any Custody Transaction Costs to the Ether Custodian according to the amounts invoiced by the Ether Custodian.

"CVC" — Convertible virtual currency.

"DAOs" — Decentralized autonomous organizations.

"dApps" — Short for decentralized applications, which consistent with common usage, refers to all applications which are built on the Ethereum network or other blockchains, whether or not decentralized in fact.

"Delaware Trustee" — Wilmington Trust, National Association, a national association, is the Delaware trustee of the Trust.

"DeFi" — Decentralized finance.

"digital asset treasury companies" — Companies engaged in businesses outside the digital asset industry that have begun to hold their corporate treasuries in digital assets instead of in fiat currency.

"DFPI" — The California Department of Financial Protection and Innovation.

"DOL" — The U.S. Department of Labor.

"DSTA" — The Delaware Statutory Trust Act.

"DTC" — The Depository Trust Company.

"DTC Participant" — An entity that has an account with DTC.

"ECI" — Income that is treated as "effectively connected" with the conduct of a trade or business in the United States.

"ERISA" — The Employee Retirement Income Security Act of 1974, as amended.

"ETHUSD_RTI" — CME CF Ether Dollar Real Time Index.

"ETHUSD_RR" —CME CF Ether-Dollar Reference Rate.

"ET" — Eastern Time Zone.

"ETH" — The currency code for ether.

"Ether Custodian" or "Coinbase Custody" — Coinbase Custody Trust Company, LLC.

"Ether Trading Counterparty" - Designated third parties who transact in ether pursuant to written agreements with the Trust.

"Ethereum blockchain" — The blockchain ledger for ether.

"Ethereum Classic" or "ETC" — The original blockchain, now referred to as "Ethereum Classic" with the digital asset on that blockchain now referred to as Ethereum Classic, or ETC.

"Ethereum Client" — software application that implements the Ethereum network specification, communicates with the Ethereum network and allows them to act as a node in the network to the new specification.

"Ethereum Foundation" — A Swiss non-profit organization, was set up to oversee the protocol's development.

"Ethereum network" — Ethereum blockchain and any digital asset network, including the Ethereum peer-to-peer network.

"EthSuisse" — Ethereum Switzerland GmbH.

"ETF Services" — Certain order processing, Authorized Participant communications, and related services in connection with the issuance and redemption of Baskets.

"ETF Services Agreement" The agreement between the Trust and BRIL, an affiliate of the Trustee, to perform ETF Services.

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"ETF Servicing Fee" — The fee received from Authorized Participants for providing the ETF Services.

"Exchange Act" — The Securities Exchange Act of 1934, as amended.

"Execution Client" — An execution-layer client software program.

"Fair Value Event" — An event which occurs if the CF Benchmarks Index is not available or the Sponsor determines, in its sole discretion, that the CF Benchmarks Index is unreliable.

"FBO" — For the benefit of.

"FBO Account" — An omnibus account in the Prime Execution Agent's name FBO its customers at each of multiple FDIC-insured banks.

"FCA" — The Financial Conduct Authority of the United Kingdom.

"FDAP" — A Non-U.S. Shareholder's allocable share of U.S. source dividend, interest, rental and other "fixed or determinable annual or periodical gains, profits and income."

"FDIC" — The Federal Deposit Insurance Corporation.

"FinCEN" — The U.S. Department of the Treasury Financial Crimes Enforcement Network.

"FINRA" — The Financial Industry Regulatory Authority.

"fork" — A non-backward compatible change to the original Ethereum blockchain and the source code of the original Ethereum network which results in the original ethereum network and the original Ethereum blockchain existing side-by-side, but incompatible, with a new network and a new blockchain, and leads to the creation of a new asset running on the new blockchain.

"FTX" — FTX Trading Ltd.

"GAAP" — The U.S. generally accepted accounting principles.

"Genesis" — Genesis Global Capital, LLC and its affiliates.

"GENIUS Act" — The Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025 which establishes a federal regulatory framework for payment stablecoins.

"gwei" — One-billionth of an ether (0.000000001 ether).

"hard fork" — A permanent split in a network's blockchain that separates an existing blockchain network into two networks, each with its own digital asset, blockchain and source code, which are not backwards compatible.

"IIV" — Intraday indicative value per Share.

"Incidental Rights" — Any digital asset (for avoidance of doubt, other than ether) or other asset or right that the Trust may be entitled to or come into possession of rights to acquire, or otherwise establish dominion and control over, any digital asset or other asset or right, which rights are incident to the Trust's ownership of ether and arise without any action of the Trust, or of the Sponsor or Delaware Trustee on behalf of the Trust. In the event of a hard fork of the Ethereum blockchain, the Sponsor shall determine which network shall constitute the Ethereum network and which asset shall constitute ether in accordance with the Trust Agreement.

"Index" — The CF Benchmarks Index shall constitute the Index, unless the CF Benchmarks Index is not available or the Sponsor in its sole discretion determines not to use the CF Benchmarks Index as the Index.

"Index Administrator" — CF Benchmarks Ltd.

"Indirect Participant" — An entity that has access to the DTC clearing system by clearing securities through, or maintaining a custodial relationship with, a DTC Participant.

"In-Kind Order Cutoff Time" —The required deadline for an Authorized Participant to submit an in-kind purchase order for the creation of Baskets or an in-kind redemption order for the redemption of Baskets. The In-Kind Order Cutoff Time is 3:59 p.m. ET on the trade date.

"Investment Company Act" — The Investment Company Act of 1940, as amended.

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"IR Digital Asset" — A digital asset acquired through Incidental Rights.

"IRA" — Individual retirement account.

"IRS" — The United States Internal Revenue Service.

"JOBS Act" — The Jumpstart Our Business Startups Act.

"KYC" — Know your customer.

"Liquidity Sleeve"—The reserve of the Trust's ether intended to be maintained as unstaked, as determined pursuant to the Ethereum Staking Liquidity Risk Policy.

"mempool" — The memory pool publicly visible set of unconfirmed transactions that have been broadcast to the network but not yet included in a block.

"Money Market Fund" — A money market fund that is in compliance with Rule 2a-7 under the Investment Company Act and rated "AAA" by S&P (or the equivalent from any eligible rating service).

"MSB" — A U.S.-based platform registered as a money services business with FinCEN.

"NASDAQ" or the "Exchange" — The Nasdaq Stock Market LLC.

"NAV" — Net asset value per Share.

"NBMM" — Non-bank market marker.

"NFA" — The National Futures Association.

"Non-U.S. Shareholder" — A Shareholder that is (or is treated as), for U.S. federal income tax purposes: (1) a nonresident alien individual, (2) a foreign corporation or (3) an estate or trust whose income is not subject to U.S. federal income tax on a net income basis.

"Notice" — The 2014 notice released by the IRS.

"NYDFS" — The New York State Department of Financial Services.

"OCC" — The Office of the Comptroller of the Currency.

"October 2025 Flash Crash" — Digital asset market turmoil in mid-October 2025, widely attributed to global trade tensions, which triggered a number of dislocations in the digital asset market. Ether lost approximately 12.2% of its value according to some sources.

"OFAC" — The Office of Foreign Assets Control.

"Order Book" — A list of buy and sell orders with associated limit prices and sizes that have not yet been matched.

"OTC" — Over the counter.

"Oversight Committee" — The Oversight Committee of the Index Administrator.

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

"Plan Assets Regulation" — Regulation 29 C.F.R. § 2510.3-101, as modified by Section 3(42) of ERISA.

"Plans" — Any (a) employee benefit plan and certain other plans and arrangements, including individual retirement accounts and annuities, (b) Keogh plans and certain collective investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to Title I of ERISA and/or Section 4975 of the Code.

"Prime Execution Agent" — Coinbase, Inc., an affiliate of Coinbase Custody, the Ether Custodian.

"Prime Execution Agent Agreement" — The Amended and Restated Coinbase Prime Broker Agreement, which includes the Custodian Agreement.

"proposer-builder separation" — design meant to separate block building from block proposal, with the intent to decentralize validation activity and reduce the likelihood of transaction censorship by validators.

"Provider-Facilitated Staking" — One or more third party staking services providers staking the Trust's ether to a Staking Services Provider's operating validator software and associated hardware.

"Regular Market Session" — NASDAQ's regular market session of 9:30 a.m. to 4:00 p.m. ET.

"Relevant Coinbase Entities" — The Prime Execution Agent and its parent.

"Relevant Pair" — The relevant cryptocurrency base asset against the corresponding quote asset, including markets where the quote asset is made fungible with accepted assets.

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"Relevant Transaction" — Any cryptocurrency versus U.S. dollar spot trade that occurs during the observation window between 3:00 p.m. and 4:00 p.m. ET on a Constituent Platform in the ETH/USD pair that is reported and disseminated by a Constituent Platform through its publicly available API and observed by the Index Administrator.

"Ruling & FAQs" — The revenue ruling and set of "Frequently Asked Questions" released by the IRS in 2019.

"Sarbanes-Oxley Act" — The Sarbanes–Oxley Act of 2002.

"SEC" — The Securities and Exchange Commission of the United States, or any successor governmental agency in the United States.

"Secondary Index" — FTSE DAR Reference Price – Ethereum shall constitute the Secondary Index, unless the FTSE DAR Reference Price – Ethereum is not available or the Sponsor in its sole discretion determines not to use the FTSE DAR Reference Price – Ethereum as the Index.

"Securities Act" — The Securities Act of 1933, as amended.

"Seed Capital Investor" — BlackRock Financial Management, Inc.

"Seed Creation Baskets" — 25 Baskets, comprising 4,000 Shares at a per-Share price equal to $25, delivered on January 14, 2026 to the Seed Capital Investor in exchange for $100,000.

"Services Agreement" — The BFA Master Services Agreement between The Bank of New York Mellon and the Trustee, on behalf of itself and the Trust.

"Settlement Deadline" — 6:00 p.m. ET of the calendar day immediately following the day the Trade Credit was extended by the Trade Credit Lender to the Trust or, if such day is not a business day, on the next Business Day.

"Shareholders" — Owners of beneficial interests in the Shares.

"Shares" — Units of fractional undivided beneficial interest in the net assets of the Trust.

"SIPC" — The Securities Investor Protection Corporation.

"slashing" — A severe sanction imposed if a validator commits malicious acts related to the proposal or attestation of blocks with invalid transactions. Slashing can result in the validator having a portion of its staked ether immediately burned or destroyed.

"Sponsor" — iShares Delaware Trust Sponsor LLC, a consolidated subsidiary of BlackRock, Inc.

"Sponsor's Fee" — The fees of the Sponsor accrues daily at an annualized rate equal to 0.25% of the net asset value of the Trust and is payable at least quarterly in arrears in U.S. dollars or in-kind or any combination thereof. The Sponsor may, at its discretion and from time to time, waive all or a portion of the Sponsor's Fee for stated periods of time. The Sponsor is under no obligation to waive any portion of its fees and any such waiver shall create no obligation to waive any such fees during any period not covered by the waiver. For a twelve-month period commencing on the day the Shares are initially listed on NASDAQ, the Sponsor will waive a portion of the Sponsor's Fee so that the Sponsor's Fee after the fee waiver will be equal to 0.12% of the net asset value of the Trust for the first $2.5 billion of the Trust's assets.

"Sponsor's Staking Portion" — The Sponsor's fee equal to a portion of the Staking Consideration

"Staking Activities" — employing ether in actions where any portion of the Trust's ether becomes subject to the Ethereum proof-of-stake validation or is used to earn additional ether or generate income or other earnings.

"Staking Arrangements" — The Ether Custodian's written agreements with Staking Services Providers.

"Staking Consideration" — Staking rewards and/or income from Staking Activities.

"Staking Fee" — Expense payable by the Trust, which will include (i) the Sponsor's Staking Portion and (ii) the Prime Execution Agent's share of Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers for their respective shares of the Trust's Staking Consideration), in accordance with the Staking Services Agreement.

"Staking Instructions" — Instructions provided by the Trust to the Ether Custodian to make the Trust's ether available for the purpose of staking such ether.

"Staking Services Agreement" — The staking services addendum to the Custodian Agreement with the Ether Custodian.

"Staking Services Provider" — Third party staking services providers, which may be either affiliates of the Ether Custodian or other approved third-party validators, that stake the Trust's ether to a Staking Services Provider's operating validator software and associated hardware.

"Staking Tax Guidance" — Collectively, the 2023 Staking Tax Guidance and the 2025 Staking Tax Guidance.

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"SVB" — Silicon Valley Bank.

"Termination for Cause" — As defined in the Custodian Agreement, termination for cause occurs if (i) the Trust materially breaching any provision of the Custodian Agreement; (ii) the Trust becomes bankrupt or insolvent; or (iii) the Trust fails to pay and settle in full its obligations to Coinbase Custody's affiliate, the Trade Credit Lender, which may, from time to time, provide financing to the Trust in the form of Trade Credits.

"Trade Credit" — The Trust may borrow ether or cash as a credit on a short-term basis from the Trade Credit Lender pursuant to the Trade Financing Agreement.

"Trade Credit Lender" — Coinbase Credit, Inc.

"Trade Financing Agreement" — The Coinbase Credit Committed Trade Financing Agreement.

"Trading Balance" — A trading account at which, pursuant to the Prime Execution Agent Agreement, the Trust's ether holdings and cash holdings from time to time may be held with the Prime Execution Agent, in connection with the sale of ether to pay the Sponsor's Fee and Trust expenses not assumed by the Sponsor.

"Trading Platform" — The Prime Execution Agent's execution platform where the Sponsor may place an order.

"Transaction Parties" — The Sponsor, the Trustee, the Delaware Trustee, the Custodians and any of their respective affiliates.

"Treasury Regulations" — Tax regulations issued by the IRS.

"Trust" — iShares Staked Ethereum Trust ETF, a Delaware statutory trust formed pursuant to the Trust Agreement.

"Trust Administrator" — The Bank of New York Mellon.

"Trust Agreement" — The Trust Agreement dated as of February 5, 2026, among the Sponsor, the Trustee and the Delaware Trustee.

"Trust Documents" — The Trust agreements with the service providers.

"Trustee" — BlackRock Fund Advisors.

"UBTI" — Unrelated business taxable income.

"USD" — The currency code the US Dollar.

"USDC" — US Dollar Coin.

"U.S. Shareholder" — A Shareholder that is (1) an individual who is treated as a citizen or resident of the United States for U.S. federal income tax purposes; (2) a corporation (or an entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia; (3) an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or (4) a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust.

"Vault Balance" — Accounts storing the Trust's ether that are required to be segregated from the assets held by the Ether Custodian as principal and the assets of its other customers.

"VWAP" — Volume Weight Average Prices.

"VWMP" — Volume Weight Median Prices.

"2023 Staking Tax Guidance" — The 2023 IRS revenue ruling that provides guidance on digital currency staking, including guidance to the effect that staking rewards will, under certain circumstances, be treated as giving rise to taxable income.

"2025 Staking Tax Guidance" — The 2025 IRS revenue procedure that provides a safe harbor pursuant to which, if all the requirements listed therein are satisfied, a trust's authorization pursuant to its trust agreement to stake its digital assets will not prevent the trust from qualifying as a grantor trust for U.S. federal income tax purposes.

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**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Sponsor and Shareholder of iShares Staked Ethereum Trust ETF

 ***Opinion on the Financial Statement***

We have audited the accompanying statement of assets and liabilities of iShares Staked Ethereum Trust ETF (the "Trust") as of January 14, 2026, including the related notes (collectively referred to as the "financial statement"). In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Trust as of January 14, 2026 in conformity with accounting principles generally accepted in the United States of America.

 ***Basis for Opinion***

This financial statement is the responsibility of the Sponsor's management. Our responsibility is to express an opinion on the Trust's financial statement based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit of this financial statement in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the financial statement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statement. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statement. We believe that our audit provides a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Philadelphia, Pennsylvania

February 13, 2026

We have served as the Trust's auditor since 2026.

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**iShares Staked Ethereum Trust ETF**

**STATEMENT OF ASSETS AND LIABILITIES**

**At January 14, 2026**

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| | |
|:---|:---|
| **ASSETS:** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash | $100000 |
| Total Assets | 100000 |
| **Liabilities** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total Liabilities |  |
| Commitments and contingent liabilities (Note 5) |  |
| **Net Assets** | $100000 |
| Shares issued and outstanding<sup>(a)</sup> | 4000 |
| Net asset value per Share (Note 2E) | $25.00 |

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&nbsp;&nbsp;&nbsp;&nbsp;(a) No par value, unlimited amount authorized.

***See Notes to Financial Statement***

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**NOTES TO FINANCIAL STATEMENT** 

**1 - Organization** 

The iShares Staked Ethereum Trust ETF (the "Trust") was organized on November 19, 2025 as a Delaware statutory trust. The trustee is BlackRock Fund Advisors (the "Trustee"), which is responsible for the day-to-day administration of the Trust. The Trust's sponsor is iShares Delaware Trust Sponsor LLC, a Delaware limited liability company (the "Sponsor"). The Bank of New York Mellon serves as the "Trust Administrator." The Trust is governed by the provisions of the Trust Agreement (the "Trust Agreement") executed by the Sponsor, the Trustee and Wilmington Trust, National Association, a national association (the "Delaware Trustee"), as of February 5, 2026. The Trust issues units of beneficial interest ("Shares") representing fractional undivided beneficial interests in its net assets.

The Trust had no operations other than a sale to BlackRock Financial Management, Inc., the Seed Capital Investor, of 4,000 Shares for $100,000 ($25.00 per Share). The Seed Capital Investor is an affiliate of the Sponsor. The Seed Capital Investor will not receive from the Trust, the Sponsor or any of their affiliates any fee or other compensation in connection with the initial seed sale.

The Trust seeks to reflect generally the performance of the price of ether and rewards from staking a portion of the Trust's ether, to the extent the Sponsor in its sole discretion determines that the Trust may do so without incurring undue legal or regulatory risk, including, without limitation, any risk to the Trust's qualification as a grantor trust for U.S. federal income tax purposes. The Trust seeks to reflect such performance before payment of the Trust's expenses and liabilities. The Shares are intended to constitute a simple means for an investor to make an investment similar to an investment in ether.

To effectuate the staking of the Trust's ether ("Staking Activities"), the Sponsor has directed, and may from time to time direct, Coinbase Custody Trust Company, LLC (the "Ether Custodian") to enter into written agreements with one or more third-party staking services providers (each, a "Staking Services Provider"), which may be either affiliates of the Ether Custodian or other approved third-party validators, to stake the Trust's ether to a Staking Services Provider's operating validator software and associated hardware.

The Trust's staking program seeks to maximize the portion of the Trust's ether available for staking while controlling for liquidity and redemption risks. To manage the liquidity and redemption risks associated with staking, the Sponsor intends to maintain a reserve of unstaked ether designed to accommodate anticipated redemption activity.

The Trust qualifies as an investment company solely for accounting purposes and not for any other purpose and follows the accounting and reporting guidance under the Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services - Investment Companies, but is not registered, and is not required to be registered, as an investment company under the Investment Company Act of 1940, as amended.

**2 - Significant Accounting Policies** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*A.* *Basis of Accounting* 

The following significant accounting policies are consistently followed by the Trust in the preparation of its financial statements in conformity with generally accepted accounting principles in the United States ("U.S. GAAP"). The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*B.* *Indemnifications* 

The Trust Agreement provides that the Sponsor shall indemnify the Trustee, its directors, employees, delegees and agents against, and hold each of them harmless from, any loss, liability, claim, cost, expense or judgment of any kind whatsoever (including the reasonable fees and expenses of counsel) that is incurred by any of them and that arises out of or is related to (1) any offer or sale by the Trust of Baskets (as defined in the Trust Agreement) (2) acts performed or omitted pursuant to the provisions of the Trust Agreement, (A) by the Trustee, its directors, employees, delegees and agents or (B) by the Sponsor or (3) any filings with or submissions to the Securities and Exchange Commission ("SEC") in connection with or with respect to the Shares, except that the Sponsor shall not have any obligations to pay any indemnification amounts incurred as a result of and attributable to (x) the willful misconduct, gross negligence or bad faith of, or material breach of the terms of the Trust Agreement by, the Trustee, (y) information furnished in writing by the Trustee to the Sponsor expressly for use in the registration statement, or any amendment thereto, filed with the SEC relating to the Shares that is not materially altered by the Sponsor or (z) any misrepresentations or omissions made by an authorized participant (other than the Sponsor) in connection with such authorized participant's offer and sale of Shares.

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The Trust Agreement provides that the Trustee shall indemnify the Sponsor, its directors, employees, delegees and agents against, and hold each of them harmless from, any loss, liability, claim, cost, expense or judgment of any kind whatsoever (including the reasonable fees and expenses of counsel) (1) caused by the willful misconduct, gross negligence or bad faith of the Trustee or (2) arising out of any information furnished in writing to the Sponsor by the Trustee expressly for use in the registration statement, or any amendment thereto or periodic report, filed with the SEC relating to the Shares that is not materially altered by the Sponsor.

The Trust Agreement provides that the Sponsor and its shareholders, directors, officers, employees, affiliates (as such term is defined under the Securities Act of 1933, as amended) and subsidiaries and agents shall be indemnified from the Trust and held harmless against any loss, liability, claim, cost, expense or judgment of any kind whatsoever (including the reasonable fees and expenses of counsel) arising out of or in connection with the performance of their obligations under the Trust Agreement or any actions taken in accordance with the provisions of the Trust Agreement and incurred without their (1) willful misconduct, gross negligence or bad faith or (2) reckless disregard of their obligations and duties under the Trust Agreement.

The Trust has agreed that The Bank of New York Mellon, the custodian for the Trust's cash holdings (the "Cash Custodian"), will only be responsible for any loss or damage suffered by the Trust as a direct result of the Cash Custodian's negligence, fraud or willful default in the performance of its duties.

The Trust's maximum exposure under these arrangements is unknown because it involves future potential claims against the Trust, which cannot be predicted with any certainty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*C.* *Cash and Cash Equivalents* 

Cash includes non-interest bearing, non-restricted cash maintained with one banking institution that does not exceed U.S. federally insured limits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*D.* *Investment Valuation* 

U.S. GAAP defines fair value as the price the Trust would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Trust's policy is to value investments held at fair value.

Various inputs are used in determining the fair value of assets and liabilities. Inputs may be based on independent market data ("observable inputs") or they may be internally developed ("unobservable inputs"). These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial reporting purposes. The level of a value determined for an asset or liability within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement in its entirety. The three levels of the fair value hierarchy are as follows:

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;

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|:---|:---|
| Level 2 – | Inputs other than quoted prices included within Level 1 that are observable for the asset or liability either directly or indirectly, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not considered to be active, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived principally from or corroborated by observable market data by correlation or other means; and |

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Level 3 – Unobservable inputs that are unobservable for the asset or liability, including the Trust's assumptions used in determining the fair value of investments.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*E.* *Calculation of Net Asset Value* 

On each business day, as soon as practicable after 4:00 p.m. ET, the net asset value of the Trust is obtained by subtracting all accrued fees, expenses and other liabilities of the Trust from the total assets held by the Trust. The Trust Administrator computes the net asset value per Share ("NAV") by dividing the net asset value of the Trust by the number of Shares outstanding on the date the computation is made. The methodology used to calculate an index price to value ether in determining the net asset value of the Trust may not be deemed consistent with U.S. GAAP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*F.* *Federal Income Taxes* 

The Trust is treated as a grantor trust for U.S. federal income tax purposes and, therefore, no provision for federal income taxes is required. Any income, expenses, gains and losses are passed through to the holders of Shares of the Trust. The Sponsor has analyzed applicable tax laws and regulations and their application to the Trust as of January 14, 2026 and does not believe that there are any uncertain tax positions that require recognition of a tax liability.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*G.* *Segment Reporting* 

The Chief Financial Officer of the Sponsor acts as the Trust's Chief Operating Decision Maker ("CODM") and is responsible for assessing performance and allocating resources with respect to the Trust. The CODM has concluded that the Trust operates as a single operating segment since the Trust has a single investment strategy as disclosed in its prospectus, against which the CODM assesses performance. The financial information provided to and reviewed by the CODM is presented within the Trust's financial statement.

**3 - Trust Expenses**

The Trust will pay to the Sponsor a Sponsor's fee in accordance with the Trust Agreement. The Sponsor's fee shall be included in the Trust Agreement prior to the commencement of trading of Shares on The Nasdaq Stock Market LLC ("NASDAQ"). In exchange for the Sponsor's fee, the Sponsor has agreed to assume the marketing and the following administrative expenses of the Trust: the fees of the Trustee, the Delaware Trustee and the Trust Administrator, the Custodians' fee, NASDAQ listing fees, SEC registration fees, printing and mailing costs, tax reporting fees, audit fees, license fees and expenses and up to $500,000 per annum in ordinary legal fees and expenses. The Sponsor may determine in its sole discretion to assume legal fees and expenses of the Trust in excess of the $500,000 per annum required under the Trust Agreement. To the extent that the Sponsor does not voluntarily assume such fees and expenses, they will be the responsibility of the Trust. The Sponsor will also pay the costs of the Trust's organization and the initial sale of the Shares, including applicable SEC registration fees. The Trust is not obligated to repay any such costs related to the Trust's organization and offering paid by the Sponsor.

The Trust will pay a Staking fee to the Sponsor, which will include (i) remuneration for the Sponsor's facilitation of Staking Activities pursuant to the Trust Agreement (the "Sponsor's Staking Portion") and (ii) the Prime Execution Agent's share of Staking Consideration (including any amounts payable by the Prime Execution Agent to Staking Services Providers for their respective shares of the Trust's Staking Consideration), in accordance with the Staking Services Agreement.

**4 - Related Parties**

The Sponsor and the Trustee are considered to be related parties to the Trust. The Trustee's fee is paid by the Sponsor and is not a separate expense of the Trust.

As of January 14, 2026, the Seed Capital Investor owned 4,000 Shares of the Trust.

**5 - Commitments and Contingent Liabilities**

In the normal course of business, the Trust may enter into contracts with service providers that contain general indemnification clauses, as disclosed in Note 2B, Indemnifications. The Trust's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust which cannot be predicted with any certainty.

**6 - Subsequent Events**

The Trust has evaluated the impact of all subsequent events through February 13, 2026, the date the financial statement was available for issuance and has determined that there were no subsequent events requiring adjustment or additional disclosure in the financial statement.

------

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**iShares Staked Ethereum Trust ETF**

**PROSPECTUS**

 **, 2026**

------

[**Table of Contents**](#toc)

**PART II**—**INFORMATION NOT REQUIRED IN PROSPECTUS**

**Item 13. Other Expenses of Issuance and Distribution.\***

The Trust shall not bear any expenses incurred in connection with the issuance and distribution of the securities being registered. These expenses shall be paid by the Sponsor. Except for NASDAQ Listing Fee, all such expenses are estimated:

---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp; Securities and Exchange Commission Registration Fee  | \*\*  |
| &nbsp;&nbsp;&nbsp; NASDAQ Listing Fee  | $4000  |
| &nbsp;&nbsp;&nbsp; Printing and engraving expenses  | $6823 |
| &nbsp;&nbsp;&nbsp; Legal fees and expenses  | $510000 |
| &nbsp;&nbsp;&nbsp; Accounting fees and expenses  | $17160 |
| &nbsp;&nbsp;&nbsp; Total  | $537983 |

---

\* Subject to revision upon completion of the offering.

\*\* An indeterminate number of the securities is being registered as may from time to time be sold at indeterminate prices. In accordance with Rules 456(d) and 457(u), the Trust is deferring payment of all of the registration fee and will pay the registration fee subsequently on an annual basis.

**Item 14. Indemnification of Directors and Officers.**

Section 5.11(a) of the Trust Agreement provides that the Sponsor shall indemnify the Trustee, its directors, employees, delegees and agents against, and hold each of them harmless from, any loss, liability, claim, cost, expense or judgment of any kind whatsoever (including the reasonable fees and expenses of counsel) that is incurred by any of them and that arises out of or is related to (1) any offer or sale by the Trust of Baskets (as defined in the Trust Agreement), (2) acts performed or omitted pursuant to the provisions of the Trust Agreement, (A) by the Trustee, its directors, employees, delegees and agents or (B) by the Sponsor or (3) any filings with or submissions to the SEC in connection with or with respect to the Shares, except that the Sponsor shall not have any obligations to pay any indemnification amounts incurred as a result of and attributable to (x) the willful misconduct, gross negligence, or bad faith of, or material breach of the terms of the Trust Agreement by, the Trustee, (y) information furnished in writing by the Trustee to the Sponsor expressly for use in the registration statement, or any amendment thereto, filed with the SEC relating to the Shares that is not materially altered by the Sponsor or (z) any misrepresentations or omissions made by a Authorized Participant (other than the Sponsor) in connection with such Authorized Participant's offer and sale of Shares.

Section 5.11(b) of the Trust Agreement provides that the Trustee shall indemnify the Sponsor, its directors, employees, delegees and agents against, and hold each of them harmless from, any loss, liability, claim, cost, expense or judgment of any kind whatsoever (including the reasonable fees and expenses of counsel) (1) caused by the willful misconduct, gross negligence, or bad faith of the Trustee or (2) arising out of any information furnished in writing to the Sponsor by the Trustee expressly for use in the registration statement, or any amendment thereto or periodic report, filed with the SEC relating to the Shares that is not materially altered by the Sponsor.

Section 5.11(d) of the Trust Agreement provides that the Sponsor and its shareholders, directors, officers, employees, affiliates (as such term is defined under the Securities Act of 1933, as amended) and subsidiaries and agents shall be indemnified from the Trust and held harmless against any loss, liability, claim, cost, expense or judgment of any kind whatsoever (including the reasonable fees and expenses of counsel) arising out of or in connection with the performance of their obligations under the Trust Agreement or any actions taken in accordance with the provisions of the Trust Agreement and incurred without their (1) willful misconduct, gross negligence or bad faith or (2) reckless disregard of their obligations and duties under the Trust Agreement.

**Item 15. Recent Sales of Unregistered Securities.**

None.

------

[**Table of Contents**](#toc)

**Item 16. Exhibits.**

---

| | |
|:---|:---|
| **Exhibit No**  | **Description**  |
| 1.1  | [Seed Capital Investor Agreement\*](ex_920903.htm)  |
| 3.1  | [Certificate of Trust of iShares Staked Ethereum Trust ETF\*\*](http://www.sec.gov/Archives/edgar/data/2099103/000143774925037057/ex_895922.htm)  |
| 3.2  | [Certificate of Amendment to Certificate of Trust of iShares Staked Ethereum Trust ETF\*](ex_920905.htm)  |
| 4.1  | [Amended and Restated Trust Agreement\*](ex_920906.htm)  |
| 4.2  | [Form of Authorized Participant Agreement\*](ex_920907.htm)  |
| 5.1  | [Opinion of Morris, Nichols, Arsht & Tunnell LLP as to legality\*](ex_920908.htm)  |
| 8.1  | [Opinion of Clifford Chance US LLP as to tax matters\*](ex_920909.htm)  |
| 10.1  | [Third Amended and Restated Coinbase Prime Broker Agreement\*](ex_920910.htm)  |
| 10.2 | [Amendment to the Third Amended and Restated Coinbase Prime Broker Agreement\*](ex_920919.htm) |
| 10.3  | [Joinder and Amendment to the Coinbase Prime Broker Agreement\*](ex_920911.htm)  |
| 10.4  | [Coinbase Custody Custodial Services Agreement (included in Exhibit 10.1)\*](ex_920910.htm)  |
| 10.5  | [Staking Addendum to Coinbase Custody Custodial Services Agreement\*\*\*](ex_920910.htm)  |
| 10.6  | [Services Agreement with Bank of New York Mellon, as cash custodian and trust administrator\*](ex_920912.htm)  |
| 10.7  | [Amendment to the Services Agreement with Bank of New York Mellon, as cash custodian and trust administrator\*](ex_920913.htm)  |
| 10.8  | [ETF Services Agreement with BRIL\*](ex_920914.htm)  |
| 10.9  | [Master Custody Service Agreement with Anchorage Digital Bank N.A.\*](ex_920915.htm)  |
| 10.10  | [First Amendment to Master Custody Service Agreement with Anchorage Digital Bank N.A.\*](ex_920916.htm)  |
| 23.1  | [Consent of PricewaterhouseCoopers LLP \*](ex_920917.htm)  |
| 23.2  | [Consent of Morris, Nichols, Arsht & Tunnell LLP (included in Exhibit 5.1)\*](ex_920908.htm)  |
| 23.3  | [Consent of Clifford Chance US LLP (included in Exhibit 8.1)\*](ex_920909.htm)  |
| 24.1  | [Power of Attorney\*\*](http://www.sec.gov/Archives/edgar/data/2099103/000143774925037057/iset20251205_s1.htm)  |
| 107  | [Filing Fee Tables\*\*](http://www.sec.gov/ix?doc=/Archives/edgar/data/2099103/000143774925037057/ex_895923.htm)  |

---

------

\* Filed herewith. <br> \*\* Previously filed. <br> \*\*\* To be filed by amendment.

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**Item 17. Undertakings.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The undersigned Registrant hereby undertakes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Filing Fee Tables" or "Calculation of Registration Fee" table, as applicable in the effective registration statement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

*Provided, however*, That:

Paragraphs (1)(i), (ii), and (iii) of this section do not apply if the registration statement is on Form S-1 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)) that are incorporated by reference in the registration statement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If the registrant is relying on Rule 430B:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. *Provided*, *however*, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. *Provided, however*, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

------

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:

The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.

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**SIGNATURES**

Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets the requirements for filing on Form S-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Francisco, California, on February 17, 2026.

---

| | |
|:---|:---|
| iShares Delaware Trust Sponsor LLC<br> Sponsor of iShares Staked Ethereum Trust<sup>\*</sup> | iShares Delaware Trust Sponsor LLC<br> Sponsor of iShares Staked Ethereum Trust<sup>\*</sup> |
| By: | /s/ Shannon Ghia |
|  | **Shannon Ghia** |
|  | **Director, President and Chief Executive Officer** |
|  | **(Principal executive officer)** |
| By: | /s/ Bryan Bowers |
|  | **Bryan Bowers** |
|  | **Director and Chief Financial Officer** |
|  | **(Principal financial and accounting officer)** |

---

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities<sup>\*</sup> and on the dates indicated.

---

| | | |
|:---|:---|:---|
| **Signature**  | **Title**  | **Date**  |
| /s/ Shannon Ghia  | Director, President and Chief Executive Officer  | February 17, 2026  |
| **Shannon Ghia**  | (Principal executive officer)  |  |
| /s/ Bryan Bowers  | Director and Chief Financial Officer  | February 17, 2026 |
| **Bryan Bowers**  | (Principal financial and accounting officer)  |  |
| \*\*  | Director  | February 17, 2026 |
| **Philip Jensen**  |  |  |
| \*\*  | Director  | February 17, 2026 |
| **Peter Landini**  |  |  |
| \*\*  | Director  | February 17, 2026 |
| **Lindsey Haswell**  |  |  |
| /s/ Shannon Ghia  | Director  | February 17, 2026 |
| **\*\*Shannon Ghia, Attorney-in-fact**  |  |  |

---

------

\* The Registrant is a trust and the persons are signing in their capacities as officers or directors of iShares Delaware Trust Sponsor LLC, the sponsor of the Registrant.

## Exhibit 1.1

**Exhibit 1.1**

**SEED CAPITAL INVESTOR AGREEMENT**

**for**

**iSHARES**<sup>®</sup> **STAKED ETHEREUM TRUST ETF** 

**Sponsored by iSHARES DELAWARE TRUST SPONSOR LLC**

January 14, 2026

**iSHARES DELAWARE TRUST SPONSOR LLC**, a Delaware limited liability company (the "**Sponsor**"), has sponsored the formation of **iSHARES STAKED ETHEREUM TRUST ETF** (the "**Trust**"), a Delaware Statutory Trust. iShares Delaware Trust Sponsor LLC (the "**Sponsor**") is the sponsor of the Trust.

Upon the basis of the representations and warranties set forth in Section 1 hereof and subject to the applicable terms and conditions set forth herein, on the date hereof the Trust agrees to issue and sell to **BLACKROCK FINANCIAL MANAGEMENT, INC.** (the "**Seed Capital Investor**"), and the Seed Capital Investor agrees to purchase the aggregate number of shares representing fractional undivided beneficial interests in the Trust's net assets (the "**Shares**") as are set forth in Schedule A hereto (such Shares being referred to herein as the "**Seed Creation Baskets**") in consideration of the payment of the amount for the Shares (the "**Purchase Price**") set forth in Schedule A. The Seed Capital Investor agrees to purchase the Seed Creation Baskets and agrees not to redeem, transfer or otherwise dispose of such Seed Creation Baskets except as contemplated under Section 2(b) hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Sponsor, on its own behalf and in its capacity as Sponsor of the Trust, represents and warrants to, and agrees with, the Seed Capital Investor that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A registration statement on Form S-1 (File No. 333-291992) (the "**Initial Registration Statement**") in respect of the Shares has been filed with the Securities and Exchange Commission (the "**Commission**"); the various parts of the Initial Registration Statement, including all exhibits thereto and including the information contained in the form of final prospectus when filed with the Commission pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the "**Act**") in accordance with Section 3(a) hereof and deemed by virtue of Rule 430A under the Act to be part of the Initial Registration Statement, each as amended as of the date hereof, are hereinafter collectively called the "Registration Statement"; and such final prospectus, in the form first filed pursuant to Rule 424(b) under the Act, is hereinafter called the "**Prospectus**");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each of the Shares comprising the Seed Creation Baskets shall be duly and validly authorized and, when issued and delivered against payment therefor as provided herein, will be duly and validly issued and fully paid and non-assessable and as of the time of payment of the Purchase Price by the Seed Capital Investor (the "**Closing Time**") will conform in all material respects to the description of the Shares comprising the Seed Creation Baskets contained in the Prospectus; and

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The issuance and sale of the Shares comprising the Seed Creation Baskets by the Trust and the compliance by the Sponsor and the Trust with all of the provisions of this Agreement and the consummation of the transactions herein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Sponsor or the Trust is a party or by which the Sponsor, or the Trust is bound or to which any of the property or assets of the Sponsor or the Trust is subject, except where such conflict, breach or violation, as the case may be, would not have a material adverse effect on the ability of the Sponsor or the Trust to perform its obligations under this Agreement, nor will such action result in any violation of the provisions of the constitutive documents of the Sponsor, the Trust, or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Sponsor, or the Trust or any of their respective properties, except where such violation would not have a material adverse effect on the ability of the Sponsor to perform its obligations under this Agreement; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Shares comprising the Seed Creation Baskets hereunder or the consummation by the Sponsor or the Trust of the transactions contemplated by this Agreement, except such consents, approvals, authorizations, registrations or qualifications as may be required under the rules of the Financial Industry Regulatory Authority ("**FINRA**"), state securities, commodities or Blue Sky laws in connection with the purchase and distribution by the Seed Capital Investor of the Shares comprising the Seed Creation Baskets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The Seed Capital Investor represents and warrants to, and agrees with, the Sponsor, on its own behalf and in its capacity as Sponsor of the Trust, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On the date of this Agreement, the Seed Capital Investor shall pay the Purchase Price as set forth on Schedule A attached hereto and on or around the date of the Prospectus, the Trust shall cause the Shares comprising the Seed Creation Baskets to be delivered to the Seed Capital Investor or its designee through the facilities of The Depository Trust Company ("**DTC**") for the account of the Seed Capital Investor or its designee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Seed Capital Investor agrees that any sales of any Shares comprising the Seed Creation Baskets will be effected in a manner consistent with the Plan of Distribution contained in the Prospectus and that it shall deliver a Prospectus with any such sales when required by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The Sponsor agrees with the Seed Capital Investor:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) To prepare the Prospectus and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's close of business on the second business day following the day on which the Initial Registration Statement is declared effective, or, if applicable, such earlier time as may be required by Rule 424(b) or Rule 430A(a)(3) under the Act; to advise the Seed Capital Investor, promptly after it receives notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed and to furnish the Seed Capital Investor, upon written request, with copies thereof; to advise the Seed Capital Investor, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any prospectus, of the suspension of the qualification of the Shares comprising the Seed Creation Baskets for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of any prospectus or suspending any such qualification, promptly to use its reasonable best efforts to obtain the withdrawal of such order;

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) To use its reasonable best efforts to list, subject to notice of issuance, the Shares on The Nasdaq Stock Market LLC;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) To file promptly all reports and any information statement required to be filed by the Trust with the Commission in order to comply with the Securities Exchange Act of 1934, as amended, subsequent to the date of the Prospectus and for so long as the delivery of a prospectus is required in connection with the offering or sale of the Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) To maintain an orderly procedure for the transfer and register of the Shares comprising the Seed Creation Baskets; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) To cause the Shares comprising the Seed Creation Baskets to be delivered to the Seed Capital Investor or its designee through the facilities of The Depository Trust Company ("**DTC**") on or around the date of the Prospectus, subject to the payment by the Seed Capital Investor of the Purchase Price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Indemnification and Contribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Sponsor and the Trust will jointly and severally indemnify and hold harmless the Seed Capital Investor against any losses, claims, damages or liabilities, joint or several, to which the Seed Capital Investor may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, and will reimburse the Seed Capital Investor for any legal or other expenses reasonably incurred by the Seed Capital Investor in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that neither the Sponsor nor the Trust shall be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in the Registration Statement or the Prospectus or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Sponsor by the Seed Capital Investor expressly for use therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Seed Capital Investor will indemnify and hold harmless the Sponsor and the Trust against any losses, claims, damages or liabilities to which the Sponsor or the Trust may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein, in the light of the circumstances under which they were made, a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Registration Statement or the Prospectus or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Sponsor by the Seed Capital Investor expressly for use therein; and will reimburse the Sponsor and the Trust for any legal or other expenses reasonably incurred by the Sponsor in connection with investigating or defending any such action or claim as such expenses are incurred.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability arising out of such action or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If the indemnification provided for in this Section 4 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Sponsor and the Trust on the one hand and the Seed Capital Investor on the other from the offering of the Shares in controversy comprising the Seed Creation Baskets. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Sponsor and the Trust on the one hand and the Seed Capital Investor on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Sponsor or the Trust on the one hand or the Seed Capital Investor on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Sponsor, the Trust and the Seed Capital Investor agree that it would not be just and equitable if contribution pursuant to this subsection (d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), the Seed Capital Investor shall not be required to contribute any amount in excess of the amount by which the total price at which the Shares in controversy comprising the Seed Creation Baskets purchased by it and distributed to the public were offered to the public exceeds the amount of any damages which the Seed Capital Investor has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The obligations of the Sponsor under this Section 4 shall be in addition to any liability which the Sponsor may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls the Seed Capital Investor within the meaning of the Act; and the obligations of the Seed Capital Investor under this Section 4 shall be in addition to any liability which the Seed Capital Investor may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Sponsor and to each person, if any, who controls the Sponsor within the meaning of the Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The respective indemnities, agreements, representations, warranties and other statements of the Sponsor and the Seed Capital Investor, as set forth in this Agreement or made by them pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of the Seed Capital Investor or any controlling person of the Seed Capital Investor, or the Sponsor, or any officer or director or controlling person of the Sponsor, and shall survive delivery of and payment for the Shares comprising the Seed Creation Baskets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. If the Shares comprising the Seed Creation Baskets are not delivered by or on behalf of the Sponsor or the Trust as provided herein, the Sponsor and the Trust will reimburse the Seed Capital Investor for all out-of-pocket expenses, including fees and disbursements of counsel, reasonably incurred by the Seed Capital Investor in making preparations for the purchase, sale and delivery of the Shares comprising the Seed Creation Baskets, but the Sponsor and the Trust shall then be under no further liability to the Seed Capital Investor except as provided in Section 5 hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. All statements, requests, notices and agreements hereunder shall be in writing, and if to the Seed Capital Investor shall be delivered or sent by mail to the Seed Capital Investor at 50 Hudson Yards, New York, New York 10001 and if to the Sponsor or the Trust shall be delivered or sent by mail to the address of the Sponsor set forth in the Registration Statement, Attention: Product Management Team, iShares Product Research & Development. Any such statements, requests, notices or agreements shall take effect upon receipt thereof.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. This Agreement shall be binding upon, and inure solely to the benefit of, the Seed Capital Investor, the Sponsor, the Trust and, to the extent provided in Sections 5 and 6 hereof, the officers and directors of the Sponsor and the Trust and each person who controls the Sponsor or the Seed Capital Investor, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement. No purchaser of any of the Shares comprising the Seed Creation Baskets from the Seed Capital Investor shall be deemed a successor or assign by reason merely of such purchase.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. As used herein, the term "business day" shall mean any day when the Commission's office in Washington, D.C. is open for business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. This Agreement may be executed by any one or more of the parties hereto in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. The Sponsor and the Trust are authorized, subject to applicable law, to disclose any and all aspects of this potential transaction that are necessary to support any U.S. federal income tax benefits expected to be claimed with respect to such transaction, and all materials of any kind (including tax opinions and other tax analyses) related to those benefits, without the Seed Capital Investor imposing any limitation of any kind.

[Remainder of page left blank intentionally. Signature page follows.]

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If the foregoing is in accordance with the Seed Capital Investor's understanding, please sign and return to us four counterparts hereof, and upon the acceptance hereof by the Seed Capital Investor, this letter and such acceptance hereof shall constitute a binding agreement between the Seed Capital Investor and the Sponsor.

Very truly yours,

**iSHARES STAKED ETHEREUM TRUST**

By: **iSHARES DELAWARE TRUST**

 **SPONSOR LLC,** as Sponsor

By: <u>/s/ Shannon Ghia</u><u> </u>

Name: Shannon Ghia

Title: Director and President

**iSHARES DELAWARE TRUST SPONSOR LLC**

By: <u>/s/ Shannon Ghia</u><u> </u>

Name: Shannon Ghia

Title: Director and President

**BLACKROCK FINANCIAL MANAGEMENT, INC.**

By: <u>/s/ Shannon Ghia</u><u> </u>

Name: Shannon Ghia

Title: Director and President

------

**SCHEDULE A**

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| | |
|:---|:---|
|  | **iSHARES STAKED ETHEREUM TRUST** |
| Shares | 4000 |
| Purchase Price | $100000 |

---

## Exhibit 3.2

**Exhibit 3.2**

CERTIFICATE OF AMENDMENT TO

CERTIFICATE OF TRUST OF

ISHARES STAKED ETHEREUM TRUST ETF

THIS Certificate of Amendment to Certificate of Trust of iShares Staked Ethereum Trust ETF (the "Trust") is being duly executed and filed by the undersigned, as trustee, to amend the Certificate of Trust of the Trust under the Delaware Statutory Trust Act (12 <u>Del. C.</u> §3801 <u>et</u> <u>seq</u>.) (the "Act").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Name</u>. The name of the Trust whose Certificate of Trust is being amended hereby is iShares Staked Ethereum Trust ETF.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Amendment of Trust</u>. The Certificate of Trust of the Trust is hereby amended by changing the name and address of the trustee of the Trust having its principal place of business in the State of Delaware to Wilmington Trust, National Association, Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Effective Date</u>. This Certificate of Amendment shall be effective upon filing.

IN WITNESS WHEREOF, the undersigned trustee of the Trust has duly executed this Certificate of Amendment in accordance with Section 3811(a)(2) of the Act.

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| | |
|:---|:---|
| **Wilmington Trust, National Association**,<br> not in its individual capacity but solely as trustee | **Wilmington Trust, National Association**,<br> not in its individual capacity but solely as trustee |
| By: | /s/ Gregory A. Marcum |
| Name:  | Gregory A. Marcum  |
| Title: | Assistant Vice President |

---

## Exhibit 4.1

**Exhibit 4.1**

Dated as of February 5, 2026 iSHARES<sup>®</sup> DELAWARE TRUST SPONSOR LLC, as Sponsor and BLACKROCK FUND ADVISORS, as Administrative Trustee and WILMINGTON TRUST, NATIONAL ASSOCIATION, as Delaware Trustee <br> AMENDED AND RESTATED TRUST AGREEMENT iSHARES<sup>®</sup> STAKED ETHEREUM TRUST ETF

------

---

| | |
|:---|:---|
| **CONTENTS** | **CONTENTS** |
| Clause | Page |

---

---

| | | |
|:---|:---|:---|
| ARTICLE I DEFINITIONS AND RULES OF CONSTRUCTION | ARTICLE I DEFINITIONS AND RULES OF CONSTRUCTION | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 1.1 | Definitions | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 1.2 | Rules of Construction. Unless the context otherwise requires: | 9 |
| ARTICLE II CREATION AND DECLARATION OF TRUST | ARTICLE II CREATION AND DECLARATION OF TRUST | 9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.1 | Creation and Declaration of Trust; Business of the Trust | 9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.2 | Tax Treatment | 10 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.3 | Legal Title | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.4 | Form of Certificates; Book-Entry System; Transferability of Shares | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.5 | Issuance and Redemption of Shares; General | 12 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.6 | Purchase Orders | 12 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.7 | Delivery of Shares | 14 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.8 | Registration and Registration of Transfer of Shares; Combination and Split-up of Certificates | 14 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.9 | Redemption of Shares and Withdrawal of Trust Property | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.10 | Limitations on Issuance and Delivery, Registration of Transfer and Surrender of Shares | 16 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.11 | Lost Certificates, Etc | 17 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.12 | Cancellation and Destruction of Surrendered Certificates | 17 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 2.13 | Splits and Reverse Splits of Shares | 17 |
| ARTICLE III REGISTERED OWNERS | ARTICLE III REGISTERED OWNERS | 17 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 3.1 | Registered Owners, Beneficial Owners and Authorized Participants as Parties; Binding Effect | 17 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 3.2 | Limitation on Liability | 18 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 3.3 | Liability of Registered Owner for Taxes and Other Governmental Charges | 18 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 3.4 | Warranties on Delivery of Basket Ether Amount | 18 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 3.5 | Derivative Actions | 18 |
| ARTICLE IV ADMINISTRATION OF THE TRUST | ARTICLE IV ADMINISTRATION OF THE TRUST | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.1 | Valuation of Trust Property | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.2 | Responsibility of the Administrative Trustee for Determinations | 20 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.3 | Cash Distributions | 20 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.4 | Other Distributions | 20 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.5 | Fixing of Record Date | 21 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.6 | Payment of Expenses; Sales of Trust Property | 21 |

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------

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.7 | Statements and Reports | 22.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.8 | Further Provisions for Sales of Trust Property | 23.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.9 | Counsel | 23.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 4.10 | Tax Matters | 23.0 |
| ARTICLE V THE TRUSTEES AND THE SPONSOR | ARTICLE V THE TRUSTEES AND THE SPONSOR | 24.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.1 | Management of the Trust | 24.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.2 | Maintenance of Office and Transfer Books by the Administrative Trustee | 25.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.3 | Authority of the Sponsor | 25.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.4 | Prevention or Delay in Performance by the Sponsor or the Administrative Trustee | 26.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.5 | Liability of Covered Persons | 26.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.6 | Fiduciary Duty | 26.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.7 | Obligations of the Sponsor and the Administrative Trustee | 28.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.8 | Delegation of Obligations of the Administrative Trustee | 29.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.9 | Resignation or Removal of the Administrative Trustee; Appointment of Successor Administrative Trustee | 29.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.10 | Custodians | 30.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.11 | Indemnification | 30.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.12 | Charges of Administrative Trustee | 32.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.13 | Charges of the Sponsor | 32.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.14 | Retention of Trust Documents | 33.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.15 | Federal Securities and Commodities Law Filings | 33.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.16 | Prospectus Delivery | 34.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.17 | Discretionary Actions by Administrative Trustee; Consultation | 34.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.18 | Number of Trustees | 35.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.19 | Initial Administrative Trustee | 35.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.20 | Delaware Trustee | 35.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.21 | Compensation and Expenses of the Delaware Trustee | 39.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 5.22 | Action Upon Instruction | 39.0 |
| ARTICLE VI AMENDMENT AND TERMINATION | ARTICLE VI AMENDMENT AND TERMINATION | 39.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 6.1 | Amendment | 39.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 6.2 | Termination | 40.0 |
| ARTICLE VII MISCELLANEOUS | ARTICLE VII MISCELLANEOUS | 42.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.1 | Counterparts | 42.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.2 | Third-Party Beneficiaries | 42.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.3 | Severability | 43.0 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.4 | Notices | 43.0 |

---

------

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.5 | Governing Law; Consent to Jurisdiction | 44 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.6 | Headings | 44 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.7 | Compliance with Regulation B | 44 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.8 | Binding Effect; Entire Agreement | 44 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.9 | Provisions in Conflict With Law or Regulations | 45 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.10 | Patriot Act | 45 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section 7.11 | Execution Authority | 46 |
| EXHIBIT A FORM OF CERTIFICATE | EXHIBIT A FORM OF CERTIFICATE | A-1 |

---

------

This Amended and Restated Trust Agreement (this "**Agreement**"), dated as of February 5, 2026, is among iShares<sup>®</sup> Delaware Trust Sponsor LLC, a Delaware limited liability company, as sponsor (the "**Sponsor**"), BlackRock Fund Advisors, a California corporation, as administrative trustee (the "**Administrative Trustee**"), and Wilmington Trust, National Association, a national association, as Delaware trustee (the "**Delaware Trustee**").

W I T N E S S E T H:

WHEREAS, on November 19, 2025, iShares Staked Ethereum Trust ETF (the "**Trust**") was formed when the Certificate of Trust was filed in the Office of the Secretary of State of the State of Delaware under the provisions of the Delaware Statutory Trust Act, Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. § 3801 *et seq.* (as it may be amended from time to time, or any successor legislation, the "**Act**") and Daniel Schwieger, as initial trustee (the "**Initial Trustee**"), executed an agreement and declaration of trust, dated as of November 19, 2025 (the "**Existing Trust Agreement**");

WHEREAS, the Sponsor desires to adopt this Agreement to establish the terms on which ether may be deposited in the Trust and provide for the creation and redemption of shares representing fractional undivided beneficial interests in the net assets of the Trust (as defined herein); and

WHEREAS, the Sponsor desires to provide for other terms and conditions on which the Trust shall be established and administered, as hereinafter provided.

NOW, THEREFORE, it being the intention of the parties hereto that, subject to the terms hereof, this Agreement shall constitute the governing instrument of the Trust, and the provisions of the Existing Trust Agreement shall have no longer any force or effect and shall be superseded entirely by the provisions hereof, the parties hereto agree to further amend and restate the Existing Trust Agreement in its entirety as follows:

**ARTICLE I**<br>**DEFINITIONS AND RULES OF CONSTRUCTION**

Section 1.1 **Definitions**. Except as otherwise specified in this Agreement or as the context may otherwise require, the following terms have the respective meanings set forth below for all purposes of this Agreement.

"**Act**" has the meaning specified in the recitals hereto.

"**Additional Ether Custodian**" means any substitute or additional custodian of the Trust's ether pursuant to a written agreement with the Trust or Administrative Trustee on behalf of the Trust.

"**Administrative Trustee**" means the Person named as such in the introductory paragraph hereto, solely in such Person's capacity as administrative trustee and not in such Person's individual capacity, so long as such Person shall continue in office in accordance with the terms hereof, and any other Person who may from time to time be duly appointed, qualified and serving as an administrative trustee in accordance with the provisions hereof.

------

"**Affiliate**" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person.

"**Agreement**" or "**Trust Agreement**" means this Amended and Restated Trust Agreement, including Exhibit A, as amended, modified, supplemented and restated from time to time in accordance with its terms.

"**airdrop**" means the distribution of a new digital asset, or a right to acquire or possess such asset, to holders of ether, without any modification to the existing Ethereum network and Ethereum blockchain.

"**AP Cash Account**" means an account at a commercial bank in the United States designated in writing by the Authorized Participant to receive or transfer the cash related to Purchase Orders and Redemption Orders.

"**Applicable AML Law**" has the meaning specified in Section 7.10.

"**AML Law**" has the meaning specified in Section 7.10.

"**Authorized Participant**" means a Person who, at the time of submitting to the Trust a Purchase Order or a Redemption Order (either in cash or in-kind), (a) is a registered broker-dealer, (b) is a DTC Participant, (c) has in effect a valid Authorized Participant Agreement and, (d) solely with respect to an in-kind Purchase Order or Redemption Order, is in a position, either directly or by the use of an agent or Authorized Participant Client, to transfer ether to, or take delivery of ether from, the Administrative Trustee through one or more accounts.

"**Authorized Participant Agreement**" means an agreement among the Administrative Trustee, the Sponsor and an Authorized Participant that provides the procedures for the creation and redemption of Baskets for ether and/or cash.

"**Authorized Participant Client**" means any party other than an Authorized Participant that is designated by such Authorized Participant to deliver and/or receive ether in connection with an in-kind Purchase Order or an in-kind Redemption Order pursuant to an Authorized Participant Agreement between the Authorized Participant and the Trust.

"**Basket**" means a block of 40,000 Shares, as such number may be increased or decreased, from time to time, in accordance with Section 2.13.

"**Basket Amount**" means the amount of cash to be delivered in a cash creation or received in a cash redemption which the Processing Agent will adjust as determined on each Business Day as promptly as practicable after 4:00 p.m. ET, by multiplying the Net Asset Value per Share by the number of Shares in each Basket (40,000).

"**Basket Ether Amount**" means the amount of ether to be (i) deposited or received by an Authorized Participant or its Authorized Participant Client in connection with an in-kind creation or redemption, as applicable, and (ii) purchased or sold by the Trust in connection with a cash creation or redemption, as applicable. The Processing Agent will adjust as determined on each Business Day as promptly as practical after 4:00 p.m. (Eastern Time), by multiplying the Net Asset Value per Share by the number of Shares in each Basket and dividing the resulting product by that day's CF Benchmarks Index. Fractions of an ether smaller than 0.00000001 (known as a 10 "gwei") are disregarded for purposes of the Basket Ether Amount. The Basket Ether Amount will be determined as provided in Section 2.6(c).

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"**Beneficial Owner**" means any Person owning a beneficial interest in any Shares, including a person who holds Shares through a Registered Owner.

"**BitLicense**" has the meaning specified in Section 6.2(c)(vi).

"**Business Day**" means any day (1) on which none of the following occurs: (a) the Exchange is closed for regular trading or (b) the Federal Reserve wire transfer system is closed for cash wire transfers, or (2) that the Administrative Trustee determines that it is able to conduct business.

"**Cash Account**" means an account established for the Trust with the Cash Custodian for use related to the Cash Component and Cash Amount of a cash Purchase Order or Redemption Order.

"**Cash Amount**" means an amount of cash sufficient to pay any applicable transaction fee, redemption fee and any additional fixed and/or variable charges applicable to Purchase Orders or Redemption Orders effected fully in cash (when, in the sole discretion of the Administrative Trustee, cash transactions are available, specified or alternatively necessary).

"**Cash Component**" means, in the case of a cash Purchase Order or Redemption Order, an amount of cash equal to the Basket Amount.

"**Cash Custodian**" means The Bank of New York Mellon and any substitute or additional custodian of the Trust's cash pursuant to a written agreement with the Trust or Administrative Trustee on behalf of the Trust.

"**Cash Order Cutoff Time**" means, with respect to any Business Day, (a) 6:00 p.m. Eastern Time on the Business Day prior to such Business Day or (b) any other time agreed to by the Sponsor and the Administrative Trustee and of which all existing Authorized Participants have been previously notified by the Administrative Trustee.

"**Certificate**" means a certificate, in substantially the form attached as Exhibit A hereto that is executed and delivered by the Administrative Trustee under this Agreement evidencing Shares.

"**Certificate of Trust**" means the Certificate of Trust, as filed with the Secretary of State pursuant to Section 3810 of the Act, as amended and restated from time to time.

"**Code**" means the Internal Revenue Code of 1986, as amended.

"**Conflicting Provisions**" has the meaning specified in Section 7.9.

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"**Corporate Trust Office**" means the office of the Administrative Trustee at which its depositary receipt business is administered, which, as of the date hereof, is located at 400 Howard Street, San Francisco, CA 94105.

"**Covered Person**" means the Delaware Trustee, the Administrative Trustee, the Sponsor and their respective Affiliates.

"**Creation Cash**" means the Basket Amount received in connection with a cash Purchase Order.

"**CTA**" has the meaning specified in Section 7.10.

"**Custodian**" means, as the context requires herein, the Ether Custodian, the Additional Ether Custodian and/or the Cash Custodian, and any substitute or additional custodian of the Trust's ether and/or cash pursuant to one or more written agreements with the Trust or Administrative Trustee on behalf of the Trust.

"**Custodian Agreement**" means the custodial services agreement entered into between the Trust and a Custodian.

"**Delaware Trustee**" means the Person named as such in the introductory paragraph hereto, solely in such Person's capacity as the Delaware trustee of the Trust created hereunder and not in such Person's individual capacity and includes any successor Delaware trustee under this Agreement.

"**Delaware Trustee Indemnified Persons**" has the meaning specified in Section 5.20(e).

"**Deliver**," "**Delivered**" or "**Delivery**" means, (a) when used with respect to ether, (i) in the case of a Purchase Order, a deposit of spot ether from the relevant Digital Wallet into the Trust's Trading Account that meets the requirements for an effective transfer, and (ii) in the case of a redemption, a transfer of spot ether from the Trust's Trading Account to the relevant Digital Wallet, (b) when used with respect to Shares, either (i) one or more book-entry transfers of such Shares to an account or accounts at DTC designated by the Person entitled to such delivery for further credit as specified by such Person or (ii) in the circumstances specified in Section 2.4(e), execution and delivery at the Corporate Trust Office of one or more Certificates evidencing those Shares, and (c) when used with respect to cash (which shall in all cases be U.S. dollars), (i) in the case of a Purchase Order, a wire-transfer from the AP Cash Account to the Trust's Cash Account, and (ii) in the case of a Redemption Order, a wire-transfer from the Trust's Cash Account to the AP Cash Account.

"**Depositor**" means (i) in the case of an in-kind Purchase Order or Redemption Order, any Authorized Participant or Authorized Participant Client that Delivers ether to or at the direction of the Trust, that is the owner or beneficial owner of such ether and (ii) in the case of a cash Purchase Order or Redemption Order (a) any Authorized Participant that Delivers, directly or through an agent, cash to or at the direction of the Trust, either for its own account or on behalf of another Person and (b) any Ether Trading Counterparty or the Prime Execution Agent, as applicable, that Delivers ether directly to or at the direction of the Trust, for its own account.

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"**Digital Wallet**" shall mean an account maintained by the Prime Execution Agent, or a hosted digital wallet that is maintained by the Prime Execution Agent in connection with an account, that is owned by an Authorized Participant, an Authorized Participant Client or an Ether Trading Counterparty.

"**DTC**" means The Depository Trust Company, or its successor.

"**DTC Participant**" means a Person that has an account with DTC.

"**ETF Services**" means certain order processing, Authorized Participant communications, and related services in connection with the issuance and redemption of Baskets.

"**ETF Services Agreement**" means the agreement between the Trust and BlackRock Investments, LLC, an Affiliate of the Administrative Trustee, to perform ETF Services.

"**Ether Custodian**" means Coinbase Custody Trust Company, LLC.

"**ether**" means a type of digital asset based on an open-source cryptographic protocol existing on the Ethereum network as determined by the Administrative Trustee, and the assets underlying the Shares.

"**Ethereum blockchain**" means the blockchain ledger for ether.

"**Ethereum network**" means the online, end-user-to-end-user network associated with ether and hosting a public transaction ledger, known as a blockchain (the "**Ethereum blockchain**"), and the source code comprising the basis for the cryptographic and algorithmic protocols governing the Ethereum network, as determined by the Sponsor.

"**Ether Trading Counterparty**" means designated third parties who are not registered broker-dealers and transact in ether pursuant to written agreements with the Trust.

"**Exchange**" means The Nasdaq Stock Market LLC, a Delaware limited liability company and a registered U.S. national securities exchange, or any other regulated securities market where the Sponsor may from time to time decide to list the Shares for trading.

"**Exchange Act**" means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

"**Existing Trust Agreement**" has the meaning specified in the recitals hereto.

"**FinCEN**" has the meaning specified in Section 6.2(c)(vi).

"**Fiscal Year**" means the fiscal year of the Trust for financial accounting purposes, which shall begin on the first day of January (or, for the first fiscal year, such the date on which the Trust's year begins for financial accounting purposes) and end on the thirty-first day of December (or, for the last fiscal year, the date on which the Trust terminates).

"**fork**" means non-backward compatible change to the original Ethereum blockchain and the source code of the original Ethereum network which results in the original Ethereum network and the original Ethereum blockchain existing side-by-side, but incompatible, with a new network and a new blockchain, and leads to the creation of a new asset running on the new blockchain.

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"**GAAP**" means the U.S. generally accepted accounting principles.

"**gwei**" means one-billionth of an ether (0.000000001 ether).

"**Incidental Rights**" means the rights to acquire, or otherwise establish dominion and control over, any digital asset (for avoidance of doubt, other than ether) or other asset or right, which rights are incident to the Trust's ownership of ether and arise without any action of the Trust, or of the Sponsor or Delaware Trustee on behalf of the Trust. In the event of a hard fork of the Ethereum blockchain, the Sponsor shall determine which network shall constitute the Ethereum network and which asset shall constitute ether in accordance with this Agreement.

"**Indemnified Amounts**" has the meaning specified in Section 5.11(a).

"**Indemnitee**" has the meaning specified in Section 5.11(e).

"**Indemnitor**" has the meaning specified in Section 5.11(e).

"**Index**" means the CME CF Ether Reference Rate – New York Variant for the Ether – U.S. Dollar trading pair ("CF Benchmarks Index"), or if the CF Benchmarks Index is unavailable or the Sponsor in its sole discretion determines that the CF Benchmarks Index price shall not constitute the Index, the Trust's holdings may be fair valued in accordance with the policy approved by the Administrative Trustee.

"**Index Administrator**" means CF Benchmarks Ltd.

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

"**Initial Trustee**" has the meaning specified in the recitals hereto.

"**In-Kind Order Cutoff Time**" means, with respect to any Business Day, (a) 3:59 p.m. Eastern Time on the Business Day or (b) any other time agreed to by the Sponsor and the Administrative Trustee and of which all existing Authorized Participants have been previously notified by the Administrative Trustee.

"**IR Digital Asset**" means any digital asset or other asset or right acquired by the Trust through the exercise of any Incidental Right.

"**Liquidity Risk Policy**" has the meaning specified in Section 2.9(b).

"**Net Asset Value of the Trust**" means the net asset value of the Trust, as determined in accordance with Section 4.1(b).

"**Net Asset Value per Basket**" means, as of any date of determination the number obtained by multiplying (x) the Net Asset Value per Share on the date on which the determination is being made by (y) the number of Shares that constitute a Basket on the date on which the determination is being made.

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"**Net Asset Value per Share**" means the net asset value of a Share, as determined in accordance with Section 4.1(b).

"**Order Cutoff Time**" means the In-Kind Order Cutoff Time or Cash Order Cutoff Time, as applicable.

"**Order Date**" means, with respect to a Purchase Order, the date specified in Section 2.6(b) and, with respect to a Redemption Order, the date specified in Section 2.9(c).

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

"**Prime Execution Agent**" shall mean Coinbase, Inc., an affiliate of the Ether Custodian.

"**Prime Execution Agent Agreement**" shall mean the agreement between the Sponsor, the Administrative Trustee and the Prime Execution Agent.

"**Proceeding**" has the meaning specified in Section 5.11(e).

"**Processing Agent**" means BlackRock Investments, LLC, or any successor thereto in its capacity as the processing agent for the Trust.

"**Purchase Order**" has the meaning specified in Section 2.6(b).

"**Redemption Order**" has the meaning specified in Section 2.9(a).

"**Registered Owner**" means a Person in whose name Shares are registered on the books of the Registrar maintained for that purpose.

"**Registrar**" means the Administrative Trustee or any bank or trust company that is appointed to register Shares and transfers of Shares as herein provided.

"**Responsible Officer of the Delaware Trustee**" means any officer within the corporate trust office of the Delaware Trustee including any vice president, assistant vice president, assistant treasurer, assistant secretary, or any other officer customarily performing functions similar to those performed by any of the above designated officers and having direct responsibility for the administration of the Delaware Trustee role hereunder.

"**SEC**" means the Securities and Exchange Commission of the United States, or any successor governmental agency in the United States.

"**Securities Act**" means the Securities Act of 1933, as amended, and the rules and regulations thereunder.

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"**Shares**" means units of fractional undivided beneficial interest in the net assets of the Trust.

"**Sponsor**" means the Person named as such in the introductory paragraph hereto, solely in such Person's capacity as sponsor of the Trust and not in such Person's individual capacity, or any successor thereto which shall have executed such documents and other instruments as in the opinion of counsel to the Trust shall be necessary to assume all of the duties and responsibilities of the Sponsor hereunder.

"**Sponsor's Fee**" has the meaning specified in Section 5.13(a).

"**Sponsor Indemnified Party**" has the meaning specified in Section 5.11(d).

"**Sponsor's Staking Portion**" has the meaning specified in Section 5.13(b).

"**Staking Activities**" has the meaning specified in Section 2.1(b).

"**Staking Consideration**" means staking rewards and/or income, if any, from Staking Activities.

"**Staking Services Providers**" mean third-party staking services providers, which may be either affiliates of the Ether Custodian or third-party validators approved by the Sponsor or its designee, that stake the Trust's ether to a Staking Services Provider's operating validator software and associated hardware pursuant to a written arrangement with the Ether Custodian.

"**Staking Fee**" means the fee payable by the Trust, which will include (i) the Sponsor's Staking Portion and (ii) the Ether Custodian's share of Staking Consideration (including any amounts payable by the Ether Custodian to Staking Services Providers for their respective shares of the Trust's Staking Consideration), in accordance with a written agreement between the Ether Custodian and the Trust or Administrative Trustee on behalf of the Trust.

"**Surrender**," "**Surrendered**" or "**Surrendering**" means, when used with respect to Shares, (a) one or more book-entry transfers of Shares to the DTC account of the Administrative Trustee or (b) surrender to the Administrative Trustee at its Corporate Trust Office of one or more Certificates evidencing Shares.

"**Trading Account**" shall mean an account established for the Trust with the Prime Execution Agent for use for the ether related to creations and redemptions of the Shares.

"**Trust**" has the meaning specified in the recitals hereto.

"**Trust Administrator**" means The Bank of New York Mellon, or any successor thereto in its capacity as the trust administrator for the Trust.

"**Trust Property**" means, at any time, the assets of the Trust at such time, regardless of whether such assets are held by the Administrative Trustee or any agent or custodian for the Trust.

"**Trustee Indemnified Persons**" has the meaning specified in Section 5.11(a).

"**USA Patriot Act**" has the meaning specified in Section 7.10.

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Section 1.2 **Rules of Construction**. Unless the context otherwise requires:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a term has the meaning assigned to it;

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) "or" is not exclusive;

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the words "include", "includes" and "including" shall be deemed to be followed by the phrase "without limitation";

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) words in the singular include the plural and words in the plural include the singular; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) any definition referencing any agreement, instrument or other document shall be construed as referencing to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified.

**ARTICLE II**<br>**CREATION AND DECLARATION OF TRUST**

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Administrative Trustee declares that the Trust holds and will hold all Trust Property other than that which is maintained in the Trading Account with the Prime Execution Agent through Custodians in accordance with the Custodian Agreements, for the benefit of the Registered Owners for the purposes of, and subject to the terms and conditions set forth in, this Agreement. The Trust's ether holdings and cash holdings from time to time may be held with the Prime Execution Agent in the Trading Account in connection with in-kind creations and redemptions of Baskets or in connection with cash creations and redemptions of Baskets where the Trust will transact in ether with the Ether Trading Counterparties, and the sale or transfer of ether to pay the Sponsor's Fee (as defined below), the Staking Fee and Trust expenses not assumed by the Sponsor. The trust governed by this Agreement shall be known as "iShares<sup>®</sup> Staked Ethereum Trust ETF." The Initial Trustee filed or caused to be filed the original Certificate of Trust on November 19, 2025, and the Delaware Trustee is hereby authorized and directed to file an amendment thereto to reflect the Delaware Trustee as the trustee pursuant to Section 3807 of the Act, and at the direction of the Administrative Trustee the Delaware Trustee is authorized to file any further amendment thereto or restatement thereof as may be necessary or appropriate from time to time. The Administrative Trustee confirms that, prior to the execution of this Agreement, the Initial Trustee was the sole trustee of the Trust. The Initial Trustee hereby withdraws as a trustee of the Trust and upon execution of this Agreement shall no longer be a trustee of the Trust or be a party to the governing instrument of the Trust.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Trust's investment objective shall be to invest in, and hold ether on behalf of, investors in the Trust. It is anticipated that the Trust's investment results generally will correspond to, but will not necessarily be identical to, the performance of the price of ether, largely as a result of the payment of expenses and liabilities of the Trust. Additionally, the Trust may seek to earn rewards from staking all or a portion of the Trust's ether ("**Staking Activities**"), to the extent the Sponsor in its sole discretion determines that the Trust may do so without incurring undue legal or regulatory risk, including, without limitation, any risk to the Trust's qualification as a grantor trust for U.S. federal income tax purposes. However, in no case will the Trust seek to take advantage of variations in the market to improve the investments of the Trust or its Beneficial Owners, including variations based on the value of ether or the amount of Staking Consideration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Consistent with the investment objective set forth in Section 2.1(b), the Trust shall have full power and authority (i) to engage in such business or activities as set forth in, or contemplated by, this Agreement, the Authorized Participant Agreements, Custodian Agreements, the Prime Execution Agent Agreement, and any other agreements or instruments to which, in compliance with the provisions of this Agreement, it shall become a party to or by which it may be bound, (ii) to engage in activities incidental and necessary to carry out the duties and responsibilities as set forth in, or contemplated by, this Agreement, such Authorized Participant Agreements and such other agreements or instruments and (iii) subject to the following sentence, to engage in any other lawful business, purpose or activity for which statutory trusts may be formed under the Act. Other than the Shares, the Trust shall not issue or sell any beneficial interests or other obligations or otherwise incur, assume or guarantee any indebtedness for money borrowed *provided* that, for the avoidance of doubt, the Trust shall not be prohibited from employing the Trust's ether in staking as permitted hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Trust shall not take any action that could cause the Trust to be treated other than as a grantor trust for U.S. federal income tax purposes. Without limiting the generality of the foregoing, nothing in this Trust Agreement, any Custodian Agreement, or otherwise, shall be construed to give the Administrative Trustee, the Delaware Trustee, the Sponsor or any other Person the power to vary the investment of the Beneficial Owners within the meaning of Treasury Regulations Section 301.7701-4(c) or any similar or successor provisions, nor shall the Administrative Trustee, the Delaware Trustee or the Sponsor give any direction or take any action that would vary the investment of the Beneficial Owners. However, the Administrative Trustee shall not be liable to any Person for any failure of the Trust to qualify as a grantor trust under the Code or any comparable provision of the laws of any state or other jurisdiction where that treatment is sought, except that this sentence shall not limit the Administrative Trustee's responsibility for the administration of the Trust in accordance with this Agreement.

Section 2.2 **Tax Treatment**. Each of the parties hereto, by entering into this Trust Agreement, and each Beneficial Owner, by acquiring Shares in the Trust, (i) expresses its intention that the Shares will qualify under applicable tax law as interests in a grantor trust which holds the trust estate, (ii) agrees that it will file its own U.S. federal, state and local income, franchise and other tax returns in a manner that is consistent with clause (i) of this Section 2.2 and with the classification of the Trust as a grantor trust, except as required by applicable law, and (iii) agrees to use reasonable efforts to notify the Sponsor promptly upon a receipt of any notice from any taxing authority having jurisdiction over such party with respect to the treatment of the Shares as anything other than interests in a grantor trust.

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Section 2.3 **Legal Title**. Legal title to all of the Trust Property shall be vested in the Trust as a separate legal entity; provided, however, that where applicable law in any jurisdiction requires any part of the Trust Property to be vested otherwise, the Administrative Trustee may cause legal title to the Trust Property or any portion thereof to be held by or in the name of the Administrative Trustee or any other Person (other than a Registered Owner or a Beneficial Owner) as nominee.

Section 2.4 **Form of Certificates; Book-Entry System; Transferability of Shares**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Certificate shall be substantially in the form set forth in Exhibit A hereto, with appropriate insertions, modifications and omissions, as hereinafter provided. No Shares shall be entitled to any benefits under this Agreement or be valid or obligatory for any purpose unless a Certificate evidencing those Shares has been executed by the manual or facsimile signature of a duly authorized signatory of the Administrative Trustee and, if a Registrar (other than the Administrative Trustee) for the Shares shall have been appointed, countersigned by the manual signature of a duly authorized officer of the Registrar. A Certificate bearing the manual or facsimile signature of a duly authorized signatory of the Administrative Trustee and the manual signature of a duly authorized officer of the Registrar, if applicable, who was, at the time such Certificate was executed, a proper signatory of the Administrative Trustee or the Registrar, if applicable, shall bind the Administrative Trustee, notwithstanding that such signatory has ceased to hold such office prior to the delivery of such Certificate.

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

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

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

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) So long as the Shares are eligible for book-entry settlement with DTC and such settlement is available, unless otherwise required by applicable law, notwithstanding the provisions of Sections 2.4(a) and (b), all Shares shall be evidenced by one or more global Certificates, the Registered Owner of which is DTC or a nominee of DTC, and (1) no Beneficial Owner will be entitled to receive a separate Certificate evidencing those Shares, (2) the interest of a Beneficial Owner in Shares represented by a global Certificate will be shown only on, and transfer of that interest will be effected only through, records maintained by DTC or a DTC Participant or Indirect Participant through which the Beneficial Owner holds that interest and (3) the rights of a Beneficial Owner with respect to Shares represented by a global Certificate will be exercised only to the extent allowed by, and in compliance with, the arrangements in effect between such Beneficial Owner and DTC or the DTC Participant or Indirect Participant through which that Beneficial Owner holds an interest in Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) If, at any time when Shares are evidenced by a global Certificate, DTC ceases to make its book-entry settlement system available for such Shares, the Sponsor and the Administrative Trustee may select a comparable depositary for the book-entry settlement of the Shares and cause new global Certificates to be issued and registered in the name of such successor depositary or its nominee. If the Sponsor and the Administrative Trustee determine that no such successor depositary is available, the Trust shall be dissolved and, to the extent necessary in connection therewith, the Administrative Trustee shall execute and deliver separate Certificates evidencing Shares registered in the names of the Beneficial Owners thereof, with such additions, deletions and modifications to this Agreement and to the form of Certificate evidencing Shares as the Sponsor and the Administrative Trustee may agree.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Title to a Certificate (and to the Shares evidenced thereby), when properly endorsed or accompanied by proper instruments of transfer, shall be transferable by delivery with the same effect as in the case of a certificated security under Article 8 of the Uniform Commercial Code of the State of Delaware; **provided**, **however**, **that** the Administrative Trustee, notwithstanding any notice to the contrary, may treat the Registered Owner of Shares as the absolute owner thereof for the purpose of determining the Person entitled to any distribution or to any notice provided for in this Agreement and for all other purposes.

Section 2.5 **Issuance and Redemption of Shares; General**. Subject to the terms of this Agreement, the Administrative Trustee shall have the power and authority, and is hereby authorized, without the approval or action of any Registered Owner or Beneficial Owner, to issue and redeem Shares from time to time. The number of Shares authorized shall be unlimited. All Shares when issued on the terms contemplated by this Agreement shall be duly authorized, validly issued, fully paid and non-assessable. Every Registered Owner or Beneficial Owner, by virtue of having purchased or otherwise acquired a Share or a beneficial interest in a Share, shall be deemed to have expressly consented and agreed to be bound by the terms of this Agreement.

Section 2.6 **Purchase Orders**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) After the initial deposit of ether, Deliveries of Shares will take place only in integral numbers of Baskets and in compliance with the provisions of this Agreement, as supplemented by any procedures attached to an applicable Authorized Participant Agreement, to the extent those procedures are consistent with this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Authorized Participants wishing to acquire one or more Baskets must place an order (a "**Purchase Order**") with the Administrative Trustee (or its appointed delegee, including the Processing Agent) prior to the Order Cutoff Time on any Business Day. Purchase Orders received by the Administrative Trustee prior to the Order Cutoff Time with respect to a Business Day will have that Business Day as the Order Date. Purchase Orders received by the Administrative Trustee on or after the Order Cutoff Time on a Business Day, or on a day that is not a Business Day, will not be accepted. For cash Purchase Orders, the Authorized Participant must submit the Purchase Order by the Cash Order Cutoff Time. For in-kind Purchase Orders, the Authorized Participant must submit the Purchase Order by the In-Kind Order Cutoff Time. As consideration for each Basket to be acquired pursuant to a Purchase Order, a Depositor must Deliver the Basket Ether Amount (determined as described in Section 2.6(c) below) announced by the Trust on the Order Date (determined as described above) of such corresponding Purchase Order. The Sponsor, the Administrative Trustee and the Trust shall have no liability for any loss of ether occurring prior to the Delivery of ether to the Ether Custodian, the Additional Ether Custodian, or Prime Execution Agent, as applicable, by the Authorized Participant or Authorized Participant Client (and for the avoidance of doubt, shall have no liability for any loss of ether while held by the Ether Custodian, the Additional Ether Custodian, or Prime Execution Agent absent gross negligence or bad faith by the Sponsor and the Administrative Trustee).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Administrative Trustee shall determine the Basket Amount and the Basket Ether Amount for each Business Day. The Basket Amount shall be an amount of cash with a value equal to the Net Asset Value per Basket. The Basket Ether Amount shall be an amount of ether with a value equal to the Net Asset Value per Basket. The Sponsor intends to publish, or may designate other Persons to publish, for each Business Day, the Basket Amount and the Basket Ether Amount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If the Trust receives money (other than Creation Cash) or any property other than money and ether, the Administrative Trustee shall, as soon as commercially feasible, (i) sell and/or distribute all the property (other than money) received or otherwise dispose of the property (other than money) in a manner that it determines is commercially reasonable, (ii) if the Trust will not distribute all of the money (other than Creation Cash) received (including all money received from the sale of other property), determine the amount of such money that will be promptly used by the Trust to pay the Sponsor's Fee, the Sponsor's Staking Portion, and/or expenses and liabilities not assumed by the Sponsor, and (iii) distribute any money (other than Creation Cash) that will not be promptly used as described in the preceding prong (ii). If the Trust does not sell or distribute the money (other than Creation Cash) or other property in accordance with requirements of this Section, no deposit of money or ether will be accepted until after the Trust has sold or distributed such money or other property (and/or determined that any money that will not be distributed will be promptly used by the Trust to pay the Sponsor's Fee, the Sponsor's Staking Portion, and/or expenses and liabilities not assumed by the Sponsor).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) All ether and/or cash Delivered to the Trust as part of a Purchase Order and any other Trust Property shall be owned by the Trust and held for the Trust by the Custodians, other than that which is maintained in the Trading Account with the Prime Execution Agent in accordance with the Prime Execution Agent Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Administrative Trustee may, in its sole discretion, permit or require the substitution of an amount of cash to be added to the Cash Component to replace all ether that the Authorized Participant or its Authorized Participant Client would otherwise have had to Deliver in connection with a Purchase Order. The Administrative Trustee may suspend the ability of the Authorized Participant to engage in cash-in-lieu transactions with respect to the Trust at any time, without prior notice. The Authorized Participant shall be responsible for any and all expenses and costs incurred by the Trust, including all Cash Amounts, in connection with any Purchase Orders in accordance with the terms and conditions of the Authorized Participant Agreement.

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Section 2.7 **Delivery of Shares**. Upon receipt by the Administrative Trustee (or its appointed delegee, including the Processing Agent) of a Purchase Order and the other required documents, if any, as specified above and a confirmation from the Prime Execution Agent that the Basket Amount has been delivered to the Cash Custodian and the Basket Ether Amount has been Delivered to the Prime Execution Agent for each Basket and the Prime Execution Agent is holding that ether for the account of the Trust, the Administrative Trustee, subject to the terms and conditions of this Agreement, as supplemented by any procedures attached to the applicable Custodian Agreement and Prime Execution Agent Agreement, to the extent those procedures are not inconsistent with this Agreement, shall Deliver to, or as directed by, the Depositor the number of Baskets issuable in respect of such Delivery as requested in the corresponding Purchase Order, but only upon reimbursement to the Trust of any extraordinary costs or expenses incurred in connection with the execution of trades related to such Purchase Order, and the payment to the Administrative Trustee or Processing Agent of the fees and expenses of the Trust, the Administrative Trustee and the Processing Agent relating to such Purchase Order as provided in Section 5.12(a) and of all taxes and governmental charges and fees payable in connection with such Delivery, the transfer of the ether and the issuance and Delivery of the Baskets.

Section 2.8 **Registration and Registration of Transfer of Shares; Combination and Split**-**up of Certificates**.

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

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

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

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

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Section 2.9 **Redemption of Shares and Withdrawal of Trust Property**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Authorized Participants wishing to redeem one or more Baskets must place an order with the Administrative Trustee (or its appointed delegee, including the Processing Agent) prior to the Order Cutoff Time of a Business Day (a "**Redemption Order**"). Upon receipt by the Administrative Trustee (or its appointed delegee, including the Processing Agent) of a Redemption Order, the Surrender by an Authorized Participant of any integral number of Baskets for the purpose of withdrawal of the amount of Trust Property represented thereby, the reimbursement to the Trust of any extraordinary costs or expenses incurred in connection with the execution of trades related to such Redemption Order, and payment of the fees and expenses of the Trust, the Administrative Trustee and the Processing Agent relating to such Redemption Order as provided in Section 5.12(a) and payment of all taxes and charges payable in connection with such Surrender and withdrawal of Trust Property, and subject to the terms and conditions of this Agreement, including this Section 2.9, such Baskets shall be redeemed by the Trust, and such Authorized Participant, as, or acting on authority of, the Registered Owner of those Shares will be entitled to Delivery, in accordance with the provisions of this Agreement, as supplemented by any procedures attached to an applicable Authorized Participant Agreement, to the extent those procedures are consistent with this Agreement, of the Basket Ether Amounts or Basket Amounts corresponding to such Baskets (determined in accordance with Section 2.6(c)) on the applicable Order Date (determined as provided below).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In connection with redemptions, the Trust will maintain written liquidity risk policies and procedures in accordance with the Exchange's listing requirements, designed to mitigate the risk that the Trust may be unable to meet redemption requests in a timely manner (the "**Liquidity Risk Policy**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Redemption Orders received by the Administrative Trustee prior to the Order Cutoff Time with respect to a Business Day will have that Business Day as the Order Date. Redemption Orders received by the Administrative Trustee on or after the Order Cutoff Time on a Business Day, or on a day that is not a Business Day, will not be accepted. For cash Redemption Orders, the Authorized Participant must submit the Redemption Order by the Cash Order Cutoff Time. For in-kind Redemption Orders, the Authorized Participant must submit the Redemption Order by the In-Kind Order Cutoff Time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Upon a Surrender of an integral number of Baskets for redemption and satisfaction of all the conditions for withdrawal of Trust Property, the Administrative Trustee shall instruct the Ether Custodian, the Additional Ether Custodian, the Cash Custodian and the Prime Execution Agent to Deliver to the Surrendering Authorized Participant, its Authorized Participant Client, or the Ether Trading Counterparty, as applicable, the amount of ether and/or cash represented by the Surrendered Baskets, and the Administrative Trustee shall pay or deliver to or to the order of the Surrendering Authorized Participant, its Authorized Participant Client, or the Ether Trading Counterparty, as applicable, the amount of any other Trust Property represented by the Surrendered Baskets. The Sponsor, the Administrative Trustee and the Trust shall have no liability for any loss of ether occurring after the Delivery of ether by the Ether Custodian or the Prime Execution Agent, as applicable, to the Authorized Participant, its Authorized Participant Client, or the Ether Trading Counterparty, as applicable (and for the avoidance of doubt, shall have no liability for any loss of ether while held by the Ether Custodian, the Additional Ether Custodian, or Prime Execution Agent absent gross negligence or bad faith by the Sponsor and the Administrative Trustee).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Administrative Trustee may require that a Certificate evidencing Shares redeemed for the purpose of withdrawal is properly endorsed in blank or accompanied by proper instruments of transfer in blank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Administrative Trustee may, in its sole discretion, permit or require the substitution of an amount of cash to be added to the Cash Component to replace all of the ether that the Trust would otherwise have had to Deliver in connection with a Redemption Order. The Administrative Trustee may suspend the ability of the Authorized Participant to engage in cash-in-lieu transactions with respect to the Trust at any time, without prior notice. The Authorized Participant shall be responsible for any and all expenses and costs incurred by the Trust, including all Cash Amounts, in connection with any Redemption Orders in accordance with the terms and conditions of the Authorized Participant Agreement.

Section 2.10 **Limitations on Issuance and Delivery, Registration of Transfer and Surrender of Shares**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) As a condition precedent to the Delivery, registration of transfer, split-up, combination or Surrender of any Shares or withdrawal of any Trust Property, the Administrative Trustee or the Registrar may require payment from the Depositor or the Authorized Participant Surrendering the Shares of a sum sufficient to reimburse it for any tax or other governmental charge and any stock transfer or registration fee with respect thereto (including any such tax or charge and fee with respect to any securities being withdrawn) and payment of any applicable fees as herein provided, may require the production of proof satisfactory to it as to the identity and genuineness of any signature or other information that it deems to be necessary and may also require compliance with any regulations the Administrative Trustee may establish consistent with the provisions of this Agreement, including this Section 2.10.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The issuance and Delivery of Shares against Delivery of cash and/or ether or the registration of transfer of Shares may be refused or rejected with respect to particular requested Deliveries or Surrenders during any period in which the transfer books of the Administrative Trustee are closed or if any such action is deemed to be necessary or advisable by the Administrative Trustee or the Sponsor for any reason at any time or from time to time. Neither the Administrative Trustee nor the Sponsor shall be liable to any Person by reason of any suspension, refusal or rejection provided for in this Section 2.10(b).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as otherwise provided elsewhere in this Agreement, the Administrative Trustee may, in its sole discretion and will, when so directed by the Sponsor, suspend the right to Surrender Shares, or postpone the date of Delivery of ether or other Trust Property, generally or with respect to a particular Redemption Order (i) during any period in which the Exchange is closed (other than scheduled holiday or weekend closings) or regular trading thereon is suspended or restricted, or (ii) during a period when the Sponsor determines, in its sole discretion, that conditions exist as a result of which Delivery, disposal, unstaking or deactivation, or evaluation of ether (or sufficient amounts of the Trust's ether to satisfy Redemption Orders) is not reasonably practicable, including, without limitation as permitted by the Liquidity Risk Policy. The Administrative Trustee shall reject any Redemption Order that is not in proper form. Neither the Administrative Trustee nor the Sponsor shall be liable to any Person by reason of any suspension, postponement or rejection provided for under this Section 2.10(c).

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Section 2.11 **Lost Certificates, Etc**. The Administrative Trustee shall execute and deliver a new Certificate of like tenor in exchange and substitution for a mutilated Certificate upon cancellation thereof, or in lieu of and in substitution for a destroyed, lost or stolen Certificate, if the Registered Owner thereof has (a) filed with the Administrative Trustee (i) a request for such execution and delivery before the Administrative Trustee has notice that the Shares evidenced by the Certificate have been acquired by a protected purchaser and (ii) a sufficient indemnity bond, and (b) satisfied any other reasonable requirements imposed by the Administrative Trustee.

Section 2.12 **Cancellation and Destruction of Surrendered Certificates**.

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

Section 2.13 **Splits and Reverse Splits of Shares**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If requested in writing by the Sponsor, the Administrative Trustee shall effect a split or reverse split of the Shares as of a record date set by the Administrative Trustee in accordance with procedures determined by the Administrative Trustee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Administrative Trustee is not required to distribute any fraction of a Share in connection with a split or reverse split of the Shares. The Administrative Trustee may sell the aggregated fractions of Shares that would otherwise be distributed in a split or reverse split of the Shares or liquidate the amount of Trust Property that would be represented by those Shares and distribute the net proceeds of those Shares or that Trust Property to the Registered Owners entitled to such proceeds. The amount of Trust Property represented by each Share, the number of Shares comprising a Basket and the Basket Ether Amount shall be adjusted as appropriate as of the open of business on the Business Day following the record date for a split or reverse split of the Shares.

**ARTICLE III**<br>**REGISTERED OWNERS**

Section 3.1 **Registered Owners, Beneficial Owners and Authorized Participants as Parties; Binding Effect.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Registered Owners, Beneficial Owners and Authorized Participants from time to time shall be parties to this Agreement and shall be bound by all of the terms and conditions hereof by their acceptance of Shares or any interest therein or by their depositing ether, as the case may be.

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

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Beneficial Owner expressly waives any right such Beneficial Owner may have under any rule of law, or the provisions of any statute, or otherwise, to require the Administrative Trustee at any time to account, in any manner other than as expressly provided in this Agreement, in respect of the Trust Property from time to time received, held and applied by the Administrative Trustee hereunder.

Section 3.2 **Limitation on Liability**. Registered Owners and Beneficial Owners shall be entitled to the same limitation on personal liability extended to stockholders of private corporations for profit organized under the general corporation law of the State of Delaware.

Section 3.3 **Liability of Registered Owner for Taxes and Other Governmental Charges**. If any tax or other governmental charge shall become payable by the Administrative Trustee with respect to any transfer or redemption of Shares, such tax or other governmental charge shall be payable by the Registered Owner of such Shares to the Administrative Trustee. The Administrative Trustee shall refuse to effect any registration of transfer of such Shares or any withdrawal of Trust Property represented by such Shares until such payment is made and may withhold any distributions, or may sell for the account of the Registered Owner thereof Trust Property or Shares, and may apply such distributions or the proceeds of any such sale in payment of such tax or other governmental charge, and the Registered Owner of such Shares shall remain liable for any deficiency. The Administrative Trustee shall distribute any net proceeds of a sale made under the preceding sentence that remain, after payment of the tax or other governmental charge, to the Registered Owners entitled thereto as in the case of a distribution in cash.

Section 3.5 **Derivative Actions**. Subject to any other requirements of applicable law including Section 3816 of the Delaware Trust Statute, no Registered Owner shall have the right, power or authority to bring or maintain a derivative action, suit or other proceeding on behalf of the Trust unless (a) two or more Registered Owners who (i) are not Affiliates of one another and (ii) collectively hold at least 10% of the outstanding Shares join in the bringing or maintaining of such action, suit or other proceeding, and (b) (i) prior to bringing such action, the Registered Owners must make a demand upon the Administrative Trustee to bring the subject action unless an effort to cause the Administrative Trustee to bring such an action is not likely to succeed; and a demand on the Administrative Trustee shall only be deemed not likely to succeed and therefore excused if the Administrative Trustee has a personal financial interest in the transaction at issue, and the Administrative Trustee shall not be deemed interested in a transaction or otherwise disqualified from ruling on the merits of a Registered Owner demand by virtue of the fact that the Administrative Trustee receives remuneration for his service as the Administrative Trustee of the Trust or as a trustee or director of one or more investment companies that are under common management with or otherwise affiliated with the Trust; and (ii) unless a demand is not required under clause (i) of this paragraph, the Administrative Trustee must be afforded a reasonable amount of time to consider such Registered Owner request and to investigate the basis of such claim; and the Administrative Trustee shall be entitled to retain counsel or other advisors in considering the merits of the request and may require an undertaking by the Registered Owners making such request to reimburse the Trust for the expense of any such advisors in the event that the Administrative Trustee determines not to bring such action.

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In addition to all suits, claims or other actions (collectively, "**claims**") that under applicable law must be brought as derivative claims, each Registered Owner agrees that any claim that affects all Registered Owners equally, that is, proportionately based on their number of Shares, must be brought as a derivative claim subject to this Section 3.5 irrespective of whether such claim involves a violation of the Registered Owners' rights under this Agreement or any other alleged violation of contractual or individual rights that might otherwise give rise to a direct claim.

Notwithstanding the foregoing, however, if a provision of this 3.5 is found to violate the U.S. federal securities laws, then such provision shall not apply to any claims asserted under such U.S. federal securities law.

**ARTICLE IV**<br>**ADMINISTRATION OF THE TRUST**

Section 4.1 **Valuation of Trust Property**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Sponsor is hereby granted the exclusive authority to determine the Net Asset Value of the Trust and the Net Asset Value per Share, which authority it may, and hereby does, delegate to the Administrative Trustee to be exercised as set forth below, until such time as the Sponsor revokes such delegation in its sole discretion. The Administrative Trustee hereby delegates to the Trust Administrator the responsibility to calculate the Net Asset Value of the Trust and the Net Asset Value per Share, based on a pricing source selected by the Administrative Trustee, until such time as the Administrative Trustee revokes such delegation in its sole discretion. In determining the Net Asset Value of the Trust, the Administrative Trustee (or its appointed delegee, including the Trust Administrator or the Processing Agent, as applicable) shall value the ether held by the Trust based on the Index, unless otherwise determined by the Sponsor in its sole discretion. On each Business Day on which the Exchange is open for regular trading, the Administrative Trustee (or its appointed delegee, including the Trust Administrator or the Processing Agent, as applicable) shall determine the Net Asset Value of the Trust and the Net Asset Value per Share as of 4:00 p.m. (Eastern Time). If the Index is not available or the Sponsor determines, in its sole discretion, that the Index is unreliable, the Trust's holdings may be fair valued in accordance with the policy approved by the Administrative Trustee. The Trust's periodic financial statements may not utilize Net Asset Value of the Trust to the extent the methodology used to calculate the Index is deemed not to be consistent with GAAP. For purposes of the Trust's periodic financial statements, the Trust will utilize a pricing source that is consistent with GAAP. The Sponsor will determine in its sole discretion the valuation sources and policies used to prepare the Trust's financial statements in accordance with GAAP. None of the Trust Administrator, the Administrative Trustee nor the Sponsor shall be liable to any Person for the determination that the most recently communicated Net Asset Value of the Trust or Net Asset Value per Share is not appropriate or for any determination as to the alternative basis for valuation; **provided that** such determination is made in good faith.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In determining the Net Asset Value of the Trust, the Administrative Trustee (or its appointed delegee, including the Trust Administrator or the Processing Agent, as applicable) shall subtract all accrued fees, expenses and other liabilities of the Trust from the total value of the Trust Property as of the time of calculation. The resulting figure is the "**Net Asset Value of the Trust**." The Administrative Trustee (or its appointed delegee, including the Trust Administrator or the Processing Agent, as applicable) shall also divide the Net Asset Value of the Trust by the number of Shares outstanding as of the time of the calculation, which figure is the "**Net Asset Value per Share**." All fees, expenses and other liabilities of the Trust that are or will be incurred or accrued through the close of business on a Business Day shall be included in the calculations required by this Section 4.1(b) for that Business Day. Shares deliverable under a Purchase Order shall be considered to be outstanding for purposes of the calculations required by this Section 4.1(b) beginning on the Business Day following the Order Date of such Purchase Order. Shares deliverable under a Redemption Order shall be considered to no longer be outstanding for purposes of the calculations required by this Section 4.1(b) on and after the Business Day following the Order Date of such Redemption Order. Any estimate of the accrued fees, expenses and other liabilities of the Trust for purposes of the computations required by this Section 4.1(b) made by the Trust Administrator, on behalf of the Administrative Trustee, in good faith shall be conclusive upon all Persons interested in the Trust, and no revision or correction in any computation made under this Agreement will be required by reason of any difference in amounts estimated from those actually paid.

Section 4.2 **Responsibility of the Administrative Trustee for Determinations**. The determinations made by the Administrative Trustee under this Agreement shall be made in good faith upon the basis of, and the Administrative Trustee shall not be liable for any errors contained in, information reasonably available to it. Neither the Sponsor nor the Administrative Trustee shall be under any liability to the Depositors, the Registered Owners, the Beneficial Owners or each other for errors in judgment; **provided**, **however**, **that** this provision shall not protect the Administrative Trustee against any liability to which it would otherwise be subject by reason of willful misconduct, gross negligence or bad faith in the performance of its duties.

Section 4.3 **Cash Distributions**. The Sponsor shall have the exclusive authority to cause the Trust to distribute any Trust Property to the Registered Owners in accordance with this Agreement, which authority it may, and hereby does, delegate to the Administrative Trustee, until such time as the Sponsor revokes such delegation in its sole discretion. Whenever the Administrative Trustee distributes any cash, the Administrative Trustee shall distribute the amount available for distribution to the Registered Owners entitled thereto, in proportion to the number of Shares held by them respectively. The Administrative Trustee shall distribute only such amount, however, as can be distributed without attributing to any Registered Owner a fraction of one cent. Any such fractional amounts shall be rounded down to the nearest whole cent.

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Section 4.4 **Other Distributions**. Whenever the Administrative Trustee distributes any non-cash proceeds (including claims and other intangibles) in respect of Trust Property other than property subject to distribution in accordance with the creation and redemption procedures set forth herein, as supplemented by the Authorized Participant Agreements, the Administrative Trustee shall cause such non-cash proceeds received by it to be distributed to the Registered Owners entitled thereto, in proportion to the number of Shares held by them respectively, after deduction or upon payment of the expenses of the Administrative Trustee, in any manner that the Administrative Trustee may deem to be lawful, equitable and feasible for accomplishing such distribution; provided, however, that if in the opinion of the Administrative Trustee such distribution cannot be made proportionately among the Registered Owners entitled thereto, or if for any other reason (including any requirement that the Administrative Trustee withhold an amount on account of taxes or other governmental charges or that securities must be registered under the Securities Act in order to be distributed to the Registered Owners) the Administrative Trustee deems such distribution not to be lawful, equitable or feasible, the Administrative Trustee shall adopt such method as it deems to be lawful, equitable and feasible for the purpose of effecting such distribution, after deduction or upon payment of the expenses of the Administrative Trustee (and with respect to any Staking Consideration to be distributed, after deduction or upon payment of the Staking Fee), including the public or private sale of the non-cash proceeds thus received, or any part thereof, and the net proceeds of any such sale shall be distributed by the Administrative Trustee to the Registered Owners entitled thereto as in the case of a distribution received in cash.

Section 4.5 **Fixing of Record Date**. Whenever any distribution will be made, or whenever the Administrative Trustee receives notice of any solicitation of proxies or consents from Registered Owners, or whenever for any reason there is a split, reverse split or other change in the outstanding Shares, or whenever the Administrative Trustee shall find it necessary or convenient in respect of any matter, the Administrative Trustee, in consultation with the Sponsor, shall fix a record date for the determination of the Registered Owners who shall be (a) entitled to receive such distribution or the net proceeds of the sale thereof, (b) entitled to give such proxies or consents in respect of any such solicitation or (c) entitled to act in respect of any other matter for which the record date was set.

Section 4.6 **Payment of Expenses; Sales of Trust Property.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The following charges may be accrued and shall be paid by the Trust:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any expenses of the Trust not assumed by the Sponsor pursuant to Section 5.7(f), including any applicable brokerage commissions, financing fees and any applicable Ethereum network fees and similar transaction fees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any taxes and other governmental charges that may fall on the Trust or the Trust Property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any expenses of any extraordinary services performed by the Administrative Trustee or the Sponsor on behalf of the Trust or expenses of any action taken by the Administrative Trustee or the Sponsor to protect the Trust or the interests of Registered Owners or the Beneficial Owners (including, for example, in connection with any fork of the Ethereum blockchain, any Incidental Rights and any IR Digital Assets);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any indemnification of a Sponsor Indemnified Party as provided in Section 5.11(d) or any indemnification of the Cash Custodian, Ether Custodian, Additional Ether Custodian, or other agents, service providers or counterparties of the Trust;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the fee payable to the Sponsor pursuant to Section 5.13; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the fee related to Staking Activities pursuant to Section 5.13.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Administrative Trustee shall, when directed by the Sponsor, sell or liquidate Trust Property in such quantity and at such times as may be necessary to permit the payment of expenses or the periodic distribution of Staking Consideration to the Registered Owners or Beneficial Owners under this Agreement. Neither the Administrative Trustee nor the Sponsor shall have any liability for loss or depreciation resulting from sales of Trust Property so made. The Administrative Trustee shall not be liable or responsible in any way for depreciation or loss incurred by reason of any sale or liquidation made pursuant to the Sponsor's direction or otherwise in accordance with this Section 4.6 or as contemplated in Section 4.8.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as provided in this Agreement, the Trust shall have no obligation to make any distribution to any Registered Owners or Beneficial Owners. If, at any time and from time to time, the Sponsor determines that the amount of cash included in the Trust Property exceeds the reasonably anticipated expenses of the Trust, the Sponsor may, in its sole discretion, direct the Administrative Trustee to distribute the extra cash to DTC.

Section 4.7 **Statements and Reports.**

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Administrative Trustee shall provide the Sponsor with such certifications, supporting documents and other evidence regarding the internal control over financial reporting established and maintained by the Trust, and used by the Administrative Trustee in connection with its preparation of the financial statements of the Trust, as may be reasonably necessary in order to enable the Sponsor to prepare and file or furnish to the SEC any certifications regarding such matters that may be required to be included with the Trust's periodic reports under the Exchange Act.

Section 4.8 **Further Provisions for Sales of Trust Property**. In addition to selling or liquidating Trust Property in accordance with Section 4.6, the Administrative Trustee shall sell or liquidate Trust Property whenever either or both of the following conditions exist:

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

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) this Trust has been dissolved and the Trust Property is to be sold or liquidated in accordance with Section 6.2.

The Administrative Trustee and the Sponsor shall not be liable or responsible in any way for depreciation or loss incurred by reason of any sale or liquidation made pursuant to this Section 4.8.

Section 4.9 **Counsel**. The Sponsor may, from time to time, employ counsel to act on behalf of the Trust and perform any legal services in connection with the Trust Property and the Trust, including any legal matters relating to the possible disposition or acquisition of any Trust Property. The fees and expenses of such counsel shall be paid by the Sponsor; **provided**, **however**, **that** the Sponsor shall not be responsible for the payment of any such ordinary fees and expenses in excess of $500,000 annually.

Section 4.10 **Tax Matters**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Appropriate tax information (adequate to enable each Beneficial Owner to complete and file its U.S. federal tax return) shall be delivered to each Beneficial Owner following the end of each Fiscal Year but, to the extent possible, no later than April 1. All such information shall be prepared, and all of the Trust's tax returns shall be filed, in a manner consistent with the treatment of the Trust as a grantor trust. The Trust's taxable year shall be the calendar year. To the extent that the Administrative Trustee reasonably believes that the Trust is required to withhold and pay over any amounts (including taxes, interest, penalties, assessments or additions to tax) to any tax authority with respect to distributions or allocations to any Beneficial Owner, the Administrative Trustee, the Sponsor and the Trust (and their respective agents and affiliates) shall be entitled to withhold such amounts, and any amounts withheld shall be treated as a distribution of cash to the Beneficial Owner in the amount of the withholding and shall thereby reduce the amount of cash or other property otherwise distributable to such Beneficial Owner. If an amount required to be withheld is not withheld, the Trust may reduce subsequent distributions by the amount of such required withholding (including any additional amounts it is required to withhold). The consent of Beneficial Owners shall not be required for such withholding. In the event of any claimed over-withholding, Beneficial Owners shall be limited to an action against the applicable jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Beneficial Owner agrees that it shall not, except as required by applicable law, (i) treat, on its own income or information tax returns or any information returns that it provides to any Beneficial Owner, or to any broker or nominee through which the Beneficial Owner owns its Shares, any items relating to its Shares in a manner inconsistent with the treatment of such items by the Trust as reflected on any tax statements furnished to such Beneficial Owner or other information statement furnished to such Beneficial Owner pursuant to this Section 4.10, or (ii) file any claim for a refund relating to any such item based on, or which would result in, such inconsistent treatment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The parties hereto and, by its acceptance or acquisition of a Share or a beneficial interest therein and continued ownership thereof, a Beneficial Owner and the broker or nominee through which the Beneficial Owner owns its Share (i) agree to furnish the Sponsor and the Administrative Trustee with such representations, forms, documents or information as may be necessary to enable the Trust to comply with its U.S. federal income tax reporting obligations in respect of such Share, including information regarding such Beneficial Owner's secondary market transactions in Shares, as well as creations or redemptions of Shares and (ii) direct brokers and nominees to report to the Administrative Trustee the Beneficial Owner's name and address and such other information as may be reasonably requested by the Administrative Trustee for purposes of complying with the Trust's U.S. federal income tax reporting obligations.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Beneficial Owners recognize and intend that the Trust will be classified as a grantor trust for U.S. federal income tax purposes and will not cause the Trust to make any election inconsistent with that status for U.S. federal, state and/or local tax purposes. To the extent necessary, the Trust or the Beneficial Owners (as appropriate) will make any election necessary to obtain treatment consistent with the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) By its acceptance of a beneficial interest in any Shares (or fractions thereof), a Beneficial Owner waives all confidentiality rights, including all confidentiality rights provided by Section 3406(f) of the Code and Treasury Regulations Section 31.3406(f)-1, with respect to any representations, forms, documents or information, and any information contained in such representations, forms or documents, that the Beneficial Owner provides, or has previously provided, to any broker or nominee through which it owns its Shares, to the extent such representations, forms, documents or information may be necessary to (i) assist the Trust in complying with its withholding tax and backup withholding tax obligations pursuant to this Section 4.10 or (ii) enable the Trust to comply with its U.S. federal income tax reporting obligations. Furthermore, the parties hereto and, by its acceptance of a beneficial interest in a Share, a Beneficial Owner, acknowledge and agree that any broker or nominee through which a Beneficial Owner holds its Shares shall be a third-party beneficiary to this Agreement (with respect to the obligations of that Beneficial Owner) for the purposes set forth in this Section 4.10.

**ARTICLE V**<br>**THE TRUSTEES AND THE SPONSOR**

Section 5.1 **Management of the Trust.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject to the direction of the Sponsor pursuant to Section 5.3 and except as otherwise expressly provided in this Agreement, the Trust's business shall be conducted by the Administrative Trustee in accordance with this Agreement. Except as otherwise provided in this Agreement, the Administrative Trustee shall, under the direction of the Sponsor, have the power on behalf of and in the name of the Trust to carry out any and all of the objects and purposes of the Trust and to perform such acts and enter into and perform such contracts and other undertakings on behalf of the Trust that the Administrative Trustee may deem to be necessary, advisable or incidental thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Administrative Trustee shall maintain all books, records and supporting documents that are necessary to comply with any and all aspects of its duties under this Agreement.

Section 5.2 **Maintenance of Office and Transfer Books by the Administrative Trustee.**

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

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Administrative Trustee shall keep books for the registration of Shares and registration of transfers of Shares, which, at all reasonable times, shall be open for inspection by the Registered Owners to the same extent as is permitted stockholders of a corporation formed under the Delaware General Corporation Law.

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

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

Section 5.3 **Authority of the Sponsor**. The Sponsor shall have the exclusive authority, and shall direct the actions of the Administrative Trustee, in the management of the Trust. The Sponsor shall have the exclusive authority to direct the Administrative Trustee to perform the Sponsor's obligations and exercise its rights under this Agreement. Without limiting the foregoing, the Sponsor shall have the authority to (a) execute and deliver this Agreement; (b) without prejudice to any power or authority granted to the Administrative Trustee in accordance with the terms of this Agreement, enter into and perform such contracts and other undertakings on behalf of the Trust and any amendment thereto, as the Sponsor may deem necessary or advisable, and each of the Trust and the Administrative Trustee is hereby authorized and shall have the power and authority to enter into such agreements and perform its obligations thereunder; (c) determine what peer-to-peer network constitutes the "Ethereum network" and which digital asset constitutes "ether" for the Trust's purposes, and what action the Trust shall take in response to such fork; in making such determination, the Sponsor may consider any factors it deems relevant; provided that the Sponsor shall not make a determination that would conflict with Section 4.10 of this Agreement; (d) determine, in the Sponsor's sole discretion, in the event of an airdrop to holders of ether or any event similar to a fork or airdrop occurring with respect to ether or the Ethereum network, what action the Trust shall take; (e) administer a staking program in accordance with associated policies and procedures including the Liquidity Risk Policy on behalf of the Trust, to the extent the Sponsor in its sole discretion determines that the Trust may do so without incurring undue legal or regulatory risk, including, without limitation, any risk to the Trust's qualification as a grantor trust for U.S. federal income tax purposes, including suspending the right of redemption or postponing the redemption settlement date under certain circumstances in accordance with the Liquidity Risk Policy, and (f) determine, in the Sponsor's sole discretion, based on whatever factors the Sponsor deems relevant, what action to take in connection with the Trust's entitlement to or ownership of Incidental Rights or any IR Digital Asset, including (i) selling Incidental Rights and/or IR Digital Assets and distributing the cash proceeds to the Registered Owners, (ii) distributing Incidental Rights and/or IR Digital Assets in-kind to the Registered Owners or to an agent acting on behalf of the Registered Owners for sale by such agent if an in-kind distribution would otherwise be infeasible, (iii) using Incidental Rights and/or IR Digital Asset to pay the Sponsor Fee's and/or additional Trust expenses not assumed by the Sponsor, or (iv) electing not to acquire, claim, or obtain, and permanently and irrevocably abandoning, Incidental Rights or IR Digital Asset for no consideration.

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Section 5.4 **Prevention or Delay in Performance by the Sponsor or the Administrative Trustee**. Neither the Sponsor nor the Administrative Trustee nor any of their respective directors, employees, agents or affiliates shall incur any liability to any Registered Owner, Beneficial Owner, Authorized Participant or Depositor if, by reason of any provision of any present or future law or regulation of the United States or any other country, or of any governmental or regulatory authority or stock exchange, or by reason of any act of God or war or terrorism or other circumstances beyond its control, the Sponsor or the Administrative Trustee is prevented or forbidden from, or would be subject to any civil or criminal penalty on account of, or is delayed in, doing or performing any act or thing that, by the terms of this Agreement, it is provided shall be done or performed, and, accordingly, the Sponsor or the Administrative Trustee does not do that thing or does that thing at a later time than would otherwise be required. Neither the Sponsor nor the Administrative Trustee will incur any liability to any Registered Owner or Beneficial Owner, Authorized Participant or Depositor by reason of any non-performance or delay in the performance of any act or thing that, by the terms of this Agreement, it is provided may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in this Agreement.

Section 5.5 **Liability of Covered Persons**. A Covered Person shall have no liability to the Trust or to any Registered Owner, Beneficial Owner, Authorized Participant, Depositor or to any other Covered Person for any loss suffered by the Trust that arises out of any action or inaction of such Covered Person if such Covered Person, in good faith, determined that such course of conduct was in the best interest of the Trust and such course of conduct did not constitute willful misconduct, gross negligence or bad faith of such Covered Person. Subject to the foregoing, no Covered Person shall be personally liable for the return or repayment of all or any portion of the capital or profits of any Registered Owner, Beneficial Owner, Authorized Participant, Depositor or assignee thereof, it being expressly agreed that any such return of capital or profits made pursuant to this Agreement shall be made solely from the assets of the Trust without any rights of contribution from any Covered Person. A Covered Person shall not be liable for the conduct or misconduct of any delegee selected by the Administrative Trustee pursuant to Section 5.8 of this Agreement; **provided**, **however**, **that** in the case of the Administrative Trustee the foregoing shall only apply if the Administrative Trustee made such selection with reasonable care.

Section 5.6 **Fiduciary Duty**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The parties hereto agree to perform their duties under this Agreement in good faith and in their subjective belief as to what is in the best interests of the Trust, but only upon the express terms of this Agreement. To the fullest extent permitted by law, the parties hereto shall not have any implied duties (including fiduciary duties) or liabilities otherwise existing at law or in equity with respect to the Trust, the Registered Owners, the Beneficial Owners, the Authorized Participants, the Depositors or any other Person, all of which duties are hereby eliminated. The provisions of this Agreement, to the extent that they restrict or eliminate the duties (including fiduciary duties) and liabilities of the Administrative Trustee or the Sponsor otherwise existing at law or in equity are agreed by the parties hereto to replace such other duties and liabilities of the Administrative Trustee and the Sponsor. For the avoidance of doubt, no Person other than the parties hereto shall have any duties or obligations hereunder to the Trust, any Registered Owner, any Beneficial Owner, the Authorized Participants or the Depositors.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Unless otherwise expressly provided herein:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) whenever a conflict of interest exists or arises between the Administrative Trustee, the Sponsor or any of their respective Affiliates, on the one hand, and the Trust or any Registered Owner, Beneficial Owner, Authorized Participant, Depositor or other Person, on the other hand; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) whenever this Agreement or any other agreement contemplated herein provides that the Administrative Trustee or the Sponsor shall act in a manner that is, or provides terms that are, fair and reasonable to the Trust, any Registered Owner, Beneficial Owner, Authorized Participant, Depositor or other Person, the Administrative Trustee and the Sponsor, respectively, shall use its commercially reasonable efforts to resolve such conflict of interest, take such action or provide such terms, considering in each case the relative interest of each party (including its own interest) to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable generally accepted accounting practices or principles. In the absence of bad faith by the Administrative Trustee or the Sponsor, the resolution, action or terms so made, taken or provided by the Administrative Trustee or the Sponsor shall not constitute a breach of this Agreement or any other agreement contemplated herein or of any duty or obligation of the Administrative Trustee or the Sponsor at law or in equity or otherwise. Notwithstanding any other provision of this Agreement or of applicable law, in no event will the Sponsor or the Administrative Trustee or their respective affiliates be required to divest themselves of, or restrict their services or other activities with respect to, any assets they currently or may hold, manage or control on their own behalf or on behalf of any customer, client or any other Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding any other provision of this Agreement or of applicable law, whenever in this Agreement the Administrative Trustee or the Sponsor is permitted or required to make a decision:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) in its "discretion" or under a grant of similar authority, the Administrative Trustee or the Sponsor shall be entitled to consider such interests and factors as it desires, including its own interests, and, to the fullest extent permitted by applicable law, shall have no duty or obligation to give any consideration to any interest of or factors affecting the Trust, any Registered Owner, any Beneficial Owner, any Authorized Participant, any Depositor or any other Person; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) in its "good faith" or under another express standard, the Administrative Trustee or the Sponsor shall act under such express standard and shall not be subject to any other or different standard. The term "good faith" as used in this Agreement shall mean subjective good faith as such term is understood and interpreted under Delaware law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Administrative Trustee, the Sponsor and any of their respective Affiliates may engage in or possess an interest in other profit-seeking or business ventures of any nature or description, independently or with others, whether or not such ventures are competitive with the Trust, and the doctrine of corporate opportunity, or any analogous doctrine, shall not apply to the Administrative Trustee or the Sponsor. If the Administrative Trustee or the Sponsor acquires knowledge of a potential transaction, agreement, arrangement or other matter that may be an opportunity for the Trust, it shall have no duty to communicate or offer such opportunity to the Trust, and the Administrative Trustee and the Sponsor shall not be liable to the Trust or to the Registered Owners, the Beneficial Owners, the Authorized Participants or the Depositors for breach of any fiduciary or other duty by reason of the fact that the Administrative Trustee or the Sponsor pursues or acquires for, or directs such opportunity to, another Person or does not communicate such opportunity or information to the Trust. Neither the Trust nor any Registered Owner, Beneficial Owner, Authorized Participant or Depositor shall have any rights or obligations by virtue of this Agreement or the trust relationship created hereby in or to such independent ventures or the income or profits or losses derived therefrom, and the pursuit of such ventures, even if competitive with the activities of the Trust, shall not be deemed to be wrongful or improper. Except to the extent expressly provided herein, the Administrative Trustee and the Sponsor may engage or be interested in any financial or other transaction with the Trust, the Registered Owners, the Beneficial Owners, the Authorized Participants, the Depositors or any Affiliate of the Trust or the Beneficial Owners.

Section 5.7 **Obligations of the Sponsor and the Administrative Trustee**.

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

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

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

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

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The Sponsor will be obligated to pay the marketing and the following administrative expenses incurred by the Trust: (1) the fees of the Administrative Trustee, the Delaware Trustee, the Trust Administrator, the Processing Agent and any permitted delegee of the foregoing, (2) the Custodians' fee, (3) Exchange listing fees, (4) printing and mailing costs, (5) audit fees, (6) fees for registration of the Shares with the SEC, (7) tax reporting costs, (8) license fees and (9) pursuant to Section 4.9, ordinary legal expenses up to $500,000 annually.

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Section 5.8 **Delegation of Obligations of the Administrative Trustee**. The Administrative Trustee may and is hereby authorized to at any time delegate all or a portion of its duties and obligations under this Agreement to another entity, including the Trust Administrator and the Processing Agent, without the consent of the Sponsor, the Delaware Trustee, any Registered Owner or any Beneficial Owner; **provided, that** any such delegees shall be appointed with reasonable care, and no such delegation shall be deemed to release the Administrative Trustee from any duties or obligations so delegated. The Administrative Trustee may terminate any such delegee at any time and is not required to appoint a replacement therefor.

Section 5.9 **Resignation or Removal of the Administrative Trustee; Appointment of Successor Administrative Trustee.** 

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Sponsor may remove the Administrative Trustee in its discretion by written notice delivered to the Administrative Trustee in the manner provided in Section 7.4 at any time. If at any time the Administrative Trustee is in material breach of its obligations under this Agreement and the Administrative Trustee fails to cure such breach within thirty (30) days after receipt by the Administrative Trustee of written notice from the Sponsor specifying such default and requiring the Administrative Trustee to cure such default, the Sponsor may remove the Administrative Trustee by written notice delivered to the Administrative Trustee in the manner provided in Section 7.4, and such removal shall take effect upon the appointment of a successor Administrative Trustee and its acceptance of such appointment as hereinafter provided.

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

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Any corporation or other entity into which the Administrative Trustee may be merged, consolidated or converted in a transaction in which the Administrative Trustee is not the surviving corporation or other entity shall be the successor of the Administrative Trustee without the execution or filing of any document or any further act. During the 90-day period following the effectiveness of a merger, consolidation or conversion described in the immediately preceding sentence, the Sponsor may, by written notice to the Administrative Trustee, remove the Administrative Trustee and designate a successor Administrative Trustee in compliance with the provisions of Section 5.9(c).

Section 5.10 **Custodians**. The Administrative Trustee may at any time appoint one or more custodians (each, a "**Custodian**") to hold assets of the Trust, without the consent of any Registered Owner and any Beneficial Owner. The Administrative Trustee is further authorized to appoint any successor or replacement Custodian or terminate any previously appointed Custodian, in accordance with the terms of the applicable custodial or other agreements entered into by the Trust with such Custodian or Custodians.

Section 5.11 **Indemnification**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Sponsor shall indemnify the Administrative Trustee, its directors, employees, delegees and agents (the "**Trustee Indemnified Persons**") against, and hold each of them harmless from, any loss, liability, claim, cost, expense or judgment of any kind whatsoever (including the reasonable fees and expenses of counsel) (collectively, "**Indemnified Amounts**") that is incurred by any of them and that arises out of or is related to (i) any offer or sale by the Trust of Baskets under this Agreement, (ii) acts performed or omitted pursuant to the provisions of this Agreement, as the same may be amended, modified or supplemented from time to time, (A) by a Trustee Indemnified Person or (B) by the Sponsor or (iii) any filings with or submissions to the SEC in connection with or with respect to the Shares (which, by way of illustration and not by way of limitation, include any registration statement and any amendments or supplements thereto filed with the SEC or any periodic reports or updates that may be filed under the Exchange Act or any failure to make any filings with or submissions to the SEC that are required to be made in connection with or with respect to the Shares), except that the Sponsor shall not have any obligations under this Section 5.11(a) to pay any Indemnified Amounts incurred as a result of and attributable to (x) the willful misconduct, gross negligence or bad faith of, or material breach of the terms of this Agreement by, the Administrative Trustee, (y) information furnished in writing by the Administrative Trustee to the Sponsor expressly for use in the registration statement, or any amendment thereto, filed with the SEC relating to the Shares that is not materially altered by the Sponsor or (z) any misrepresentations or omissions made by a Depositor (other than the Sponsor) in connection with such Depositor's offer and sale of Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Administrative Trustee shall indemnify the Sponsor, its directors, employees, delegees and agents against, and hold each of them harmless from, any Indemnified Amounts (i) caused by the willful misconduct, gross negligence or bad faith of the Administrative Trustee or (ii) arising out of any information furnished in writing to the Sponsor by the Administrative Trustee expressly for use in the registration statement, or any amendment thereto or periodic report, filed with the SEC relating to the Shares that is not materially altered by the Sponsor.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If the indemnification provided for in Section 5.11(a) or (b) is unavailable or insufficient to hold harmless the indemnified party under Section 5.11(a) or (b) above, then the indemnifying party shall contribute to the Indemnified Amounts referred to in Section 5.11(a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by the Sponsor on the one hand and the Administrative Trustee on the other hand from the offering of the Shares which are the subject of the action or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Sponsor on the one hand and the Administrative Trustee on the other hand in connection with the action, statement or omission that resulted in such Indemnified Amount, as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among other things, whether any untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact from which the action arises relates to information supplied by the Sponsor or the Administrative Trustee and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission or the act or omission from which the action arises. The amount of Indemnified Amounts referred to in the first sentence of this Section 5.11(c) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim that is the subject of this Section 5.11.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Sponsor and its shareholders, directors, officers, employees, affiliates (as such term is defined under the Securities Act) and subsidiaries and agents (each, a "**Sponsor Indemnified Party**") shall be indemnified from the Trust and held harmless against any Indemnified Amounts arising out of or in connection with the performance of its obligations under this Agreement or any actions taken in accordance with the provisions of this Agreement and incurred without (1) willful misconduct, gross negligence or bad faith on the part of such Sponsor Indemnified Party or (2) reckless disregard on the part of such Sponsor Indemnified Party of its obligations and duties under this Agreement. Such indemnity shall include payment from the Trust of the costs and expenses incurred by such Sponsor Indemnified Party in defending itself against any claim or liability in its capacity as Sponsor. Any amounts payable to a Sponsor Indemnified Party under this Section 5.11(d) may be payable in advance or shall be secured by a lien on the Trust. The Sponsor may, in its discretion, undertake any action that it may deem to be necessary or desirable in respect of this Agreement and the rights and duties of the parties hereto and the interests of the Registered Owners and, in such event, the legal expenses and costs of any such actions shall be expenses and costs of the Trust, and the Sponsor shall be entitled to be reimbursed therefor by the Trust.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) If an action, proceeding (including, but not limited to, any governmental investigation), claim or dispute (collectively, a "**Proceeding**") in respect of which indemnity may be sought by either party is brought or asserted against the other party, the party seeking indemnification (the "**Indemnitee**") shall promptly (and in no event more than seven (7) days after receipt of notice of such Proceeding) notify the party obligated to provide such indemnification (the "**Indemnitor**") of such Proceeding. The failure of the Indemnitee to so notify the Indemnitor shall not impair the Indemnitee's ability to seek indemnification from the Indemnitor (but only for costs, expenses and liabilities incurred after such notice) unless such failure adversely affects the Indemnitor's ability to adequately oppose or defend such Proceeding. Upon receipt of such notice from the Indemnitee, the Indemnitor shall be entitled to participate in such Proceeding and, to the extent that it shall so desire and provided no conflict of interest exists as specified in clause (i) below and there are no other defenses available to Indemnitee as specified in clause (iii) below, to assume the defense thereof with counsel reasonably satisfactory to the Indemnitee (in which case all attorney's fees and expenses shall be borne by the Indemnitor, and the Indemnitor shall in good faith defend the Indemnitee). The Indemnitee shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but, in such case, no fees and expenses of such counsel shall be borne by the Indemnitor unless such fees and expenses are otherwise required to be indemnified under Section 5.11(a), (b) or (d), as applicable, and (i) there is such a conflict of interest between the Indemnitor and the Indemnitee as would preclude, in compliance with the ethical rules in effect in the jurisdiction in which the Proceeding was brought, one lawyer from representing both parties simultaneously, (ii) the Indemnitor fails, within the earlier of (x) twenty (20) days following receipt of notice of the Proceeding from the Indemnitee or (y) seven (7) days prior to the date the first response or appearance is required to be made in such Proceeding, to assume the defense of such Proceeding with counsel reasonably satisfactory to the Indemnitee or (iii) there are legal defenses available to Indemnitee that are different from or are in addition to those available to the Indemnitor. No compromise or settlement of such Proceeding may be effected by either party without the other party's consent unless (m) there is no finding or admission of any violation of law and no effect on any other claims that may be made against such other party and (n) the sole relief provided is monetary damages that are paid in full by the party seeking the settlement. Neither party shall have any liability with respect to any compromise or settlement effected without its consent, which shall not be unreasonably withheld. The Indemnitor shall have no obligation to indemnify and hold harmless the Indemnitee from any loss, expense or liability incurred by the Indemnitee as a result of a default judgment entered against the Indemnitee unless such judgment was entered after the Indemnitor agreed, in writing, to assume the defense of such Proceeding.

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Section 5.12 **Charges of Administrative Trustee.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Person acquiring Baskets pursuant to a Purchase Order and each Person Surrendering Baskets pursuant to a Redemption Order shall pay to the Processing Agent the transaction fee specified in the ETF Services Agreement between the Trust and the Processing Agent, and reimburse the Trust, the Administrative Trustee and the Processing Agent for any and all expenses and costs incurred in connection with such Purchase Order or Redemption Order.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Administrative Trustee is entitled to receive from the Sponsor fees for its services and reimbursement for its out-of-pocket expenses in accordance with written agreements between the Sponsor and the Administrative Trustee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Administrative Trustee is entitled to charge the Trust for all expenses and disbursements incurred by it under Section 5.17(a) or that are of the type described in Sections 4.6(a)(ii) or (iii) (including the fees and disbursements of legal counsel), except that the Administrative Trustee is not entitled to charge the Trust for (i) expenses and disbursements that were incurred by it before the commencement of trading of Shares on the Exchange and (ii) fees of agents for performing services the Administrative Trustee is required to perform under this Agreement.

Section 5.13 **Charges of the Sponsor**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Sponsor is entitled to receive from the Trust, as an expense of the Trust, a fee for services that will accrue daily and be paid at least quarterly in arrears at an annualized rate of up to 0.50% of the Net Asset Value of the Trust (the "**Sponsor's Fee**"), which the Sponsor may adjust in its discretion and may further adjust above 0.50% in accordance with Section 6.1(a). The Sponsor may, at its sole discretion and from time to time, waive all or a portion of the Sponsor's Fee for such period(s) of time it specifies in a notice of such fee waiver to the Administrative Trustee. The Sponsor is under no obligation to waive any portion of its fees hereunder or reimbursements pursuant to this Section 5.13, and any such waiver shall create no obligation to waive any such fees or reimbursements during any period not covered by the waiver. Any fee or reimbursement waiver by the Sponsor shall not operate to reduce the Sponsor's obligations hereunder, including its obligations under Section 5.7(f). The Sponsor may instruct the Administrative Trustee from time to time to withhold a portion of the Sponsor's Fee otherwise payable to the Sponsor and to pay such withheld portion to Persons identified by the Sponsor for the purpose of satisfying certain expenses of the Trust for which the Sponsor is responsible under Section 5.7(f).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Sponsor is also entitled to receive from the Trust, as an expense of the Trust, a fee for the Sponsor's facilitation of Staking Activities (the "**Sponsor's Staking Portion**"). In addition to the Sponsor's Staking Portion, the Trust will pay the Ether Custodian a share of the Trust's Staking Consideration from Staking Activities. The Staking Fee shall not exceed a per annum percentage of the gross Staking Consideration, as specified in the Trust's prospectus. The Trust will retain the remainder of such gross Staking Consideration. The Sponsor may, at its sole discretion and from time to time, waive all or a portion of the Sponsor's Staking Portion for such period(s) of time it specifies in a notice of such fee waiver to the Administrative Trustee. The Sponsor is under no obligation to waive any portion of its fees hereunder or reimbursements pursuant to this Section 5.13, and any such waiver shall create no obligation to waive any such fees or reimbursements during any period not covered by the waiver. Any fee or reimbursement waiver by the Sponsor shall not operate to reduce the Sponsor's obligations hereunder, including its obligations under Section 5.7(f). The Sponsor may instruct the Administrative Trustee from time to time to withhold a portion of the Sponsor's Staking Portion otherwise payable to the Sponsor and to pay such withheld portion to Persons identified by the Sponsor for the purpose of satisfying certain expenses of the Trust for which the Sponsor is responsible under Section 5.7(f).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Sponsor is entitled to receive reimbursement from the Trust for all expenses and disbursements incurred by it under the last sentence of Section 5.11(d) or that are of the type described in Sections 4.6(a)(ii), (iii) or (iv) (in respect of services performed or actions taken by the Sponsor) of this Agreement (including the fees and disbursements of legal counsel), except that the Sponsor is not entitled to charge the Trust for (i) expenses and disbursements incurred by it prior to the commencement of trading of Shares on the Exchange and (ii) fees of agents for performing services the Sponsor is required to perform under this Agreement.

Section 5.14 **Retention of Trust Documents**. The Administrative Trustee is authorized to destroy those documents, records, bills and other data compiled during the term of this Agreement at the times permitted by the laws or regulations governing the Administrative Trustee, unless the Sponsor reasonably requests the Administrative Trustee in writing to retain those items for a longer period.

Section 5.15 **Federal Securities and Commodities Law Filings.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Sponsor has prepared and filed a registration statement with the SEC and shall (i) take such action as is necessary to qualify the Shares for offering and sale under the federal securities laws of the United States, including the preparation and filing of amendments and supplements to such registration statement, and, if the Sponsor so determines, under the laws of any other relevant jurisdiction, (ii) promptly notify the Administrative Trustee of any amendment or supplement to the registration statement or prospectus, of any order preventing or suspending the use of any prospectus, of any request to amend or supplement the registration statement or prospectus or if any event or circumstance occurs that is known to the Sponsor as a result of which the registration statement or prospectus, as then amended or supplemented, would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iii) provide the Administrative Trustee with copies, including copies in electronic form, of the prospectus, as amended and supplemented, in such quantities as the Administrative Trustee may from time to time reasonably request and (iv) prepare, file and distribute, if applicable, any periodic reports or updates that may be required under the Exchange Act, the Commodity Exchange Act, as amended, or the rules and regulations thereunder. The Administrative Trustee shall furnish to the Sponsor any information from the records of the Trust that the Sponsor reasonably requests in writing as needed to prepare any filing or submission that the Sponsor or the Trust is required to make under the federal securities or commodities laws of the United States or the laws of any other jurisdiction.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Sponsor shall have all necessary and exclusive power and authority to (i) adopt, implement or amend, from time to time, such disclosure and financial reporting information gathering and control policies and procedures as are necessary or desirable, in the Sponsor's reasonable judgment, to ensure compliance with applicable disclosure and financial reporting obligations under any applicable securities laws, (ii) appoint and remove the auditors of the Trust, (iii) make any determination, choice, estimate or other decision that may be necessary or desirable in connection with the preparation of the financial statements of the Trust and (iv) seek from the relevant securities or other regulatory authorities such relief, clarification or other action as the Sponsor shall deem to be necessary or desirable regarding the disclosure or financial reporting obligations of the Trust; **provided**, **however**, **that** to the extent applicable laws, regulations or the listing rules of the Exchange contemplate that one or more of the powers vested in the Sponsor hereby be exercised by an audit committee, then the audit committee of the Sponsor's board of directors shall have exclusive power and authority to exercise such powers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Policies and procedures comprising the Trust's internal control over financial reporting have been adopted as of the date hereof and copies thereof have been delivered to the appropriate officers of the Sponsor and the Administrative Trustee. Amendments to such internal control over financial reporting may be proposed from time to time by the Sponsor, but such amendments may not be adopted in connection with the preparation of the Trust's financial statements without the Administrative Trustee's consent (which consent will not be unreasonably withheld or delayed).

Section 5.16 **Prospectus Delivery**. The Sponsor, or the Administrative Trustee on its behalf, will comply with the requirements to provide copies of the current prospectus for the Trust to Authorized Participants as provided in the relevant Authorized Participant Agreements.

Section 5.17 **Discretionary Actions by Administrative Trustee; Consultation.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Administrative Trustee may, with the consent of the Sponsor, undertake any action that it deems to be necessary or desirable to protect the Trust or the interests of the Registered Owners. The expenses incurred by the Administrative Trustee in connection with taking any such action (including the fees and disbursements of legal counsel) shall be expenses of the Trust, and the Administrative Trustee shall be entitled to be reimbursed for those expenses by the Trust.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Administrative Trustee shall notify and consult with the Sponsor if the Administrative Trustee becomes aware of any development or event that affects the administration of the Trust but is not contemplated or provided for in this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Sponsor shall notify and consult with the Administrative Trustee (i) prior to undertaking any action described in the last sentence of Section 5.11(d) or (ii) if the Sponsor becomes aware of any development or event that affects the administration of the Trust but is not contemplated or provided for in this Agreement.

Section 5.18 **Number of Trustees**. The number of trustees of the Trust initially shall be two (2), and thereafter the number of trustees shall be such number as shall be fixed from time to time by the Sponsor. The Sponsor is entitled, subject to Section 5.9, to appoint or remove without cause any trustee at any time; **provided**, **however**, **that**, if required by the Act, there shall at all times be a Delaware Trustee.

Section 5.19 **Initial Administrative Trustee**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The initial Administrative Trustee shall be BlackRock Fund Advisors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as otherwise required by the Act, the Administrative Trustee is authorized to execute on behalf of the Trust any documents that the Administrative Trustee has the power and authority to cause the Trust to execute pursuant to this Agreement.

Section 5.20 **Delaware Trustee**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Delaware Trustee shall either be (i) a natural person who is at least twenty-one (21) years of age and a resident of the State of Delaware or (ii) a legal entity that is a trustee having its principal place of business in the State of Delaware, otherwise meets the requirements of applicable Delaware law and shall act through one or more persons authorized to bind such entity. If at any time the Delaware Trustee shall cease to be eligible in accordance with the provisions of this Section 5.20, it shall resign immediately in the manner and with the effect hereinafter specified in this Section 5.20. The Delaware Trustee shall be Wilmington Trust, National Association.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Delaware Trustee shall not be entitled to exercise any powers, nor shall the Delaware Trustee have any of the duties and responsibilities, of the Administrative Trustee or the Sponsor that are set forth herein. The Delaware Trustee shall be one of the trustees of the Trust for the sole and limited purpose of fulfilling the requirements of Section 3807 of the Act and for taking such actions as are required to be taken by a Delaware trustee under the Act. Subject to the foregoing, the duties (including fiduciary duties), liabilities and obligations of the Delaware Trustee shall be limited to (i) accepting legal process served on the Trust in the State of Delaware and (ii) executing any certificates required to be filed with the Delaware Secretary of State that the Delaware Trustee is required to execute under Section 3811 of the Act, and there shall be no other duties (including fiduciary duties) or obligations, express or implied, at law or in equity, of the Delaware Trustee. The Delaware Trustee shall not be liable or accountable hereunder to the Trust or to any other Person or under any other agreement to which the Trust is a party, except for the Delaware Trustee's own gross negligence, bad faith or willful misconduct. In particular, but not by way of limitation:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Delaware Trustee shall have no liability or responsibility for the validity or sufficiency of this Trust Agreement or for the form, character, genuineness, sufficiency, enforceability, collectability, location, existence, value or validity of the Trust Property or for the due execution hereof by the Sponsor and Administrative Trustee;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Delaware Trustee has not prepared or verified, and shall not be responsible or liable for, any information, disclosure or other statement in any document issued or delivered in connection herewith or the sale or transfer of the Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Delaware Trustee shall not be liable for any actions taken or omitted to be taken by it in accordance with the instructions of the Administrative Trustee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The Delaware Trustee shall not have any liability for the acts or omissions of the Sponsor, the Administrative Trustee or any other Person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) The Delaware Trustee shall have no duty or obligation to supervise the performance of any obligations of the Sponsor, the Administrative Trustee or any other Person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) No provision of this Trust Agreement shall require the Delaware Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its rights or powers hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) The Delaware Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Trust Agreement at the request, order or direction of the Administrative Trustee unless the Administrative Trustee or Sponsor has advanced any necessary expense and offered to Wilmington Trust, National Association (in its capacity as Delaware Trustee and individually) security or indemnity satisfactory to it against the costs, expenses and liabilities that may be incurred by Wilmington Trust, National Association (including the reasonable fees and expenses of its counsel) therein or thereby;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) Notwithstanding anything contained herein to the contrary, the Delaware Trustee shall not be required to take any action in any jurisdiction other than in the State of Delaware;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) The Delaware Trustee shall not be personally liable for any error of judgment made in good faith by an officer or employee of the Delaware Trustee and the permissive right of the Delaware Trustee to perform any discretionary act or exercise any privilege enumerated herein shall not be construed as a duty;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) The Delaware Trustee shall have no obligation or duty to monitor the Trust's obligations and duties;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) Under no circumstance shall the Delaware Trustee be personally liable for any representation, warranty, covenant, obligation, agreement or indebtedness of the Trust;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii) The Delaware Trustee shall not be personally liable for (x) special, consequential, exemplary, indirect or punitive damages, however styled, including lost profits, (y) the acts or omissions of any nominee, correspondent, clearing agency or securities depository through which it holds the Trust's securities or assets or (z) any losses due to forces beyond the reasonable control of the Delaware Trustee, including strikes, work stoppages, acts of war or terrorism, insurrection, revolution, nuclear or natural catastrophes or acts of God and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) In the exercise or administration of the Trust hereunder and in the performance of its duties and obligations under this Agreement, the Delaware Trustee may act directly or through agents or attorneys or a custodian or nominee and the Delaware Trustee shall not be liable for the conduct or misconduct of such agents or attorneys or a custodian or nominee if such agents or attorneys or a custodian or nominee shall have been selected by the Delaware Trustee in good faith;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv) Knowledge or information acquired by the Delaware Trustee will not be imputed to the Delaware Trustee in its individual capacity under any other document, nor shall it be imputed to any affiliate, line of business or other division of the client (and vice versa);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xv) The Delaware Trustee shall neither be responsible for, nor chargeable with, knowledge of the terms and conditions of any other agreement, instrument, or document, other than this Agreement, and shall have no duty to inquire as to the performance or nonperformance of any provision, whether or not an original or a copy of such agreement has been provided to the Delaware Trustee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvi) In the event that any of the Trust Property shall be attached, garnished or levied upon by any court order, or the delivery thereof shall be stayed or enjoined by an order of a court, or any order, judgment or decree shall be made or entered by any court order affecting the Trust Property, the Delaware Trustee, shall notify the Sponsor promptly in writing upon receipt by a Responsible Officer of the Delaware Trustee of notice of such event and naming the Trust and is hereby expressly authorized in its sole discretion, to respond as it deems appropriate or to comply with all writs, orders or decrees so entered or issued, or which it is advised by legal counsel of its own choosing is binding upon it. In the event that the Delaware Trustee obeys or complies with any such writ, order or decree as provided in the immediately preceding sentence it shall not be liable to any Person, firm or corporation, should, by reason of such compliance notwithstanding, such writ, order or decree be subsequently reversed, modified, annulled, set aside or vacated; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvii) If any conflict, disagreement or dispute arises between, among, or involving any of the parties hereto concerning the meaning or validity of any provision hereunder or concerning any other matter relating to this Agreement, or the Delaware Trustee is in doubt as to the action to be taken hereunder, the Delaware Trustee may, at its option, after sending written notice of the same to transaction parties, refuse to act until such time as it (a) receives a final non-appealable order of a court of competent jurisdiction (b) receives a written instruction, executed by each of the parties involved in such disagreement or dispute, in a form reasonably acceptable to the Delaware Trustee. The Delaware Trustee will be entitled to act on any such written instruction or final, non-appealable order of a court of competent jurisdiction without further question, inquiry or consent. The Delaware Trustee may file an interpleader action in a state or federal court, and upon the filing thereof, Delaware Trustee will be relieved of all liability and will be entitled to recover reasonable and documented out-of-pocket attorneys' fees, expenses and other costs incurred in commencing and maintaining any such interpleader action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Delaware Trustee shall serve until such time as the Sponsor removes the Delaware Trustee or the Delaware Trustee resigns and a successor Delaware Trustee is appointed by the Sponsor in accordance with the terms of this Section 5.20. The Delaware Trustee may resign at any time upon the giving of at least sixty (60) days' advance written notice to the Administrative Trustee; **provided, that** such resignation shall not become effective unless and until a successor Delaware Trustee shall have been appointed by the Sponsor in accordance with Section 5.20. If the Sponsor does not act within such sixty (60) day period, the Delaware Trustee may apply to the Court of Chancery of the State of Delaware for the appointment of a successor Delaware Trustee.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Upon the resignation or removal of the Delaware Trustee, the Sponsor shall appoint a successor Delaware Trustee by delivering a written instrument to the outgoing Delaware Trustee. Any successor Delaware Trustee must satisfy the requirements of Section 3807 of the Act. Any resignation or removal of the Delaware Trustee and appointment of a successor Delaware Trustee shall not become effective until a written acceptance of appointment is delivered by the successor Delaware Trustee to the outgoing Delaware Trustee and the Sponsor and any fees and expenses due to the outgoing Delaware Trustee are paid. Following compliance with the preceding sentence, the successor Delaware Trustee (i) shall file an amendment to the Certificate of Trust reflecting the change of Delaware Trustee and (ii) shall become fully vested with all of the rights, powers, duties and obligations of the outgoing Delaware Trustee under this Agreement, with like effect as if originally named as Delaware Trustee, and the outgoing Delaware Trustee shall be discharged of its duties and obligations under this Agreement. Any business entity into which the Delaware Trustee may be merged or converted or with which it may be consolidated, or any entity resulting from any merger, conversion or consolidation to which the Delaware Trustee shall be a party, or any entity succeeding to all or substantially all of the corporate trust business of the Delaware Trustee, shall be the successor of the Delaware Trustee hereunder, without the execution or filing of any paper or any further act on the part of any of the parties hereto except as may be required by applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The Sponsor, the Administrative Trustee and the Trust shall indemnify the Delaware Trustee, its directors, employees, delegees and agents (the "**Delaware Trustee Indemnified Persons**") against, and hold each of them harmless from, any Indemnified Amounts (including the reasonable fees and expenses of counsel in the enforcement of this Agreement) that are incurred by any of them and that arise out of or are related to (i) the Trust, this Agreement, the Trust Property, the Shares or any offer or sale by the Trust of Baskets under this Agreement, (ii) acts performed or omitted pursuant to the provisions of this Agreement, as the same may be amended, modified or supplemented from time to time, (A) by a Delaware Trustee Indemnified Person or (B) by the Sponsor or the Administrative Trustee or (iii) any filings with or submissions to the SEC in connection with or with respect to the Shares (which, by way of illustration and not by way of limitation, include any registration statement and any amendments or supplements thereto filed with the SEC or any periodic reports or updates that may be filed under the Exchange Act or any failure to make any filings with or submissions to the SEC that are required to be made in connection with or with respect to the Shares), except that the none of the Administrative Trustee, the Sponsor nor the Trust shall have any obligations under this Section 5.20(e) to pay any Indemnified Amounts incurred as a direct result of and attributable to (x) the willful misconduct, gross negligence or bad faith of the Delaware Trustee or (y) representations regarding the Delaware Trustee in its individual capacity furnished in writing by the Delaware Trustee in its individual capacity to the Sponsor expressly for use in the registration statement, or any amendment thereto, filed with the SEC relating to the Shares that is not altered by the Sponsor or the Trust. Any such indemnity shall be subject to the provisions of Section 5.11(e).

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Section 5.21 **Compensation and Expenses of the Delaware Trustee**. The Delaware Trustee shall be entitled to receive from the Sponsor compensation for its services hereunder as set forth in a separate fee agreement with the Delaware Trustee and shall be entitled to be reimbursed by the Sponsor for reasonable out-of-pocket expenses incurred by it in the performance of its duties hereunder, including the reasonable compensation, out-of-pocket expenses and disbursements of counsel and such other agents as the Delaware Trustee may retain in connection with the exercise and performance of its rights and duties hereunder.

Section 5.22 **Action Upon Instruction**. Whenever the Delaware Trustee is (i) unable to decide between alternative courses of action permitted or required by the terms of this Trust Agreement or (ii) unsure as to the application of any provision of this Trust Agreement or any such provision is ambiguous as to its application, or is, or appears to be, in conflict with any other applicable provision or in the event that this Trust Agreement is silent or is incomplete as to the course of action that the Delaware Trustee is required to take with respect to a particular set of facts, the Delaware Trustee may give notice (in such form as shall be appropriate under the circumstances) to the Administrative Trustee requesting instruction and, to the extent that the Delaware Trustee acts or refrains from acting in good faith in accordance with any such instruction received from the Administrative Trustee, the Delaware Trustee shall not be liable, on account of such action or inaction, to any person. If the Delaware Trustee shall not have received appropriate instruction within 10 days of such notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the circumstances) it may, but shall be under no duty to, take or refrain from taking such action as it shall deem to be in the best interests of the Trust, and shall not have liability to any Person for such action or inaction. The Delaware Trustee shall not be required to take any action hereunder or at the request or direction of the Administrative Trustee, if the Delaware Trustee shall have reasonably determined, or shall have been advised by counsel, that such action is likely to result in liability on the part of the Delaware Trustee or is contrary to the terms hereof or of any document or is otherwise contrary to law or if the Delaware Trustee shall have reasonable grounds for believing that adequate indemnity (satisfactory in its sole and absolute discretion) against the costs, expenses and liabilities which may be incurred by it in compliance with such request or direction is not reasonably assured or provided to it.

**ARTICLE VI**<br>**AMENDMENT AND TERMINATION**

Section 6.1 **Amendment**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Sponsor and the Administrative Trustee may amend any provision of this Agreement without the consent of any Registered Owner or Beneficial Owner. Any amendment that imposes or increases any fees or charges (other than the Sponsor's Fee, to the extent it does not exceed 0.50% of the Net Asset Value of the Trust and other than taxes and other governmental charges) or prejudices a substantial existing right of the Registered Owners will not become effective until thirty (30) days after notice of such amendment is given by the Administrative Trustee to the Registered Owners. Every Registered Owner and Beneficial Owner, at the time any such amendment becomes effective, shall be deemed, by continuing to hold any Shares or an interest therein, to consent and agree to such amendment and to be bound by this Agreement as amended thereby. In no event shall any amendment impair the right of a Registered Owner to Surrender Baskets and receive therefor the amount of Trust Property represented thereby, except in order to comply with mandatory provisions of applicable law. Notwithstanding any other provision of this Agreement, without the consent of Registered Owners representing a majority of the outstanding Shares, no amendment to this Agreement may be made if, as a result of such amendment, it would cause the Trust to be treated as anything other than a grantor trust for U.S. federal income tax purposes.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No amendment shall be made to this Agreement without the consent of the Delaware Trustee if such amendment adversely affects any of its rights, duties or liabilities. Prior to the execution of any amendment to the Trust Agreement or the Certificate of Trust, the Delaware Trustee shall be entitled to receive and rely upon an opinion of counsel and/or officer's certificate of the Sponsor or Administrative Trustee stating that the execution of such amendment is authorized or permitted by this Agreement and an officer's certificate of the Sponsor or Administrative Trustee stating that all conditions precedent to such amendment have been satisfied.

Section 6.2 **Termination**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The term for which the Trust will exist commenced on the date of the filing of the Certificate of Trust and shall continue until terminated pursuant to the provisions hereof. The Administrative Trustee shall set a date on which the Trust shall dissolve and mail notice of that dissolution to the Registered Owners at least thirty (30) days prior to the date set for dissolution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Trust shall dissolve at any time if any of the following occurs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Administrative Trustee is notified that the Shares are delisted from the Exchange and are not approved for listing on another national securities exchange within five (5) Business Days of their delisting;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a U.S. federal or state regulator requires the Trust to shut down or forces the Trust to liquidate its ether or seizes, impounds or otherwise restricts access to Trust assets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Sponsor notifies the Administrative Trustee in writing that it has determined, in its sole discretion, that the dissolution of the Trust is advisable; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) DTC is unable or unwilling to continue to perform its functions, and a comparable replacement is unavailable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Without limiting the authority of the Sponsor to dissolve the Trust under Section 6.2(b)(iii), the Sponsor may, in its sole discretion, dissolve the Trust if any of the following occurs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) sixty (60) days have elapsed since the Administrative Trustee notified the Sponsor of the Administrative Trustee's election to resign, and a successor Administrative Trustee has not been appointed and accepted its appointment as provided in Section 5.9;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the SEC (or its staff) or a court of competent jurisdiction determines that the Trust is an investment company under the Investment Company Act of 1940, as amended;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the CFTC determines that the Trust is a commodity pool under the Commodity Exchange Act;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the Index Administrator ceases to maintain the Index or any ongoing event exists that prevents or makes impractical the determination of the Index price and, in the opinion of the Sponsor, no successor or similar pricing source is reasonably available;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) the value of the Trust is at a level at which continued operation of the Trust is not cost-efficient;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the U.S. Department of the Treasury Financial Crimes Enforcement Network ("**FinCEN**") determines that the Trust or the Sponsor is required to register as a money services business, or the New York Department of Financial Services determines the Trust or the Sponsor is required to obtain licensure under 23 NYCRR Part 200 ("**BitLicense**");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) if any state regulator or court of competent authority determines the Sponsor or the Trust is required to obtain a money transmitter license or other state license;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) any ongoing event exists that either prevents the Trust from or makes impractical the Trust's holding of ether, or prevents the Trust from converting or makes impractical the Trust's reasonable efforts to convert ether to U.S. dollars, or prevents the Trust from completing or makes impractical the Trust's reasonable efforts to complete in-kind creations and redemptions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) the Trust fails to qualify for treatment, or ceases to be treated, for U.S. federal income tax purposes, as a grantor trust, and the Administrative Trustee receives notice from the Sponsor that the Sponsor has determined that, because of that tax treatment or change in tax treatment, termination of the Trust is advisable; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) any custodian (including, for the avoidance of doubt, either of the Custodians) or prime execution agent (including, for the avoidance of doubt, the Prime Execution Agent) then acting resigns, is removed or otherwise ceases to act as custodian or prime execution agent and, in the opinion of the Sponsor, no successor custodian or prime execution agent has been employed prior to (i) the effective date of such resignation, removal or cessation, or (ii) in the case of the Ether Custodian, the Additional Ether Custodian or Prime Execution Agent, the final date as of which the Ether Custodian, Additional Ether Custodian or Prime Execution Agent will cease to hold any of the Trust's assets, to the extent different from (i).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) On and after the dissolution of the Trust, the Administrative Trustee shall, in accordance with Section 3808(e) of the Act, wind up the business and affairs of the Trust. Subject to the payment or the reasonable provision of such payment by the Administrative Trustee of the claims and obligations of the Trust as required by Section 3808(e) of the Act, the Registered Owners will be entitled to delivery to them of the amount of Trust Property represented by their Shares as hereinafter provided. The Administrative Trustee shall not accept any Purchase Order or Redemption Order after the date of dissolution. If any Shares remain outstanding after the date of dissolution of the Trust, the Administrative Trustee thereafter shall (i) discontinue the registration of transfers of Shares; (ii) continue to collect distributions pertaining to Trust Property and hold the proceeds thereof uninvested, without liability for interest; and (iii) pay pursuant to Section 3808(e) of the Act the Trust's expenses and may sell Trust Property as necessary to meet those expenses. After the dissolution of the Trust, the Administrative Trustee shall sell or otherwise liquidate the Trust Property then held under this Trust Agreement and, after complying with Section 3808(e) of the Act and deducting any fees, expenses, taxes or other governmental charges payable by the Trust and any expenses for the account of the Registered Owner of such Shares in accordance with the terms and conditions of this Trust Agreement and any applicable taxes or other governmental charges, promptly distribute the net proceeds from such sale to the Registered Owners. The Administrative Trustee and the Sponsor shall not be liable for any loss or depreciation resulting from any sale or other disposition of property made by the Administrative Trustee pursuant to the Sponsor's instruction or otherwise made by the Administrative Trustee in good faith. Upon the dissolution of the Trust and the winding up of the Trust by the Sponsor and the Administrative Trustee, the Delaware Trustee shall, upon receipt of written direction of the Administrative Trustee or the Sponsor, execute and cause a certificate of cancellation of the Certificate of Trust to be filed with the Secretary of State in accordance with the Act. After making such filing, the Administrative Trustee and the Delaware Trustee shall be discharged from all obligations under this Trust Agreement and this Trust Agreement shall terminate other than such provisions that expressly survive termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Upon the termination of this Agreement, the Sponsor shall be discharged from all obligations under this Agreement, except that its obligations to the Administrative Trustee under Sections 5.11 and 5.12 shall survive termination of this Agreement.

**ARTICLE VII**<br>**MISCELLANEOUS**

Section 7.1 **Counterparts**. This Agreement may be executed in any number of counterparts, each of which is deemed to be an original and all of such counterparts constitute one and the same agreement. Copies of this Agreement are filed with the Administrative Trustee and are open to inspection by any Registered Owner during the Administrative Trustee's business hours.

Section 7.2 **Third-Party Beneficiaries**. Subject to Section 5.8, this Agreement is for the exclusive benefit of the parties hereto and the Covered Persons and other indemnified parties referred to in Section 5.11, and the Registered Owners, Beneficial Owners and Depositors from time to time, and shall not be deemed to give any legal or equitable right, remedy or claim whatsoever to any other Person.

Section 7.3 **Severability**. In case any one or more of the provisions contained in this Agreement are or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions of this Agreement shall in no way be affected, prejudiced or disturbed thereby.

Section 7.4 **Notices**.

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

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any notice to be given to the Administrative Trustee, the Sponsor or the Delaware Trustee shall be deemed to have been duly given (i) when it is actually delivered by a messenger or a recognized courier service, (ii) five (5) days after it is mailed by registered or certified mail, postage paid or (iii) when receipt of a facsimile transmission is acknowledged via a return receipt or receipt confirmation as requested by the original transmission, in each case to or at the address or facsimile number set forth below:

To the Administrative Trustee:

BlackRock Fund Advisors.<br> 400 Howard Street<br> San Francisco, CA 94105<br> Attention: Legal Department<br> Facsimile: (415) 618-5712

or (1) any other place to which the Administrative Trustee may have transferred its Corporate Trust Office with notice to the Sponsor and the Delaware Trustee or (2) any entity to which the Administrative Trustee may have transferred all or some of its duties hereunder pursuant to Section 5.8 at the address set forth in the notice of transfer provided to the Sponsor and the Delaware Trustee.

To the Sponsor:

iShares<sup>®</sup> Delaware Trust Sponsor LLC<br> 400 Howard Street<br> San Francisco, CA 94105<br> Attention: Product Management Team, Intermediary Investors and<br> Exchange Traded Products Department<br> Facsimile: (415) 618-5097

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

To the Delaware Trustee:

Wilmington Trust, National Association<br> Rodney Square North<br> 1100 North Market Street<br> Wilmington, DE 19890<br> Attention: Corporate Trust Administration<br> Facsimile: (302) 636-4140

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any notice to be given to a Registered Owner shall be deemed to have been duly given (i) when actually delivered by messenger or a recognized courier service, (ii) when mailed, postage prepaid or (iii) when sent by facsimile transmission confirmed by letter, in each case at or to the address of such Registered Owner as it appears on the transfer books of the Administrative Trustee, or, if such Registered Owner shall have filed with the Administrative Trustee a written request that any notice or communication intended for such Registered Owner be delivered to some other address, at the address designated in such request.

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Section 7.5 **Governing Law; Consent to Jurisdiction**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Agreement is governed by and is to be construed in accordance with the laws of the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The parties hereto hereby (i) irrevocably submit to the non-exclusive jurisdiction of any Delaware state court or federal court sitting in Wilmington, Delaware in any action arising out of or relating to this Agreement and (ii) consent to the service of process by mail. Nothing herein shall affect the right of any party to serve legal process in any manner permitted by applicable law or affect its right to bring any action in any other court. Each party agrees that, in the event that any dispute arising from or relating to this Agreement becomes subject to any judicial proceeding, such party waives any right that it may otherwise have to (x) seek punitive or consequential damages or (y) request a trial by jury. Notwithstanding the foregoing, causes of action for violations of the Exchange Act or the Securities Act shall not be governed by this Section 7.5.

Section 7.6 **Headings**. The titles of the Articles and the headings of the Sections of this Agreement are for convenience of reference only and are not to be considered in construing the terms and provisions of this Agreement.

Section 7.7 **Compliance with Regulation B**. If any banking institution that is either a party to this Agreement or a delegee pursuant hereto reasonably believes that any of the activities described herein and to be performed by such institution are reasonably likely to result in such institution having to register as a broker-dealer under federal law, then (a) such institution will promptly notify in writing the other parties in reasonable detail of the basis of its concern, (b) such institution thereafter shall not be deemed to be in violation of, or acting negligently or in bad faith with respect to, this Agreement or any agreement incidental hereto by virtue of not engaging in such activity and (c) the parties hereto shall promptly restructure the arrangements described herein in good faith to the extent necessary to prevent such registration from having to occur.

Section 7.8 **Binding Effect; Entire Agreement**. Except as otherwise provided in this Agreement, every covenant, term and provision of this Agreement is binding upon and inures to the benefit of the parties hereto and their respective personal representatives, successors and permitted assigns. This Agreement constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, whether written or oral, relating to such subject matter in any way.

Section 7.9 **Provisions in Conflict With Law or Regulations**. The provisions of this Agreement are severable, and if the Administrative Trustee determines, with the advice of counsel, that any one or more of such provisions (the "**Conflicting Provisions**") are in conflict with the Code, the Act or other applicable U.S. federal or state laws, the Conflicting Provisions shall be deemed never to have constituted a part of this Agreement, even without any amendment of this Agreement pursuant to this Agreement; **provided**, **however**, **that** such determination by the Administrative Trustee shall not affect or impair any of the remaining provisions of this Agreement or render invalid or improper any action taken or omitted prior to such determination. The Administrative Trustee shall not be liable for making or failing to make such a determination.

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Section 7.10 **Patriot Act**. In order to comply with laws, rules, regulations and executive orders in effect from time to time applicable to banking institutions, including those relating to the funding of terrorist activities and money laundering, including the Customer Identification Program requirements established under the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Title III of Pub. L. 107 56 (signed into law October 26, 2001) and its implementing regulations (collectively, the "**USA PATRIOT Act**"), FinCEN, Customer Due Diligence Requirements and such other laws, rules, regulations and executive orders in effect from time to time applicable to banking institutions ("**Applicable AML Law**"), the Delaware Trustee is required to obtain, verify and record certain information relating to individuals and entities which establish or maintain a business relationship with the Delaware Trustee. Accordingly, the Beneficial Owners shall, at the reasonable request of the Delaware Trustee, cause to be provided to the Delaware Trustee from time to time such identifying information and documentation as may be available to enable the Delaware Trustee to comply with Applicable AML Law.

Pursuant to Applicable AML Law, the Delaware Trustee is required to obtain on or before closing and from time to time thereafter, documentation to verify and record information that identifies each Person who opens an account at the Delaware Trustee. For a non-individual Person such as a business entity, a charity, a trust or other legal entity, the Delaware Trustee will ask for documentation to verify the entity's formation and existence, its financial statements, licenses, tax identification documents, identification and authorization documents from individuals claiming authority to represent the entity and other relevant documentation and information (including beneficial owners of such entities). To the fullest extent permitted by Applicable AML Law, the Delaware Trustee may conclusively rely on, and shall be fully protected in relying on, any such information. Failure to provide such information may result in an inability of the Delaware Trustee to perform its obligations hereunder, which, at the sole option of the Delaware Trustee, may result in the Delaware Trustee's resignation in accordance with the terms hereof. In addition to the Delaware Trustee's obligations under Applicable AML Law, the Corporate Transparency Act (31 U.S.C § 5336) and its implementing regulations (collectively, the "**CTA**" and together with Applicable AML Law, "**AML Law**"), may require the Trust to file reports with FinCEN after the date of this Agreement. It shall be the Sponsor's and Administrative Trustee's duty and not the Delaware Trustee's duty to cause the Trust to make such filings and to cause the Trust to comply with its obligations under the CTA, if any. The parties hereto agree that, for purposes of AML Law, the Beneficial Owners shall be deemed to be the sole direct owners of the Trust, acknowledge that the Delaware Trustee acts solely as a directed trustee at the direction of other Persons designated hereunder and that one or more controlling parties of such Persons (and not of the Delaware Trustee) are and shall deemed to be the parties with the power and authority to exercise substantial control over the Trust.

The parties hereto agree that the Trust, the Sponsor and the Administrative Trustee are not responsible for the accuracy of information provided by other parties hereto or any third party.

Section 7.11 **Execution Authority**. The Delaware Trustee is hereby authorized and directed to execute this Agreement. The Sponsor and the Administrative Trustee certify to the Delaware Trustee that the execution of this Agreement is authorized and permitted by the Existing Trust Agreement and all conditions precedent to this Agreement have been satisfied.

[*Signature Page Follows*]

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IN WITNESS WHEREOF, the undersigned have duly executed this Amended and Restated Trust Agreement as of the day and year first set forth above.

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| | |
|:---|:---|
| iSHARES<sup>®</sup> DELAWARE TRUST SPONSOR LLC, as Sponsor | iSHARES<sup>®</sup> DELAWARE TRUST SPONSOR LLC, as Sponsor |
| By: | /s/Shannon Ghia |
|  | Name: Shannon Ghia |
|  | Title: Managing Director |
| BLACKROCK FUND ADVISORS, as Administrative Trustee | BLACKROCK FUND ADVISORS, as Administrative Trustee |
| By: | /s/Shannon Ghia |
|  | Name: Shannon Ghia |
|  | Title: Managing Director |
| WILMINGTON TRUST, NATIONAL ASSOCIATION, | WILMINGTON TRUST, NATIONAL ASSOCIATION, |
| as Delaware Trustee | as Delaware Trustee |
| By: | /s/ Gregory A. Marcum |
|  | Name: Gregory A. Marcum |
|  | Title: Assistant Vice President |

---

Consented and agreed:

---

| | |
|:---|:---|
| By: | */s/Daniel Schwieger* |
|  | Daniel Schwieger, as Initial Trustee |

---

------

**EXHIBIT A**

**FORM OF CERTIFICATE**

THE SHARES EVIDENCED HEREBY REPRESENT RIGHTS WITH RESPECT TO UNDERLYING TRUST PROPERTY (AS DEFINED IN THE TRUST AGREEMENT REFERRED TO HEREIN) HELD BY THE iSHARES<sup>®</sup> STAKED ETHEREUM TRUST ETF (THE "**TRUST**") AND DO NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN, AND ARE NOT GUARANTEED BY THE SPONSOR, THE ADMINISTRATIVE TRUSTEE, THE DELAWARE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THE SHARES NOR THE UNDERLYING TRUST PROPERTY IS INSURED UNDER ANY AGREEMENT THAT DIRECTLY BENEFITS THE TRUST OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.

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

TRUST SHARES<br> ISSUED BY<br> iSHARES<sup>®</sup> STAKED ETHEREUM TRUST ETF<br> REPRESENTING<br> FRACTIONAL UNDIVIDED INTERESTS IN THE NET ASSETS OF THE TRUST<br> BLACKROCK FUND ADVISORS, as Administrative Trustee

No. <sup>\*</sup>Shares <br> CUSIP:

BLACKROCK FUND ADVISORS, as Administrative Trustee (the "**Administrative Trustee**"), hereby certifies that CEDE & CO., as nominee of The Depository Trust Company, or registered assigns, IS THE OWNER OF __________ 1 Shares issued by iShares<sup>®</sup> Staked Ethereum Trust ETF (the "**Trust**"), each representing a fractional undivided beneficial interest in the net assets of the Trust, as provided in the Trust Agreement referred to below. The Administrative Trustee's Corporate Trust Office and its principal executive office are located at 400 Howard Street, San Francisco, CA 94105.

This Certificate is issued upon the terms and conditions set forth in the Amended and Restated Trust Agreement, dated as of February 5, 2026 (the "**Trust Agreement**"), among iShares<sup>®</sup> Delaware Trust Sponsor LLC (the "**Sponsor**"), the Administrative Trustee, and Wilmington Trust, National Association, as Delaware Trustee. The Trust Agreement sets forth the rights of Registered Owners and the rights and duties of the Administrative Trustee and the Sponsor. Copies of the Trust Agreement are on file at the Administrative Trustee's Corporate Trust Office.

------

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

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

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

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| | |
|:---|:---|
| BLACKROCK FUND ADVISORS, as Administrative Trustee | BLACKROCK FUND ADVISORS, as Administrative Trustee |
| By: |  |
|  | Name: Shannon Ghia |
|  | Title: Managing Director |

---

THE ADMINISTRATIVE TRUSTEE'S CORPORATE TRUST OFFICE ADDRESS IS<br> 400 HOWARD STREET, SAN FRANCISCO, CA 94105

## Exhibit 4.2

**Exhibit 4.2**

**Authorized Participant Agreement**

This authorized participant agreement ("**Authorized Participant Agreement**" or "**Agreement**") dated as of [ ], 2026 among (i) [ ], a [ ] organized under the laws of [ ] (the "**Authorized Participant**"), (ii) BlackRock Fund Advisors, a California corporation acting in its capacity as administrative trustee (in such capacity, the "**Administrative Trustee**") of the iShares® Staked Ethereum Trust ETF (the "**Trust**"), a Delaware statutory trust organized and governed by the provisions of the Trust Agreement (as may be amended, modified, supplemented and restated from time to time, the "**Trust Agreement**") dated as of [ ], 2026 among the Administrative Trustee, iShares Delaware Trust Sponsor LLC, a Delaware limited liability company acting in its capacity as sponsor of the Trust (in such capacity, the "**Sponsor**") and Wilmington Trust, National Association acting in its capacity as Delaware trustee of the Trust (in such capacity, the "**Delaware Trustee**"), and (iii) the Sponsor.

RECITALS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Pursuant to the provisions of the Trust Agreement, the Trust may from time to time issue or redeem equity securities representing an interest in the assets of the Trust ()"**Shares** "), in each case only in an aggregation of a specified number of Shares (such aggregated amount, as the same may be amended or modified from time to time pursuant to the provisions of the Trust Agreement, a "**Basket** "), and integral multiples thereof, and only in transactions with parties who, at the time of the transaction, shall have a signed and effective authorized participant agreement with the Trust.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. [AP NAME] has requested to become an "Authorized Participant" with respect to the Trust (as such term is defined in the Trust Agreement), and the Sponsor and the Administrative Trustee have agreed to such request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. The Authorized Participant may place Purchase Orders and Redemption Orders (as defined in the Procedures) on its own behalf or on behalf of one or more third parties, which may be affiliates, who have entered into agreements or arrangements with such Authorized Participant (any such third party, an "**Authorized Participant Client**") pursuant to which the Authorized Participant or Authorized Participant Client shall source, deliver and/or receive digital assets (but not Shares) in connection with Purchase Orders and Redemption Orders placed by the Authorized Participant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. If the Authorized Participant has designated an Authorized Participant Client, then where the Authorized Participant is under an obligation to deliver, receive or otherwise transfer digital assets under this Agreement (including pursuant to any provisions of any schedule or attachment hereto), that obligation shall be performed by its Authorized Participant Client. The Authorized Participant shall be liable to the Trust for any failure of the Authorized Participant Client to deliver or transfer digital assets to the Trust as required by this Agreement, subject to the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;E. If the Purchase Order or Redemption Order is for cash, the cash shall be delivered by the Authorized Participant to the Trust for a Purchase Order and to the Authorized Participant by the Trust for a Redemption Order (as defined herein). In addition, the Authorized Participant shall ensure that its Authorized Participant Client complies with any representation, warranty or covenant relating to the delivery, receipt or transfer of digital assets and/or cash required to be made hereunder. For the avoidance of doubt and notwithstanding anything else herein to the contrary, the Authorized Participant shall be fully liable for any failure of any Authorized Participant Client to perform such obligation or make such representation, warranty or covenant and no Authorized Participant Client shall receive any fees or other form of compensation from the Sponsor or the Trust hereunder.

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**NOW, THEREFORE,** in consideration of the foregoing premises, and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties, hereto, intending to be legally bound, agree as follows:

Section 1. <u>Procedures</u>. The Authorized Participant will purchase or redeem Baskets of the Trust in compliance with the Trust Agreement as supplemented by the Purchase and Redemption Procedures attached to this Agreement as Schedule 1 (such procedures, as the same may be amended or modified from time to time in compliance with the provisions hereof and thereof, the "**Procedures**"), using such forms as shall be adopted from time to time by the Administrative Trustee to purchase one or more Baskets (a "**Purchase Order**"), or to redeem one or more Baskets (a "**Redemption Order**"). All Purchase Orders and Redemption Orders (collectively, "**Orders**") shall be placed and executed in accordance with the Trust Agreement as supplemented by the Procedures.

Section 2. <u>Incorporation of Standard Terms</u>. The Standard Terms attached hereto as Schedule 2 are hereby incorporated by reference into, and made a part of, this Agreement.

Section 3. <u>Conflicts Rules</u>. In case of any inconsistency between the provisions of this Agreement and the Trust Agreement, the provisions of the Trust Agreement shall control. In case of inconsistency between the provisions incorporated by reference into this Agreement pursuant to Section 2 above and any other provision of this Agreement, the latter will control.

Section 4. <u>Authorized Representatives</u>. Pursuant to Section 2.01 of the Standard Terms, attached hereto as Schedule 3 is a certificate listing the Authorized Representatives of the Authorized Participant.

Section 5. <u>Notices</u>. Except as otherwise specifically provided in the Procedures, all notices required or permitted to be given pursuant hereto shall be given in writing and delivered by personal delivery or by postage prepaid registered or certified United States first class mail, return receipt requested, or by telex, telegram, facsimile, email, or similar means of same day delivery (with a confirming copy by mail) addressed as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If to the Administrative Trustee:

BlackRock Fund Advisors

400 Howard Street

San Francisco, CA 94105

Attn: Legal Department

Telephone: (415) 670-2860

Facsimile: (415) 618-5731

Email: groupisharesetfslegalus@blackrock.com

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If to the Sponsor:

iShares Delaware Trust Sponsor LLC

400 Howard Street

San Francisco, CA 94105

Attn: iShares Product Management Team

Telephone: (415) 670-4671

Facsimile: (415) 618-5097

------

With a copy to:

BlackRock Fund Advisors

400 Howard Street

San Francisco, CA 94105

Attn: Legal Department

Telephone: (415) 670-2860

Facsimile: (415) 618-5731

Email: groupisharesetfslegalus@blackrock.com

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If to the Authorized Participant:

[ ]

Address: [ ]

Attn: [ ]

Electronic Mail: [ ]

Telephone: [ ]

Facsimile: [ ]

or to such other address as any of the parties hereto shall have communicated in writing to the remaining parties in compliance with the provisions hereof.

Section 6. <u>Effectiveness, Termination and Amendment</u>. This Agreement shall become effective, upon execution and delivery by each of the parties hereto. This Agreement may be terminated at any time by any party upon sixty days prior written notice to the other parties and may be terminated earlier by the Administrative Trustee or the Sponsor at any time in the event of a breach by the Authorized Participant of any provision of this Agreement (including the Standard Terms incorporated by Section 2 hereof) or the Procedures. This Agreement supersedes any prior agreement between or among the parties concerning the matters governed hereby. This Agreement may be amended by the Administrative Trustee and the Sponsor from time to time without the consent of the Authorized Participant, or any person on whose behalf the Authorized Participant holds Shares, by the following procedure: the Administrative Trustee or the Sponsor will mail a copy of the amendment to the Authorized Participant in compliance with the notice provisions of this Agreement; if the Authorized Participant does not object in writing to the amendment within ten (10) Business Days after receipt of the proposed amendment, the amendment will become part of this Agreement in accordance with its terms.

Section 7. <u>Governing Law</u>. This Agreement shall be governed by and interpreted in accordance with the laws of the State of New York without reference to the conflicts of law provisions thereof. The parties irrevocably submit to the non-exclusive jurisdiction of any New York State of United States Federal court sitting in New York City over any suit, action or proceeding arising out of, or relating to, this Agreement.

Section 8. <u>Assignment</u>. No party to this Agreement shall assign any rights, or delegate the performance of any obligations, arising hereunder without the prior written consent of the other parties hereto, except that an Authorized Participant may designate an Authorized Participant Client as provided herein; and further *provided* that (i) any party hereto which may be merged or converted, or with which it may be consolidated, or any entity resulting from any merger, consolidation or conversion to which a party hereunder shall be a party, shall be the successor of such party hereto, and (ii) each of the Administrative Trustee and the Sponsor may (A) assign this Agreement, in whole but not in part, to an affiliate that succeeds to such party's duties under the Trust Agreement upon notice to the other parties or (B) may delegate any portion of its duties or functions hereunder, if any, for so long as it remains responsible therefor. Any purported assignment or delegation in violation of these provisions shall be null and void. Notwithstanding the foregoing, any successor Administrative Trustee appointed in compliance with the Trust Agreement shall automatically become a party hereto and shall assume all the obligations and be entitled to all the rights and remedies of the Administrative Trustee hereunder.

Section 9. <u>Signatures and Counterparts</u>. This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Facsimile, PDF or electronic image file signatures to this Agreement shall be acceptable and binding.

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**IN WITNESS WHEREOF,** the parties hereto have executed this Authorized Participant Agreement as of the date set forth above.

**BLACKROCK FUND ADVISORS**, in its capacity as Administrative Trustee of the iShares<sup>®</sup> Staked Ethereum Trust ETF<br>

By:   <br> Name: <br> Title:

**iSHARES**<sup>®</sup> **DELAWARE TRUST SPONSOR LLC**, in its capacity<br> as Sponsor of the iShares<sup>®</sup> Staked Ethereum Trust ETF<br>

By:   <br> Name: <br> Title:

**[AUTHORIZED PARTICIPANT]**<br>

By:   <br> Name: <br> Title:

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**Schedule 1**

**Purchase and Redemption Procedures**

**iShares Staked Ethereum Trust ETF**

ARTICLE I

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

Section 1.01. <u>Definitions.</u> For purposes of these Procedures, unless the context otherwise requires, the following terms will have the following meanings:

"**Administrative Trustee**" shall mean BlackRock Fund Advisors, a California corporation, in its capacity as administrative trustee under the Trust Agreement, and any successor thereto in compliance with the provisions thereof.

"**AP Cash Account**" shall mean an account at a commercial bank in the U.S. designated in writing by the Authorized Participant to receive or transfer the cash related to Orders.

"**Authorized Participant**" shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement.

"**Authorized Participant Agreement**" shall mean, with respect to an Authorized Participant, such Authorized Participant's Authorized Participant Agreement with the Administrative Trustee and the Sponsor.

"**Authorized Participant Client**" has the meaning given in the recitals to this Agreement.

"**Authorized Representative**" shall mean, with respect to an Authorized Participant, each individual who, pursuant to the provisions of its Authorized Participant Agreement, has the power and authority to act on behalf of the Authorized Participant in connection with the placement of Purchase Orders or Redemption Orders and is in possession of the personal identification number (PIN) assigned by the Administrative Trustee for use in any communications regarding Purchase Orders or Redemption Orders on behalf of such Authorized Participant.

"**Basket**" shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement.

"**Basket Ether Amount**" shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement.

"**BRIL**" shall mean BlackRock Investments, LLC. Under an ETF Services Agreement, the Trust has retained BRIL, an affiliate of the Administrative Trustee, to perform certain order processing and other services with respect to the issuance and distribution of Baskets of the Trust.

"**Business Day**" shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement.

"**Cash Account**" shall mean an account established for the Trust with the Cash Custodian for use related to the Cash Component and Cash Amount of a cash Purchase Order or Redemption Order.

**"Cash Amount**" shall mean an amount of cash sufficient to pay any applicable transaction fee, redemption fee and any additional fixed and/or variable charges applicable to Purchase Orders or Redemption Orders effected fully in cash (when, in the sole discretion of the Administrative Trustee, cash transactions are available, specified or alternatively necessary), in each case, as disclosed in the Prospectus.

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"**Cash Component**" shall mean, in the case of a cash Purchase Order or Redemption Order, an amount of cash equal to the Basket Ether Amount.

"**Cash Custodian**" shall mean The Bank of New York Mellon, or any successor thereto in its capacity as the cash custodian for the Trust.

"**Delivery**" **or** "**Deliver**" **(or** "**Delivered**"**)** shall mean (a) when used with respect to ether, (i) in the case of a Purchase Order, a deposit of spot ether from the relevant Digital Wallet into the Trust's Trading Account that meets the requirements for an effective transfer, and (ii) in the case of a redemption, a transfer of spot ether from the Trust's Trading Account to the relevant Digital Wallet, (b) when used with respect to Shares, either (i) one or more book-entry transfers of those Shares to an account or accounts at DTC designated by the person entitled to such delivery for further credit as specified by that person or (ii) in the circumstances specified in Section 2.4(e) of the Trust Agreement, execution and delivery at the Corporate Trust Office of the Administrative Trustee of one or more Certificates evidencing those Shares, and (c) when used with respect to cash (which shall be U.S. dollars), (i) in the case of a cash Purchase Order, a wire-transfer from the AP Cash Account to the Trust's Cash Account, and (ii) in the case of a Redemption Order, a wire transfer from the Trust's Cash Account to the AP Cash Account.

"**Deposit Property**" means property, and, if applicable, a Cash Component, which, in compliance with the provisions of the Trust Agreement, must be transferred by the Authorized Participant or the Authorized Participant Client, to the Trust in exchange for Shares.

"**Digital Wallet**" shall mean an account maintained by the Prime Execution Agent, or a hosted digital wallet that is maintained by the Prime Execution Agent in connection with an account, that is owned by an Authorized Participant or an Authorized Participant Client. Only an account or a hosted digital wallet that is maintained by the Prime Execution Agent, and that is owned by an Authorized Participant or an Authorized Participant Client shall constitute a Digital Wallet for purposes of this Agreement. 

"**DTC**" shall mean The Depository Trust Company, or its successor.

"**ether**" shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement.

"**Ether Custodian**" shall mean Coinbase Custody Trust Company, LLC, in its capacity as ether custodian for the Trust pursuant to the Coinbase Custodial Services Agreement or other entity with which the Trust shall have entered into an agreement for the custody of the Trust's property; *provided,* that if there is more than one Ether or Cash Custodian at any time, a reference in these Procedures to "the Custodian" in connection with a particular Purchase Order or Redemption Order shall be to such Ether or Cash Custodian as the Administrative Trustee shall have designated for purposes of such Purchase Order or Redemption Order.

"**Ether Custodian Agreement**" shall mean, as of any date, the Coinbase Custodial Services Agreement at the time in effect between the Trust and the Ether Custodian.

"**Ethereum Staking Liquidity Risk Policy**" shall mean the staking liquidity policy by which the Sponsor monitors and manages liquidity risks.

"**Liquidity Sleeve**" shall mean the allocation of ether that is not staked and held by the Trust's Ether Custodian to meet anticipated redemption activity, as prescribed by the Ethereum Staking Liquidity Risk Policy.

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"**Order Cutoff Time**" shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement.

"**Order Date**" shall have, (i) with respect to a Purchase Order, the meaning ascribed to the term in Section 2.6 of the Trust Agreement; and (ii) with respect to a Redemption Order, the meaning ascribed to the term in Section 2.9 of the Trust Agreement.

"**Prime Execution Agent**" shall mean Coinbase, Inc., an affiliate of the Ether Custodian.

"**Prime Execution Agent Agreement**" shall mean the Coinbase Prime Execution Agent agreement between the Sponsor, Administrative Trustee and the Prime Execution Agent.

"**Procedures**" shall mean these Purchase and Redemption Procedures, as may be amended from time to time.

"**Purchase and Redemption Line**" shall mean a telephone number designated as such by the Administrative Trustee and communicated to each Authorized Participant in compliance with the notice provisions of the respective Authorized Participant Agreement.

"**Purchase Order**" shall mean an order to purchase one or more Baskets in the form from time to time adopted by the Administrative Trustee.

"**Redemption Order**" shall mean an order to redeem one or more Baskets in the form from time to time adopted by the Administrative Trustee.

"**Redemption Property**" means property, and, if applicable, a Cash Component, which, in compliance with the provisions of the Trust Agreement, must be transferred by the Trust to the Authorized Participant or the Authorized Participant Client in exchange for Shares.

"**Shares**" **s**hall mean units of fractional undivided beneficial interest in the net assets of the Trust.

"**Sponsor**" shall mean iShares Delaware Trust Sponsor LLC, a Delaware limited liability company, in its capacity as sponsor of the Trust, and any successor thereto in such capacity.

"**Staking**" **or** "**Staked**" **or** means using, or permitting to be used, in any manner, directly or indirectly, through an agent or otherwise (including, for the avoidance of doubt, through a delegation of rights to any third party by making any portion of the ether held in the Trust available to any third party or by entering into any similar arrangement with a third party), any portion of the Trust's assets in a proof-of-stake validation protocol. For the avoidance of doubt, the mere act of transferring units of virtual currency on a peer-to-peer virtual currency network that utilizes a proof-of-stake validation protocol shall not be considered to be "Staking" nor shall such transferred units be considered "Staked".

"**Trading Account**" shall mean an account established for the Trust with the Prime Execution Agent for use for the ether related to Purchase Orders and Redemption Orders.

"**Transaction Fee**" shall mean, as of any date, the transaction fee at the time in effect pursuant to Section 5.12 of the Trust Agreement.

"**Trust**" shall mean the iShares® Staked Ethereum Trust ETF, a trust governed by the provisions of the Trust Agreement.

"**Trust Administrator**" shall mean The Bank of New York Mellon, or any successor thereto in its capacity as the trust administrator for the Trust.

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"**Trust Agreement**" shall have the meaning set forth in this Authorized Participant Agreement.

"**VAT**" shall mean (a) any tax imposed pursuant to or in compliance with the Sixth Directive of the Council of the European Economic Communities (77/388/EEC) or the Council Directive of 28 November 2006 on the common system of value added tax (EC Directive 2006/112) (as amended) and any national legislation implementing that Directive or any predecessor to it or supplemental to that Directive including, in relation to the United Kingdom, value added tax imposed by the Value Added Tax Act 1994 and legislation and regulations supplemental thereto; and (b) any other tax of a similar nature (including any sales taxes or similar taxes), whether imposed in a member state of the European Union or elsewhere, in substitution for, or levied in addition to, such tax referred to in "(a)".

Section 1.02. <u>Interpretation</u>. In these Procedures:

Unless otherwise indicated, all references to Sections, clauses, paragraphs, schedules or exhibits, are to Sections, clauses, paragraphs, schedules or exhibits in or to these Procedures.

The words "hereof", "herein", "hereunder" and words of similar import shall refer to these Procedures as a whole, and not to any individual provision in which such words may appear.

A reference to any statute, law, decree, rule, regulation or other applicable norm shall be construed as a reference to such statute, law, decree, rule, regulation or other applicable norm as re-enacted, re-designated or amended from time to time.

A reference to any agreement, instrument or document shall be construed as a reference to such agreement, instrument or document as the same may have been amended from time to time in compliance with the provisions thereof.

Section 1.03. <u>Conflicts</u>. In case of conflict between any provision of these Procedures and the terms of the Trust Agreement, the terms of the Trust Agreement shall control.

ARTICLE II

PURCHASE PROCEDURES

Section 2.01. <u>Purchase Orders</u>. The issuance and Delivery of Shares shall take place only in integral numbers of Baskets in compliance with the following rules:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. General. To effect a Purchase Order, the Authorized Participant agrees to deliver to the Trust the Deposit Property, plus any applicable Cash Amount. Authorized Participants wishing to acquire from the Administrative Trustee one or more Baskets (whether on its own behalf, or acting as agent for an Authorized Participant Client) shall place a Purchase Order with BRIL on any Business Day; provided, however, that only Purchase Orders received by BRIL prior to the Order Cutoff Time on a Business Day shall have such Business Day as the Order Date unless there is an early Order Cutoff Time on the business day prior to the trade date. When using such an early Order Cutoff Time, the Order Date shall be the business day following the date the Order is received by BRIL prior to the Order Cutoff Time on a Business Day. Purchase Orders received by BRIL on or after the Order Cutoff Time on a Business Day (except as otherwise provided in Section 2.01(c)(ii)) will not be accepted. A new Purchase Order may be submitted in accordance with these Procedures. Appendix B to Schedule 1 includes more details on the operational steps and costs associated with in-kind orders.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Cash-in-Lieu. The Administrative Trustee may, in its sole discretion, permit or require the substitution of an amount of cash to be added to the Cash Component to replace all ether that the Authorized Participant Client would otherwise have had to Deliver in connection with a Purchase Order. The Administrative Trustee may suspend the ability of the Authorized Participant to engage in cash in lieu transactions with respect to the Trust at any time, without prior notice. The Authorized Participant shall be responsible for any and all expenses and costs incurred by the Trust, including all Cash Amounts, in connection with any Purchase Orders. Appendix A to Schedule 1 includes more details on the operational steps and costs associated with such cash-in-lieu orders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. For purposes of paragraph "a" and "b" above, a Purchase Order shall be deemed "received" by the Administrative Trustee only when each of the following has occurred:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) An Authorized Representative shall have placed a telephone call to the Administrative Trustee's Purchase and Redemption Line informing the Administrative Trustee that the Authorized Participant wishes to place a Purchase Order for a specified number of Baskets, or entered a Purchase Order through BRIL's electronic order entry system, as such may be available and constituted from time to time (the use of which shall be subject to the applicable order entry system terms and conditions), informing the Administrative Trustee that the Authorized Participant wishes to place a Purchase Order for a specified number of Baskets. If the Authorized Participant wishes to settle a Purchase Order in a time frame other than the first Business Day following the Order Date (*i.e*., T + 1), such request must be made to the Administrative Trustee upon placement of the Purchase Order and must be approved by the Administrative Trustee in its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Within one hour following such telephone call, the Administrative Trustee shall have received, via electronic mail message, a duly completed, irrevocable Purchase Order executed by an Authorized Representative of such Authorized Participant (which Purchase Order may be received after the Order Cutoff Time if such telephone call was made prior to the Order Cutoff Time).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Should BRIL elect to accept the Purchase Order, it shall communicate its decision by sending to the Authorized Participant, via facsimile or electronic mail message, no later than 4:30 pm (New York time) on the Order Date for such Purchase Order a copy of the corresponding Purchase Order endorsed "Accepted" by BRIL and shall communicate to the Authorized Participant, via electronic mail message, no later than 7:30 p.m. (New York time) on such Order Date the Basket Ether Amount that the Authorized Participant Client shall Deliver to the Trust's Trading Account at the Prime Execution Agent in respect of each Basket or, if applicable, the Cash Component and estimated Cash Amount that the Authorized Participant shall Deliver to the Trust's Account at the Cash Custodian designated by the Administrative Trustee for each Basket. For Purchase Orders submitted via BRIL's electronic order entry system which BRIL has elected to accept, the Authorized Participant will receive an automated electronic mail message indicating the acceptance of the Purchase Order and indicating the Basket Ether Amount that the Authorized Participant Client shall Deliver to the Trust's Trading Account at the Prime Execution Agent in respect of each Basket or, if applicable, the Cash Component and estimated Cash Amount that the Authorized Participant shall Deliver to the Trust's Account at the Cash Custodian designated by the Administrative Trustee for each Basket, and the Purchase Order will be marked "Accepted" in BRIL's electronic order entry system. Prior to the transmission of BRIL's acceptance as specified above, a Purchase Order will only represent the Authorized Participant Client's unilateral offer to deposit ether and/or cash, if applicable, in exchange for Baskets and will have no binding effect upon the Trust, the Administrative Trustee, BRIL, the Ether Custodian, the Cash Custodian, Prime Execution Agent or any other party.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e. The Basket Ether Amount, if applicable, corresponding to each Basket must be Delivered to the Trust's Trading Account at the Prime Execution Agent from a Digital Wallet, no later than 1:30 p.m. (New York time) on the settlement date of the Purchase Order, which shall be the first Business Day following the Order Date unless prior approval for an alternate settlement has been granted by the Administrative Trustee in its sole discretion. The Cash Component and estimated Cash Amount, if applicable, corresponding to each Basket must be Delivered to the Trust's Cash Account at the Cash Custodian, no later than 1:30 p.m. (New York time) on the settlement date of the Purchase Order, which shall be the first Business Day following the Order Date unless prior approval for an alternate settlement has been granted by the Administrative Trustee in its sole discretion. The Authorized Participant acknowledges and agrees (on behalf of itself and its Authorized Participant Client) that it (and its Authorized Participant Client) is responsible for confirming the accuracy of the Trust's Trading Account information (including, if applicable, any associated blockchain address or other information) in connection with any Delivery to the Trust's Trading Account and the Trust's Cash Account information in connection with any Delivery to the Trust's Cash Account; and it (or its Authorized Participant Client) is responsible for and bears the risk of loss for all ether transferred in any Delivery to the Trust's Trading Account until such ether is credited to the Trust's Trading Account by the Prime Execution Agent, and neither the Trust, the Sponsor, BRIL, nor the Administrative Trustee is responsible or liable to the Authorized Participant or an Authorized Participant Client in connection therewith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f. Ether that has been Delivered to the Prime Execution Agent no later than 1:30 p.m. (New York time) on a Business Day shall be allocated by the Prime Execution Agent to the Trust's Trading Account no later than 2:00 p.m. (New York time) on the date of such Delivery. Where ether is Delivered to the Trading Account after 1:30 p.m. (New York time) on a Business Day, the Prime Execution Agent (i) will use its commercially reasonable efforts to allocate such ether to the Trust's Trading Account no later than 2:00 p.m. (New York time) on the date of such Delivery, and (ii) will allocate such ether to the Trust's Trading Account no later than 2:00 p.m. (New York time) on the next Business Day following the date of such Delivery.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g. The Prime Execution Agent shall allocate ether to the Trust's Trading Account by (i) making entries in the Prime Execution Agent's books and records to identify such ether as being held for the Trust and (ii) sending to the Administrative Trustee and BRIL, via electronic message, a confirmation of the allocation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h. On the first Business Day following the Order Date corresponding to a Purchase Order, or on such earlier date as the Administrative Trustee in its discretion may agree, the Trust Administrator shall issue the aggregate number of Shares corresponding to the Baskets ordered by the Authorized Participant and Deliver them, by credit to the account at DTC which the Authorized Participant shall have identified for such purpose in its Purchase Order, provided that, by 3:00 p.m. (New York time) on the date such issuance and Delivery is to take place:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) BRIL shall have received from the Authorized Participant the applicable Transaction Fee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Authorized Participant shall have agreed to pay, or reimburse the Cash Custodian, the Ether Custodian, the Prime Execution Agent, the Administrative Trustee or the Trust for the amount of any applicable taxes (including VAT) which are or become due in connection with the Delivery of ether to the Ether Custodian or cash to the Cash Custodian;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) In situations where a Cash Amount and/or a Cash Component will be applied to a Purchase Order, the Authorized Participant hereby agrees it will transfer funds for each purchase of Shares in an amount equal to the Cash Amount and/or Cash Component, as applicable. Computation of this amount shall exclude any stamp duty and other similar fees and expenses payable upon the transfer of beneficial ownership of the Basket, which shall be the sole responsibility of the Authorized Participant and not of the Trust. The Authorized Participant hereby agrees to deliver the Cash Amount and/or Cash Component to the Trust on or before the first Business Day following the Order Date of the Purchase or such earlier time as may be designated by the Administrative Trustee; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any other conditions to the issuance under the Trust Agreement shall have been satisfied.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. In the event the conditions in paragraph "h" above are not met, the Authorized Participant shall consult with the Sponsor to determine the ongoing status of the Purchase Order, and the Trust Administrator shall issue the aggregate number of Shares corresponding to the Baskets ordered by the Authorized Participant and Deliver them by credit to the account at DTC which the Authorized Participant shall have identified for such purpose in its Purchase Order on the Business Day following the date on which the conditions set forth in clauses (i) to (iv) of paragraph "h" above shall have been met.

ARTICLE III

REDEMPTION PROCEDURES

Section 3.01. <u>Redemption Orders</u>. Redemption of Shares shall take place only in integral numbers of Baskets in compliance with the following rules:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. General. To effect the Redemption Order, the Authorized Participant agrees to deliver to the Trust, the requisite number of Shares comprising the number of Baskets being redeemed plus any applicable Cash Amount and/or Cash Component. Proceeds of a Redemption Order shall consist of Redemption Property, less any applicable Cash Amount. Authorized Participants wishing to redeem one or more Baskets (whether as principal or on an agency basis on behalf of an Authorized Participant Client) shall place a Redemption Order with BRIL on any Business Day; provided, however, that only Redemption Orders received by BRIL prior to the Order Cutoff Time on a Business Day shall have such Business Day as the Order Date unless there is an early Order Cutoff Time on the business day prior to the trade date. When using such an early Order Cutoff Time, the Order Date shall be the business day following the date the Order is received by BRIL prior to the Order Cutoff Time on a Business Day. Redemption Orders received by the Administrative Trustee on or after the Order Cutoff Time on any Business Day (except as otherwise provided in Section 3.01(c)(ii)) will not be accepted. A new Redemption Order may be submitted in accordance with these Procedures. Redemption Orders shall not be accepted if redemptions have been suspended in accordance with the Trust Agreement. Appendix B to Schedule 1 includes more details on the operational steps and costs associated with in-kind orders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Cash-in-Lieu. The Administrative Trustee may, in its sole discretion, permit or require the substitution of an amount of cash to be added to the Cash Component to replace all of the ether that the Trust would otherwise have had to Deliver in connection with a Redemption Order. The Administrative Trustee may suspend the ability of the Authorized Participant to engage in cash in lieu transactions with respect to the Trust at any time, without prior notice. The Authorized Participant shall be responsible for any and all expenses and costs incurred by the Trust, including all Cash Amounts, in connection with any Redemption Orders. Appendix A to Schedule 1 includes more details on the operational steps and costs associated with such cash-in- lieu orders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. Delayed Settlement Scenarios. In the event in-kind Redemption Orders placed during a certain order window cause the Liquidity Sleeve to fall below a certain level (each a "Reduced Buffer Scenario"), the Administrative Trustee may, in its sole discretion, require cash-in-lieu Redemption Orders until the Liquidity Sleeve has been restored. In the event in-kind Redemption Orders placed during a certain order window exhaust the Liquidity Sleeve (each a "Delayed Settlement Scenario"), settlement of Redemption Orders will be conducted in accordance with the section titled Delayed Settlement Scenarios in Appendix A herein, as it relates to cash Redemption Orders, and Appendix B herein, as it relates to in-kind Redemption Orders. The Authorized Participant acknowledges and agrees that the Prospectus, as amended or supplemented from time to time, governs all matters relating to the Delayed Settlement Scenario. To the extent any term of this Agreement, Appendix A, or Appendix B, as it relates to Delayed Settlement Scenarios, is inconsistent with the Prospectus, the Prospectus shall control, and the Authorized Participant shall act in accordance with the Prospectus.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. For purposes of paragraph "a", "b", and "c" above, a Redemption Order shall be deemed "received" by the Administrative Trustee only when each of the following has occurred:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) An Authorized Representative shall have placed a telephone call to the Administrative Trustee's Purchase and Redemption Line informing the Administrative Trustee that the Authorized Participant wishes to place a Redemption Order for a specified number of Baskets, or entered a Redemption Order through BRIL's electronic order entry system, as such may be available and constituted from time to time (the use of which shall be subject to the applicable order entry system terms and conditions attached hereto as Annex A). If the Authorized Participant wishes to settle a Redemption Order in a time frame other than the first Business Day following the Order Date (*i.e*., T + 1), such request must be made to the Administrative Trustee upon placement of the Redemption Order and must be approved by the Administrative Trustee in its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Within one hour following such telephone call, the Administrative Trustee shall have received, via electronic mail message, a duly completed, irrevocable Redemption Order executed by an Authorized Representative of such Authorized Participant (which Redemption Order may be received after the Order Cutoff Time if such telephone call was made prior to the Order Cutoff Time).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Should BRIL elect to accept such Redemption Order, it shall communicate its decision to the Authorized Participant by sending to the Authorized Participant, via facsimile or electronic mail message, no later than 4:30 p.m. (New York time) on the Order Date for such Redemption Order a copy of the corresponding Redemption Order endorsed "Accepted" by BRIL and shall communicate to the Authorized Participant, via electronic mail message, no later than 7:30 p.m. (New York time) on such Order Date, the Basket Ether Amount that the Prime Execution Agent shall Deliver to the Digital Wallet of the Authorized Participant Client in respect of each Basket being redeemed or, if applicable, the Cash Component minus the estimated Cash Amount that the Cash Custodian shall Deliver to the Authorized Participant at its bank in accordance with settlement instructions it shall provide for a cash Redemption Order ("**AP Cash Account**"). For Redemption Orders submitted via BRIL's electronic order entry system that BRIL elects to accept, the Authorized Participant will receive an automated electronic mail message indicating the acceptance of the Redemption Order and indicating the Basket Ether Amount that the Prime Execution Agent shall Deliver to the Digital Wallet of the Authorized Participant Client or, if applicable, the Cash Component minus the Cash Amount that the Cash Custodian shall Deliver to the AP Cash Account for the Authorized Participant in respect of each Basket, and the Redemption Order will be marked "Accepted" in the Administrative Trustee's electronic order entry system.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e. Provided that, by 2:00 p.m. (New York time) on the first Business Day following the Order Date of a Redemption Order, the Administrative Trustee shall have confirmed in writing or by electronic communication to the Prime Execution Agent, the Ether Custodian and, if applicable, the Cash Custodian that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Authorized Participant has Delivered to the Administrative Trustee's account at DTC the total number of Shares to be redeemed by such Authorized Participant pursuant to such Redemption Order;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) BRIL has received the corresponding Transaction Fee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Authorized Participant has agreed to pay, or reimburse the Ether Custodian, the Cash Custodian, the Prime Execution Agent, the Administrative Trustee or the Trust for the amount of any applicable taxes (including VAT) which are or becomes due in connection with the Delivery of ether or cash to the Authorized Participant or the Authorized Participant Client, as applicable;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) in situations where a Cash Amount and/or a Cash Component will be applied to a Redemption Order, the Authorized Participant hereby agrees that it will make available or transfer funds in an amount equal to the Cash Amount and/or Cash Component, as applicable. Computation of this amount shall exclude any stamp duty and other similar fees and expenses payable upon the transfer of beneficial ownership of the Redemption Property, which shall be the sole the responsibility of the Authorized Participant and not of the Trust. The Authorized Participant hereby agrees to ensure that the Cash Amount and/or Cash Component will be received by the Trust on or before the first Business Day following the Order Date or such earlier time as may be designated by the Administrative Trustee; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) any other conditions to the redemption under the Trust Agreement have been satisfied,

the Prime Execution Agent will, as applicable, on such day, in the amounts specified in the communication sent in compliance with paragraph "d" above: Deliver ether to the redeeming Authorized Participant Client, by crediting the appropriate Digital Wallet at the Prime Execution Agent indicated by the redeeming Authorized Participant in its Redemption Order or, if applicable, the Cash Custodian will Deliver cash to the AP Cash Account for the Authorized Participant. Having made such Delivery, the Prime Execution Agent will send written confirmation thereof to the Administrative Trustee and Trust Administrator who will then cancel the Shares so redeemed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f. In the event the conditions in paragraph "e" above are not met, Delivery must be completed by the Prime Execution Agent as soon as, in the reasonable judgment of the Prime Execution Agent, it is practicable following receipt of written confirmation from the Administrative Trustee as described in clauses "i" to "v" of paragraph "e" above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g. The foregoing provisions notwithstanding, the Prime Execution Agent shall not be liable for delays, suspension of operations, whether temporary or permanent, failure in making Delivery of ether in respect of a Redemption, or interruption of service in each case to the extent it is directly due to a cause or condition beyond the reasonable control of the Prime Execution Agent, including any act of God; embargo natural disaster; act of civil or military authorities; act of terrorists; hacking (provided that the Prime Execution Agent has taken reasonable precautions and acts in a manner consistent with its applicable policies and procedures with respect to hacking risks and in doing so is not negligent); government prohibitions; civil disturbance; war, strike or other labor dispute; fire; severe weather; interruption in telecommunications, Internet services, or network provider services; unavailability of Fedwire, SWIFT or banks' payment processes; outbreaks of infectious disease or any other public health crises, including quarantine or other required employee restrictions; or any other catastrophe or material event which is beyond the reasonable control of the Prime Execution Agent. For the avoidance of doubt, a cybersecurity attack, hack or other intrusion by a third-party or by someone associated with the Prime Execution Agent is not a circumstance that is beyond the Prime Execution Agent's reasonable control, to the extent directly caused by the Prime Execution Agent's failure to comply with its obligations under the agreement between the Sponsor, Administrative Trustee and the Prime Execution Agent (the "**Prime Execution Agent Agreement**"). In any such event, the time for the Prime Execution Agent's performance shall be deferred for a period of time equal to the time lost by reason of such event, provided that the Prime Execution Agent shall notify the Administrative Trustee of such event and shall reasonably cooperate with the Administrative Trustee in minimizing any adverse impact of such event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h. In the event that, by 2:00 p.m. (New York time) on the first Business Day following the Order Date of a Redemption Order the Administrative Trustee's account at DTC shall not have been credited with the total number of Shares corresponding to the total number of Baskets to be redeemed pursuant to such Redemption Order, the Administrative Trustee will cancel such Redemption Order and will send via electronic mail message notice of such cancellation to the respective Authorized Participant, the Prime Execution Agent, the Ether Custodian and, if applicable, the Cash Custodian.

*[Signature Page Follows]*

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**IN WITNESS WHEREOF,** the Sponsor and the Administrative Trustee have executed these Purchase and Redemption Procedures as of the date set forth above.

**BLACKROCK FUND ADVISORS**, in its capacity as Administrative Trustee of the iShares<sup>®</sup> Staked Ethereum Trust ETF<br>

By:   <br> Name: <br> Title:

**iSHARES**<sup>®</sup> **DELAWARE TRUST SPONSOR LLC**, in its capacity as Sponsor of the iShares® Staked Ethereum Trust ETF<br>

By:   <br> Name: <br> Title:

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**Appendix A to Schedule 1**

**Additional Information Regarding Cash Purchase Orders and Redemption Orders**

**<u>Overview</u>.** The Authorized Participants will submit an Order to purchase or redeem Baskets exclusively in exchange for cash. In connection with such cash Order, the Trust will engage in ether transactions to convert cash into ether (in association with Purchase Orders) and ether into cash (in association with Redemption Orders). The Trust will conduct its ether purchase and sale transactions by, in its sole discretion, choosing to trade:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ directly with ether trading counterparties, pursuant to written agreements between each such Ether Trading Counterparty and the Trust)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ "**Ether Trading Counterparty**" and "E **ther Trading Counterparties**" shall mean the designated third party the Trust conducts its ether purchase and sale transactions with pursuant to written agreements between each such Ether Trading Counterparty and the Trust.

● Ether Trading Counterparties settle trades with the Trust using their own accounts at the Prime Execution Agent when trading with the Trust), or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ through the Prime Execution Agent acting in an agency capacity with third parties through its Coinbase Prime service pursuant to the Prime Execution Agent Agreement.

● As part of the Coinbase Prime service, Coinbase will execute orders for the Trust by facing liquidity sources such as exchanges, which can include Coinbase's own exchange, and other liquidity providers.

● Coinbase Prime orders can be either prefunded or financed, where financing is in the form of Trade Credits (as defined in the Prospectus) which are extinguished upon settlement.

**<u>Cash Purchase Orders</u>.** For the purchase of a Basket, the Authorized Participant may be required to submit the Purchase Order by an early order cutoff (the "**Purchase Early Cutoff Time**"), which may be as early as 6:00 p.m. ET on the business day prior to trade date. On the applicable order cutoff date for a Purchase Order, as disclosed in the Prospectus, the Trust will choose, in its sole discretion, to enter into a transaction with a Ether Trading Counterparty or the Prime Execution Agent to buy ether in exchange for the cash proceeds from such Purchase Order.

<u>Settlement for Purchase Order</u>

On settlement date, the Trust delivers Shares to the Authorized Participant in exchange for cash received from the Authorized Participant. Also, on or around the settlement date, the Ether Trading Counterparty or Prime Execution Agent, as applicable, deposits the required ether pursuant to its trade with the Trust into the Trust's Trading Account in exchange for cash.

In the event the Trust fails to successfully execute and complete settlement of an ether transaction by the settlement date, the Authorized Participant will be given the option to (1) cancel the Purchase Order, or (2) accept that the Trust will utilize another ether execution method which will delay the settlement date of the Purchase Order. At all times, the Authorized Participant is responsible for the dollar cost of the difference between the ether price utilized in calculating NAV per Share on trade date and the price at which the Trust acquires the ether to the extent the price realized in buying the ether is higher than the ether price utilized in the NAV. To the extent the price realized in buying the ether is lower than the price utilized in the NAV, the Authorized Participant shall get to keep the dollar impact of any such difference.

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<u>Delivery of Cash for Purchase Orders</u>

The Trust may require the Authorized Participant to deliver the required cash for the Purchase Order on trade date. The requirement to deliver cash on the trade date of the Purchase Order will be communicated to the Authorized Participant on the business day prior to trade date.

**<u>Cash Redemption Order</u>.** For the redemption of a Basket, the Authorized Participant may be required to submit the Redemption Order by an early order cutoff (the "**Redemption Early Cutoff Time**"), which may be as early as 6:00 p.m. ET on the business day prior to trade date. On the applicable order cutoff date for a Redemption Order, as disclosed in the Prospectus, the Trust may choose, in its sole discretion, to enter into a transaction with a Ether Trading Counterparty or the Prime Execution Agent to sell ether in exchange for cash. Also, on the applicable order cutoff date, the Trust instructs the Ether Custodian to prepare to move the associated ether from the Trust's Custody Account to the Trust's Trading Account.

**<u>Cash Redemption Orders during Delayed Settlement Scenarios</u>.** In the event there is a Delayed Settlement Scenario**,** for cash Redemption Orders, the Administrative Trustee will notify the Authorized Participant and provide the expected date the Redemption Order can be settled. Authorized Participants will be given the option to (1) cancel the Redemption Order or (2) modify the Redemption Order. The Authorized Participant must cancel or modify before the Delayed Redemption Order Cutoff Time, which will be (a) 9:00 a.m. ET one Business Day after the Redemption Order is received or (b) any other time agreed to by the Sponsor and the Administrative Trustee and of which all existing Authorized Participants have been previously notified by the Administrative Trustee. In the event the Authorized Participant fails to cancel or modify its Redemption Order by the Delayed Cash Order Cutoff Time, the Authorized Participant will be unable to adjust its Redemption Order. Notwithstanding the foregoing, the Authorized Participant will remain fully responsible for Delivering to the Administrative Trustee's account at DTC the total number of Shares to be redeemed by such Authorized Participant pursuant to its Redemption Order.

<u>Settlement for Redemption Order</u>

On the settlement date, the following occurs:

● The Authorized Participant delivers the necessary Shares to the Trust,

● An Ether Trading Counterparty or Prime Execution Agent, as applicable, delivers the cash (associated with the Trust's sale of ether) to the Trust in exchange for the Trust's ether, and

● The Trust delivers the cash to the Authorized Participant.

In the event the Trust fails to successfully execute and complete settlement of a ether transaction by the settlement date, the Authorized Participant will be given the option to (1) cancel the Redemption Order, or (2) accept that the Trust will utilize another ether execution method which will delay the settlement date. The Authorized Participant is responsible for the dollar cost of the difference between the ether price utilized in calculating NAV per Share on trade date and the price realized in the Trust selling the ether to raise the cash needed for the cash Redemption Order to the extent the price realized in selling the ether is lower than the ether price utilized in the NAV. To the extent the price realized in selling the ether is higher than the price utilized in the NAV, the Authorized Participant shall get to keep the dollar impact of any such difference.

Redemption Orders during Delayed Settlement Scenarios will be fulfilled by order date, pro rata. The Authorized Participant will receive either the amount specified in the Redemption Order or the modified amount specified before the Delayed Redemption Order Cutoff Time. Only once the Redemption Orders for a particular order date have been fully settled will the Trust begin fulfilling Redemption Orders for a subsequent order date.

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**Appendix B to Schedule 1**

**Additional Information Regarding In-Kind Creation and Redemption Orders**

**<u>Overview</u>.** The Authorized Participants will submit an Order to purchase or redeem Baskets exclusively in exchange for ether.

For the purchase of a Basket, the Authorized Participant will submit the Purchase Order by the In-Kind Order Cutoff Time (the "**In-Kind Order Cutoff Time**"), which will be (a) 3:59 p.m. ET on the trade date or (b) any other time agreed to by the Sponsor and the Administrative Trustee and of which all existing Authorized Participants have been previously notified by the Administrative Trustee, to create Baskets in exchange for ether.

<u>Settlement for Purchase Order</u>

On settlement date for an in-kind creation, the Trust delivers Shares to the Authorized Participant in exchange for ether received from the Authorized Participant or Authorized Participant Client. The Authorized Participant or Authorized Participant Client, as applicable, will deposit such ether to the Trust's Trading Account at the Prime Execution Agent.

In the event the Authorized Participant or Authorized Participant Client, has not deposited the ether to the Trust's Trading Account at the Prime Execution Agent by the applicable time specified in the Procedures on the settlement date of the in-kind creation order, the Authorized Participant will be given the option to (1) cancel the in-kind creation order, (2) delay settlement of the order to enable delivery of ether at a later date approved by the Sponsor or Administrative Trustee, or (3) accept that the Trust will execute a ether transaction required for the creation and the Authorized Participant will deliver the U.S. dollars required for this purchase. In the case of (3), the Authorized Participant is liable to the Trust for and shall bear all slippage costs as well as all other costs, expenses, liabilities, and losses, suffered or incurred by the Trust in connection with the events described in the foregoing sentence, including, without limitation, the dollar cost of the difference between the ether price utilized in calculating NAV per Share on trade date and the price at which the Trust acquires the ether to the extent the price realized in buying the ether is higher than the ether price utilized in the NAV, if applicable. To the extent the price realized in buying the ether is lower than the price utilized in the NAV, the Authorized Participant shall get to keep the dollar impact of any such difference.

**<u>In-Kind Redemption Orders during Delayed Settlement Scenarios</u>.** During a Delayed Settlement Scenario, Authorized Participants will be given the option to (1) cancel the Redemption Order, (2) modify the Redemption Order, or (3) replace the in-kind Redemption Order with a cash Redemption Order in the next cash order window. The Authorized Participant must cancel, modify, or choose to replace the Redemption Order before the Delayed In-Kind Order Cutoff Time, which will be (a) 5:00 p.m. ET on the trade date or (b) any other time agreed to by the Sponsor and the Administrative Trustee and of which all existing Authorized Participants have been previously notified by the Administrative Trustee. In the event the Authorized Participant fails to cancel, modify, or replace its Redemption Order by the Delayed In-Kind Order Cutoff Time, the Authorized Participant will be unable to adjust its Redemption Order. Notwithstanding the foregoing, the Authorized Participant will remain fully responsible for Delivering to the Administrative Trustee's account at DTC the total number of Shares to be redeemed by such Authorized Participant pursuant to its Redemption Order.

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<u>Settlement for Redemption Order</u>

On settlement date for an in-kind redemption, the Trust delivers ether to the account of the Authorized Participant Client at the Prime Execution Agent in exchange for Shares received from the Authorized Participant. In the event the Trust fails to successfully execute and complete settlement of an ether transaction by the settlement date, the Authorized Participant will be given the option to cancel the Redemption Order.

Redemption Orders during Delayed Settlement Scenarios will be fulfilled by order date. The Authorized Participant will receive either the amount specified in the Redemption Order or the modified amount specified before the Delayed Redemption Order Cutoff Time. The Administrative Trustee will settle the order date's Redemption Orders one business day after it has enough unstaked ether to fulfill all in-kind Redemption Orders for that date. Once Redemption Orders for a particular order date have been fully settled, the Administrative Trustee will begin fulfilling Redemption Orders for a subsequent order date.

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**Schedule 2**

**iShares**<sup>®</sup> **Staked Ethereum Trust ETF** 

**Standard Terms for Authorized Participant Agreements**

**Dated as of [ ], 2026**

**STANDARD TERMS FOR AUTHORIZED PARTICIPANT AGREEMENTS** (the "**Standard Terms**") agreed to as of [ ], 2026, by and between BlackRock Fund Advisors, a California corporation, and iShares Delaware Trust Sponsor LLC, a Delaware limited liability company.

ARTICLE I

ORDERS FOR PURCHASE AND REDEMPTION

Section 1.01. <u>Authorization to Purchase and Redeem Baskets</u>. Subject to the provisions of the Authorized Participant Agreement, during the term of the Authorized Participant Agreement, the Authorized Participant will be authorized to purchase and redeem Baskets of Shares in compliance with the provisions of the Trust Agreement."

Section 1.02. <u>Procedures for Orders</u>. Each party hereto agrees to comply with the provisions of the Trust Agreement and the Procedures to the extent applicable to it.

Section 1.03. <u>Consent to Recording</u>. The phone lines used by the Administrative Trustee, the Ether Custodian and the Cash Custodian or their affiliated persons may be recorded, and the Authorized Participant hereby consents to the recording of all calls with any of those parties.

Section 1.04. <u>Irrevocability</u>. The Authorized Participant agrees on behalf of itself and any Authorized Participant Client that delivery to the Administrative Trustee or BRIL of an Order shall be irrevocable; *provided* that each of the Trust, the Administrative Trustee, BRIL and the Sponsor reserves the right to reject any Order in compliance with the provisions of the Trust Agreement.

Section 1.05. <u>Costs and Expenses</u>. The Authorized Participant shall be responsible for any and all expenses and costs incurred by the Trust in connection with any Orders. The Authorized Participant shall be responsible for any and all reasonable expenses and costs incurred by the Trust in connection with any modified or cancelled Order.

Section 1.06. <u>Delivery of Property to the Trust</u>. The Authorized Participant understands and agrees that in the event Deposit Property is not transferred to the Trust by the time specified in the Purchase Order and in compliance with the Procedures and the Trust Agreement, a Purchase Order will be cancelled by the Administrative Trustee and the Authorized Participant will be solely responsible for all costs incurred by the Trust, the Administrative Trustee, BRIL, the Ether Custodian or the Cash Custodian related to the cancelled Order.

Section 1.07. <u>Title to Deposit Property and Shares Surrendered for Redemption</u>. The Authorized Participant represents and warrants to the Administrative Trustee and the Sponsor that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. in connection with each Purchase Order, the Authorized Participant (or its Authorized Participant Client, if applicable) will have full power and authority to transfer to the Trust the corresponding Deposit Property, and that, upon delivery of such Deposit Property to the Prime Execution Agent, the Cash Custodian, the Ether Custodian and/or the relevant subcustodian in accordance with the Procedures, the Trust will acquire good and unencumbered title to such property, free and clear of all liens, charges, duties imposed on the transfer of assets and encumbrances and not subject to any adverse claims or transferability restrictions, whether arising by operation of law or otherwise; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. as of the close of a day that the exchange on which the Trust is listed is open for regular trading and on which the Authorized Participant has placed any Redemption Order for the purpose of redeeming any Shares, it or the Authorized Participant Client, as the case may be, will own (within the meaning of Rule 200 of Regulation SHO) or has arranged to borrow for delivery to the Trust on or prior to the settlement date of the Redemption Order the number of Shares to be redeemed. In either case, the Authorized Participant acknowledges that: (i) it has or if, applicable, its Authorized Participant Client has full legal authority and legal right to tender for redemption the requisite number of Shares and to receive the entire proceeds of the redemption and (ii) if such Shares submitted for redemption have been loaned or pledged to another party or are the subject of a repurchase agreement, securities lending agreement or any other arrangement affecting legal or beneficial ownership of such Shares being tendered there are no restrictions precluding the tender and delivery of such Shares (including borrowed shares, if any) for redemption, free and clear of liens, on the redemption settlement date.

Section 1.08. <u>Certain Payments or Distributions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. With respect to any Purchase Order, the Trust acknowledges and agrees to return to the Authorized Participant on behalf of itself and any Authorized Participant Client any payment, distribution or other amount paid to the Trust in respect of any Deposit Property transferred to the Trust that, based on the valuation of such Deposit Property at the time of transfer, should have been paid to the Authorized Participant or Authorized Participant Client. Likewise, the Authorized Participant on behalf of itself and any Authorized Participant Client acknowledges and agrees to return to the Trust any payment, distribution or other amount paid to the Authorized Participant or any Authorized Participant Client in respect of any Deposit Property transferred to the Trust that, based on the valuation of such Deposit Property at the time of transfer, should have been paid to the Trust. The Authorized Participant accepts and agrees on behalf of itself and any Authorized Participant Client that, in connection with any fork or airdrop with respect to any Deposit Property, any ether corresponding to the Shares, or otherwise, neither the Trust nor the Prime Execution Agent has any duty or obligation whatsoever to the Authorized Participant or any Authorized Participant Client to claim, take possession of, secure, or otherwise take any action for the benefit of the Authorized Participant or any Authorized Participant Client, as applicable, in connection therewith, and the Authorized Participant or any Authorized Participant Client, as applicable, hereby renounce and abandon any and all right, title, interest, or claim to any assets connected to any such fork or airdrop.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. With respect to any Redemption Order, the Authorized Participant on behalf of itself and any Authorized Participant Client acknowledges and agrees to return to the Trust any payment, distribution or other amount paid to it or an Authorized Participant Client in respect of any property transferred to the Authorized Participant or any Authorized Participant Client that, based on the valuation of such property at the time of transfer, should have been paid to the Trust. The Trust is entitled to reduce the amount of any property due to the Authorized Participant or any Authorized Participant Client by an amount equal to any payment, distribution or other sum to be paid to the Authorized Participant or to the Authorized Participant Client in respect of any property transferred to the Authorized Participant or any Authorized Participant Client that, based on the valuation of such property at the time of transfer, should be paid to the Trust. Likewise, the Trust acknowledges and agrees to return to the Authorized Participant or any Authorized Participant Client any payment, distribution or other amount paid to it in respect of any Shares transferred to the Trust that, based on the valuation of such Shares at the time of transfer, should have been paid to the Authorized Participant or such Authorized Participant Client.

Section 1.09. <u>Governmental Sanctions</u>. The Authorized Participant acknowledges and agrees on behalf of itself and any Authorized Participant Client that, if a deposit of ether (as defined in the Procedures) made by the Authorized Participant, or any Authorized Participant Client with the Prime Execution Agent (as defined in the Procedures) in connection with a Purchase Order includes any ether which is subject to governmental sanctions applicable to ether, including, without limitation, sanctions of The Office of Foreign Assets Control of the Department of Treasury of the United States applicable to ether, the Prime Execution Agent will block or reject the applicable Purchase Order for the Shares and will take necessary steps to comply with applicable laws.

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ARTICLE II

AUTHORIZED REPRESENTATIVES

Section 2.01. <u>Certification</u>. Concurrently with the execution of the Authorized Participant Agreement, the Authorized Participant shall deliver to the Trust a certificate signed by the Authorized Participant's Secretary or other duly authorized person setting forth the names, e-mail addresses and telephone and facsimile numbers of all persons authorized to give instructions relating to any activity contemplated hereby or any other notice, request or instruction on behalf of the Authorized Participant (each an "**Authorized Representative**") The Administrative Trustee may request updates to such certificate from time to time, in a form approved by the Administrative Trustee, but no less frequently than annually. Such certificate and any updates thereto may be accepted and relied upon by the Trust as conclusive evidence of the facts set forth therein and shall be considered to be in full force and effect until (i) receipt by the Administrative Trustee of a superseding certificate or update to a certificate in a form approved by the Administrative Trustee bearing a subsequent date, or (ii) termination of the Authorized Participant Agreement.

Section 2.02. <u>PIN Numbers</u>. The Administrative Trustee shall issue to each Authorized Representative a unique personal identification number ("**PIN Number**") by which such Authorized Representative shall be identified and instructions issued by the Authorized Participant shall be authenticated. The PIN Number shall be kept confidential and only provided to Authorized Representatives. The Authorized Participant may revoke any PIN Number at any time upon written notice to the Administrative Trustee, and the Authorized Participant shall be responsible for doing so in the event that it becomes aware that an unauthorized person has received access to a PIN Number or has or intends to use a PIN Number in an unauthorized manner.

If an Authorized Representative's PIN Number is changed, the new PIN Number will become effective on a date mutually agreed upon by the Authorized Participant and the Administrative Trustee. The Authorized Participant agrees that, absent the Administrative Trustee's fraud, willful misconduct or failure to deactivate the PIN Number promptly following a written request to do so from the Authorized Participant or the termination of the Authorized Participant Agreement, none of the Trust or the Administrative Trustee shall be liable for losses incurred by the Authorized Participant as a result of unauthorized use of a Authorized Representative's PIN Number prior to the time the Authorized Participant provides notice to the Administrative Trustee of the termination or revocation of authority pursuant to Section 2.03.

Section 2.03. <u>Termination of Authority</u>*.* Upon the termination or revocation of authority of an Authorized Representative by the Authorized Participant or the revocation of a PIN Number by the Authorized Participant, the Authorized Participant shall (i) give immediate written notice of such fact to the Administrative Trustee and such notice shall be effective upon receipt by the Administrative Trustee; and (ii), if applicable, request a new PIN Number. The Administrative Trustee shall, as promptly as practicable, deactivate the PIN Number upon receipt of such written notice.

Section 2.04. <u>Verification</u>. The Administrative Trustee may assume that all instructions issued to it using an Authorized Representative's PIN Number have been properly placed by the applicable Authorized Representative, unless the Administrative Trustee has actual knowledge to the contrary or the Authorized Participant has revoked the PIN Number. The Administrative Trustee shall have no duty to verify that an Order is being placed by an Authorized Representative. The Authorized Participant agrees that the Administrative Trustee shall not be responsible for any losses incurred by the Authorized Participant as a result of an Authorized Representative identifying himself or herself as a different Authorized Representative or an unauthorized person identifying himself or herself as an Authorized Representative, unless the Administrative Trustee previously received from the Authorized Participant written notice to revoke the PIN Number used by such person.

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ARTICLE III

STATUS OF THE AUTHORIZED PARTICIPANT

Section 3.01. <u>Clearing Status</u>. The Authorized Participant represents, covenants and warrants that, as of the date of execution of the Authorized Participant Agreement, and at all times during the term of the Authorized Participant Agreement, the Authorized Participant is and will be entitled to use the clearing and settlement services of each of the national or international clearing and settlement organizations through which, in compliance with the Procedures, the transactions contemplated hereby will clear and settle. Any change in the foregoing status of the Authorized Participant shall terminate the Authorized Participant Agreement and the Authorized Participant shall give prompt written notice thereof to the Administrative Trustee.

Section 3.02. <u>Broker-Dealer Status</u>. The Authorized Participant represents, covenants and warrants that, unless the following paragraph is applicable to it, it is (i) registered as a broker-dealer under the Securities Exchange Act of 1934, as amended, (ii) qualified to act as a broker or dealer in the states or other jurisdictions where it transacts business to the extent so required by applicable law, and (iii) a member in good standing of FINRA. The Authorized Participant agrees that it will maintain such registrations, qualifications, and membership in good standing and in full force and effect throughout the term of the Authorized Participant Agreement. The Authorized Participant further agrees to comply with all Federal laws, the laws of the states or other jurisdictions concerned, and the rules and regulations promulgated thereunder, to the extent such laws and regulations are applicable to the Authorized Participant's transactions in Shares, and with the Constitution, By-Laws and Conduct Rules of FINRA applicable to its activities as an Authorized Participant, and that it will not offer or sell Shares in any state or jurisdiction where they may not lawfully be offered and/or sold.

Section 3.03. <u>Foreign Status</u>. If the Authorized Participant is offering and selling Shares in jurisdictions outside the several states, territories and possessions of the United States and is not otherwise required to be registered, qualified, or a member of FINRA as set forth in the preceding paragraph, the Authorized Participant nevertheless agrees to observe applicable laws.

Section 3.04. <u>Compliance with Laws</u>.- The Authorized Participant agrees that it shall comply with all applicable U.S. federal laws and regulations, the laws of the states or other jurisdictions concerned (and the rules and regulations promulgated thereunder), and with the Constitution, By-Laws and Conduct Rules of FINRA, and the rules and regulations or any other applicable self-regulatory organization and/or exchange, in each case to the extent the foregoing relate to promotions, offers and/or transactions in, and activities with respect to, the Shares conducted by it or any Authorized Participant Client. The Authorized Participant shall not offer nor sell Shares in any state or jurisdiction where such shares may not lawfully be offered and/or sold. The Authorized Participant will, and will cause all of its and its affiliates' directors, officers, employees, agents, representatives, any Authorized Participant Client, and other persons that provide services on behalf of the Authorized Participant relating to the Shares to not (and, with respect to any Authorized Participant Client shall perform appropriate diligence and obtain representations that such Authorized Participant Client shall not) make any payments in violation of applicable laws, including, without limitation, the U.S. Foreign Corrupt Practices Act of 1977, as amended, in connection with or in any way relating to or affecting the Shares or the offering or distribution of the Shares or transactions in ether relating to this Agreement.

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Section 3.05 <u>Anti-Money Laundering</u>. The Authorized Participant represents, covenants and warrants that neither it nor any of its officers, directors, employees, affiliates or the Authorized Participant Client and the Authorized Participant Client's officers, directors, employees and affiliates have not been, (i) indicted with respect to, or convicted of, any criminal charges, including money laundering, or (ii) is the subject of any criminal charges, including money laundering, or (ii) is the subject of any criminal action of any nature or of any action by a regulatory agency or self-regulatory organization relating to money laundering. The Authorized Participant confirms that it and each Authorized Participant Client are subject to the anti-money laundering requirements of the Currency and Foreign Transactions Act of 1970 of the United States, as amended by the USA PATRIOT Act and Anti-Money Laundering Act of 2020 (the "**Bank Secrecy Act**"), and its implementing regulations, and it represents, covenants and warrants that it and each Authorized Participant Client have adopted, implemented and shall maintain and comply with the anti-money laundering program and other requirements to comply with the Bank Secrecy Act and implementing regulations, and the anti-money laundering, terrorist financing, VASP or similar laws, regulations, and guidance of other jurisdictions, as are applicable (collectively, together with the Bank Secrecy Act, "**AML Laws**"), including but not limited to, (i) maintaining and complying with written policies, procedures and controls designed to detect, prevent and report money laundering, terrorist financing, or other suspicious activity and prohibit dealings with shell banks and (ii) maintaining a customer identification program, and any other relevant requirements imposed by such laws, regulations, and guidance. The Authorized Participant confirms that it and each Authorized Participant Client comply with all AML Laws, and the Authorized Participant agrees and acknowledges that it shall be responsible to the Trust, Sponsor, and Administrative Trustee for any breach of this provision by the Authorized Participant or Authorized Participant Client. The Authorized Participant confirms that any Authorized Participant Client has been successfully onboarded and processed through the Authorized Participant's own Bank Secrecy Act compliance program, including the Authorized Participant's customer due diligence, KYC and customer identification procedures. In connection with any ether or cash it delivers to the Trust under this Agreement, the Authorized Participant confirms that the Authorized Participant Client will form a reasonable belief (i) as to the identities of, and conduct necessary diligence with respect to, any counterparties from whom it obtains ether or cash being transferred and (ii) that such ether or cash being transferred were not derived from, or associated with, unlawful or criminal activity.

Section 3.06. <u>Sanctions Program</u>. Authorized Participant represents, covenants and warrants that it, and any Authorized Participant Client, has adopted, implemented, and shall maintain and comply with a reasonable risk-based program to comply with all applicable economic, trade and financial sanctions laws, resolutions, executive orders and regulations enacted by the United States (including as administered and/or enforced by the Office of Foreign Assets Control), the United Kingdom, United Nations, European Union, and any applicable sanctions authority (collectively, "**Sanctions Laws**"). The Authorized Participant represents, covenants and warrants that it and any Authorized Participant Client shall maintain and comply, with policies, procedures and controls that are reasonably designed to ensure (i) compliance with Sanctions Laws and limit the risk of transactions that could be regarded as circumventing Sanctions Laws and (ii) that it, its affiliates, or any Authorized Participant Client, and, to the extent required by law, its and their owners and controllers (a) are not in violation of any Sanctions Laws or on any list of prohibited individuals or entities enacted under Sanctions Laws (collectively, "**Sanctions Lists**") and (b) are not located, organized or doing business in a country or territory that is, or whose government is, the target of embargo or countrywide sanctions under any Sanctions Laws. The Authorized Participant represents, covenants, and warrants that the Authorized Participant Client shall ensure that any Delivery of ether to the Trust performed by the Authorized Participant Client shall not be directly or indirectly derived from, invested for the benefit of or related in any way to, persons, entities or jurisdictions that are subject to any country embargoes, in violation of any Sanctions Laws or on any Sanctions Lists. The Authorized Participant confirms that any Authorized Participant Client has been successfully onboarded and processed through the Authorized Participant's own Sanctions Laws compliance program. The Authorized Participant confirms the Authorized Participant Client has formed a reasonable belief that no part of the digital assets it is transferring to the Trust are derived from, held for the benefit of, or related in any way to transactions with or on behalf of any person on any Sanctions Lists or located, organized or doing business in a country or territory that is, or whose government is, the target of embargo or countrywide sanctions under any Sanctions Laws.

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Authorized Participant confirms that the Authorized Participant Client acknowledges that due to the Bank Secrecy Act and other applicable AML Laws and Sanctions Laws, the Trust, Sponsor, Administrative Trustee, or their affiliates or service providers may require further documentation verifying the Authorized Participant Client's identity. Authorized Participant confirms that Authorized Participant Client agrees to provide the Trust, Sponsor, Administrative Trustee or their affiliates or service providers at any time with such information or certification as the Trust, Sponsor, Administrative Trustee or their affiliates or service providers determine to be necessary or appropriate to verify compliance with the AML Laws of any applicable jurisdiction or to respond to requests for information concerning the identity of Authorized Participant Client from any governmental authority or self-regulatory organization.

Section 3.07. <u>Money Services Business</u>. The Authorized Participant understands and acknowledges that some activities on its part or the part of its Authorized Participant Clients, depending on the circumstances and under certain possible interpretations of applicable law, could be interpreted as resulting in (i) it, or an Authorized Participant Client, being deemed a "money services business" by the Financial Crimes Enforcement Network, a bureau of the United States Department of Treasury and/or (ii) a money transmitter under state law and/or (iii) an entity which is engaged in "virtual currency business activity" that requires licensure under 23 NYCRR Part 200, and similar virtual currency-specific laws in other states. The Authorized Participant agrees to consult its own counsel in connection with entering into the Authorized Participant Agreement and transacting in ether, and represents, covenants and warrants that it has, and any Authorized Participant Clients have, obtained all necessary government licenses, registrations, approvals, authorizations and permits necessary to enter into and perform the activities contemplated hereunder.

Section 3.08. <u>Authorized Participant Status</u>*.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. The Authorized Participant understands and acknowledges that the method by which Baskets of Shares will be created and traded may raise certain issues under applicable securities laws. For example, because new Baskets of Shares may be issued and sold by the Trust on an ongoing basis, at any point a "distribution", as such term is used in the 1933 Act, may occur. The Authorized Participant understands and acknowledges that some activities on its part, depending on the circumstances, may result in its being deemed a participant in a distribution in a manner which could render it a statutory underwriter and subject it to the prospectus delivery and liability provisions of the 1933 Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. The Sponsor shall ensure that each of the Prospectus and the Trust's Form 10-K contains an accurate and current listing of Authorized Participants. The Sponsor shall ensure that each of the Prospectus and the Trust's Form 10-K contains an accurate and current listing of Authorized Participants. By executing this Agreement, the Authorized Participant hereby consents to the inclusion of its name as an authorized participant in the Prospectus and the Trust's Form 10-K.. The Sponsor will promptly notify, or cause to be notified, the Authorized Participant when the characterization of the Authorized Participant's role is materially changed in the Prospectus or the Trust's Form 10-K. Upon the termination of the Authorized Participant Agreement, (i) (A) during the period prior to when the Trust qualifies and in its sole discretion elects to file on Form S-3, the Sponsor will remove such identification from the Prospectus and the Trust's Form 10-K within a reasonable period of time after the date of the termination of the Authorized Participant Agreement and (B) during the period after when the Sponsor qualifies and in its sole discretion elects to file on Form S-3, the Sponsor will reflect the withdrawal of the Authorized Participant as an authorized participant of the Trust in an Exchange Act filing that will be incorporated by reference into Form S-3 within a reasonable period of time after the date of the termination of the Authorized Participant Agreement and (ii) the Sponsor will promptly update the Trust's website to remove any identification of the Authorized Participant as an authorized participant of the Trust.

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ARTICLE IV

ROLE OF AUTHORIZED PARTICIPANT

Section 4.01. <u>Independent Contractor</u>. The Authorized Participant acknowledges and agrees that for all purposes of the Authorized Participant Agreement, the Authorized Participant will be deemed to be an independent contractor, and will have no authority to act as agent for the Trust or the Administrative Trustee in any matter or in any respect. The Authorized Participant agrees to make itself and its employees available, upon request, during normal business hours to consult with the Administrative Trustee, the Sponsor or their designees concerning the performance of the Authorized Participant's responsibilities under the Authorized Participant Agreement; *provided, however,* that the Authorized Participant shall be under no obligation to divulge or otherwise disclose any information that the Authorized Participant reasonably believes (i) it is under legal obligation not to disclose, or (ii) is confidential or proprietary in nature.

Section 4.02. <u>Rights and Obligations of DTC Participant</u>. In executing the Authorized Participant Agreement, the Authorized Participant agrees in connection with any purchase or redemption transactions in which it acts for an Authorized Participant Client or for any other DTC Participant or indirect participant, or any other Beneficial Owner, that it shall extend to any such party all of the rights (to the extent permitted by applicable rules and regulations), and shall be bound by all of the obligations, of a DTC Participant in addition to any obligations that it undertakes hereunder or in accordance with the Procedures.

Section 4.03. <u>Beneficial Owner Communications</u>. The Authorized Participant agrees, subject to any limitations arising under federal or state securities laws relating to privacy or other obligations it may have to its customers, to assist the Administrative Trustee or the Sponsor in determining the ownership level of each beneficial owner relating to positions in Shares that the Authorized Participant may hold as record holder. In addition, the Authorized Participant agrees, in accordance with applicable laws, rules and regulations, at the request of the Sponsor or the Administrative Trustee to forward to such beneficial owners written materials and communications received from the requesting party in sufficient quantities to allow mailing thereof to such beneficial owners, including notices, annual reports, disclosure or other informational materials and any amendments or supplements thereto that may be required to be sent by the Sponsor or the Administrative Trustee to such beneficial owners pursuant to the Trust Agreement or applicable law or regulation, or that the Sponsor or the Administrative Trustee reasonably wishes to distribute, at its own expense, to such beneficial owners.

ARTICLE V

MARKETING MATERIALS AND REPRESENTATIONS

Section 5.01. <u>Authorized Participant</u>'<u>s Representation</u>. The Authorized Participant represents, warrants and agrees that it will not make, or permit any of its representatives to make, any representations concerning Shares other than those contained in or consistent with the Trust's then current Prospectus or in any promotional materials or sales literature furnished to the Authorized Participant by the Sponsor. The Authorized Participant agrees to provide each purchaser of Shares, whenever required by Rule 173 under the 1933 Act, a notice in compliance with the provisions of such Rule. The Authorized Participant agrees not to furnish or cause to be furnished to any person or display or publish any information or materials relating to Shares (including, without limitation, promotional materials and sales literature, advertisements, press releases, announcements, statements, posters, signs or other similar materials), except such information and materials as may be furnished to the Authorized Participant by the Sponsor and such other information and materials as may be approved in writing by the Sponsor. The Authorized Participant understands that the Trust will not be advertised as offering redeemable securities, and that any advertising materials will prominently disclose that the Shares are not redeemable units of beneficial interest in the Trust. Notwithstanding the foregoing, the Authorized Participant may, without the approval of the Sponsor, prepare and circulate in the regular course of its business or for internal use, research reports, institutional communications (as such term is defined in FINRA Rule 2210 as of the date hereof), correspondence (as such term is defined in FINRA Rule 2210 as of the date hereof) and other similar materials that include information, opinions or recommendations relating to Shares, provided that such materials comply with applicable FINRA rules and are not inconsistent with the Prospectus. Copies of the then current Prospectus of the Trust will be supplied by the Sponsor to the Authorized Participant in reasonable quantities upon request.

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Section 5.02. [Reserved.]

Section 5.03. <u>Prospectus</u>. The Sponsor will provide, or cause to be provided, to the Authorized Participant copies of the then current Prospectus and any printed supplemental information in reasonable quantities upon request. The Sponsor will notify, or cause to be notified, the Authorized Participant when a revised, supplemented or amended Prospectus for the Shares is available, and make available to the Authorized Participant copies of such revised, supplemented or amended Prospectus at such time and in such quantities as may be reasonable to permit the Authorized Participant to comply with any obligation the Authorized Participant may have to deliver such Prospectus to its customers. The Sponsor shall be deemed to have complied with this Section 5.03 when the Authorized Participant has received such revised, supplemented or amended Prospectus by e-mail, in printable form, with such number of hard copies as may be agreed from time to time by the parties promptly thereafter.

ARTICLE VI

INDEMNIFICATION; LIMITATION OF LIABILITY

Section 6.01. <u>Indemnification</u>. The provisions of this Section 6.01 shall survive termination of the Authorized Participant Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. The Authorized Participant shall indemnify and hold harmless the Sponsor, the Administrative Trustee, BRIL, the Trust, the Prime Execution Agent, the Ether Custodian, the Cash Custodian, the Trust Administrator (which the parties agree is a third-party beneficiary under this Subsection 6.01(a)) their respective subsidiaries, Affiliates, directors, officers, employees and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each a "**Sponsor Indemnified Party**") from and against any loss, liability, cost and expense (including attorneys' fees) ("**Losses**") incurred by such Sponsor Indemnified Party as a result of (i) any breach by the Authorized Participant, its affiliates, or agents, or any Authorized Participant Client, of any of its or their representations or warranties (including under Section 3.4 of the Trust Agreement); (ii) any failure on the part of the Authorized Participant, its affiliates, or agents, or any Authorized Participant Client, to perform any of its or their obligations set forth in the Authorized Participant Agreement; (iii) any failure by the Authorized Participant, its affiliates, or agents, or any Authorized Participant Client to comply with applicable laws and regulations, including rules and regulations of self-regulatory organizations, that apply to it or them; or (iv) actions of such Sponsor Indemnified Party in reliance upon any instructions issued in accordance with the Procedures reasonably believed by such Sponsor Indemnified Party to be genuine and to have been given by the Authorized Participant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. The Authorized Participant shall not be liable to any Sponsor Indemnified Party for any damages arising out of (i) mistakes or errors in data provided in connection with purchase or redemption transactions except for data provided by the Authorized Participant, or (ii) mistakes or errors by, or arising out of interruptions or delays of communications with, the Administrative Trustee or any Sponsor Indemnified Party, or (iii) the reckless disregard of its duties, bad faith, fraud or willful misconduct of any Sponsor Indemnified Party.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. The Sponsor shall indemnify and hold harmless the Authorized Participant, its subsidiaries, Affiliates, directors, officers, employees and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each an "**AP Indemnified Party**") from and against any Losses incurred by such AP Indemnified Party as a result of (i) any breach by the Sponsor or its affiliates of any of its or their representations or warranties; (ii) any failure on the part of the Sponsor or its affiliates to perform any of its or their obligations set forth in the Authorized Participant Agreement; (iii) any failure by the Sponsor or its affiliates to comply with applicable laws and regulations, including rules and regulations of self-regulatory organizations, that apply to it or them; or (iv) actions of such AP Indemnified Party in reliance upon any instructions issued in accordance with the Procedures reasonably believed by such Indemnified Party to be genuine and to have been given by the Sponsor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. The Sponsor shall not be liable to any AP Indemnified Party for any damages arising out of (i) mistakes or errors in data provided in connection with purchase or redemption transactions except for data provided by the Sponsor, (ii) mistakes or errors by or arising out of interruptions or delays of communications with, or actions, omissions, or obligations hereunder of, the Prime Execution Agent, Trust Administrator, Ether Custodian, the Cash Custodian or any AP Indemnified Party, or any Authorized Participant Client, (iii) the reckless disregard by an AP Indemnified Party or any Authorized Participant Client of its duties, or an AP Indemnified Party's or any Authorized Participant Client's bad faith, fraud or willful misconduct, or (iv) any Delayed Settlement Scenario.

Section 6.02. <u>Limitation of Liability</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. No party to the Authorized Participant Agreement shall be liable for any special, indirect, incidental, exemplary, punitive or consequential loss or damage of any kind whatsoever (including but not limited to loss of revenue, loss of actual or anticipated profit, loss of contracts, loss of the use of money, loss of anticipated savings, loss of business, loss of opportunity, loss of market share, loss of goodwill or loss of reputation), even if such parties have been advised of the likelihood of such loss or damage and regardless of the form of action, except as otherwise expressly provided herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. No party to the Authorized Participant Agreement shall be responsible or liable for any failure or delay in the performance of their obligations under the Authorized Participant Agreement caused directly by circumstances beyond its reasonable control, including without limitation, acts of God; earthquakes; fires; floods; wars; civil or military disturbances; terrorism; sabotage; epidemics or pandemics; riots; interruptions; loss or malfunction of utilities, computer (hardware or software) or communications service; accidents; labor disputes; acts of civil or military authority or governmental actions; except as otherwise provided herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. None of the Sponsor, the Administrative Trustee, the Trust, the Delaware Trustee, the Prime Execution Agent, nor any other person shall be liable hereunder to any Agent or Authorized Participant Client in connection with a Delayed Settlement Scenario.

ARTICLE VII

MISCELLANEOUS

Section 7.01. <u>Commencement of Trading</u>. The Authorized Participant may not submit an Order prior to the effectiveness of the registration statement, or amendment to the registration statement, filed with the Securities and Exchange Commission and pursuant to which the Authorized Participant is identified as such in the Prospectus.

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Section 7.02. <u>Definitions</u>. The capitalized terms used herein are defined as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. "**1933 Act**" means the U.S. Securities Act of 1933, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. "**Administrative Trustee**" shall have the meaning ascribed to it in the introductory paragraph of the Authorized Participant Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. "**Affiliate**" shall have the meaning given to it by Rule 501(b) under the 1933 Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. "**airdrop**" shall have the meaning ascribed to it in the Trust Agreement.

e**.** "**AML Laws**" shall have the meaning in Section 3.05 of this Schedule 2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f. "**Authorized Participant Agreement**" shall mean each Authorized Participant Agreement among the Authorized Participant, the Administrative Trustee and the Sponsor into which these Standard Terms shall have been incorporated by reference.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g. "**Authorized Participant**" shall have the meaning ascribed to it in the introductory paragraph of the Authorized Participant Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h. "**Authorized Participant Client**" means any party on whose behalf the Authorized Participant acts in connection with an Order (whether a customer or otherwise).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. "**Authorized Representative**" shall have the meaning ascribed to it in Section 2.01 hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;j. "**Bank Secrecy Act**" shall mean the anti-money laundering requirements of the Currency and Foreign Transactions Act of 1970 of the United States, as amended by the USA PATRIOT Act and Anti-Money Laundering Act of 2020.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;k. "**Basket**" shall have the meaning ascribed to it in the Recitals to the Authorized Participant Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;l. "**Basket Ether Amount**" shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;m. "**BRIL**" shall mean BlackRock Investments, LLC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;n. "**Beneficial Owner**" shall have the meaning given to it by Rule 16a-1(a)(2) of the Securities Exchange Act of 1934.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o. "**Custodian**" shall have the meaning ascribed to it in the Procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;p. "**Deposit Property**" means property which, in compliance with the provisions of the Trust Agreement, must be transferred by the Authorized Participant to the Trust in exchange for Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;q. "**DTC**" means The Depository Trust Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;r. "**DTC Participant**" means a person that, pursuant to the DTC's governing documents, is entitled to deposit securities with DTC in its capacity as a "participant".

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;s. "**FINRA**" means the Financial Industry Regulatory Authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;t. "**fork**" shall have the meaning ascribed to it in the Trust Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;u. "**Indemnified Party**" shall have the meaning ascribed to it in Section 6.01.a hereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. "**Order**" shall have the meaning ascribed to it in Section 1 of the Authorized Participant Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;w. "**Procedures**" shall have the meaning ascribed to it in Section 1 of the Authorized Participant Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;x. "**Prospectus**" means the Trust's current prospectus included in its effective registration statement, as supplemented or amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;y. "**Purchase Order**" shall have the meaning ascribed to it in Section 1 of the Authorized Participant Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;z. "**Redemption Order**" shall have the meaning ascribed to it in Section 1 of the Authorized Participant Agreement.

aa. "**Sanctions Laws**" shall have the meaning ascribed to it herein.

bb. "**Sanctions Lists**" shall have the meaning ascribed to it herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;cc. "**Shares**" means shares issued by the Trust pursuant to the provisions of the Trust Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;dd. "**Sponsor**" shall have the meaning ascribed to it in the introductory paragraph of the Authorized Participant Agreement.

ee. "**Trust**" shall have the meaning ascribed to it in the introductory paragraph of the Authorized Participant Agreement.

ff. "**Trust Agreement**" shall have the meaning ascribed to it in the introductory paragraph of the Authorized Participant Agreement.

*[Signature Page Follows]*

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**IN WITNESS WHEREOF**, the Sponsor and the Administrative Trustee have executed these Standard Terms as of the date first set forth above.

**BLACKROCK FUND ADVISORS**, in its capacity as Administrative Trustee

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| | |
|:---|:---|
| By: | <u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u> |
|  | Name:<u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u> |
|  | Title:<u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u> |

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**iSHARES**® **DELAWARE TRUST SPONSOR LLC**, in its capacity as Sponsor

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|:---|:---|
| By: | <u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u> |
|  | Name:<u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u> |
|  | Title:<u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u><u> </u> |

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**Schedule 3**

**CERTIFICATE OF AUTHORIZED REPRESENTATIVES**

Each of the following employees of the Authorized Participant (each, an "**Authorized Representative**") is authorized, in accordance with the Authorized Participant Agreement dated as of [ ], 2026 among the Authorized Participant, the Sponsor, and the Administrative Trustee, to submit Purchase Orders and Redemption Orders on behalf and in the name of the Authorized Participant and to give instructions or any other notice or request on behalf of Authorized Participant with respect to such Orders or any other activity contemplated by the Authorized Participant Agreement.

Name:

E-Mail Address:

Telephone:

The undersigned, [ ], [ ] of Authorized Participant, does hereby certify that the persons listed above have been duly authorized to act as Authorized Representatives pursuant to the Authorized Participant Agreement.

By: ________________________

Name:

Title:

Date:

## Exhibit 5.1

**Exhibit 5.1**

**Morris, Nichols, Arsht & Tunnell llp**<br>1201 North Market Street<br> P.O. Box 1347<br> Wilmington, Delaware 19899-1347<br>(302) 658-9200<br> (302) 658-3989 FAX<br>

February 13, 2026

iShares Staked Ethereum Trust ETF

400 Howard Street

San Francisco, CA 94105

Re: <u>iShares Staked Ethereum Trust ETF</u>

Ladies and Gentlemen:

We have acted as special Delaware counsel to iShares Staked Ethereum Trust ETF, a Delaware statutory trust (the "Trust"), in connection with certain matters of Delaware law relating to the issuance of Shares of the Trust. Capitalized terms used herein and not otherwise herein defined are used as defined in the Amended and Restated Trust Agreement of the Trust dated as of February 5, 2026 (the "Governing Instrument").

In rendering this opinion, we have examined and relied on copies of the following documents, each in the form provided to us: Pre-Effective Amendment No. 1 (the "Amendment") to Registration Statement No. 333-291992 under the Securities Act of 1933 on Form S-1 of the Trust to be filed with the Securities and Exchange Commission on or about the day hereof; the Certificate of Trust of the Trust as filed in the Office of the Secretary of State of the State of Delaware (the "State Office") on November 19, 2025, as amended by the Certificate of Amendment thereto as filed in the State Office on February 5, 2026; the Governing Instrument; the form of Authorized Participant Agreement to be entered into by the Administrative Trustee, the Sponsor and each Authorized Participant (the "Authorized Participant Agreement" and together with the Governing Instrument and the Amendment, the "Governing Documents"); a Certificate of the Administrative Trustee of the Trust dated on or about the date hereof; and a certification of good standing of the Trust obtained as of a recent date from the State Office. In such examinations, we have assumed the genuineness of all signatures, the conformity to original documents of all documents submitted to us as copies or drafts of documents to be executed, and the legal capacity of natural persons to complete the execution of documents. We have further assumed for purposes of this opinion: the due formation or organization, valid existence and good standing of each entity that is a signatory to any of the documents reviewed by us under the laws of the jurisdiction of its respective formation or organization; the due adoption, authorization, execution and delivery by, or on behalf of, each of the parties thereto (other than the Trust) of the above-referenced agreements, instruments, certificates and other documents and of all documents contemplated by the Governing Documents to be executed by Persons desiring to become Beneficial Owners, Registered Owners or Authorized Participants; that the activities of the Trust have been and will be conducted in accordance with the terms of the Governing Instrument and the Delaware Statutory Trust Act, 12 *Del*. *C*. §§ 3801 *et seq.* (the "Delaware Act"); that appropriate notation of the names and addresses of, the number of the Shares held by, and the consideration paid by, any of the Registered Owners will be maintained in the appropriate registers and other books and records of the Trust in connection with the issuance or transfer of Shares; that the required consideration for the Shares is paid in accordance with the terms, conditions, requirements and procedures set forth in the Governing Documents and that the Shares are otherwise issued in accordance with the terms, conditions, requirements and procedures set forth in the Governing Documents and the Delaware Act; and that each of the documents examined by us is in full force and effect, expresses the entire understanding of the parties thereto with respect to the subject matter thereof and has not been amended, supplemented or otherwise modified, except as herein referenced. We have not reviewed any documents other than those identified above in connection with this opinion, and we have assumed that there are no documents, facts or circumstances that are contrary to, or inconsistent with the opinions expressed herein. No opinion is expressed herein with respect to the requirements of, or compliance with, federal or state securities or blue sky laws. Further, we express no opinion on the sufficiency or accuracy of any registration or offering documentation relating to the Trust or the Shares. As to any facts material to our opinion, other than those assumed, we have relied without independent investigation on the above-referenced documents and on the accuracy, as of the date hereof, of the matters therein contained.

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iShares Staked Ethereum Trust ETF

February 13, 2026

Based on and subject to the foregoing, and limited in all respects to matters of Delaware law, it is our opinion that the Shares, when issued in accordance with the terms, conditions, requirements and procedures set forth in the Governing Documents, will constitute legally issued, fully paid and non-assessable shares of beneficial interest in the Trust.

We hereby consent to the filing of a copy of this opinion with the Securities and Exchange Commission as an exhibit to the Amendment. In giving this consent, we do not hereby admit that we come within the category of Persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder. This opinion speaks only as of the date hereof and is based on our understandings and assumptions as to present facts, and on the application of Delaware law as the same exist on the date hereof, and we undertake no obligation to update or supplement this opinion after the date hereof for the benefit of any Person (including any Registered Owner or Beneficial Owner) with respect to any facts or circumstances that may hereafter come to our attention or any changes in facts or law that may hereafter occur or take effect. This opinion is intended solely for the benefit of the Trust, the Registered Owners and the Beneficial Owners in connection with the matters contemplated hereby and may not be relied upon by any other Person, or for any other purpose, without our prior written consent.

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| |
|:---|
| Sincerely, |
| MORRIS, NICHOLS, ARSHT & TUNNELL LLP |
| /s/ David A. Harris |
| David A. Harris |

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## Exhibit 8.1

**Exhibit 8.1**

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|:---|:---|
| ![logo01.jpg](logo01.jpg) | **Clifford Chance US LLP**<br> Two Manhattan West<br> 375 9th Avenue<br> New York, NY 10001 |

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iShares<sup>®</sup> Delaware Trust Sponsor LLC 400 Howard Street San Francisco, California 94105 February 13, 2026

**Re: iShares Staked Ethereum Trust ETF**

Dear Intended Recipients:

We have acted as legal counsel to iShares Delaware Trust Sponsor LLC, a Delaware limited liability company (the "**Sponsor**"), in connection with the preparation and filing under the Securities Act of 1933, as amended (the "**Securities Act**"), and the rules and regulations of the Securities and Exchange Commission promulgated thereunder, of a registration statement on Form S-1 (the "**Registration Statement**") relating to the continuous offering of shares (the "**Shares**") representing units of fractional undivided beneficial interest in and ownership of the iShares Staked Ethereum Trust ETF (the "**Trust**"), a Delaware Statutory Trust governed by the Amended and Restated Trust Agreement dated as of February 5, 2026 (the "**Trust Agreement**"), entered into by and between the Sponsor as sponsor, BlackRock Fund Advisors, a California corporation, as administrative trustee (the "**Administrative Trustee**") in its capacity as a trustee of the Trust, and Wilmington Trust, National Association, a national association, as Delaware trustee (the "**Delaware Trustee**") in its capacity as a trustee of the Trust. In connection therewith, you have requested our opinion with respect to certain U.S. federal income tax matters. Capitalized terms not otherwise defined herein shall have the meanings given to them in the Trust Agreement.

In rendering the opinions expressed herein, we have examined and relied on the Trust Agreement; the Registration Statement; the Trust's Ethereum staking liquidity risk policy; originals or copies, certified or otherwise identified to our satisfaction, of all such agreements, certificates and other statements of corporate officers and other representatives of the Sponsor; and such other documents, records and instruments as we have deemed necessary in order to enable us to render the opinion referred to in this letter.

In our examination of the foregoing documents, we have assumed, with your consent, that all documents reviewed by us are original documents, or true and accurate copies of original documents, and have not been subsequently amended; the signatures of each original document are genuine; each party who executed the document had proper authority and capacity; all representations and statements set forth in such documents are true and correct; and all obligations imposed by any such documents on the parties thereto have been or will be performed or satisfied in accordance with their terms.

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| ![logo01.jpg](logo01.jpg) | **Clifford Chance US LLP** |

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Our opinions are based upon the Internal Revenue Code of 1986, as amended (the "**Code**"), Treasury Regulations promulgated thereunder, pertinent judicial decisions, current interpretive rulings and pronouncements of the Internal Revenue Service (the "**IRS**"), and such other authorities as we have considered relevant, in effect as of the date hereof, all of which are subject to legislative, judicial or administrative change or differing interpretation, possibly with retroactive effect. Our opinions are not binding on the IRS, and no assurance can be given that the conclusions expressed herein will not be challenged by the IRS or sustained by a court.

Based upon and subject to the foregoing, (i) we are of the opinion, although not free from doubt due to the lack of directly governing authority, that the Trust should be classified as a "grantor trust" for U.S. federal income tax purposes, and (ii) we confirm that the discussion in the Registration Statement under the caption "U.S. Federal Income Tax Consequences," to the extent it consists of statements of law and legal conclusions, and subject to the limitations and qualifications set forth therein, constitutes our opinion as to the material U.S. federal income tax consequences that will apply under currently applicable law to the purchase, ownership and disposition of the Shares.

The opinions stated above represent our conclusions as to the application of the U.S. federal income tax laws existing as of the date of this letter. Further, the opinions set forth above represent our conclusions based upon the assumptions, documents, facts and representations referred to above. Any material amendments to such documents, changes in any significant facts or inaccuracy of such assumptions or representations could affect the accuracy of our opinions. Although we have made such inquiries and performed such investigations as we have deemed necessary to fulfill our professional responsibilities as counsel, we have not undertaken an independent investigation of all of the facts referred to in this letter and the certificates and other statements of corporate officers and other representatives of the Sponsor.

The opinions set forth in this letter are (i) limited to those matters expressly covered and no opinion is expressed in respect of any other matter, (ii) as of the date hereof, and (iii) rendered by us at the request of the Sponsor. We assume no obligation to update our opinions for events or changes in the law occurring after the effective date of the Registration Statement.

We hereby consent to the filing of this opinion with the Securities and Exchange Commission as an exhibit to the Registration Statement and to the references therein to us. In giving such consent, we do not hereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act, or the rules and regulations of the Securities and Exchange Commission promulgated thereunder.

Very truly yours,

/s/ Clifford Chance US LLP

## Exhibit 10.1

**Exhibit 10.1**

**THIRD AMENDED AND RESTATED**

**COINBASE PRIME BROKER AGREEMENT**

**General Terms and Conditions**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Introduction** 

Each entity specified on Schedule I hereto (each, a "<u>Client</u>") severally and not jointly acting through the applicable agent specified for such entity on Schedule I (each, an "<u>Agent</u>") enters into this agreement (including, the Coinbase Custody Custodial Services Agreement attached hereto as Exhibit A (the "<u>Custody</u> <u>Agreement</u>"), the Coinbase Master Trading Agreement attached hereto as Exhibit B (the "<u>MTA),</u>" the Coinbase Committed Trade Financing Agreement attached hereto as Exhibit D (the "<u>CTF Agreement</u>"), and all other exhibits, addenda and supplements attached hereto or referenced herein, including Addendum No. 1 ("<u>Service Level Agreement</u>" or "<u>SLA</u>") and Addendum No. 2 ("<u>Addendum No. 2</u>") and, collectively, the "<u>Coinbase Prime Broker Agreement</u>") with Coinbase, Inc. ("<u>Coinbase</u>"), on behalf of itself and as agent for Coinbase, Coinbase Custody Trust Company, LLC ("<u>Coinbase Custody</u>"), and, as applicable, Coinbase Credit, Inc. ("<u>Coinbase Credit</u>," and collectively with Coinbase and Coinbase Custody, the "<u>Coinbase</u> <u>Entities</u>"). This Coinbase Prime Broker Agreement shall constitute separate agreements, each between a single Client and the Coinbase Entities, as if such Client had executed a separate Coinbase Prime Broker Agreement naming only itself as the Client, and no Client shall have any liability for the obligations of any other Client. This Coinbase Prime Broker Agreement sets forth the terms and conditions pursuant to which the Coinbase Entities will open and maintain the prime broker account (the "<u>Prime Broker Account</u>") for Client and provide services relating to custody, trade execution, lending or post-trade credit (if applicable), and other services including the Coinbase Tech (as defined below) (collectively, the "<u>Prime Broker</u> <u>Services</u>" or "Services") for certain digital assets ("<u>Digital Assets</u>") as set forth herein. Client and the Coinbase Entities (individually or collectively, as the context requires) may also be referred to as a "Party". Capitalized terms not defined in these General Terms and Conditions (the "<u>General Terms</u>") shall have the meanings assigned to them in the respective exhibit, addendum or supplement. In the event of a conflict between these General Terms and any exhibit, addendum or supplement hereto, then the document governing the specific relevant Prime Broker Service shall control in respect of such Prime Broker Service. The parties hereto agree that this agreement (including any annexes hereto that are stated to be applicable to each Client) shall replace and supersede in its entirety any prior Coinbase Prime Broker Agreement (or similar agreement setting out the terms and conditions pursuant to which the Coinbase Entities would provide prime brokerage services) entered into between the parties hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **Conflicts of Interest Acknowledgement** 

Client acknowledges that the Coinbase Entities may have actual or potential conflicts of interest in connection with providing the Prime Broker Services including that (i) Orders (as such term is defined in the MTA) may be routed to Coinbase's exchange platform where Orders may be executed against other Coinbase customers or with Coinbase acting as principal, (ii) the beneficial identity of the purchaser or seller with respect to an Order is unknown and therefore may inadvertently be another Coinbase client, (iii) Coinbase does not engage in front-running, but is aware of Orders or imminent Orders and may execute a trade for its own inventory (or the account of an affiliate) while in possession of that knowledge and (iv) Coinbase may act in a principal capacity with respect to certain Orders (*e.g.*, to fill residual Order size when a portion of an Order may be below the minimum size accepted by the Connected Trading Venues (as defined in the MTA). As a result of these and other conflicts, when acting as principal, the Coinbase Entities may have an incentive to favor their own interests and the interests of their affiliates over a particular Client's interests and has in place certain policies and procedures in place that are designed to mitigate such conflicts. Coinbase will maintain appropriate and effective arrangements to eliminate or manage conflicts of interest, including segregation of duties, information barriers and training. Coinbase will notify Client in accordance with the notice provisions hereof of changes to its business that have a material adverse effect on Coinbase's ability to manage its conflicts of interest. Notwithstanding anything herein to the contrary, the Coinbase Entities shall execute trades pursuant to such policies and procedures; provided that the Coinbase Entities (a) shall execute in a commercially reasonable amount of time (i) any marketable orders appropriately entered by Client and (ii) any other pending Client orders received by the Coinbase Entities that become marketable, (b) for any order that Coinbase receives from Client, Coinbase will make commercially reasonable efforts to route orders for execution to the Connected Trading Venue offering the highest price for Client sale Orders and the lowest price for Client purchase Orders, including consideration of any gas fees or similar fees related to a particular blockchain at the time that such orders are routed for execution, and (c) shall not knowingly enter into a transaction for the benefit of (x) the Coinbase Entities, or (y) any other client received after Client's order, ahead of any order received from Client. For purposes of the foregoing, a marketable order is a sell order equivalent to or better than the best bid price, or a buy order equivalent to or better than the best ask price, on any Connected Trading Venue (or any venue that a Coinbase Entity may use) at a given moment. Coinbase agrees to direct Client's Orders in a manner that does not systematically favor Coinbase's exchange platform or Connected Trading Venues that provide financial incentives to Coinbase; provided, however, that under certain circumstances Coinbase may choose to intentionally route to the Coinbase exchange platform due to temporary conditions affecting Connected Trading Venues (e.g. connectivity problems of the Connected Trading Venue or funding constraints).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **Account Statements** 

Client authorizes Coinbase to combine information regarding all Prime Broker Services activities into a single statement. Coinbase will provide Client with an electronic account statement (the "Account Statement") every day by the time set-forth in the Service Level Agreement. Each Account Statement will identify the amount of cash and the amount and type of each Digital Asset in Client's Prime Broker Account at the end of the prior day, setting forth separately the amount and type of each Digital Asset held in the Trading Balance and the Vault Balance (as such terms are defined in Exhibit B hereto), the Storage Fees charged, and will set forth all Prime Broker Account activity during that period, as described in the Service Level Agreement. Subject to the terms herein, Client will have on demand access to its account information on the Coinbase website.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **Client Instructions** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 In a written notice to Coinbase, Client may designate persons and/or entities authorized to act on behalf of Client with respect to the Prime Broker Account (the "Authorized Representative"). Upon such designation, Coinbase may rely on the validity of such appointment until such time as Coinbase receives Instructions from Client revoking such appointment or designating a new Authorized Representative. Coinbase will disable the access of an Authorized Representative as soon as reasonably practicable upon request from Client and in no event greater than one day following the receipt of such request and the execution of any documents reasonably required by Client. Any removal of an Authorized Representative shall occur automatically, without any request for documentation, upon Client removing such person via the portal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 Subject to the terms of this Coinbase Prime Broker Agreement, The Coinbase Entities will act upon instructions received from Client or Client's Authorized Representative ("Instructions"), provided that such Instructions are received by the Coinbase Entities pursuant to the reasonable security procedures set forth by Coinbase Entities ("Security Procedures"), which may involve two-factor authentication and messaging only through certain Coinbase systems. For the avoidance of doubt and notwithstanding anything herein to the contrary, the Coinbase Entities shall act upon Instructions only when such instructions have been received pursuant to the Security Procedures. When taking action upon Instructions in a manner consistent with the provisions herein, the applicable Coinbase Entity shall act in a commercially reasonable manner, and in conformance with the following: (a) Instructions shall continue in full force and effect until executed, cancelled or superseded; (b) if any Instructions are ambiguous or if in in the applicable Coinbase Entity's reasonable opinion any Instructions are likely to be inaccurate, the applicable Coinbase Entity shall notify Client and may refuse to execute such Instructions until any such ambiguity has been resolved to the Coinbase Entity's satisfaction; (c) the Coinbase Entities may refuse to execute Instructions if in the applicable Coinbase Entity's reasonable opinion such Instructions are outside the scope of its obligations under this Coinbase Prime Broker Agreement or are contrary to any applicable laws, rules and regulations, and the applicable Coinbase Entity will promptly notify Client of such refusal; and (d) the Coinbase Entities may rely on any Instructions, notice or other communication reasonably believed by it to be genuine and given by Client or Client's Authorized Representative received pursuant to the Security Procedures. Client shall be fully responsible and liable for all Claims and Losses incurred by the Coinbase Entities (excluding Storage Fees) arising out of or relating to inaccurate or ambiguous Instructions unless such Claim and Losses are caused primarily by a Coinbase Entity's failure to abide by the relevant standard of care as set forth in Section 22. The applicable Coinbase Entity is responsible for losses resulting from its errors in executing a transaction (e.g., if Client provides the correct destination address for executing a withdrawal transaction, but Coinbase Entity erroneously sends Client's Digital Assets to another destination address).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 Coinbase will comply with the Client's Instructions to stake, stack or vote the Client's Digital Assets to the extent the applicable Coinbase Entity supports proof of stake validation, proof of transfer validation, or voting for such Digital Assets. The Coinbase Entities may, in their sole discretion, decide whether or not to support (or cease supporting) staking services or stacking or voting for a Digital Asset.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **Representations, Warranties, and Additional Covenants** 

Client represents, warrants, and covenants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 Client has the full power, authority, and capacity to enter into this Coinbase Prime Broker Agreement and to engage in transactions with respect to all Digital Assets relating to the Prime Broker Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 Client has policies and procedures in place to maintain full compliance with all applicable laws, rules, and regulations to the extent relevant and material to its performance hereunder in each jurisdiction in which Client operates or otherwise uses the Prime Broker Services, including U.S. securities laws and regulations, as well as any applicable state and federal laws, including all applicable laws and regulations relating to anti-money laundering, including the Bank Secrecy Act, as amended by the USA PATRIOT Act and the Anti-Money Laundering Act of 2020 (collectively "AML Laws") and other anti-terrorism statutes, regulations, and conventions of the United States or other international jurisdictions to the extent relevant and material to its performance hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 With the understanding that each Coinbase entity must perform its own due diligence on the authorized participants and their agents/partners who open accounts with Coinbase, Client can attest that it has performed its own due diligence on the authorized participants it has contracted with to source the Digital Assets contemplated under this Agreement and has confirmed that the authorized participants and its agents/partners have similarly implemented policies, procedures and controls designed to comply with applicable AML Laws and Sanctions Laws. Client is and shall remain in good standing with all relevant government agencies, departments, regulatory, and supervisory bodies to the extent relevant and material to its performance hereunder, and Client will, to the extent permitted under applicable law and such relevant government agency, department, regulatory, and supervisory body, promptly notify Coinbase if Client ceases to be in good standing with any regulatory authority to the extent such cessation would materially impact either party's performance hereunder;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 Client shall promptly provide information as the Coinbase Entities may reasonably request in writing from time to time regarding: Client's use of the Prime Broker Services to the extent reasonably necessary for the Coinbase Entities to comply with any applicable laws, rules, and regulations (including money laundering statutes, regulations and conventions of the United States or other jurisdictions), or the guidance or direction of, or request from, any regulatory authority or financial institution, in each case related to its performance hereunder, provided that such information may be redacted to remove Confidential Information not relevant to the requirements of this Coinbase Prime Broker Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5 Client's use of the Prime Broker Services shall be for commercial, business purposes only;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6 the Agent represents to the Coinbase Entities, that the Client (a) has duly authorized Agent to execute and deliver the Coinbase Prime Broker Agreement on behalf of such Client and (b) has the power to so authorize Agent; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.7 This Coinbase Prime Broker Agreement is Client's legal, valid, and binding obligation, enforceable against it in accordance with its terms.

Each Coinbase Entity, as applicable, represents, warrants, and covenants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.8 Each Coinbase Entity has adopted, implemented, and shall maintain and follow a reasonable risk- based program ("Sanctions Program") that is designed to comply with all applicable economic, trade and financial sanctions laws, resolutions, executive orders and regulations enacted by the United States (including as administered and/or enforced by the Office of Foreign Assets Control), the United Kingdom, the European Union, the United Nations and other applicable jurisdictions (collectively "Sanctions Laws"). That Sanctions Program includes reasonable steps designed to prevent Digital Assets, Orders or transactions from being directly derived from or knowingly associated with persons, entities or countries that are the target or subject of sanctions or any country embargoes, in violation of any Sanctions Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9 Each Coinbase Entity has also adopted, implemented and shall maintain and follow an anti-money laundering program ("AML Program") that is designed to comply with (i) all applicable AML Laws. As part of its AML Program, each Coinbase entity performs both initial and ongoing due diligence on each of its customers, as well as ongoing transaction monitoring that is designed to identify and report suspicious activity conducted through customer accounts, as required by law. The above AML controls are applied to all customer accounts opened at Coinbase, including any opened by (a) Connected Trading Venues, (b) authorized participants of the Client or (c) agents/partners of such authorized participants (collectively as "Connected Trading Venue or Authorized Participant Accounts") for the purpose of facilitating bitcoin or ethereum deposits to, and withdrawals from, the Client's Trading Account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.10 All fund movements into a Connected Trading Venue or Authorized Participant's Account at Coinbase will be sanctions screened to ensure that bitcoin or ethereum in kind transactions did not directly originate from persons, entities or countries that are the target or subject of sanctions or any country embargoes, or knowingly associated with such persons, entities or countries, or otherwise in violation of any Sanctions Laws, in violation of any Sanctions Laws, prior to any onward transfer to the Client's account(s) at Coinbase.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.11 In the event sanctions screening results in a bitcoin or ethereum in-kind transaction being suspected or determined to be in violation of any Sanctions Laws, each Coinbase Entity will (a) block or reject the deposit of such bitcoin or ethereum into the a Connected Trading Venue or Authorized Participant Account, where required by applicable Sanctions Laws, and (b) agree to promptly inform the Client if any fund movement between a Connected Trading Venue or Authorized Participant Account at Coinbase and the Client's account(s) at Coinbase involves the aforementioned, so long as permitted by law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.12 Each Coinbase Entity also agrees to provide Client with (i) a quarterly report on the sanctions screening results of any fund movement between a Connected Trading Account or Authorized Participant Account at Coinbase and the Client's account(s), after the end of the calendar quarter, and (ii) to the extent permitted by law, such information as it may reasonably request, to enable Client to fulfill its obligations under Sanctions Laws and AML Laws, including an annual attestation regarding Coinbase's AML and Sanctions Law controls. Client is permitted to share this report with service providers of the Client and authorized participants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.13 It possesses and will maintain, all licenses, registrations, authorizations and approvals required by any applicable government agency or regulatory authority for it to operate its business and provide the Prime Broker Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.14 It is and shall remain in good standing with all relevant government agencies, departments, regulatory and supervisory bodies to the extent relevant and material to its performance hereunder, and it will, to the extent permitted under applicable law and by such relevant government agency, department, regulatory and supervisory body, and in compliance with its policies and procedures addressing material non-public information, promptly notify Client if it ceases to be in good standing with any regulatory authority to the extent such cessation would materially impact either party's performance hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.15 It shall promptly provide information as the Client may reasonably request in writing from time to time in connection with its provision of the Prime Broker Services, to the extent reasonably necessary for the Client to comply with any applicable laws, rules, and regulations (including money laundering statutes, regulations and conventions of the United States or other jurisdictions), or the guidance or direction of, or request from, any regulatory authority or financial institution, in each case related to its performance hereunder and to the extent that providing such information is not prohibited by applicable law or any internal policies and procedures in furtherance of applicable law or addressing material non-public information, and does not constitute material nonpublic information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.16 It has all rights necessary to provide Client with access to the Coinbase Prime Broker Site and Content, Coinbase Prime, Coinbase Prime API, Market Data and any other tech/data provided by Coinbase (the "Coinbase Tech") as contemplated herein; (b) the intended use by Client of the Coinbase Tech as described in and in accordance with this Coinbase Prime Broker Agreement shall not infringe, violate or misappropriate the intellectual property rights of any third party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.17 It has the full power, authority, and capacity to enter into and be bound by this Coinbase Prime Broker Agreement and to provide the Prime Broker Services; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.18 This Coinbase Prime Broker Agreement is its legal, valid and binding obligation, enforceable against it in accordance with its terms.

Notwithstanding anything to the contrary contained in this Coinbase Prime Broker Agreement or any annex, schedule, addendum, confirmation or other document issued or delivered in connection with any transaction hereunder, the Coinbase Entities each acknowledges and agrees that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.19 Agent is acting in connection with any transaction hereunder solely in its capacity as agent and investment adviser or sub-investment adviser to the Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.20 Neither Agent nor any of its affiliates, subsidiaries or successors, in each case, to the extent that such affiliates, subsidiaries or successors are not Clients under this Coinbase Prime Broker Agreement shall have any obligation of any kind or nature whatsoever, by guaranty, enforcement or otherwise, with respect to the performance of any Client's obligations, agreements, representations or warranties under the Coinbase Prime Broker Agreement or any transaction hereunder;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.21 Other than with respect to the payment of custodial fees and Settlement Fees, Agent and its affiliates shall have no responsibility or liability to pay any costs, expenses, damages or claims arising under or in connection with or in any way relating to this Coinbase Prime Broker Agreement or any transaction hereunder entered into on behalf of a Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.22 Coinbase Entities' remedies shall not include a right of set off in respect of the rights or obligations, if any, of Agent arising in its capacity as principal or agent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.23 No recourse of any kind or nature whatsoever shall be had against the Agent or any affiliate, subsidiary or successor to Agent, or against any incorporator, shareholder, officer, director, member, manager, employee or agent of any Agent (each, an "Agent Party") with respect to any of the covenants, agreements, representations or warranties contained in this Coinbase Prime Broker Agreement or any annex, or schedule hereto, or any addendum, Confirmation or any other document issued or delivered in connection with any transaction entered into under this Coinbase Prime Broker Agreement, in each case unless otherwise provided in the relevant document or if any Agent Party is or becomes a Client under this Coinbase Prime Broker Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.24 Other than with respect to the Storage Fees, under no circumstances shall the Agent or any Agent Party be in any way individually or personally liable under this Coinbase Prime Broker Agreement and that the Coinbase Entities shall look solely to the assets and property of the Client that are under management by Agent for performance of the Coinbase Prime Broker Agreement or payment of any claim under the Coinbase Prime Broker Agreement with respect to such Client; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.25 Agent acknowledges and agrees that the payment of Storage fees and Settlement Fees is the obligation of Agent as principal and Agent shall be liable to the Coinbase Entities for the failure to pay such fees when due under this Coinbase Prime Broker Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **ERISA** 

Client represents and warrants that the assets used to consummate the transactions provided hereunder (hereinafter referred to as "<u>ERISA Transactions</u> for purposes of this Section 6 and Section 7) do not, and shall not, constitute the assets of (i) an "employee benefit plan" that is subject to Part 4, Subtitle B, Title I of the Employee Retirement Income Security Act of 1974, as amended ("<u>ERISA</u>"); (ii) a "plan" within the meaning of Section 4975 of the Internal Revenue Code of 1986, as amended (the "<u>Code</u>"), that is subject to Section 4975 of the Code; or (iii) a person or entity the underlying assets of which are deemed to include plan assets as determined under Section 3(42) of ERISA and the regulations thereunder, and Client will notify Coinbase (1) if Client is aware in advance that it will breach the foregoing representation and warranty (the "<u>Representation</u>"), reasonably in advance of it breaching the Representation; or (2) promptly upon becoming aware that it is in breach of the Representation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **Other Plans** 

Either (i) the assets used to consummate the ERISA Transactions provided hereunder do not, and shall not, constitute the assets of a governmental plan that is subject to any federal, state or local law that is substantially similar to the provisions of Section 406 of ERISA or Section 4975 of the Code (a "<u>Similar</u> <u>Law</u>") or (ii) the ERISA Transactions hereunder do not violate any applicable Similar Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **No Investment Advice or Brokerage** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 Client assumes responsibility for each transaction in or for its Prime Broker Account. Client understands and agrees that none of the Coinbase Entities are an SEC/FINRA registered broker- dealer or investment adviser to Client in any respect, and the Coinbase Entities have no liability, obligation, or responsibility whatsoever for Client decisions relating to the Prime Broker Services, subject to Section 22. Client should consult its own legal, tax, investment and accounting professionals.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 While the Coinbase Entities may make certain general information available to Client, the Coinbase Entities are not providing and will not provide Client with any investment, legal, tax or accounting advice regarding Client's specific situation. Client is solely responsible, and shall not rely on the Coinbase Entities, for determining whether any investment, investment strategy, or transaction involving Digital Assets is appropriate for Client based on Client's investment objectives, financial circumstances, risk tolerance, and tax consequences. Except as otherwise set forth herein, the Coinbase Entities shall have no liability, obligation, or responsibility whatsoever regarding any Client decision to enter into in any transaction with respect to any Digital Asset, subject to Section 22.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **Opt-In to Article 8 of the Uniform Commercial Code** 

Client Assets in the Trading Balance and Vault Balance will be treated as "financial assets" under Article 8 of the New York Uniform Commercial Code ("<u>Article 8</u>"). Coinbase and Coinbase Custody are "securities intermediaries," the Trading Balance and Vault Balance are each "securities accounts," and Client is an "entitlement holder" under Article 8. This Agreement sets forth how the Coinbase Entities will satisfy their Article 8 duties. Treating Client Assets in the Trading Balance and Vault Balance as financial assets under Article 8 does not determine the characterization or treatment of the cash and Digital Assets under any other law or rule. New York will be the securities intermediary's jurisdiction with respect to Coinbase and Coinbase Custody, and New York law will govern all issues addressed in Article 2(1) of the Hague Securities Convention. Coinbase and Coinbase Custody will credit the Client with any payments or distributions on any Client Assets it holds for Client's Trading Balance and Vault Balance. Coinbase and Coinbase Custody will comply with Client's Instructions with respect to Client Assets in Client's Trading Balance or Vault Balance, subject to the terms of the MTA or Custody Agreement, as applicable, and related Coinbase rules, including the Coinbase Trading Rules (as such term is defined in the MTA). Each of Coinbase and Coinbase Custody is obligated by Article 8 to maintain sufficient Digital Assets to satisfy all entitlements of customers of Coinbase or Coinbase Custody, respectively, to the same Digital Assets. Neither Coinbase nor Coinbase Custody may grant a security interest in the Digital Assets in the Trading Balance or Client's Custodial Account, respectively. Digital Assets in Client's Custodial Account are custodial assets. Under Article 8, the Digital Assets in the Trading Balance and Client's Custodial Account are not general assets of Coinbase or Coinbase Custody, respectively and are not available to satisfy claims of creditors of Coinbase or Coinbase Custody, respectively. Coinbase and Coinbase Custody will comply at all times with the duties of a securities intermediary under Article 8, including those set forth at sections 8-504(a), 8-505(a), 8-506(a), 8-507 and 8-508, in accordance with the terms of this Coinbase Prime Broker Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **General Use, Security and Prohibited Use** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1 *Prime Broker Site and Content*. During the term of this Coinbase Prime Broker Agreement, the Coinbase Entities hereby grant Client a limited, nonexclusive, non-transferable, non- sublicensable, revocable and royalty-free license, subject to the terms of this Coinbase Prime Broker Agreement, to access and use the Coinbase Prime Broker Site accessible at prime.coinbase.com (" <u>Coinbase Prime Broker Site</u> ") and related content, materials, and information (collectively, the " <u>Content</u> ") solely for Client's internal business use and other purposes as permitted by Coinbase in writing from time to time. Any other use of the Coinbase Prime Broker Site or Content is hereby prohibited. All other right, title, and interest (including all copyright, trademark, patent, trade secrets, and all other intellectual property rights) in the Coinbase Prime Broker Site, Content, and Prime Broker Services is and will remain the exclusive property of the Coinbase Entities and their licensors. Except as expressly permitted herein, Client shall not copy, transmit, distribute, sell, license, reverse engineer, modify, publish, or participate in the transfer or sale of, create derivative works from, or in any other way exploit any of the Prime Broker Services or Content, in whole or in part. "Coinbase," "Coinbase Prime," "prime.coinbase.com," and all logos related to the Prime Broker Services or displayed on the Coinbase Prime Broker Site are either trademarks or registered marks of the Coinbase Entities or their licensors. Client may not copy, imitate or use them without Coinbase's prior written consent. The license granted under this Section 10.1 will automatically terminate upon termination of this Coinbase Prime Broker Agreement, or the suspension or termination of Client's access to the Coinbase Prime Broker Site or Prime Broker Services. Notwithstanding the foregoing or anything to the contrary herein or in the Market Data Exhibit (now or hereinafter modified), "Client Data" shall mean Client's executed trade data, settled transaction history generated from the Trading Platform, Coinbase's exchange platform or other platform of Coinbase or its affiliates or the Prime Broker Services, and any electronic data or information of Client, submitted to the Prime Broker Services. Client Data shall not be deemed to be "Market Data". Notwithstanding anything to the contrary in this Coinbase Prime Broker Agreement including any annex, schedule or appendix thereto, including the Market Data Exhibit, Coinbase may incorporate any Client Data solely in aggregated and anonymized or unattributable form into one or more data sets; provided that for purposes of the Coinbase Prime Broker Agreement, data is "anonymized" or "unattributable" only if all identifiers that directly or indirectly identify the source and subject of such data with Client have been removed, and it does not enable a third party to discern, decompile, recreate, or reverse engineer any particular trading strategy of Client. Coinbase may use any Client Data in aggregated and anonymized form for any purpose consistent with this Section 10.1 and Section 13. In the event that Client Data are incorporated into a commercially available product such as a standalone dataset, Coinbase will discuss an appropriate license-back to Client, on terms commensurate with Client's contribution to such product. Without limiting the foregoing, Client shall not reverse engineer Coinbase's pricing mechanism or smart order router or cause or facilitate the same to be reverse engineered. Coinbase agrees that (i) it will use unaggregated and attributable Client Data in compliance with applicable law and regulatory requirements, and (ii) it will not use unaggregated and attributable Client Trade Data to develop, facilitate the development of, or reverse engineer algorithms for the detection of the trading strategy or algorithms used by Client in the execution of Client Data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2 *Unauthorized Users.* Client shall not allow any person or entity that is not the Client or an Authorized Representative (each, an " <u>Unauthorized User</u> ") to access, connect to, and/or use Client's Prime Broker Account. Subject to Section 22, the Coinbase Entities shall have no liability, obligation, or responsibility for, and Client shall be fully responsible and liable for, any and all Claims and Losses of the Coinbase Entities arising out of or relating to the acts and omissions of any Unauthorized User, except to the extent caused by any Coinbase Entity in respect of the Prime Broker Services, Prime Broker Account, and/or the Prime Broker Site. Client shall notify Coinbase immediately if Client believes or becomes aware that an Unauthorized User has accessed, connected to, or used Client's Prime Broker Account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3 *Password Security; Contact Information*. Client is fully responsible for maintaining adequate security and control of any and all IDs, passwords, hints, personal identification numbers (PINs), *API* keys, YubiKeys, other security or confirmation information or hardware, and any other codes that Client uses to access the Prime Broker Account and Prime Broker Services. Client agrees to keep Client's email address and telephone number up to date in Client's Prime Broker Account in order to receive any notices or alerts that the Coinbase Entities may send to Client. Subject to Section 22, Client shall be fully responsible for any Losses that Client may sustain due to compromise of Prime Broker Account login credentials. In the event Client believes Client's Prime Broker Account information has been compromised, Client must contact Coinbase promptly.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4 *Prohibited Use*.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.1 *Unlawful Activity*. Client shall not engage in any of the following activities with its use of the Prime Broker Services: Activity that would *violate*, or assist in violation of, any law, statute, ordinance, or regulation, sanctions programs administered in the countries where Coinbase conducts business, including but not limited to the U.S. Department of Treasury's Office of Foreign Assets Control (OFAC), or which would involve proceeds of any unlawful activity; publish, distribute or disseminate any unlawful material or information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.2 *Abusive Activity*. Client shall use reasonable efforts to not engage in the following activities with the use of Prime Broker Services: actions that impose an unreasonable or disproportionately large load on Coinbase's infrastructure, or detrimentally interfere with, intercept, or expropriate any system, data, or information; transmit or upload any material to Coinbase systems that contains viruses, trojan horses, worms, or any other harmful or deleterious programs through the use of process and technology reasonably designed to avoid such activities; attempt to gain unauthorized access to Coinbase systems, other Coinbase accounts, computer systems or networks connected to Coinbase systems, Coinbase Site, through password mining or any other means; use Coinbase Account information of another party to access or use the Coinbase systems, except in the case of specific Clients and/or applications which are specifically authorized by a Client to access such Client's Coinbase Account and information; or transfer Client's account access or rights to Client's account to a third party, unless by operation of law or with the express permission of Coinbase; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.3 *Fraud.* Client shall not engage in activity with its use of the Prime Broker Services which operates to defraud Coinbase or any other person or entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5 *Computer Viruses*. Subject to Section 22 or, in the case of Client's liability, limited to the extent of the failure of the Coinbase Entities to adhere to the standards of care set forth in Section 22, no party hereto shall have any liability, obligation, or responsibility whatsoever for any damage or interruptions caused by any computer viruses, spyware, scareware, Trojan horses, worms or other malware that may affect another party's computer or other equipment, or any phishing, spoofing or other attack, unless such party fails to have commercially reasonable policies, procedures and technical controls in place to prevent such damages or interruptions. Client may access and use its Prime Broker Account through the Coinbase Prime Broker Site to review any Orders, deposits or withdrawals or required actions to confirm the authenticity of any communication or notice from the Coinbase Entities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6 *Training*. Coinbase will provide to Client training that is reasonably required for Client to access and use the Service, at no additional cost to Client.

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| **11** | **Taxes** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1 *Taxes*. Except as otherwise expressly stated herein, Client shall be fully responsible and liable for, and the Coinbase Entities shall have no liability, obligation, or responsibility whatsoever for, the payment of any and all present and future tariffs, duties or taxes (including withholding taxes, transfer taxes, stamp taxes, documentary taxes, value added taxes, personal property taxes and all similar costs) imposed or levied by any government or governmental agency (collectively, " <u>Taxes</u> ") and any related Claims and Losses or the accounting or reporting of income or other Taxes arising from or relating to any transactions Client conducts through the Prime Broker Services. Client acknowledges that Coinbase shall not be responsible for filing all tax returns, reports and disclosures required by laws applicable to Client.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2 *Withholding Tax*. Except as required by applicable law, each payment under this Coinbase Prime Broker Agreement or collateral deliverable by Client to any Coinbase Entities shall be made, and the value of any collateral or margin shall be calculated, without withholding or deducting of any Taxes. The Coinbase Entities agree that the Client may withhold or deduct Taxes as may be required by applicable law. If any Taxes are required to be withheld or deducted, Client (a) authorizes the Coinbase Entities to effect such withholding or deduction and remit such Taxes to the relevant taxing authorities and (b) shall pay such additional amounts or deliver such further collateral as necessary to ensure that the actual net amount received by the Coinbase Entities is equal to the amount that the Coinbase Entities would have received had no such withholding or deduction been required. Client agrees that the Coinbase Entities may disclose any information with respect to Client Assets, the Prime Broker Account, Custodial Accounts, Trading Accounts, and transactions required by any applicable taxing authority or other governmental entity. The Client agrees that the Coinbase Entities may withhold or deduct Taxes as may be required by applicable law. Both parties agree that under reasonable request, valid tax documentation or certification of the party's taxpayer status be furnished to the requesting party within a reasonable time as required by applicable law, and any failure by either party to comply with this request in the reasonable time frame identified may result in withholding and/or remission of taxes to a tax authority as required by applicable law.

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| **12** | **Prime Broker Services Fees** |

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Client agrees to pay all commissions and fees in connection with the Orders and Prime Broker Services on a timely basis as set forth in the Fee Schedule, attached hereto as Appendix 1. Client authorizes the Coinbase Entities to pay themselves for fees and commissions relating to the Trading Account (excluding custodial fees) by deducting fees from the Trading Balance in accordance with the protocols set forth herein, to satisfy Client's fees owed; for the avoidance of doubt fees unrelated to the foregoing shall be billed to Client and separately paid by client, and any other deductions from any of Client's accounts must be made pursuant to Section 19.

For any periodic fees set forth in the Fee Schedule (which, for the avoidance of doubt, includes only the custodial fees), Coinbase will deliver on a monthly basis, in accordance with the notice provisions set forth herein, an invoice detailing the periodic fees incurred during the immediately prior month.

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| **13** | **Confidentiality** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.1 Client and Coinbase Entities each agree that with respect to any non-public, confidential or proprietary information of the other Party, including the existence and terms of this Coinbase Prime Broker Agreement, Client Data, Client's trade details, Orders, requests for financing (including related to any Digital Availability Notice), and information relating to the other party's business operations or business relationships (including the Coinbase Entities' fees), and any arbitration pursuant to Section 24 (collectively, " <u>Confidential Information</u> "), it (a) will not disclose such Confidential Information except to such party's officers, directors, agents, employees and professional advisors who need to know the Confidential Information for the purpose of assisting in the performance of this Coinbase Prime Broker Agreement and who are informed of, and agree to be bound by obligations of confidentiality no less restrictive than those set forth herein and (b) will protect such Confidential Information from unauthorized use and disclosure. Each Party shall use any Confidential Information that it receives solely for purposes of (i) exercising its rights and performing its duties under the Coinbase Prime Broker Agreement and (ii) complying with any applicable laws, rules and regulations; provided that, the Coinbase Entities may use Confidential Information for (1) risk management; and (2) to develop, enhance and market their products and services, so long as any Client Data used for such purposes is adequately aggregated and anonymized such that neither Client, Agent nor any Authorized Representative can be associated with such Client Data nor any trading strategy reverse engineered from it. Confidential Information shall not include any (w) information that is or becomes generally publicly available through no fault of the recipient; (x) information that the recipient obtains from a third party (other than in connection with this Coinbase Prime Broker Agreement) that, to the recipient's best knowledge, is not bound by a confidentiality agreement prohibiting such disclosure; (y) information that is independently developed or acquired by the recipient without the use of Confidential Information provided by the disclosing party; or (z) disclosure with the prior written consent of the disclosing Party.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.2 Notwithstanding the foregoing, each Party may disclose Confidential Information of the other Party to the extent required by a court of competent jurisdiction or governmental authority or otherwise required by law; provided, however, the Party making such required disclosure shall first notify the other Party (to the extent legally permissible) and shall afford the other Party a reasonable opportunity to seek confidential treatment if it wishes to do so and will consider in good faith reasonable and timely requests for redaction. For purposes of this Section 13, no affiliate of Coinbase shall be considered a third party of any Coinbase Entity, and the Coinbase Entities may share Client's Confidential Information among each other and with such affiliates, subject to (i) all applicable laws and restrictions with respect to sharing, (ii) each applicable Coinbase Entity's obligations under Section 2 hereof, including its information handling and conflict of interest policies and procedures and Section 11 of the Master Trading Agreement, (iii) the prior written consent of Client if such information is private or personally identifiable information, and (iv) solely as necessary for the affiliates to process, use and store such data in accordance with the terms of this Prime Broker Agreement and in connection with the Prime Brokerage Services. All documents and other tangible objects containing or representing Confidential Information and all copies or extracts thereof or notes derived therefrom that are in the possession or control of the receiving Party shall be and remain the property of the disclosing Party and shall be promptly returned to the disclosing Party or destroyed, each upon the disclosing Party's request; provided, however, notwithstanding the foregoing, the receiving Party may retain one (1) copy of Confidential Information if (a) required by law or regulation; or (b) retained pursuant to an established document retention policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.3 Other than as provided in this Section 13, no Coinbase Entity may identify to any third party that Client is a customer or licensee of any Coinbase Entity without Client's prior written consent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.4 Notwithstanding anything herein to the contrary, Client may disclose the existence of this Prime Broker Agreement to its investors and prospective investors. Additionally, notwithstanding anything herein to the contrary, the Coinbase Entities permit Client to reference the Coinbase Entities (including a description of the Coinbase Entities and/or business, as obtained from publicly available information on Coinbase's website or filings with the Securities and Exchange Commission) as a service provider hereunder along with the existence and terms of this Coinbase Prime Broker Agreement, in its public disclosures contained in public filings, each as may be required under applicable law. In addition, Client may file the Coinbase Prime Broker Agreement as an exhibit in public filings with the Securities and Exchange Commission, as may be required under applicable law, provided that such information may be redacted to remove pricing and other proprietary information in the Coinbase Prime Broker Agreement as permitted under applicable law.

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| **14** | **Market Data** |

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Client agrees that its use of data made available to it through the Trading Platform's application programming interface(s), which may include the prices and quantities of orders and transactions executed on Trading Platform (collectively "<u>Market Data</u>"), is subject to the Market Data Terms of Use, as amended and updated from time to time in the Addendum No. 2. For the avoidance of doubt, Client Data are not considered Market Data.

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| **15** | **Recording of Conversations** |

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For compliance and monitoring purposes, Client authorizes each Coinbase Entity at its sole discretion to record conversations between such Coinbase Entity and Client or its Authorized Representatives relating to this Coinbase Prime Broker Agreement, the Prime Broker Account and the Prime Broker Services. In the event a dispute arises between Client and a Coinbase entity, the Coinbase entity shall use reasonable efforts to provide any available recordings with respect to the dispute to the Client upon request.

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| **16** | **Security and Business Continuity** |

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Coinbase's information security standards and business continuity standards shall at minimum comply with the terms addressing information security, data protection and business continuity standards as set forth in Addendum No. 2.

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| **17** | **Acknowledgement of Risks** |

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Subject to the other provisions of this Coinbase Prime Broker Agreement, including without limitation Addendum No. 2, Client hereby acknowledges that: (i) Digital Assets are not legal tender, are not backed by any government, and are not subject to protections afforded by the Federal Deposit Insurance Corporation or Securities Investor Protection Corporation; (ii) Legislative and regulatory changes or actions at the state, federal, or international level may adversely affect the use, transfer, exchange, and/or value of Digital Assets; (iii) transactions in Digital Assets are irreversible, and, accordingly, Digital Assets lost due to fraudulent or accidental transactions may not be recoverable; (iv) subject to the provisions herein, certain Digital Assets transactions will be deemed to be made when recorded on a public blockchain ledger, which is not necessarily the date or time that Client initiates the transaction or such transaction enters the pool; (v) the value of Digital Assets may be derived from the continued willingness of market participants to exchange any government issued currency ("<u>Fiat Currency</u>") for Digital Assets, which may result in the permanent and total loss of value of a Digital Asset should the market for that Digital Asset disappear; (vi) the volatility of the value of Digital Assets relative to Fiat Currency may result in significant losses; (vii) subject to the obligations of the Coinbase Entities hereunder and under applicable laws, regulations and rules, Digital Assets may be susceptible to an increased risk of fraud or cyber-attack; (viii) subject to the obligations of the Coinbase Entities hereunder and under applicable laws, regulations and rules, the nature of Digital Assets means that any technological difficulties experienced by a Coinbase Entity may prevent the access or use of Client Digital Assets; and (ix) subject to the obligations of the Coinbase Entities hereunder and under applicable laws, regulations and rules, any bond or trust account maintained by Coinbase Entities for the benefit of its customers may not be sufficient to cover all losses (including Losses) incurred by customers.

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| **18** | **Operation of Digital Asset Protocols** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.1 The Coinbase Entities do not own or control the underlying software protocols which govern the operation of Digital Assets. Generally, the underlying software protocols and, if applicable, related smart contracts (referred to collectively as " <u>Protocols</u> " for purposes of this Section 18) are open source and anyone can use, copy, modify or distribute them. By using the Prime Broker Services, Client acknowledges and agrees that (i) the Coinbase Entities make no guarantee of the functionality, security, or availability of underlying Protocols; (ii) some underlying Protocols are subject to consensus-based proof of stake validation methods which may allow, by virtue of their governance systems, changes to the associated blockchain or digital ledger (" <u>Governance</u> <u>Modifiable Blockchains</u> "), and that any Client transactions validated on such Governance Modifiable Blockchains may be affected accordingly; and (iii) the underlying Protocols are subject to sudden changes in operating rules (a/k/a "forks"), and that such forks may materially affect the value, function, and/or even the name of the Digital Assets. In the event of a fork, Client agrees that the Coinbase Entities may temporarily suspend Prime Broker Services; provided that the Coinbase Entities shall (where reasonably practicable) provide advance written notice to Client promptly upon becoming aware of such a potential suspension and that the Coinbase Entities may, in their sole discretion, determine whether or not to support (or cease supporting) either branch of the forked protocol entirely, provided that the Coinbase Entities shall use commercially reasonable efforts to avoid ceasing to support both branches of such forked protocol and will support, at a minimum, the original digital asset. Client agrees that, other than as set forth herein, and provided that the Coinbase Entities shall make commercially reasonable efforts to assist Client and take the necessary steps to enable Client to retrieve and/or obtain any assets related to a fork, airdrop or similar event the Coinbase Entities shall have no liability, obligation or responsibility whatsoever arising out of or relating to the operation of Protocols, transactions affected by Governance Modifiable Blockchains, or an unsupported branch of a forked protocol and, accordingly, Client acknowledges and assumes the risk of the same.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.2 Unless specifically communicated by the Coinbase Entities through a written public statement on the Coinbase website, the Coinbase Entities do not support airdrops, metacoins, colored coins, side chains, or other derivative, enhanced or forked protocols, tokens or coins, which supplement or interact with a Digital Asset (collectively, " <u>Advanced Protocols</u> ") in connection with the Prime Broker Services. The Prime Broker Services are not configured to detect, process and/or secure Advanced Protocol transactions and neither Client nor the Coinbase Entities will be able to retrieve any unsupported Advanced Protocol. Coinbase shall have no liability, obligation or responsibility whatsoever in respect to Advanced Protocols.

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| **19** | **Setoff** |

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Upon the occurrence and continuation of a Setoff Event (as defined below) defaulting parties (each, a "Defaulting Party") and non-defaulting parties (each, a "Non-Defaulting Party") will be designated as follows: if the defaulting party is Client, Client will be the Defaulting Party and each Coinbase Entity will be a Non-Defaulting Party; and, if the defaulting party is either or all of Coinbase, Coinbase Custody or Coinbase Credit, each of Coinbase, Coinbase Custody and Coinbase Credit will be a Defaulting Party and Client will be the Non-Defaulting Party. Storage Fees are in all events excluded from the determination of amounts and the application of any party's setoff rights under this provision or otherwise.

Upon the occurrence and continuation (unless, with respect to a non-continuing event, the Non-Defaulting Party has already commenced exercising its rights under this Section 19 or has otherwise notified the Defaulting Party that it will promptly do so), after giving effect to any cure period, of an event that constitutes "Cause" (as defined below) or a "Coinbase Termination Event" (as defined below), to the extent such event has resulted in the termination of this Coinbase Prime Broker Agreement (each, a "<u>Setoff</u> <u>Event</u>"), each Non-Defaulting Party may set off and net the amounts due from it or any other Non- Defaulting Party, if any, to each Defaulting Party and from each Defaulting Party to it or any other Non- Defaulting Party (in all cases, excluding Storage Fees), so that a single payment (the "<u>Net Payment</u>") shall be immediately due and payable by the Defaulting Party to the Non-Defaulting Party (subject to the other provisions hereof and of any agreement with a Coinbase Entity). Upon the occurrence of a Setoff Event where Client is the Defaulting Party, the Coinbase Entities may (a) liquidate, apply and set off any or all Client Assets against any Net Payment, unpaid Trade Credits, or any other obligation owed by Client to any Coinbase Entity (excluding Storage Fees) and (b) set off and net any Net Payment or any other obligation owed to the Client by any Coinbase Entity (excluding, for the avoidance of doubt, any Digital Asset held in the Custody Account) against any Net Payment, unpaid Trade Credits or any other obligation owed by Client to any Coinbase Entity (excluding Storage Fees) (in each case, whether matured or unmatured, fixed or contingent, or liquidated or unliquidated). For purposes of this Section 19, the value of Digital Assets will be determined by reference to the CME CF Bitcoin Reference Rate New York (BRRNY) or the CME CF Ether-Dollar Reference Rate New York (ETHUSD_NY), as applicable, published by CME Group at 4 pm on the day the termination notice giving rise to setoff rights hereunder is delivered ("<u>Benchmark Valuation</u>"); provided, that in a circumstances where Client Digital Assets are being liquidated, the value of such Digital Assets for purposes of this Section 19 shall be the actual execution price achieved in such liquidation and such execution will be conducted in accordance with the provisions set forth in Section 2 hereof. Notwithstanding anything herein to the contrary, in exercising any rights under this Section 19, (i) the Coinbase Entities shall exercise such rights with respect to the Trading Balance prior to exercising any such rights with respect to the Vault Balance; (ii) the Coinbase Entities shall not have the right to exercise setoff rights with respect to any disputed amounts owed under Section 21; and (iii) the Coinbase Entities shall not have the right to exercise rights under this Section 19 to satisfy indemnity obligations, if any, of Client arising from legal fees (clause (i) to (iii), the "<u>Set-off Exceptions</u>").

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| **20** | **Disclaimer of Warranties** |

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EXCEPT AS EXPRESSLY SET FORTH HEREIN, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE PRIME BROKER SERVICES AND THE COINBASE WEBSITE ARE PROVIDED ON AN "AS IS" AND "AS AVAILABLE" BASIS WITHOUT ANY WARRANTY OF ANY KIND, AND THE COINBASE ENTITIES HEREBY SPECIFICALLY DISCLAIM ALL WARRANTIES NOT SPECIFICALLY SET FORTH HEREIN WITH RESPECT TO THE PRIME BROKER SERVICES, WHETHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING THE IMPLIED WARRANTIES AND/OR CONDITIONS OF TITLE, MERCHANTABILITY, SATISFACTORY QUALITY, FITNESS FOR A PARTICULAR PURPOSE, AND/OR NON-INFRINGEMENT. EXCEPT AS EXPRESSLY SET FORTH HEREIN THE COINBASE ENTITIES DO NOT WARRANT THAT THE PRIME BROKER SERVICES, INCLUDING ACCESS TO AND USE OF THE COINBASE WEBSITES, OR ANY OF THE CONTENT CONTAINED THEREIN, WILL BE CONTINUOUS, UNINTERRUPTED, TIMELY, COMPATIBLE WITH ANY SOFTWARE, SYSTEM OR OTHER SERVICES, SECURE, COMPLETE, FREE OF HARMFUL CODE OR ERROR-FREE.

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| **21** | **Indemnification** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.1 Client shall defend and indemnify and hold harmless each Coinbase Entity, its affiliates, and their respective officers, directors, agents, employees and representatives from and against any and all third party Claims and Losses arising out of or relating to Client's material breach of this Coinbase Prime Broker Agreement, Client's violation of any law, rule or regulation related to the performance of its obligations under this Prime Broker Agreement, or Client's gross negligence, fraud or willful misconduct, in each case unless caused primarily by a Coinbase Entity's failure to abide by the relevant standard of care as set forth in Section 22. This obligation will survive any termination of this Coinbase Prime Broker Agreement as it relates to the Claims and Losses arising during the term of the Coinbase Prime Broker Agreement or as it relates to activity during such term (including, for the avoidance of doubt, any Transition Period). Client shall not accept any settlement of any Claims or Losses if such settlement imposes any financial or non-financial liabilities, obligations or restrictions on, or requires an admission of guilt or wrong-doing from, any indemnified party pursuant to this Section 21, without such indemnified party's prior written consent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.2 Each Coinbase Entity shall defend and indemnify and hold harmless Client, its affiliates, and their respective officers, directors, agents, employees and representatives from and against any and all third party Claims and Losses to the extent arising out of or relating to such Coinbase Entity's: (i) any breach of such Coinbase Entity's confidentiality, data protection and/or information security obligations, (ii) violation of any law, rule or regulation with respect to the provision of the Prime Broker Services; (iii) the full amount of any Client Assets lost due to the insolvency of or security event at a Connected Trading Venue (provided that clause (iii) will also include Claims and Losses that are direct damages to Client); (iv) gross negligence, fraud or willful misconduct; or (v) that Client's access or use of the Prime Broker Services, in accordance with the terms and conditions of this Coinbase Prime Broker Agreement violates, misappropriates, or infringes upon any third party intellectual and/or industrial property rights, including patent rights, copyrights, moral rights, trademarks, trade names, service marks, trade secrets, rights in inventions (including applications for, and registrations, extensions, renewals, and re-issuances of the foregoing), in each case as it relates to the Claims and Losses arising during the term of the Coinbase Prime Broker Agreement or as it relates to activity during such term (including, for the avoidance of doubt, any Transition Period). This obligation will survive any termination of this Coinbase Prime Broker Agreement. No Coinbase Entity shall accept any settlement of any Claims or Losses if such settlement imposes any financial or non-financial liabilities, obligations or restrictions on, or requires an admission of guilt or wrong-doing from, any indemnified party pursuant to this Section 21, without such indemnified party's prior written consent.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.3 For the purposes of this Coinbase Prime Broker Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) " <u>Claim</u> " means any action, suit, litigation, demand, charge, arbitration, proceeding (including any civil, criminal, administrative, investigative or appellate proceeding), hearing, inquiry, audit, examination or investigation commenced, brought, conducted or heard by or before, or otherwise involving, any court or other governmental, regulatory or administrative body or any arbitrator or arbitration panel; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) " <u>Losses</u> " means any liabilities, damages, diminution in value, payments, obligations, losses, interest, costs and expenses, security or other remediation costs (including any regulatory investigation or third party subpoena costs, reasonable attorneys' fees, court costs, expert witness fees, and other expenses relating to investigating or defending any Claim); fines, taxes, fees, restitution, or penalties imposed by any governmental, regulatory or administrative body, interest on and additions to tax with respect to, or resulting from, Taxes imposed on Client's assets, cash, other property, or any income or gains derived therefrom; and judgments (at law or in equity) or awards of any nature.

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| **22** | **Limitation of Liability** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.1 <u>CONSEQUENTIAL DAMAGES</u>. NEITHER PARTY HERETO SHALL BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, CONSEQUENTIAL OR SIMILAR LOSSES ("CONSEQUENTIAL DAMAGES"), EVEN IF THE OTHER PARTY HAD BEEN ADVISED OF OR KNEW OR SHOULD HAVE KNOWN OF THE POSSIBILITY THEREOF.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.2 <u>LIABILITY CAPS</u>. OTHER THAN WITH RESPECT TO CLAIMS AND LOSSES ARISING FROM (I) SPOT TRADING OF BTC OR ETH (WHICH FOR THE AVOIDANCE OF DOUBT SHALL NOT INCLUDE <u>DERIVATIVES</u> TRANSACTIONS ON BTC OR ETH), (II) FRAUD OR WILFULL MISCONDUCT OF THE COINBASE ENTITIES, (III) THE MUTUALLY CAPPED LIABILITIES (DEFINED BELOW), AND NOTWITHSTANDING ANY OTHER PROVISION HERIN, IN NO EVENT SHALL ANY COINBASE ENTITY'S AGGREGATE LIABILITY HEREUNDER EXCEED THE GREATER OF (A) THE GREATER OF (i) $5 MILLION AND (ii) THE AGGREGATE AMOUNT OF FEES PAID BY CLIENT TO COINBASE IN THE 12-MONTH PERIOD PRIOR TO THE EVENT GIVING RISE TO SUCH LIABILITY AND (B) THE VALUE OF THE CASH OR AFFECTED DIGITAL ASSETS GIVING RISE TO SUCH LIABILITY. ADDITIONALLY, SOLELY WITH RESPECT TO CUSTODIAL SERVICES, IN NO EVENT SHALL COINBASE CUSTODY'S AGGREGATE LIABILITY IN RESPECT OF EACH COLD STORAGE ADDRESS EXCEED ONE HUNDRED MILLION US DOLLARS (US$100,000,000)

"MUTUALLY CAPPED LIABILITIES" MEANS (I) CLAIMS AND LOSSES ARISING FROM A PARTY'S BREACH OF ITS CONFIDENTIALITY OBLIGATIONS, (II) A PARTY'S INDEMNITY OBLIGATIONS SET FORTH IN SECTION 21 HEREOF AND (III) CLAIMS AND LOSSES ARISING FROM THE VIOLATION, MISAPPROPRIATION, OR INFRINGEMENT BY A PARTY OF ANY THIRD PARTY INTELLECTUAL AND/OR INDUSTRIAL PROPERTY RIGHTS, INCLUDING PATENT RIGHTS, COPYRIGHTS, MORAL RIGHTS, TRADEMARKS, TRADE NAMES, SERVICE MARKS, TRADE SECRETS, RIGHTS IN INVENTIONS (INCLUDING APPLICATIONS FOR, AND REGISTRATIONS, EXTENSIONS, RENEWALS, AND RE-ISSUANCES OF THE FOREGOING).

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OTHER THAN WITH RESPECT TO LIABILITIES ARISING FROM A PARTY'S WILFULL MISCONDUCT OR FRAUD, AND NOTWITHSTANDING ANY OTHER PROVISION HEREOF, IN NO EVENT WILL ANY PARTY'S LIABILITY FOR A MUTUALLY CAPPED LIABILITY EXCEED THE GREATER OF FIVE MILLION US DOLLARS (US$5,000,000) AND THE AGGREGATE AMOUNT OF FEES PAID BY CLIENT TO COINBASE IN THE 12- MONTH PERIOD PRIOR TO THE EVENT GIVING RISE TO SUCH LIABILITY.

FOR PURPOSES OF THIS SECTION 22.2: (I) WITH RESPECT TO CLAIMS AND LOSSES RELATED TO A SALE OR AN INTENDED SALE, THE VALUE OF CASH OR SUPPORTED ASSETS SHALL BE THE EXECUTION PROCEEDS OF SUCH SALE OR INTENDED SALE BY REFERENCE TO THE BENCHMARK VALUATION ON THE DATE OF THE SALE OR INTENDED SALE; AND (II) WITH RESPECT TO CLAIMS AND LOSSES RELATED TO A WITHDRAWAL OR TRANSFER OF DIGITAL ASSETS, THE VALUE OF SUCH DIGITAL ASSETS SHALL BE DETERMINED BY REFERENCE TO THE BENCHMARK VALUATION ON THE DATE DELIVERY OF SUCH DIGITAL ASSETS IN CONNECTION WITH SUCH WITHDRAWAL OR TRANSFER IS DUE IN ACCORDANCE WITH THE TERMS OF THIS COINBASE PRIME BROKERAGE AGREEMENT, INCLUDING WITHOUT LIMITATION, FOR THE AVOIDANCE OF DOUBT, ADDENDUM 2.

AS A BEST PRACTICE, TRUST COMPANY RECOMMENDS LIMITING THE VALUE OF DIGITAL ASSETS DEPOSITED IN EACH COLD STORAGE ADDRESS TO LESS THAN EIGHTY MILLION US DOLLARS (US$80,000,000). THE COINBASE ENTITIES WILL USE COMMERCIALLY REASONABLE EFFORTS TO MONITOR THE BALANCE IN CLIENT'S CUSTODY ACCOUNTS AND COLD STORAGE ADDRESSES AND WILL NOTIFY CLIENT WHEN THE AMOUNT OF DIGITAL ASSETS APPROACHES EIGHTY MILLION US DOLLARS (US$80,000,000) FOR A SPECIFIC ADDRESS.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.3 <u>LIABILITY STANDARDS</u>. EXCEPT FOR (I) THE EXCLUDED LIABILITIES (AS DEFINED BELOW), (II) THE CORE ATTRIBUTES OF AN ORDER, WHICH INCLUDE WITHOUT LIMITATION PRICE, SIZE, DIRECTION, AND TIMING, (III) FAILING TO EXECUTE AN ORDER, (IV) ANY OBLIGATION TO MAINTAIN ASSETS IN THE AMOUNT REQUIRED, IN SPECIE, IN ACCORDANCE WITH SECTION 9 AND ALL APPLICABLE LAW AND REGULATION, INCLUDING WITHOUT LIMITATION, UNDER NY DFS BITLICENSE REQUIREMENTS AND STATE MONEY TRANSMITTER LICENSE REQUIREMENTS, (V) THE CUSTODIAL SERVICES AND ANY OBLIGATIONS PURSUANT TO THE CUSTODY AGREEMENT OR ADDENDUM NO. 2, AND (VI) ANY OBLIGATIONS PURSUANT TO THE CTF AGREEMENT, IN NO EVENT SHALL COINBASE, THE COINBASE ENTITIES OR EACH OF THEIR AFFILIATES, RESPECTIVE OFFICERS, DIRECTORS, AGENTS, EMPLOYEES OR REPRESENTATIVES HAVE ANY LIABILTY TO CLIENT OR AGENT WHICH DOES NOT ARISE FROM ITS GROSS NEGLIGENCE, FRAUD, MATERIAL VIOLATION OF APPLICABLE LAW OR WILLFUL MISCONDUCT; PROVIDED THAT WITH RESEPCT TO CLAUSE (II), (III), (IV), (V) AND (VI), IN NO EVENT SHALL COINBASE, THE COINBASE ENTITIES OR EACH OF THEIR AFFILIATES, RESPECTIVE OFFICERS, DIRECTORS, AGENTS, EMPLOYEES OR REPRESENTATIVES HAVE ANY LIABILTY TO CLIENT OR AGENT WHICH DOES NOT ARISE FROM ITS NEGLIGENCE, FRAUD, MATERIAL VIOLATION OF APPLICABLE LAW OR WILLFUL MISCONDUCT. COINBASE AND THE COINBASE ENTITIES WILL BE LIABLE TO CLIENT WITH RESPECT TO ANY EXCLUDED LIABILITIES, SUBJECT TO ANY APPLICABLE CONTRACTUAL DEFENSES TO SUCH LIABILITY, INCLUDING BUT NOT LIMITED TO SECTION 30.

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"EXCLUDED LIABILITIES" MEANS ANY LIABILITY DIRECTLY RESULTING FROM (A) A BREACH BY ANY COINBASE ENTITY OF ITS CONFIDENTIALITY OBLIGATIONS UNDER THIS COINBASE PRIME BROKER AGREEMENT (B) A WILLFUL OR INTENTIONAL MATERIAL BREACH BY ANY COINBASE ENTITY OF THE COINBASE PRIME BROKER AGREEMENT OTHER THAN IN THE PROVISION OF THE PRIME BROKER SERVICES (FOR THE AVOIDANCE OF DOUBT, THE SERVICES DESCRIBED IN THE SERVICE LEVERL AGREEMENT ARE PRIME BROKER SERVICES), (C) VIOLATION, MISAPPROPRIATION, OR INFRINGEMENT BY A COINBASE ENTITY OF ANY THIRD PARTY INTELLECTUAL AND/OR INDUSTRIAL PROPERTY RIGHTS, INCLUDING PATENT RIGHTS, COPYRIGHTS, MORAL RIGHTS, TRADEMARKS, TRADE NAMES, SERVICE MARKS, TRADE SECRETS, RIGHTS IN INVENTIONS (INCLUDING APPLICATIONS FOR, AND REGISTRATIONS, EXTENSIONS, RENEWALS, AND RE-ISSUANCES OF THE FOREGOING, OR (D) THE OCCURRENCE OF AN EVENT CONSTITUTING A COINBASE TERMINATION EVENT PURSUANT TO CLAUSE (i), (ii), OR (iii) OF THE DEFINITION OF COINBASE TERMINATION EVENT (PROVIDED THAT NEITHER THE CONTINUANCE OF SUCH AN EVENT AFTER ANY APPLICABLE CURE PERIOD NOR THE EXERCISE OF REMEDIES BY CLIENT SHALL BE REQUIRED FOR SUCH EVENT TO BE DEEMED AN EXCLUDED LIABILITY).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.4 <u>SPECIFIC PERFORMANCE</u>. TO THE EXTENT ANY OF THE COINBASE ENTITIES IS LIABLE FOR ANY CLAIMS OR LOSSES CLIENT INCURS IN CONNECTION WITH THE CUSTODIAL SERVICES OR WITH RESPECT TO ASSETS CREDITED TO OR THAT SHOULD BE CREDITED TO THE TRADING BALANCE, CLIENT AND EACH OF THE COINBASE ENTITIES AGREES THAT IRREPARABLE DAMAGE WOULD OCCUR IN THE EVENT ANY PROVISION OF THIS COINBASE PRIME BROKER AGREEMENT WAS NOT PERFORMED IN ACCORDANCE WITH THE TERMS HEREOF AND THAT CLIENT SHALL BE ENTITLED TO SPECIFIC PERFORMANCE OF THE TERMS HEREOF, IN ADDITION TO ANY OTHER REMEDY AT LAW OR IN EQUITY.

"SPECIFIC PERFORMANCE" IS DEFINED AS THE OBLIGATION, IMMEDIATELY UPON NOTICE, TO: (A) FOR ANY ERROR OR FAILURE OF PERFORMANCE OR DELIVERY WITH RESPECT TO AN INSTRUCTION TO BUY DIGITAL ASSETS HEREUNDER, TO DELIVER TO CLIENT THE CORRECT QUANTITY OF DIGITAL ASSETS AS IF THERE HAD BEEN NO SUCH ERROR OR FAILURE OF PERFORMANCE OR DELIVERY; (B) FOR ANY ERROR OR FAILURE OF PERFORMANCE OR DELIVERY WITH RESPECT TO AN INSTRUCTION TO SELL DIGITAL ASSETS HEREUNDER, TO DELIVER TO CLIENT THE CORRECT QUANTITY OF CASH AS OF THE TIME AND DATE ON WHICH EXECUTION WAS INTENDED TO OCCUR IN ACCORDANCE WITH THE PROVISIONS HEREOF; AND

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) WITH RESPECT TO ANY FAILURE OF ITS OBLIGATION TO MAINTAIN DIGITAL ASSETS OR CASH IN THE TRADING BALANCE OR THE VAULT, TO DELIVER SUCH DIGITAL ASSETS OR CASH IN THE QUANTITY OR VALUE, RESPECTIVELY, AFFECTED BY SUCH FAILURE.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.5 <u>LIABILITY STANDARDS FOR THE SLA</u>. (A) WITH RESPECT TO THE COINBASE ENTITIES, EXCEPT WITH RESPECT TO THE PROVISIONS OF THE SLA EXPLICITLY IDENTIFIED THEREIN AS EXCLUDED FROM CLAUSE (A) OF THIS PROVISION, THE COINBASE ENTITIES, THEIR AFFILIATES AND EACH OF THEIR RESPECTIVE OFFICERS, DIRECTORS, AGENTS, EMPLOYEES AND REPRESENTATIVES SHALL NOT BE LIABLE TO CLIENT OR AGENT FOR ANY LOSSES TO THE EXTENT ARISING FROM A BREACH OF THE PROVISION OF THE SLA THAT DOES NOT CONSTITUTE A VIOLATION OF ANY OTHER PROVISION HEREIN UNLESS SUCH BREACH (I) RESULTS FROM THE FAILURE OF SUCH COINBASE ENTITY OR ACTOR TO USE REASONABLE CARE IN PERFORMING SUCH OBLIGATIONS AND (II) SUCH BREACH OF THE OBLIGATION IS REPEATED AND MATERIAL AND (B) WITH RESPECT TO CLIENT AND AGENT, (I) EXCEPT WITH RESPECT TO THE PROVISIONS OF THE SLA EXPLICITLY IDENTIFIED THEREIN AS EXCLUDED FROM CLAUSE (B)(I) OF THIS PROVISION, THE FAILURE TO PERFORM THE ACTIVITIES LISTED IN THE SLA AS A BFA RESPONSIBILITY THEREUNDER WILL NOT GIVE RISE TO ANY BREACH OR LIABILITY BY CLIENT, AGENT OR ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS, AGENTS, EMPLOYEES AND REPRESENTATIVES UNLESS SUCH FAILURE (X) CONSTITUTES A VIOLATION OF ANY OTHER PROVISION HEREIN OR (Y) OTHERWISE GIVES RISE TO AN INDEMNITY OBLIGATION SET FORTH IN SECTION 21.1; AND (II) WITH RESPECT TO THE PROVISIONS OF THE SLA EXPLICITLY EXCLUDED FROM CLAUSE (B)(I) OF THIS PROVISION, THE FAILURE TO PERFORM THE ACTIVITIES LISTED IN THE SLA AS A BFA RESPONSIBILITY THEREUNDER WILL NOT GIVE RISE TO ANY BREACH OR LIABILITY BY CLIENT, AGENT OR ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS, AGENTS, EMPLOYEES AND REPRESENTATIVES UNLESS SUCH FAILURE (X) CONSTITUTES A VIOLATION OF ANY OTHER PROVISION HEREIN, (Y) IS REPEATED AND MATERIAL AND ARISES FROM CLIENT'S NEGLIGENCE, OR (Z) OTHERWISE GIVES RISE TO AN INDEMNITY OBLIGATION SET FORTH IN SECTION 21.1. FOR THE AVOIDANCE OF DOUBT, THE FAILURE BY CLIENT OR AGENT TO PERFORM ANY BFA RESPONSIBILITY SET FORTH IN THE SLA, SHALL NOT CONSTITUTE A CAUSE EVENT HEREUNDER UNLESS SUCH FAILURE ALSO INEPENDENTLY CONSTITUTES A VIOLATION OR BREACH OF ANOTHER PROVISION IN THIS COINBASE PRIME BROKER AGREEMENT NOT SET FORTH IN THE SLA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.6 <u>NO LIMITATION FOR FRAUD OR WILFUL MISCONDUCT</u>. FOR THE AVOIDANCE OF DOUBT, AND NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, NOTHING IN THIS PRIME BROKER AGREEMENT OR ANY OF ITS EXHIBITS, ADDENDUMS, APPENDICES OR ANNEXES SHALL HAVE THE EFFECT OF LIMITING THE LIABLITY OF ANY PARTY HERETO FOR LOSSES ARISING FROM ITS FRAUD OR WILFUL MISCONDUCT.

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| **23** | **Privacy** |

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The Coinbase Entities shall use and disclose Client's and its Authorized Representatives' non-public personal information in accordance with the Coinbase Privacy Policy, as set forth at <u>*https://www.coinbase.com/legal/privacy*</u> or a successor website, and as amended and updated from time to time.

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| **24** | **Arbitration** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.1 Any Claim arising out of or relating to this Coinbase Prime Broker Agreement, or the breach, termination, enforcement, interpretation or validity thereof, including any determination of the scope or applicability of the agreement to arbitrate as set forth in this Section 24, shall be determined by arbitration in the state of New York or another mutually agreeable location, before one neutral arbitrator. The arbitration shall be administered by JAMS pursuant to its Comprehensive Arbitration Rules and Procedures, and the award of the arbitrator (the " <u>Award</u> ") shall be accompanied by a reasoned opinion. Judgment on the Award may be entered in any court having jurisdiction. This Coinbase Prime Broker Agreement shall not preclude the Parties from seeking provisional relief, including injunctive relief, in any court of competent jurisdiction. Seeking any such provisional relief shall not be deemed to be a waiver of such party's right to compel arbitration. The Parties expressly waive their right to a jury trial to the extent permitted by applicable law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.2 In any arbitration arising out of or related to this Coinbase Prime Broker Agreement, the arbitrator shall award to the prevailing party, if any, as determined by the arbitrator, all of its costs and fees. "Costs and fees" mean all reasonable pre-award expenses of the arbitration, including the arbitrator's fees, administrative fees, travel expenses, out-of-pocket expenses such as copying and telephone, court costs, witness fees, and attorneys' fees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.3 The Parties acknowledge that this Coinbase Prime Broker Agreement evidences a transaction involving interstate commerce. Notwithstanding the provision herein with respect to applicable substantive law, any arbitration conducted pursuant to the terms of this Coinbase Prime Broker Agreement shall be governed by the Federal Arbitration Act (9 U.S.C. §§ 1-16).

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| **25** | **Term, Termination and Suspension** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless specifically permitted herein, each Coinbase Entity shall not suspend, restrict, terminate or modify and shall continue to provide the Prime Broker Services, including, (i) the custody of Client's Digital Assets on Client's behalf, the processing of Custody Transactions and the other Custodial Services, (ii) access to the Trading Platform and the execution and settlement of all Orders for the purchase and sale of any Digital Assets submitted by the Client on the Trading Platform, subject to and in accordance with the terms of the MTA, and (iii) the extension of credit to the Client for the purchase and sale of Digital Assets to the extent Coinbase has committed to provide such financing under the CTF Agreement, in each case unless and until the Coinbase Entities provide 180 days' (the " <u>Notice Period</u> ") prior written notice to Client describing in reasonable detail the suspension, restriction, termination or modification that the applicable Coinbase Entity will implement or, solely with respect to the Transition Services, the end of the Transition Period; provided however, that if after the date of the Custody Prime Broker Agreement, there occurs any change in or adoption of any applicable law, rule, or regulation which, in the reasonable opinion of counsel to Coinbase will prohibit or materially impede some or all of the arrangement contemplated by this Coinbase Prime Broker Agreement (a " <u>Change in Law</u> "), the parties will, in good faith and acting in a commercially reasonable manner intended to produce a commercially reasonable result, agree on modifications to the Coinbase Prime Broker Agreement or the Prime Broker Services that would enable compliance with such Change in Law or, in the case of a material impediment, reduce the impact to the parties of such Change in Law and the Coinbase Entities shall continue to provide the Prime Broker Services as contemplated herein unless prohibited from doing so by the Change in Law. If the parties cannot agree on modifications within thirty (30) day's following notice from Coinbase or if the Change in Law requires that Coinbase immediately ceases providing any Prime Broker Services, Coinbase may, only following notice in writing to Client, suspend, restrict or terminate the Prime Broker Services solely to the extent necessary to account for the Change in Law, provided that Coinbase agrees that any suspension, restriction, termination or modification arising from a Change in Law shall be narrowly tailored to enable compliance with such Change in Law and, to the extent not prohibited by the Change in Law, the Coinbase Entities will continue to provide, at a minimum, the Transition Services following any Change in Law. Coinbase, on behalf of itself and each other Coinbase Entity, represents, warrants and covenants that it will promptly notify Client of any proposed or announced change in law, rule or regulation that may result in a Change in Law hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Coinbase Prime Broker Agreement is effective as of the date written below and shall remain in effect until terminated by Coinbase or Client. Coinbase may terminate this Coinbase Prime Broker Agreement in its entirety for any reason and without Cause by providing at least 180 days' prior written notice to Client and Client may terminate this Coinbase Prime Broker Agreement in whole or in part for any reason by providing at least thirty (30) days' prior written notice to the applicable Coinbase Entity, provided, however, in each case, the Coinbase Entities shall not restrict, suspend, or modify the Prime Broker Services following any termination without Cause or any termination by Client until the end of any such notice period and neither party's termination of this Coinbase Prime Broker Agreement shall be effective until Client and the Coinbase Entities have fully satisfied their obligations hereunder.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Regardless of any other provision of this Coinbase Prime Broker Agreement, but subject to Section 25(i), upon the occurrence and during the continuance of an event that constitutes Cause (as defined below) (unless, with respect to a non-continuing event that constitutes Cause, Coinbase has already commenced exercising its rights under this Section 25(c) or has otherwise notified Client that it will promptly do so, in each case while such event is continuing) and after giving effect to any notice requirement and cure period that may apply, each Coinbase Entity may, in its reasonable discretion, take any of the following actions: (i) terminate, in whole or in part, the Coinbase Prime Broker Agreement and accelerate the obligations hereunder (including any extensions of Trade Credit), (ii) cancel outstanding Orders (including Orders that have been submitted or are in the process of being fulfilled) to the extent Coinbase Credit has provided financing for such Orders, (iii) exercise any rights of a secured creditor with respect to its interests in the Collateral in accordance with the terms of this Prime Broker Agreement, (iv) exercise its rights under Section 19 and/or (iv) suspend, restrict or terminate the Client's Prime Broker Services, except for the Transition Services during the Transition Period. With respect to any rights or remedies any Coinbase Entity has as a secured creditor or any rights of set-off any Coinbase Entity may have, each such Coinbase Entity agrees to exercise such remedies as follows: first, exercise its setoff rights in accordance with Section 19 hereto; then, to the extent any Trade Credits to Coinbase Credit remains outstanding, Coinbase Credit shall have the right to exercise any rights of a secured creditor with respect to its interests in the Collateral to the extent not in contravention of applicable law; then to the extent any other obligations to any Coinbase Entity remain outstanding, such Coinbase Entity shall have the right to exercise any other right such Coinbase Entity is at any time otherwise entitled (whether by operation of law, contract or otherwise); provided that (i) in no event shall the Coinbase Entities exercise such rights with respect to the Vault Balance prior to exercising any such rights with respect to the Trading Balance; (ii) the Coinbase Entities shall not have the right to liquidate Collateral and exercise setoff rights with respect to any disputed amounts owed under Section 21; and (iii) the Coinbase Entities shall not have the right to exercise the rights hereunder to satisfy indemnity obligations, if any, of Client arising from legal fees. Subject to the foregoing, all rights granted hereby shall be without prejudice and in addition to any right of set-off, combination of accounts, lien or other right to which the Coinbase Entity is at any time otherwise entitled (whether by operation of law, contract or otherwise) and, other than as specifically provided herein, no delay or omission by any Coinbase Entity in exercising any right or remedy hereunder shall operate as a waiver of the future exercise of that right or remedy or of any other rights or remedies hereunder. In the event any Coinbase Entity exercises its remedies hereunder, Client shall, upon demand, pay to such Coinbase Entity all documented and reasonable costs and expenses, including reasonable attorneys' fees and court costs, and trading fees incurred by Client in connection with the enforcement of its rights hereunder.

"<u>Cause</u>" shall mean: (i) Client materially breaches any provision of this Coinbase Prime Broker Agreement (other than provisions of the Custody Agreement) and such breach remains uncured for a period of 10 calendar days after notice of such breach is provided by Coinbase to Client; (ii) Client materially breaches any provision of the Custody Agreement and such breach remains uncured for a period of 30 calendar days after notice of such breach is provided by Coinbase to Client, (iii) a Bankruptcy Event (as defined below) occurs and is continuing with respect to Client, (iv) the failure of Borrower to repay Trade Credits by the applicable Settlement Deadline (provided, however, Client shall have one (1) Business Day (as defined in the CTF Agreement) following notice from a Coinbase Entity that such repayment is outstanding to cure such failure in the event the failure to repay Trade Credits resulted solely from an error or omission of an administrative or operational nature); or (v) a default or an event of default by Client or similar event under another trading or financing agreement with a Coinbase Entity or an entity majority-owned and controlled directly or indirectly by Coinbase (such entity a "<u>Coinbase Affiliate</u>") after giving effect to any applicable notice requirement or grace period that may apply under such agreement, resulting in the liquidation, acceleration, or early termination of transactions or obligations governed under such agreement.

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"<u>Bankruptcy Event</u>" means the party is (i) dissolved (other than pursuant to a consolidation, amalgamation or merger); (ii) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (iii) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (iv) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors' rights, or a petition is presented for its winding-up or liquidation, and in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (I) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (II) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (v) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (vi) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (vii) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (viii) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (i) to (vii) (inclusive); or (ix) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If any Coinbase Entity elects to exercise its remedies hereunder, Coinbase will notify Client in writing prior to exercising such remedies, unless a court order or other legal or regulatory process prohibits the Coinbase Entities from providing Client with such notice. Client acknowledges that the Coinbase Entities' decision to take certain actions described in this Section 25 may be based on confidential criteria that are essential to Coinbase Entities' risk management and security protocols. Client agrees that the Coinbase Entities are under no obligation to disclose the details of its risk management and security procedures to Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Upon receipt of written notice from Client of any event that constitutes Cause, if Coinbase fails to exercise any of its rights and remedies above for a period of 20 days following the receipt of such notice requesting a waiver, then Coinbase shall have waived its right to terminate the Coinbase Prime Broker Agreement or exercise any other rights or remedies by reason of such event and such event shall be deemed to have been cured regardless of whether it continues after such waiver; provided however that this provision (i) does not limit Coinbase's right to take any actions with respect to an event that constitutes Cause as the result of the separate occurrence of such event or the occurrence of any other such event and (ii) shall not apply to any Bankruptcy Event.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Regardless of any other provision of this Coinbase Prime Broker Agreement, upon the occurrence and continuance of a Coinbase Termination Event (as defined below) (unless, with respect to a non- continuing event that constitutes a Coinbase Termination Event, Client has already commenced exercising its rights under this Section 25(f) or has otherwise notified Coinbase that it will promptly do so, in each case while such event is continuing) and after giving effect to any notice requirement and cure period that may apply, Client may, in its reasonable discretion, take any of the following actions: (i) terminate, in whole or in part, the Coinbase Prime Broker Agreement and accelerate the obligations hereunder, (ii) cancel outstanding Orders (including Orders that have been submitted or are in the process of being fulfilled), (iii) make a written demand on the Coinbase Entities for the return of all Client Assets, (iv), seek Specific Performance with respect to any obligations hereunder, and (v) with respect to a Bankruptcy Event, or a Coinbase Termination Event under clauses (ii) or (iii) of the definition of Coinbase Termination Event, exercise its right of set-off hereunder, and (vi) determine its claim against each Coinbase Entity using the Benchmark Valuation and seek payment thereof. In addition, Client's payment obligations under the Coinbase Prime Broker Agreement shall be suspended upon the occurrence and during the continuance of a Coinbase Termination Event. Notwithstanding anything herein to the contrary (other than with respect to Section 22 in the event Client exercises remedies solely with respect to a Coinbase Termination Event under clause (iv) and/or (v) of the definition thereof), all rights granted hereby shall be without prejudice and in addition to any right of set-off, combination of accounts, lien or other right to which Client is at any time otherwise entitled (whether by operation of law, contract or otherwise) and, other than as specifically provided herein, no delay or omission by Client in exercising any right or remedy hereunder shall operate as a waiver of the future exercise of that right or remedy or of any other rights or remedies hereunder. In the event Client exercises its remedies hereunder, each Coinbase Entity shall, upon demand, pay to Borrower all documented and reasonable costs and expenses, including reasonable attorneys' fees and court costs, and trading fees incurred by Client in connection with the enforcement of its rights hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) If a Coinbase Termination Event occurs and Client elects to exercise its remedies hereunder against any Coinbase Entity, Client will notify the Coinbase Entities in writing prior to exercising such remedies, unless a court order or other legal or regulatory process prohibits Client from providing the Coinbase Entities with such notice. Each Coinbase Entity acknowledges that Client's decision to take certain actions described in this Section 25 may be based on confidential criteria that are essential to Client's risk management and security protocols. Each Coinbase Entity agrees that Client is under no obligation to disclose the details of its risk management and security procedures to the Coinbase Entities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Upon receipt of written notice from Coinbase any Coinbase Termination Event, if Client fails to exercise any of its rights and remedies above for a period of 20 days following the receipt of such notice requesting a waiver, then Client shall have waived its right to terminate the Coinbase Prime Broker Agreement or exercise any other rights or remedies by reason of such event and such event shall be deemed to have been cured regardless of whether it continues after such waiver; provided however that this provision (i) does not limit Client's right to take any actions with respect to an event that constitutes a Coinbase Termination Event as the result of the separate occurrence of such event or the occurrence of any other such event and (ii) shall not apply to any Bankruptcy Event.

"<u>Coinbase Termination Event</u>" means the occurrence and continuance of (i) a Bankruptcy Event with respect to any Coinbase Entity, (ii) the failure of any Coinbase Entity to sell or withdraw or transfer Client BTC or ETH in accordance with Client's Instructions within the time periods set forth in this Coinbase Prime Broker Agreement and such failure is not cured within two (2) Business Days following Client providing written notice to the relevant Coinbase Entity ("<u>CB</u> <u>Return Cure</u>"); provided, however, that (A) if, prior to the expiration of the CB Return Cure, Coinbase transfers cash to Client in an amount equal to the value of the BTC or ETH based on the Benchmark Valuation as of the time that the request to sell, transfer or withdraw was originally made by Client (the "<u>BTC/ETH Cash Value</u>") or if Coinbase delivers cash collateral to an account designated by Client and in which Client has a perfected, first priority security interest and in an amount equal to the BTC/ETH Cash Value until the relevant Digital Asset is sold, withdrawn or transferred or Client elects to receive such amount in cash in lieu of Coinbase's obligation to sell, withdraw or transfer the relevant Digital Asset, in each cash, such failure will be deemed cured; provided, further that, Client shall have the right to choose whether to receive the BTC/ETH Cash Value in lieu of the relevant Digital Asset or receive the BTC/ETH Cash Value as cash collateral, or (B) if such failure is due to a technology or security issue where, in the commercially reasonable opinion of Coinbase, returning the relevant Digital Assets would result in material risk to Client or Coinbase or may result in the relevant Digital Assets being lost or otherwise not successfully returned and Coinbase promptly notifies Client promptly upon Client's notice of such failure, (1) Client may request that Coinbase still sell, withdraw or transfer the Digital Assets, but Coinbase will have no liability with respect to any such sell, withdrawal or transfer (unless Coinbase or any of the Coinbase Entities act with negligence unrelated to such technology or security issue) and any failure to withdraw or transfer shall not result in a Coinbase Termination Event if Client does not receive the withdrawn or transferred Digital Assets or the proceeds of any such sale due to such technology or security issue, or (2) if Client does not elect to have Coinbase still make the sale, withdrawal or transfer, a Coinbase Termination Event shall not occur while the relevant security or technology event is occurring and continuing, (iii) the failure of any Coinbase Entity to withdraw or transfer cash to Client in accordance with Client's Instructions within the time periods set forth in this Coinbase Prime Broker Agreement and such failure is not cured within one (1) Business Day following Client providing written notice to the relevant Coinbase Entity, (iv) a Coinbase Entity intentionally or willfully, materially breaches any provision of the Coinbase Prime Broker Agreement (other than the provisions of the Custody Agreement) and such breach remains uncured for a period of 10 calendar days after notice of such breach is provided by Client to Coinbase; or (v) a Coinbase Entity intentionally or willfully, materially breaches any provision of the Custody Agreement and such breach remains uncured for a period of 30 calendar days after notice of such breach is provided by Client to Coinbase.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Notwithstanding any termination of the Coinbase Prime Broker Agreement for Cause, during any Transition Period (as defined below) the Coinbase Entities or its affiliates shall continue to provide the Transition Services (as defined below) and render such assistance as the Client or its affiliates may reasonably request to enable the continuation and orderly assumption of the Transition Services to be effected by the Client, an affiliate of the Client or any alternative service provider and shall continue to provide the Transition Services pursuant to the Prime Broker Agreement, except to the extent any Transition Service is prohibited under applicable law (including but not limited to applicable sanctions programs) or by a facially valid subpoena, court order, or binding order of a government authority; provided that the Coinbase Entities will continue to have the right, subject to the Set-Off Exceptions, to exercise its right of set-off hereunder with respect to any sale proceeds during the Transition Period for any fees or other amounts owed by Client hereunder and (ii), notwithstanding anything to the contrary herein, including Section 25, in no event shall any Coinbase Entity, its affiliates, or their respective officers, directors, agents, employees and representatives have any liability to Client or Agent for any Claims or Losses arising out of or relating to the Coinbase Prime Broker Agreement during (A) with respect to any Transition Services described in clause (i) of the definition thereof, the 91<sup>st</sup> day through the end of the Transition Period and (B) with respect to any Transition Services described in clause (ii) of the definition thereof, the 16<sup>th</sup> day through the end of the Transition Period, which do not result from its gross negligence, fraud, material violation of applicable law or willful misconduct; provided that throughout the Transition Period the Coinbase Entities shall act in good faith and in a commercially reasonable manner to provide the same level of service with respect to the Transition Services as was provided prior to the start of the Transition Period. For the avoidance of doubt, during the Transition Period, the fees referenced in Section 12 will continue to apply to the Transition Services.

"<u>Transition Period</u>" means a 180-day period (or such extended period as agreed in writing by the Coinbase Entities and Client) commencing on the date Client is notified of any termination of the Coinbase Prime Broker Agreement pursuant to Section 25(c).

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"<u>Transition Services</u>" means the Prime Broker Services consisting of (i) the custody of Client's Digital Assets on Client's behalf, the processing of Custody Transactions and the other Custodial Services, and (ii) access to the Trading Platform and the execution and settlement of all Orders for the sale of any Digital Assets submitted by the Client on the Trading Platform. For the avoidance of doubt, the Transition Services shall not include the extension of credit, or any other Service provided under the CTF Agreement and the obligation to execute and settle any Orders for the purchase of Digital Assets.

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|:---|:---|
| **26** | **Severability** |

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If any provision or condition of this Coinbase Prime Broker Agreement shall be held invalid or unenforceable, the remainder of this Coinbase Prime Broker Agreement shall continue in full force and effect.

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| **27** | **Waiver** |

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Any waivers of rights by the Coinbase Entities or Client under this Coinbase Prime Broker Agreement must be in writing and signed by Coinbase on behalf of the relevant Coinbase Entities or Client, as applicable. A waiver will apply only to the particular circumstance giving rise to the waiver and will not be considered a continuing waiver in other similar circumstances. The Coinbase Entities' or Client's failure to insist on strict compliance with this Coinbase Prime Broker Agreement or any other course of conduct by the Coinbase Entities or Client shall not be considered a waiver of their rights under this Coinbase Prime Broker Agreement.

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|:---|:---|
| **28** | **Survival** |

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All provisions of this Coinbase Prime Broker Agreement which by their nature extend beyond the expiration or termination of this Coinbase Prime Broker Agreement shall survive the termination or expiration of this Coinbase Prime Broker Agreement.

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|:---|:---|
| **29** | **Governing Law** |

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This Coinbase Prime Broker Agreement, Client's Prime Broker Account, and the Prime Broker Services will be governed by and construed in accordance with the laws of the State of New York, excluding its conflicts of laws principles, except to the extent such state law is preempted by federal law.

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|:---|:---|
| **30** | **Force Majeure** |

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Neither any Coinbase Entity nor the Client shall be liable to the other for delays, suspension of operations, whether temporary or permanent, failure in performance of this Coinbase Prime Broker Agreement, or interruption of service in each case to the extent it is directly due to a cause or condition beyond the reasonable control of the Party affected by it, including any act of God; embargo; natural disaster; act of civil or military authorities; act of terrorists; hacking (provided that any affected Coinbase Entity has taken reasonable precautions and acts in a manner consistent with its applicable policies and procedures with respect to hacking risks and in doing so is not negligent); government prohibitions; civil disturbance; war; strike or other labor dispute; fire; severe weather; interruption in telecommunications, Internet services, or network provider services; unavailability of Fedwire, SWIFT or banks' payment processes; outbreaks of infectious disease or any other public health crises, including quarantine or other required employee restrictions; or any other catastrophe or material event which is beyond the reasonable control of the Party affected by it. For the avoidance of doubt, a cybersecurity attack, hack or other intrusion by a third party or by someone associated with the Coinbase Entities is not a circumstance that is beyond the Coinbase Entities' reasonable control, to the extent directly caused by Coinbase Entities' failure to comply with its obligations under this Coinbase Prime Broker Agreement. In any such event, the time for the Party's performance shall be deferred for a period of time equal to the time lost by reason of such event, provided that the delayed Party shall notify the other Party of such event and shall reasonably cooperate with the other Party in minimizing any adverse impact of such event.

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|:---|:---|
| **31** | **Service Level Agreement** |

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The Coinbase Entities will use commercially reasonable efforts to perform its obligations under this Coinbase Prime Broker Agreement (including, for the avoidance of doubt, any schedule, addendum, confirmation or other document issued or delivered in connection with any transaction hereunder) in accordance with the Service Level Agreement attached

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|:---|:---|
| **32** | **Entire Agreement; Headings**  |

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This Coinbase Prime Broker Agreement, together with all exhibits, addenda and supplements attached hereto or referenced herein, comprise the entire understanding between Client and the Coinbase Entities as to the Prime Broker Services and supersedes all prior discussions, agreements and understandings, including any previous version of this Coinbase Prime Broker Agreement, and the Custodial Services Agreement between Client and any Coinbase Entity, including all exhibits, addenda, policies, and supplements attached thereto or referenced therein. Section headings in this Coinbase Prime Broker Agreement are for convenience only and shall not govern the meaning or interpretation of any provision of this Coinbase Prime Broker Agreement.

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|:---|:---|
| **33** | **Amendments** |

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Any amendment to this Coinbase Prime Broker Agreement must be in writing and signed by a duly authorized representative of each party.

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|:---|:---|
| **34** | **Assignment** |

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Any assignment of either party's rights and/or licenses granted under this Coinbase Prime Broker Agreement without obtaining the prior written consent of other party shall be null and void (such consent not to be unreasonably withheld or delayed); provided, however, other than with respect to its asset safekeeping (including, for the avoidance of doubt, custodial services) and execution obligations hereunder, Coinbase may assign this Coinbase Prime Agreement to an affiliate with equal or greater creditworthiness upon thirty (30) days' prior written notice to Client.

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|:---|:---|
| **35** | **Electronic Delivery of Communications** |

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Client agrees and consents to receive electronically all communications, agreements, documents, notices and disclosures (collectively, "<u>Communications</u>") that the Coinbase Entities provide in connection with Client's Prime Broker Account and Client's use of Prime Broker Services. Communications include:

(a) terms of use and policies Client agrees to, including updates to policies, (b) Prime Broker Account details, including transaction receipts, confirmations, records of deposits, withdrawals or transaction information, (c) legal, regulatory and tax disclosures or statements the Coinbase Entities may be required to make available to Client and (d) responses to claims or customer support inquiries filed in connection with Client's Prime Broker Account.

Coinbase will provide these Communications to Client by posting them on the Prime Broker Site, emailing them to Client at the primary email address on file with Coinbase, communicating to Client via instant chat, and/or through other means of electronic communication. The Client agrees that electronically delivered Communications may be accepted and agreed to by Client through the Prime Broker Services interface. Furthermore, the Parties consent to the use of electronic signatures in connection with Client's use of the Prime Broker Services.

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|:---|:---|
| **36** | **Notice and Contacts** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36.1 All notices required or permitted to be given hereunder shall be in writing delivered to the Party at its address specified below via an overnight mailing company of national reputation. Any Party that changes its notice address must notify the other Party promptly of such change.

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If to any Coinbase Entity:

**Legal Department** Coinbase, Inc.

248 3rd St, #434

**Oakland, CA 94607** [\*\*\*]

If to Client, the address specified in the applicable Agent Annex.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36.2 In the event of any market operations, connectivity, or erroneous trade issues that require immediate attention including any unauthorized access to Client's Prime Broker Account, please contact:

To Coinbase: [\*\*\*]

To Client: the email address specified in the applicable Agent Annex.

It is solely Client's responsibility to provide Coinbase with a true, accurate and complete contact information including any e-mail address, and to keep such information up to date. Client understands and agrees that if Coinbase sends Client an electronic Communication but Client does not receive it because Client's primary email address on file is incorrect, out of date, blocked by Client's service provider, or Client is otherwise unable to receive electronic Communications, Coinbase will be deemed to have provided the Communication to Client. Client may update Client's information via Client's Prime Broker Account and visiting settings or by providing a notice to Coinbase as prescribed above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36.3 To see more information about our regulators, licenses, and contact information for feedback, questions or complaints, please visit <u>*https:// www.coinbase.com/legal/licenses*</u> .

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|:---|:---|
| **37** | **Multiple Clients** |

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Notwithstanding any inconsistent or contrary provision in this Coinbase Prime Broker Agreement, under no circumstance shall the rights, obligations, or remedies with respect to a particular Client constitute a right, obligation or remedy applicable to any other Client. In particular, and without otherwise limiting the scope of this Section 37: (i) any Cause event under Section 21 or any breach regarding one Client shall not create any right, obligation or remedy with respect to any other Client, (ii) any Coinbase Entity's remedies under this Coinbase Prime Broker Agreement upon the occurrence of a Cause event shall be determined as if each Client had entered into a separate Coinbase Prime Broker Agreement with such Coinbase Entity, (iii) the Coinbase Entities shall have no right to set off claims of a particular Client against claims of any other Client, (iv) the business and contractual relationships created hereby, the consideration for entering into this Coinbase Prime Broker Agreement, each transaction hereunder and the consequences of such relationship, consideration and transaction relate solely to the particular Client to which the particular relationship, consideration or transaction applied and are separate and apart from any relationship, consideration or transaction between the Coinbase Entities and any other Client, (v) no Client shall have any liability under this Coinbase Prime Broker Agreement for the obligations of any other Client and (vi) any other provisions of this Coinbase Prime Broker Agreement shall be interpreted solely on the basis of this Coinbase Prime Broker Agreement as a separate agreement between the Coinbase Entities and each separate individual Client and shall be fulfilled solely by the performance of the individual Client that is a party to any transaction. Coinbase and any individual Agent may agree, from time to time and at any time, to amend in writing such Agent's Agent Annex and/or add to or remove from Schedule I any Client on behalf of which such Agent is acting without the consent of any other Client or Agent.

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|:---|:---|
| **38** | **Counterparts** |

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This Coinbase Prime Broker Agreement may be executed in one or more counterparts, including by facsimile or email of .pdf signatures or DocuSign (or similar electronic signature software), each of which shall be deemed to be an original document, but all such separate counterparts shall constitute only one and the same Coinbase Prime Broker Agreement.

***[Signatures on following page]***

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**IN WITNESS WHEREOF**, the Parties have caused this Coinbase Prime Broker Agreement, including the Custody Agreement, MTA, and CTF Agreement to be duly executed and delivered as of the date below.

**COINBASE, INC. for itself and as agent for the Coinbase Entities** 

**By:** /s/ Lauren Abendschein

**Name:** Lauren Abendschein

**Title:** Senior Director

**Date:** May 22, 2024

**COINBASE CREDIT, INC., as Lender**

**By:** /s/ Matt Boyd

**Name:** Matt Boyd

**Title:** Head of Prime Financing

**Date:** May 22, 2024

**COINBASE CUSTODY TRUST COMPANY, LLC, as agent to Lender**

**By:** /s/ Lauren Abendschein

**Name:** Lauren Abendschein

**Title:** Senior Director

**Date:** May 22, 2024

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 **ISHARES BITCOIN TRUST, as Client, by Agent, acting on behalf of Client and solely in its capacity as Agent**

**By:** /s/ Shannon Ghia

**Name:** Shannon Ghia

**Title:** Managing Director

**Date:** May 21, 2024

**ISHARES ETHEREUM TRUST as Client, by Agent, acting on behalf of Client and solely in its capacity as Agent**

**By:** /s/ Shannon Ghia

**Name:** Shannon Ghia

**Title:** Managing Director

**Date:** May 21, 2024

**BLACKROCK FUND ADVISORS, in its principal capacity solely with respect to Section 5.21** 

**By:** /s/ Shannon Ghia

**Name:** Shannon Ghia

**Title:** Managing Director

**Date:** May 21, 2024

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**SCHEDULE I**

**CLIENT**

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|:---|:---|:---|:---|
| **CLIENT** | **AGENT** | **APPLICABLE PRIME FEE SCHEDULE** | **FACILITATION ACCOUNT APPLICABLE** |
| **ISHARES BITCOIN TRUST** | **BLACKROCK FUND ADVISORS, acting as trustee for iShares Bitcoin Trust** | **Appendix 1-B (BTC ETP)** | **No** |
| **iShares Ethereum Trust** | **BLACKROCK FUND ADVISORS, acting as trustee for iShares Ethereum Trust** | **Appendix 1-ETP** | **No** |

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**EXHIBIT A**

**to the Coinbase Prime Broker Agreement**

**<u>COINBASE CUSTODY CUSTODIAL SERVICES AGREEMENT</u>**

This Custody Agreement is entered into between each Client set forth in Schedule I to the Coinbase Prime Broker Agreement and Coinbase Custody and forms a part of the Coinbase Prime Broker Agreement between the Client and the Coinbase Entities. Capitalized terms used in this Custody Agreement that are not defined herein shall have the meanings assigned to them in the other parts of the Coinbase Prime Broker Agreement.

Except as specifically stated, each Client entering into this Custody Agreement will be obligating itself only with respect to itself, and not with respect to any other entity including, without limitation, any other entity managed or advised by a BlackRock advisor. References to a "<u>Party</u>" herein refer to either the Coinbase Entities or the applicable Client, and references to the "<u>Parties</u>" herein refer to both the Coinbase Entities and the applicable Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Custodial Services.** 

Coinbase Custody shall provide Client with a segregated custody account controlled and secured by Coinbase Custody ("<u>Custodial Account</u>") to store certain Digital Assets supported by Coinbase Custody, on Client's behalf ("<u>Custodial Services</u>"). Coinbase Custody is a fiduciary under § 100 of the New York Banking Law and a qualified custodian for purposes of Rule 206(4)-2(d)(6) under the Investment Advisers Act of 1940, as amended, and is licensed to custody Client's Digital Assets in trust on Client's behalf. Digital Assets in Client's Custodial Account shall (i) be segregated from the assets held by Coinbase Custody as principal and the assets of other customers of Coinbase Custody, (ii) not be treated as general assets of Coinbase Custody, and except as otherwise provided herein, Coinbase Custody shall have no right, title or interest in such Digital Assets, (iii) Coinbase Custody serves as a fiduciary and custodian on Client's behalf, and the Digital Assets in Client's Custodial Account are considered fiduciary assets that remain Client's property at all times. In addition, Coinbase Custody shall maintain (i) any registrations, permits, licenses, approvals and consents issued by any governmental or quasi-governmental authority or regulatory organization necessary for it to carry out any of its obligations hereunder and (ii) any adequate capital and reserves to the extent required by applicable law and shall not, directly or indirectly, lend, pledge, hypothecate or re-hypothecate or otherwise encumber any Digital Assets in the Custodial Account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **Custodial Account.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 *In* General *.* The Custodial Services shall permit the Client (i) to hold its Vault Balance in its Custodial Account and transfer Digital Assets to and from its Trading Balance, (ii) to deposit supported Digital Assets from a public blockchain address controlled by Client into its Custodial Account, (iii) withdraw supported Digital Assets from its Custodial Account to a public blockchain address controlled by Client and (iv) certain additional services as may be agreed to between the Client and Coinbase Custody from time to time. Each such deposit or withdrawal shall be referred to as a " <u>Custody Transaction</u> " and shall conform to Instructions provided by Client through the Coinbase Prime Broker Site. Client shall only withdraw or deposit Digital Assets to public blockchain addresses and accounts, in each case, for which Client has conducted the necessary Know Your Customer (" <u>KYC</u> ") and anti-money laundering (" <u>AML</u> ") due diligence as determined by the Client using its commercially reasonable discretion; provided, for the avoidance of doubt, that withdrawals, deposits and other transfers performed by a Coinbase Entity hereunder are not considered withdrawals or deposits by Client for purposes of this sentence. Digital Assets shall be held in Client's Custodial Account in accordance with the terms of this Custody Agreement and shall not be commingled with other clients' Digital Assets. Coinbase Custody reserves the right to refuse to process or to cancel any pending Custody Transaction as required by applicable law or in response to a subpoena, court order or other binding government order, or to apply any restrictions on such Custody Transactions as agreed between the Coinbase Entities and the Client under the Prime Broker Agreement, in each case as communicated to Client (with relevant details and rationale related to such restriction) as soon as reasonably practicable where Coinbase Custody is permitted to do so, or if Coinbase Custody reasonably believes that the Custody Transaction may violate or facilitate the violation of an applicable law, regulation or rule of a governmental authority or self-regulatory organization.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 *Digital Asset Deposits and Withdrawals.* Coinbase Custody will process supported Digital Asset Custody Transactions according to the Instruction received from Client or Client's Authorized Representatives, and, except as otherwise explicitly set forth herein, including, without limitation, any obligation to perform due diligence on its own customers, Coinbase Custody is not required to verify the accuracy of the Instruction prior to processing. Client must verify the accuracy of all deposit and withdrawal information prior to submitting Instructions to Coinbase Custody regarding a Custody Transaction. Subject to Section 22, Coinbase Custody shall have no liability, obligation, or responsibility for Client Digital Asset transfers conducted in reliance on Instructions received from Client or Client's Authorized Representatives pursuant to the Security Procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 *Digital Asset Storage and Transmission Delays*. Without prejudice to the requirements set forth in Addendum No. 1 to the Coinbase Prime Broker Agreement, Coinbase Custody may require up to twenty-four (24) hours between any request to withdraw Digital Assets from Client's Cold Vault Balance and submission of Client's withdrawal to the applicable Digital Asset network. Since Coinbase Custody securely stores all Digital Asset private keys in offline storage, it may be necessary to retrieve certain information from offline storage in order to facilitate a withdrawal in accordance with Client's Instructions, which may delay the initiation or crediting of such withdrawal from the Client's Cold Vault Balance. Client acknowledges and agrees that a Custody Transaction may be delayed from the Client's Cold Vault Balance for up to twenty-four (24) hours' notice initiated from Client's Custodial Account. The time of such request shall be the time such notice is transmitted from Client's Cold Vault Balance. All Digital Assets in "hot" storage are not subject to the twenty-four hour delay described in this Section 2.3 and are subject to delays related to the network or blockchain on which the transaction is processed (or while Coinbase Custody waits for or to verify particular client Instructions).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 *Supported Digital Assets*. Coinbase Custody shall provide Client with one hundred and eighty (180) days' written notice before ceasing to support a Digital Asset, unless Coinbase Custody is required to cease such support by court order, statute, law, rule (including a self-regulatory organization rule), regulation, code, or other similar requirement, in which case written notice shall be provided promptly upon Coinbase Custody determining it will not be able to support such Digital Asset. Subject to Section 18.1 of the General Terms and Section 7 of the MTA, the Custodial Services are available only in connection with those Digital Assets that Coinbase Custody, in its sole discretion, decides to support.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 *Use of the Custodial Services.* Client acknowledges and agrees that Coinbase Custody may monitor use of the Custodial Account and the Custodial Services and the resulting information may only be utilized, reviewed, retained and or disclosed by Coinbase Custody for its internal purposes related to billing, security protocols or performance monitoring or otherwise in accordance with this Coinbase Prime Broker Agreement, or in accordance with the rules of any applicable legal, regulatory or self-regulatory organization or as otherwise may be required to comply with relevant law, sanctions programs, legal process or government request; provided, however, that any information used or disclosed (subject to the terms herein) in connection with providing the services herein (a) available only in an aggregated form that is compiled with a sufficient amount of data from other clients of Coinbase Custody so that it is impossible to attribute directly or indirectly to Client, and (b) anonymous such that Coinbase Custody does not disclose that Client is the source of any aggregated data and such aggregated data cannot be deconstructed, decompiled, disassembled or reverse engineered to identify Client.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6 *Independent Verification.* If Client is subject to Rule 206(4)-2 under the Investment Advisers Act of 1940, Coinbase Custody shall, upon written request, provide Client's authorized independent public accountant confirmation of or access to information sufficient to confirm (i) Client's Digital Assets as of the date of an examination conducted pursuant to Rule 206(4)-2(a)(4), and (ii) Client's Digital Assets are held either in a separate account under Client's name or in accounts under Client's name as agent or trustee for Client's clients.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7 *Third Party Payments.* Except as specified herein (including, without limitation, in relation to any asset held in any Client account at Coinbase Custody), Coinbase Custody has no control over, or liability for, the delivery, quality, safety, legality or any other aspect of any goods or services that Client may purchase or sell to or from a third party (including other users of Custodial Services) involving Digital Assets that Client intends to store, or have stored, in Client's Custodial Account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.8 *Termination, and Cancellation.* Section 25 of the General Terms shall govern any suspension, restriction, termination or modification of the Custody Agreement and the Custodial Services provided hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **Coinbase Custody Obligations** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 *Bookkeeping*. Coinbase Custody shall keep timely and accurate records as to the deposit, disbursement, investment and reinvestment of the Digital Assets, as required by applicable law and in accordance with Coinbase Custody's internal document retention policies.

3.2 *Insurance*. Coinbase Custody shall obtain and maintain, at its sole expense, insurance coverage in such types and amounts that are compliant with the requirements of Addendum No. 2 to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3  ***Additional Matters.*** 

In addition to any additional service providers that may be described in an addendum or attachment hereto, Client acknowledges and agrees that the Custodial Services may be provided from time to time by, through or with the assistance of affiliates of, or vendors to, Coinbase Custody; provided however, that unless otherwise agreed in writing by Client, the Custodial Accounts and all assets held in the Custodial Account shall be held by Coinbase Custody.

***[Remainder of page intentionally left blank]***

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**EXHIBIT B**

**to the Coinbase Prime Broker Agreement**

**<u>COINBASE MASTER TRADING AGREEMENT</u>**

Client should carefully consider whether trading or holding Digital Assets is suitable for its purpose, including in relation to Client's knowledge of Digital Assets and Digital Asset markets and Client's financial condition. All investments involve risk, and the past performance of a financial product does not guarantee future results or returns.

This Master Trading Agreement ("<u>MTA</u>") sets forth the terms and conditions for Client to trade Digital Assets through the Coinbase prime broker execution platform ("<u>Trading Platform</u>") and forms a part of the Coinbase Prime Broker Agreement between Client and the Coinbase Entities. Pursuant to this MTA, Coinbase shall open a Trading Account for the Client on the Trading Platform consisting of linked accounts at Coinbase and Coinbase Custody, each accessible via the Trading Platform ("<u>Trading Account</u>"). The Trading Platform shall provide Client with access to trade execution and automated trade routing services via graphical user interface, application program interface or Coinbase Execution Services (as defined below) to enable Client to submit orders ("<u>Orders</u>") to purchase and sell specified Digital Assets in accordance with this MTA and the Coinbase Trading Rules set forth at *<u>https://</u>www.coinbase.com/legal/trading_rules* or a successor website notified to Client in accordance with the notice procedures set forth herein (as amended and updated from time to time, the "<u>Coinbase Trading</u> <u>Rules</u>") (such services, the "<u>Trading Services</u>"). In the event of an inconsistency between the Trading Rules and this MTA or any other parts of the Coinbase Prime Broker Agreement, this MTA (excluding the Trading Rules) will govern. Capitalized terms used in this MTA that are not defined herein shall have the meanings assigned to them in the other parts of the Coinbase Prime Broker Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Order Routing and Connected Trading Venue** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 The Trading Platform operates a trade execution service through which Client may submit Orders to purchase or sell Digital Assets. After Client submits an Order, the Trading Platform will route the Order (or a portion of the Order) to one of the trading venues, which may include other platforms and OTC liquidity providers, to which the Trading Platform has established connections (each such venue, a " <u>Connected Trading Venue</u> "). At a future date as determined by Coinbase and Client, Client may notify to Coinbase a set of permitted Connected Trading Venues (" <u>Permitted Connected Trading Venues</u> "), provided that for the avoidance of doubt and notwithstanding anything contrary herein, certain Connected Trading Venues are deemed confidential information of Coinbase and shall not be disclosed to Client and, notwithstanding the foregoing, such Connected Trading Venues shall be deemed Permitted Connected Trading Venues. After delivery and receipt of such Permitted Connected Trading Venue notice, Coinbase will only route Client Orders to Permitted Connected Trading Venues. For the avoidance of doubt, Client may by notice to Coinbase update the list of Permitted Connected Trading Venues from time to time, provided that Certain Connected Trading Venues are deemed confidential information of Coinbase and shall not be disclosed to Client. Each Order will be sent, processed and settled at each Connected Trading Venue to which it is routed. Once an Order to purchase Digital Assets has been placed, the associated Client Assets (as defined below) used to fund the Order, if any, will be placed on hold and will generally not be eligible for other use or withdrawal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 With each Connected Trading Venue, Coinbase shall establish an account in its name, or in its name for the benefit of clients, to trade on behalf of its clients, and the establishment of a Trading Account will not cause Client to have a direct legal relationship, or account with, any Connected Trading Venue. The Trading Platform will not intentionally match the buy and sell orders of its clients against each other and will not intentionally settle Orders against or otherwise trade with Coinbase's principal funds. Client acknowledges that Coinbase and its other clients may trade in their own interests on the Connected Trading Venues and could, therefore, be the counterparty to a Client Order on a Connected Trading Venue.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 Client acknowledges that Coinbase has sole discretion to determine the Connected Trading Venues with which it will establish connections; provided that (i) Coinbase will use reasonable care in the selection of new Connected Trading Venues and carry out a risk-based assessment of each Connected Trading Venue to validate that the prospective Connected Trading Venue meets Coinbase's security requirements and (ii) Coinbase will periodically review each Connected Trading Venue in light of Coinbase's security and business continuity standards, including the type of access and classification of data being accessed (if any), controls necessary to protect data, and legal or regulatory requirements. Further, Coinbase will use reasonable efforts to review the financial condition of each Connected Trading Venue annually and on an interim basis as determined by Coinbase's credit risk team.

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Coinbase will direct Orders to the Connected Trading Venues on an automated basis and will not manually route orders unless required to do so because of a system or technology issue. In designing algorithms that determine an Order's routing logic, Coinbase may consider the following factors relating to the Order and the Connected Trading Venues: the speed of execution, whether the venue is able to consummate off-chain transactions, the availability of efficient and reliable systems, the level of service provided, and the cost of executing orders. For the avoidance of doubt, all trades and orders received by Coinbase from Client shall be subject to the terms herein, including without limitation Section 2 of the General Terms. Coinbase may receive cash payments or other financial incentives (such as reciprocal business arrangements) from Connected Trading Venues. Coinbase will provide a detailed fill report including transaction cost analysis for each Order, as soon as reasonably practicable and no later than the end of the day on which the Order is executed. Such report will disclose the all-in execution price(s) at which each portion of the Order was filled at each applicable Connected Trading Venue. Coinbase will also provide additional information and reports detailing executed Orders that help demonstrate that Orders were routed in a manner intended to receive the best available price at the time of execution among the Connected Trading Venues. Notwithstanding the foregoing, the fill report shall not disclose the identity of certain Connected Trading Venues given the confidential nature of certain Connected Trading Venues that are OTC liquidity providers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 Subject to Section 1.1 and Section 1.3 above, and Section 2 of the General Terms, Coinbase shall have no liability, obligation, or responsibility whatsoever for the selection or performance (with respect to pricing) of any Connected Trading Venue. Digital Assets may trade at different prices on different trading venues, and other Connected Trading Venues and/or trading venues not used by Coinbase may offer better prices and/or lower costs than the Connected Trading Venue used to execute Client's Order.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5 Coinbase acts in an agency capacity for purposes of routing Orders. Unless otherwise agreed in writing by Coinbase, Client shall not use (i) the Request For Quotation (" <u>RFQ</u> ") service in connection with which Coinbase may act as principal to fill Order shall and (ii) Coinbase's over- the-counter trading service. Each Client should independently evaluate whether such services are appropriate given its own investing profile and sophistication, among other considerations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6 Coinbase will deliver to Client a confirmation of terms as soon as technologically feasible following the execution of an Order, and will settle each Order in accordance with its confirmation, by delivery of cash or Digital Assets, as applicable, to Client's Trading Balance, as defined below, against the delivery by Client of cash or Digital Assets, as applicable to Coinbase Inc.

Coinbase represents and warrants that any Digital Asset transferred by it to Client in satisfaction of an Order or otherwise shall be free and clear of any liens, claims and encumbrances of which it has actual knowledge.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **Client Trading Balance and Vault Balance** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 For purposes of this MTA, Client's Digital Assets are referred to as " <u>Client Digital Assets</u>," Client's cash is referred to as " <u>Client Cash</u>," and Client Digital Assets and Client Cash are together referred to as " <u>Client Assets</u>."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 Within the Trading Platform, Coinbase provides access to two types of accounts with balances relating to Client Assets: (1) the "Trading Balance" (as described below in Section 2.3), which includes the "Facilitation Account" (as described below in Section 8.4C), and (2) the "Vault Balance" (as described below in Section 2.5). The Trading Account provides a record of both the Trading Balance and the Vault Balance. Client determines the allocation of its Client Digital Assets between the Trading Balance and the Vault Balance **,** and the allocation of its Client Assets in the Trading Balance between the Facilitation Account and the general Trading Balance. Maintenance of the Vault Balance shall be subject to the terms of the Custody Agreement; provided, however, Client's Trading Balance is separate from any Digital Assets Client maintains directly with Coinbase Custody. For the avoidance of doubt, the Facilitation Account is part of the Trading Balance and will be held in accordance with Section 9 of the General Terms and any other provisions in this Coinbase Prime Broker Agreement governing the Trading Balance, and any assets credited to the Facilitation Account are Client Assets. Coinbase will hold Client Assets credited to the Facilitation Account in the same locations and manner as it holds Client Assets credited to Clients' Trading Balances generally **.** 

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 Client Digital Assets credited to the Trading Balance are immediately available to Client for purposes of submitting an Order. Coinbase holds Digital Assets credited to the Trading Balance in one of three ways: (i) in omnibus hot wallets (each, an " <u>Omnibus Hot Wallet</u> "); (ii) in omnibus cold wallets (each, an " <u>Omnibus Cold Wallet</u> "); and (iii) in Coinbase's accounts with the Connected Trading Venues, other than OTC liquidity providers (" <u>Coinbase Connected Trading Venue Digital Asset Balance</u> "). Client agrees that Coinbase has discretion in determining the allocation of Digital Assets credited to the Trading Balance. Because Digital Assets credited to the Trading Balance are held on an omnibus basis and because of the nature of certain Digital Assets, Client does not have an identifiable claim to any particular Digital Asset. Instead, Client's Trading Balance represents an entitlement to a *pro rata* share of the Digital Assets Coinbase has allocated to the Omnibus Hot Wallets, Omnibus Cold Wallets and Coinbase Connected Trading Venue Digital Asset Balance. For the avoidance of doubt, the foregoing does not negate any requirement applicable to a Coinbase Entity to hold and maintain Client Assets in an amount and of a type as indicated in its internal ledgers referenced in Section 2.6 hereto as required by the NYDFS BitLicense. Coinbase agrees that in the event of a bankruptcy or insolvency event affecting a Connected Trading Venue, or otherwise, it shall make available for withdrawal by Client, in accordance with the time period set forth in Section 4.3 below, the full amount of Digital Assets credited to the Trading Balance for the benefit of Client in accordance with the NYDFS BitLicense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 Client may maintain Client Cash in the Trading Balance but not in the Vault Balance. Coinbase holds Client Cash credited to the Trading Balance: (i) in one or more omnibus accounts in Coinbase's name for the benefit of customers at one or more U.S. insured depository institutions provided that 30 days' prior notification is provided to Client in accordance with the notice provisions hereof before any Client Cash is held in a new such depository institution (each, an " <u>FBO account</u> ") and (ii) money market funds in compliance with Rule 2a-7 under the Investment Company Act of 1940 and rated "AAA" by S&P (or the equivalent from any eligible rating service), provided that such investments are held in accounts in Coinbase's name for the benefit of customers and are permitted and held in accordance with state money transmitter laws (the "Permitted Investments"). Coinbase will maintain in the foregoing accounts the full aggregate amount of all Client Cash. Coinbase will maintain the full aggregate amount of cash consistently for all clients, ledgered accurately and appropriately for each client, and handle this cash in accordance with our permissible investment requirements under our state money transmission license. Coinbase will make available for withdrawal by Client, or the prompt repayment to Client upon request, of the full amount of Client Cash held for the benefit of Client at an FBO account or in Permitted Investments in accordance with the terms of the Coinbase Prime Broker Agreement. Coinbase will title the FBO accounts it maintains with U.S. depository institutions and maintain records of Client's interest in a manner that enables Coinbase to secure receipt of Federal Deposit Insurance Corporation (" <u>FDIC</u> ") deposit insurance, where applicable and up to the deposit insurance limits applicable under FDIC regulations and guidance, on Client Cash for the Client's benefit on a pass-through basis. Unless otherwise agreed by Client in writing, the amount of Client Cash held in an FBO account shall not exceed the FDIC deposit insurance limit then in effect, provided however, that in the event the Client Cash held in an FBO account exceeds the FDIC deposit insurance limit then in effect, Coinbase will perform a daily sweep and move the excess into a U.S. government money market fund(s) as set forth above. FDIC insurance applies to cash deposits at banks and other insured depository institutions in the event of a failure of that institution, and does not apply to any Coinbase Entity or to any Digital Asset held by a Coinbase Entity on Client's behalf. Client Cash is immediately available to Client for purposes of submitting an Order, unless a restriction applies in the circumstances described in Section 10.4 of the Coinbase Prime Broker Agreement or a compliance restriction. Coinbase will inform Client as soon as is reasonably practicable of any new arrangements for the holding of cash that provides for additional customer protections (including new depositary institutions).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 At Client's election, all or a portion of Client Digital Assets may also be allocated to the Vault Balance which is held in a Custodial Account in Client's name at Coinbase Custody pursuant to the Custody Agreement. Such Vault Balance will be divided between segregated hot storage in Client's name (" <u>Hot Vault Balance</u> ") and segregated cold storage in Client's name (" <u>Cold Vault Balance</u> "). Client shall have sole discretion to allocate Digital Assets between the Hot Vault Balance and Cold Vault Balance. Digital Assets in the Hot Vault Balance may be transferred immediately to Client's Trading Balance unless a restriction applies in the circumstances described in Section 10.4 of the Coinbase Prime Broker Agreement or a compliance related restriction. A transfer of Digital Assets in the Cold Vault Balance to Client's Trading Balance will be subject to Coinbase Custody's standard cold storage withdrawal procedures. Client hereby appoints Coinbase as Client's agent for purposes of instructing Coinbase Custody to transfer Client Digital Assets between Client's Vault Balance and Client's Trading Balance. Client agrees that an Instruction to Coinbase to settle an Order to or from Client's Vault Balance constitutes authorization to Coinbase to transfer Client Digital Assets to or from Client's Vault Balance as necessary or appropriate to consummate such settlement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6 In all circumstances and consistent with laws and regulations applicable to Coinbase, Coinbase will keep an internal ledger that specifies the Client Assets credited to Client's Trading Balance and enables Coinbase and its auditors and regulators to identify Client and the Client Assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7 Coinbase treats all Client Assets as custodial assets held for the benefit of Client. No Client Assets credited to the Trading Balance shall be considered to be the property of, or loaned to, Coinbase. Neither Coinbase nor any Coinbase Entity will sell, transfer, loan, rehypothecate or otherwise alienate Client's Assets credited to Client's Trading Balance unless instructed by Client pursuant to an agreement between Client and a Coinbase Entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **Role of Coinbase Custody** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 To facilitate the Trading Services, Coinbase may at its sole discretion maintain portions of the Omnibus Hot Wallet and the Omnibus Cold Wallet in one or more custodial FBO accounts with its affiliate, Coinbase Custody. In such circumstances, although the Omnibus Hot Wallet and the Omnibus Cold Wallet are held in Coinbase's FBO accounts with Coinbase Custody, Client's legal relationship for purposes of Digital Assets held in the Omnibus Hot Wallet and the Omnibus Cold Wallet will not be, directly or indirectly, with Coinbase Custody and the terms, conditions and agreements relating to those wallets are to be governed by this MTA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 Client Digital Assets held in the Hot Vault Balance and Cold Vault Balance are maintained directly between Client and Coinbase Custody in Client's name and are subject to the terms of the Client's Custody Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **Cash and Digital Asset Deposits and Withdrawals** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 <u>To deposit Client Cash</u>, Client must initiate a transfer from a linked bank account, a wire transfer, a SWIFT transfer, or other form of electronic payment approved by Coinbase from time to time to Coinbase's bank account, the instructions for which are available on the Coinbase Prime Broker Site. Coinbase will credit the Trading Balance with Client Cash promptly upon receipt of such Client Cash.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 <u>To withdraw Client Cash</u>, Client may initiate a withdrawal of Client Cash from the Trading Balance at any time using the withdrawal function on the Trading Platform that will be processed in accordance with the Service Level Agreement. "Business Day" shall mean any day that the Federal Reserve wire transfer system is open for business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 <u>To deposit Client Digital Assets</u>, Client may transfer Client Digital Assets directly to the Omnibus Hot Wallet or Omnibus Cold Wallet, the instructions for which are available on the Coinbase Prime Broker Site. Client may transfer Client Digital Assets to and among its Hot Vault Balance or Cold Vault Balance in accordance with the Service Level Agreement. Either of the types of transfers described in the foregoing two sentences is a "Deposit Transfer." When Client transfers Digital Assets to Coinbase or Coinbase Custody, it delivers custody and control of the Digital Assets to Coinbase or Coinbase Custody, as applicable, to be held on Client's behalf in accordance with the terms hereof. Client represents and warrants that any Digital Asset so transferred shall be free and clear of all liens, claims and encumbrances of which it has actual knowledge and other than any lien, claim or encumbrance arising under the Coinbase Prime Broker Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 To withdraw Client Digital Assets, Client must provide applicable Instructions via the Coinbase Prime Broker Site ("Withdrawal Transfer"). Once Client has initiated a Withdrawal Transfer, Coinbase shall promptly facilitate such withdrawal in accordance with the Service Level Agreement the associated Client Digital Assets will be in a pending state (related to processing time for the applicable blockchain or payment network or Instructions from Client, and not subject to significant additional delay from any Coinbase Entity) and upon delivery in accordance with Client's withdrawal Instructions will not be included in the Client's Trading Balance or Vault Balance. Client acknowledges that Coinbase may not be able to reverse a Withdrawal Transfer once initiated. Client may withdraw Client Digital Assets at any time, subject to delays for Digital Assets held in Cold Vault Balance, and any applicable account restrictions in the circumstances described in Section 10.4 of the Coinbase Prime Broker Agreement or a compliance related restriction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 Client must verify all transaction information prior to submitting withdrawal Instructions to Coinbase, as Coinbase cannot and does not guarantee the identity of the wallet owner or bank account to which Client is sending Client Digital Assets or Client Cash, as applicable. Unless otherwise provided herein or under applicable laws, Coinbase shall have no liability, obligation, or responsibility whatsoever for Client Cash or Client Digital Asset transfers sent to or received from, as applicable, an incorrect party, or sent or received, as applicable, via inaccurate Instructions provided by Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **Disruption to Trading Platform** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 Client acknowledges that electronic facilities and systems such as the Trading Platform are vulnerable to disruption, delay or failure and, consequently, such facilities and systems may be unavailable to Client as a result of foreseeable and unforeseeable events. Client understands and agrees that Coinbase does not guarantee uninterrupted access to the Trading Platform or all features of the Trading Services. Client acknowledges that although Coinbase will attempt to provide notice of any scheduled or unscheduled unavailability that would result in Client being unable to access the Trading Platform or the Trading Services, Coinbase cannot guarantee advanced notice to Client. Nothing in this Section 5.1 shall relieve Coinbase of any of its obligations, representations, or warranties under this Coinbase Prime Broker Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 Coinbase may, in its good faith discretion, take any of the following actions, and shall use reasonable efforts to provide Client with as much prior notice as is practicable: (i) halt or suspend Trading Services, including trading on the Trading Platform or the trading of any Digital Assets or currency, (ii) impose limits on the amount or size of Client's Orders, or (iii) reject an Order, in each case, to the extent that an (a) event described in Section 30 has occurred and is continuing, (b) a violation of section 10.4 or the Trading Rules has occurred and is continuing, (c) the acceptance of any Order would cause the amount of Trade Credits extended to exceed the Authorized Amount, (d) pursuant to Section 4 or (d) a security or technology issue occurred and is continuing that results in Coinbase being unable to provide the Trading Services or accept the relevant Order; provided that, in taking any actions under this Section 5.2 Coinbase shall treat Client the same as other prime broker clients and shall not take any such actions in a manner designed to circumvent the purposes of this Coinbase Prime Broker Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **Coinbase Trading Rules and Order Types** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 Client agrees to comply with the Coinbase Trading Rules in effect at the time of any Order. Client agrees to review and become familiar with the terms of the various types of Orders (each an " <u>Order</u> <u>Type</u> ") available through the Trading Service. A detailed description of the terms of all Orders is contained in the Coinbase Trading Rules. Coinbase reserves the right to modify the terms of any Order Type and the Coinbase Trading Rules at any time and without prior notice to Client, and Client acknowledges that it is solely responsible for ensuring knowledge of applicable Order Types and Coinbase Trading Rules prior to placing an Order.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 Coinbase may and, upon Client's Instruction, will modify the terms of, or cancel, any Order executed on Trading Platform if the Order was clearly erroneous according to the Coinbase Trading Rules or otherwise. Except as otherwise set forth herein and in the Coinbase Trading Rules, and subject to Section 22, Coinbase shall have no liability, obligation, or responsibility to Client as a result of exercising its rights under this Section 6.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **Coinbase Supported Digital Assets** 

Coinbase determines in its sole discretion which Digital Assets to support for use with the Trading Services, as specified on the Coinbase Prime Broker Site available at <u>https://help.coinbase.com/en/prime/trading-</u> <u>and-funding/supported-cryptocurrencies-and-trading-pairs</u> or any successor website that Client is given access too. Not all Digital Assets supported for Custodial Services are also supported for Trading Services. Notwithstanding the foregoing, BTC and ETH will be supported for Custodial Services and Trading Services for the full term of this Coinbase Prime Broker Agreement except to the extent that BTC or ETH is no longer supported on a platform-wide basis and such cessation is generally consistent with similarly situated digital asset exchanges.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **Coinbase Execution Services and Facilitation Account** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 Client may elect to submit Orders to Coinbase Execution Services (" <u>CES</u> "), a Trading Service through which CES personnel will execute Orders on behalf of Client. Subject to the terms herein, CES will execute Orders by using automated trade routing services through Client's Prime Broker Account in accordance with Client's Instructions to Connected Trading Venues or by filling orders on Coinbase's over-the-counter ("OTC") trading service. Coinbase and Client may communicate regarding Instructions related to Orders on a mutually agreed communication medium, including instant messaging, email, and telephone. Coinbase shall execute and settle all Orders for the purchase and sale of any Digital Assets submitted by Client to CES in accordance with the terms of this Coinbase Prime Broker Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 CES brokers Orders on a commercially reasonable basis as Client's agent and may exercise discretion in executing Orders. Client must pre-fund its Trading Balance and/or establish a credit arrangement with Coinbase (as currently set forth in the CTF Agreement), prior to submitting Orders. Solely with respect to Delayed Settlement OTC Orders, under certain circumstances, Coinbase may agree that neither pre-funding nor a credit arrangement with Coinbase is required. By electing to use CES, Client agrees that it is authorizing CES personnel to access its Prime Broker Account to initiate and execute Orders in accordance with Client's Instructions. Absent express written agreement between the Parties, Coinbase will accept Orders only from Authorized Representatives that are designated in the Client's Prime Broker Account as having trading authority. An " <u>OTC Order</u> " means an Order that Client Instructs Coinbase to fill via CES. If Client communicates to Coinbase that such Order is to be pre-funded as opposed to utilizing a credit arrangement (i.e., the credit arrangement set forth in the CTF Agreement), Client shall pre-fund its Trading Balance prior to submitting such Order. If upon Client's Instructions to fill an Order via CES, such Order is executed with a Connected Trading Venue on a delayed settlement basis solely in instances when Client has exceeded the Authorized Amount or a Digital Asset Unavailability Event has occurred and is continuing (such OTC Order, a " <u>Delayed Settlement OTC Order</u> "), Client may not be required to pre-fund or utilize a credit arrangement in connection with the execution of such OTC Order provided that notwithstanding the foregoing, Client acknowledges and agrees that a Delayed Settlement Order shall be subject to Coinbase's reasonable discretion in all cases based on Coinbase's risk policies and procedures, credit and funding constraints, risk management limits, and solvency concerns or other terms agreed in writing by the Parties related to Delayed Settlement Orders, in accordance with the foregoing, Coinbase shall use commercially reasonable efforts to execute such Order as a Delayed Settlement OTC Order and obtain the best execution price for such Order.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3 Coinbase will maintain information barriers and other policies and procedures to safeguard Client confidential trading information, such as Instructions and Orders, that is provided to CES personnel. After an Order is submitted for routing and execution by CES personnel, information related to the Order will be handled in the same manner as information related to Orders submitted electronically to the Trading Platform.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4 To the extent "Facilitation Account Applicable" is marked as "Yes" in Schedule I for such Client, the Facilitation Account for such Client may receive and hold assets to facilitate Orders. The Facilitation Account shall be used only as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any assets resulting from execution of Orders shall initially be credited to the Facilitation Account ("Facilitation Positions");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Client shall provide Instructions for the allocation of assets that are credited to the Facilitation Account as soon as practicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each of Client and Coinbase hereby represents and warrants that, as of the date of this Agreement and continuing through the term of this Agreement that the Facilitation Account will only be used to facilitate the distribution of assets in accordance with Client's Instructions. Client is responsible for all debits, costs, commissions, and losses arising from any actions Coinbase must take to liquidate or close transactions in the Facilitation Account due to failure to allocate.

If "Facilitation Account Applicable" is marked as "No" for such Client in Schedule I, the terms in this Section 8.4 shall not apply, Coinbase shall not open a Facilitation Account for such Client, and as a result the terms in this Coinbase Prime Broker Agreement related to the Facilitation Account and Facilitation Positions shall not be applicable with respect to such Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **Determination of Suitability; All Risks Not Disclosed** 

Coinbase's provision of the Trading Services is neither a recommendation that Client enter into a particular Order nor a representation that any product described on the Trading Platform is suitable or appropriate for Client. Many of the Trading Services described on Trading Platform involve significant risks, and Client should not use the Trading Services unless it has fully understood all such risks and has independently determined that such Orders are appropriate. Any discussion of the risks contained in this MTA or on the Trading Platform should not be considered to be a disclosure of all risks or a complete discussion of the applicable risks.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **Characterization of Trading Services; Not a Registered Broker-Dealer or Investment Adviser** 

Client understands and acknowledges that no transactions executed in connection with Client's Trading Account or the Trading Services are securities transactions, and Coinbase is not registered with the U.S. Securities and Exchange Commission as a broker-dealer or an investment adviser or licensed under any state securities laws. Coinbase is not acting as a fiduciary in respect of Client (including in connection with its rights under this MTA) and does not have any responsibility under the standards governing the conduct of broker-dealers, fiduciaries, investment advisers or investment managers. Client agrees and acknowledges that any information or advice provided by Coinbase or any other Coinbase Entity does not and will not serve as the basis of any investment decision by Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **Coinbase Corporate Accounts** 

Coinbase and its affiliates may transact through Trading Accounts on the Trading Platform ("<u>Coinbase</u> <u>Corporate Accounts</u>") for purposes including inventory management to facilitate Client Orders, and for other corporate purposes. To the extent that a Coinbase Corporate Account transacts on the Trading Platform, the Coinbase Corporate Account (i) will not have any special priority vis-a-vis Client Orders and will be subject to the Coinbase Trading Rules, (ii) will trade only on Market Data available to all clients, and (iii) will not access any non-public data of Clients. Coinbase's internal ledger will indicate the amount of each Digital Asset held for each client and each such Coinbase Corporate Account.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.** **Term, Termination and Suspension** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.1 Section 25 of the General Terms shall govern any suspension, restriction, termination or modification of the MTA and the Prime Brokerage Services provided hereunder.

12.2 Without limiting the Coinbase Entities obligations to Client during any Transition Period as provided for under Section 25 of the General Terms, Client agrees to promptly provide Coinbase with Instructions as to where its Client Assets should be transferred, and agrees that failure to do so within one hundred and eighty (180) days of receipt of notice of termination may result in Client Assets being transferred to the Client's linked bank account or Digital Asset wallet on file, in each case subject to off- set for any outstanding obligations to any Coinbase Entity in accordance with the General Terms. Client is responsible for all debits, costs, commissions, and losses arising from any actions Coinbase must take to liquidate or close transactions in the Client's Trading Account after such one hundred and eighty (180) day period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.** **Unclaimed Property** 

If Coinbase is holding Client Assets in the Trading Balance, has no record of Client's use of the Trading Services for an extended period, and is otherwise unable to contact Client, Coinbase may be required under applicable laws, rules or regulations to report these assets as unclaimed property and to deliver such unclaimed property to the applicable authority. Coinbase may deduct a dormancy fee or other administrative charge from such unclaimed funds, as permitted by applicable laws, rules or regulations.

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**EXHIBIT C**

**to the Coinbase Prime Broker Agreement**

<u>[RESERVED]</u>

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**EXHIBIT D**

**to the Coinbase Prime Broker Agreement**

**<u>COINBASE COMMITTED -TRADE FINANCING AGREEMENT</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Introduction** 

This Coinbase Committed Trade Financing Agreement ("<u>CTF Agreement</u>") is entered into by and among the Client, Coinbase Credit, Coinbase (in its own capacity and as agent to Coinbase Credit), and Coinbase Custody (as agent to Coinbase Credit with respect to the Client's balance of Digital Assets held in its Custodial Account (including any Vault Balance) pursuant to Client's Custody Agreement) to govern the extension of credit from Lender to Client for use in connection with the execution and settlement of Client's trading of Digital Assets on Coinbase's Trading Platform.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **Defined Terms** 

Capitalized terms used in this CTF Agreement without definition shall have the meanings assigned to them in the Custody Agreement, General Terms and the MTA. Section references shall be to the sections in this CTF Agreement unless stated otherwise.

The following terms shall have the meaning set forth below for purposes of this CTF Agreement:

<u>"Aggregate Max Debit</u><u>"</u> shall mean the aggregate USD notional value of the Digital Asset(s) borrowed by Borrower during a Defined Interval.

<u>"Available Balance</u>" shall mean, the sum of (i) the then-current aggregate amount of Cash and USD notional value of the Digital Asset(s) in the Borrower's Trading Balance and (ii) the difference of (a) the Borrower Authorized Amount and (b) the then-current aggregate amount of Cash Trade Credits and the USD notional value of the Digital Asset Trade Credits outstanding.

<u>"Authorized Amount</u>" shall be an amount to be determined based on Lender's sole discretion considering factors including, but not limited to, availability of financing and credit due diligence of the Borrower.

<u>"Borrower</u>" shall mean Client.

<u>"Borrower Authorized Amount</u>" shall mean, with respect to any Borrower, the Authorized Amount less any outstanding trade credits extended to any other client listed on Schedule I at the time the Borrower's Order is placed.

<u>"Business Day</u>" shall mean any day that the Federal Reserve wire transfer system is open for business.

<u>"Cash</u>" shall mean USD or any other currency as agreed between the Borrower and Lender.

<u>"CB Agent</u>" shall mean Coinbase acting in its capacity as agent to Coinbase Credit hereunder.

<u>"Change of Agent Event</u>" shall occur when the authority of Agent to act on behalf of Borrower in connection with the Coinbase Prime Broker Agreement is terminated for any reason at any time and a successor investment advisor, reasonably acceptable (such acceptance not to be unreasonably withheld) to Coinbase, has not been concurrently appointed on behalf of Borrower with respect to all matters hereunder or thereunder; <u>provided</u> that, subject to applicable law, the Agent is permitted to transfer and assign its obligations to act on behalf of Borrower to any of its affiliates and any such transfer or assignment shall not constitute a Change of Agent Event.

<u>"Commitment Period</u>" shall mean the period of time commencing on the date of execution of this CTF Agreement and terminating on the earlier of (i) the date of termination of the Coinbase Prime Broker Agreement in accordance with Section 25 of the General Terms, subject to any required notice or notice period thereunder, and (ii) following a Change of Agent Event, immediately upon delivery to Borrower of written notice of the occurrence of such Change of Agent Event or the close of business on such later date as Lender may specify in any such written notice.

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<u>"Defined Interval</u>" shall mean a twenty-four (24) hour period starting at 6:00 A.M. EST on any day an Order is placed to the extent there is a related Trade Credit. For the avoidance of doubt, if Lender extends any Trade Credits to Borrower prior to 6:00 A.M. EST on any given day, the USD notional value of such Trade Credits shall be included in the calculation of the Available Balance for the immediately prior day.

<u>"Digital Asset Availability Notice</u>" shall mean, with respect to any potential Order to sell Digital Assets, a notice Borrower sends Lender in accordance with Section 3(d) informing Lender of the number of Digital Asset Trade Credits Borrower is expecting to request.

<u>"Digital Asset Unavailability Event</u>" shall mean, with respect to an Order to sell Digital Assets, that each of the following conditions have been met: (i) Lender is unable, after using commercially reasonable efforts, to borrow a number of Digital Assets in an amount equal to the Requested Amount; (ii) Lender (or affiliates from whom Lender may borrow the relevant Digital Assets under applicable law) are unable to extend new loans to any of its other customers (or the other customer of such affiliates), individually or in the aggregate, for a number of Digital Assets equal to the Requested Amount (A) if the Borrower has not delivered a Digital Asset Availability Notice, at the time of the related Order, or (B) if the Borrower has delivered a Digital Asset Availability Notice, at the time that Borrower delivers such notice; (iii) at the time such Order is submitted, an event has occurred and is continuing that disrupts or impairs the ability of market participants with whom Lender and its affiliates from whom Lender may borrow the relevant Digital Assets under applicable law have established relationships and are in good standing to effect transactions in, borrow, or obtain market values for, the related Digital Asset and Lender determines in good faith and in its reasonable discretion that such event is material; and (iv) (A) Borrower has not delivered a Digital Asset Availability Notice with respect to such Order or (B) if Borrower has delivered a Digital Asset Availability Notice with respect to such Order, Lender has responded that the Requested Amount in such notice is unavailable.

<u>"Financing Commitment</u>" shall mean Lender and Coinbase's obligations to Borrower under Section 3 of this CTF Agreement.

<u>"Lender</u>" shall mean Coinbase Credit.

<u>"Requested Amount</u>" shall mean, with respect to an Order to sell Digital Assets, (i) if Borrower has not delivered a Digital Asset Availability Notice to Lender with respect to such Order, Digital Asset Trade Credits with a USD notional value equal to the Available Balance, or (ii) if Borrower has delivered a Digital Asset Availability Notice with respect to such Order, the amount of Digital Assets identified in such notice.

<u>"Settlement Deadline</u>" shall mean 6:00 P.M. EST on the calendar day immediately following the start of a Defined Interval; <u>provided</u>, <u>however</u>, that, if such Settlement Deadline occurs on any day that is not a Business Day, such Settlement Deadline shall be deemed to occur at 6:00 P.M. EST on the immediately following Business Day.

<u>"Termination for Cause</u>" shall mean (i) a Bankruptcy Event occurring with respect to Borrower or (ii) the Coinbase Entities elect to exercise remedies in connection with a Cause event in accordance with the Prime Broker Agreement and, to the extent required, notifies Borrower of such election.

<u>"Trading Balance</u>," for purposes of this CTF Agreement, shall mean the Borrower's Trading Balance, as defined in the MTA.

<u>"Trade Credits</u>" shall mean a specific quantity of cash ("<u>Cash Trade Credit</u>") or Digital Assets ("<u>Digital Asset Trade Credit</u>") that Lender loans to Borrower under this CTF Agreement for the purchase or sale, respectively, of Digital Assets via the Trading Platform.

<u>"UCC</u>" shall mean the New York Uniform Commercial Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **Financing Commitment** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For the duration of the Commitment Period and subject to the terms of this CTF Agreement, Lender shall finance on a committed basis Orders for the purchase and sale of any Digital Assets submitted by the Client on the Trading Platform up to the Authorized Amount; <u>provided</u>, <u>however</u>, that Lender shall not be required to lend Digital Assets with respect to any Order if a Digital Asset Unavailability Event has occurred and is continuing. Coinbase and Lender agree that if at the time Client submits an Order (other than a Delayed Settlement OTC Order) on the Trading Platform Client does not have sufficient Cash or Digital Assets in its Trading Balance for such purchase or sale, respectively, Lender shall provide financing in the form of Cash Trade Credits or Digital Asset Trade Credits, respectively, in an amount sufficient to execute and settle such Order subject to the terms of this CTF Agreement and provided that (i) Lender shall not be required to extend to Borrower any Trade Credit with a USD notional value at the time the relevant Order is placed in excess of the Available Balance and (ii) with respect to a sale Order, a Digital Asset Unavailability Event has not occurred. In addition, Coinbase and Lender agree that this CTF Agreement meets any pre-funding or financing arrangement condition Coinbase may have for the execution of Orders on the Trading Platform up to the Borrower Authorized Amount.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each of Lender and Coinbase agree that prior to the end of the Commitment Period neither entity shall take any of the following actions without providing 180 calendar days' written notice to Borrower:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) subject to Section 3(e), increase any interest charges and fees above the applicable charges and fees agreed in writing between Coinbase, Lender and Borrower from time to time for the execution, settlement or financing of any Orders related to the Digital Assets or impose any additional fees or charges with respect thereto; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) change, modify or adjust any index relevant to interest charged or paid with respect to the execution, settlement or financing of any Orders related to the Digital Assets; or terminate, accelerate or recall any Trade Credits; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) discontinue extending Digital Assets as Trade Credits to Borrower with respect to an Order for the sale of the same type of Digital Asset; <u>provided</u> that, (A) a Digital Asset Unavailability Event has not occurred, and (B) Lender is not required to extend to Borrower any Trade Credit with a USD notional value at the time of extension in excess of the Available Balance; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) discontinue extending cash as Trade Credits to Borrower with respect to an Order for the purchase of any Digital Asset; <u>provided</u> that, Lender is not required to extend to Borrower any Trade Credit with a USD notional value at the time of extension in excess of the Available Balance; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) require the posting of a minimum amount of margin or collateral; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) modify any pre-funding or financing arrangement condition Coinbase may have for the execution of Orders on the Trading Platform; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) impose any other requirement in respect of Borrower or condition with respect to the extension of credit that is not required under the CTF Agreement or by applicable law; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) modify the Authorized Amount or the determination of the Available Balance.

Coinbase and Lender may only take any of the actions set forth in this clause (b) by (i) delivering a written notice to Borrower that describes in reasonable detail (including specific references to relevant provisions of the CTF Agreement) the actions such entity intends to take and is delivered on a day that is no earlier than 180 calendar days prior to the date on which such entity takes such action or (ii) in the event of a Change in Law with respect to the financing under this CTF Agreement, as permitted under Section 25(a) of the Prime Broker Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Lender shall not be required to extend Digital Asset Trade Credits with respect to any Requested Amount if at the time an Order for the sale of Digital Assets is submitted that would require the extension of Digital Assets Trade Credits a Digital Asset Unavailability Event has occurred and is continuing. Notwithstanding the foregoing, if Borrower has delivered a Digital Asset Availability Notice to Lender by 6:00 PM EST on the Business Day prior to an Order and Lender has not responded to such notice within 1 hour of its receipt, Lender is committed to extending Digital Asset Trade Credits in a number equal to the Required Amount regardless of the market conditions at the time.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Borrower shall deliver any Digital Asset Availability Notice to [\*\*\*]. Coinbase and Lender represent, warrant and covenant that any information provided in connection with a Digital Asset Availability Notice shall be shared solely with members of their financing team, solely for purposes of determining the availability of a Required Amount and Coinbase and Lender and Coinbase's obligations under Section 2 of the General Terms shall apply to such information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) With respect to any Order to sell Digital Assets, if an event described in clause (iii) of the definition of "Digital Asset Unavailability Event" has occurred and is continuing which results in Lender's cost to borrow the relevant Digital Assets materially increasing because of such event, if Lender can still borrow the relevant Digital Asset, Lender shall be entitled, acting in good faith and in its commercially reasonably discretion, to increase the fees applicable to loans of Digital Assets to take account of such increased cost; <u>provided</u> that, (i) any such increase in fees shall be determined in Lender's commercially reasonable discretion based on the market rate for the relevant Digital Asset and (ii) (A) if Borrower has submitted a Digital Asset Availability Notice prior 6:00 PM EST on the immediately preceding Business Day, Lender has informed Borrower of the amount of any fee increase within 1 hour of its receipt of such Digital Asset Availability Notice or (B) if Borrower has not submitted a Digital Asset Availability Notice, Lender has notified Borrower of such fee increase by 6:00 PM EST on the immediately preceding Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **Trade Credits and Trading** 

In the absence of Trade Credits or other financing arrangement authorized by Coinbase, and unless such Order is a Delayed Settlement OTC Order in accordance with Section 8 of the MTA, Borrower must pre-fund its Trading Balance on the Trading Platform with Cash or Digital Assets in order to buy or sell Digital Assets on the Trading Platform. Trade Credits may only be available for specified Digital Assets, as determined by Lender in its sole discretion; <u>provided</u> that Coinbase and Lender agree that Trade Credits are available for BTC and ETH and such Digital Assets are subject to the Financing Commitment unless and until BTC and ETH are no longer supported for Custodial Services and Trading Services under Section 7 of the MTA. Notwithstanding anything herein to the contrary, this CTF Agreement does not apply to Delayed Settlement OTC Orders and no Trade Credit or other financing shall be extended in connection therewith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **Requesting a Trade Credit and the Trade Finance Debit Account** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Borrower may place Order(s) pursuant to the MTA and, subject to the terms of this CTF Agreement, Lender shall provide financing with respect to such Order(s) (unless any such Order is a Delayed Settlement OTC Order) in amounts up to Borrower's then current Available Balance. With respect to Order(s) that are not Delayed Settlement OTC Orders, Borrower may request extension of a Trade Credit at any time during the term of this CTF Agreement by placing such Order(s) with Coinbase via the Trading Platform to buy Digital Assets with a USD notional value that exceeds the Client Cash in the Borrower's Trading Balance at the time such Order(s) is submitted or to sell certain Digital Assets in an amount that exceeds the amount of such Client Digital Asset in the Borrower's Trading Balance at the time such Order(s) is submitted. The amount by which Borrower's Order is executed and exceeds the applicable Client Asset available in the Borrower's Trading Balance shall constitute the specific quantity of a Trade Credit unless, for the avoidance of doubt, such Order is a Delayed Settlement OTC Order.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The USD notional value of a Trade Credit drawn in a Digital Asset will be determined by CB Agent on the basis of the price for that Digital Asset that the CB Agent is indicating via the Trading Platform or, to the extent such pricing is unavailable or otherwise erroneous, CB Agent shall determine the USD notional value of such Digital Asset in good faith and in a commercially reasonable manner so as to produce a commercially reasonable result. Cash shall be valued at face value.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Coinbase and Lender agree that no pre-approval of the extension of Trade Credits (other than any Trade Credit with a USD notional value in excess of the Available Balance) shall be required for or a condition to the execution of any Order placed by Borrower pursuant to the MTA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Lender will establish in the name of Borrower a ledger entry for purposes of tracking Trade Credits extended by Lender (" <u>Trade Finance Debit Account</u> "). The Trade Finance Debit Account shall reflect the cumulative Trade Credits that Lender has extended during each Defined Interval, both in terms of the aggregate USD notional value of the Trade Credits (as determined hereunder) and the Trade Credits denominated in specific Digital Assets.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Borrower and Lender agree that Borrower may use the Trade Credits extended hereunder exclusively for the purpose of the execution of trades on the Trading Platform. Borrower acknowledges that this CTF Agreement is not intended to be utilized for short selling of Digital Assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **Credit Protection** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) *Grant of Security Interest*. Borrower hereby grants to Lender a continuing security interest in, lien on and right of set off against all of Borrower's right, title and interest, whether now owned or existing or hereafter acquired or arising, in Borrower's Trading Balance and Custodial Account together with proceeds thereof (the " <u>Collateral</u> "), in order to secure repayment of Trade Credits and financing fees to Lender; <u>provided</u> that Lender's lien on any Cash, Digital Assets or proceeds thereof shall immediately terminate upon the transfer of such assets from the Trading Balance or the Custodial Account at the instruction of Borrower.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) *No Other Liens*. Borrower will not cause the Collateral, whether now owned or hereafter acquired, to be or become subject to any liens, security interests, mortgages or encumbrances of any nature, other than granted hereunder or arising under the Coinbase Prime Broker Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) *Perfection*. Borrower shall execute such documents and take such other actions as the Lender shall reasonably request to perfect and maintain the Lender's security interest with respect to the Collateral.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) *Control by CB Agent.* For purposes of perfecting Lender's security interest in the Collateral, CB Agent holds the Collateral as agent for Lender, and has control over the Collateral on behalf of Lender. Upon a Termination for Cause, Borrower hereby authorizes CB Agent, as securities intermediary with respect to the Trading Balance, to comply with all instructions and entitlement orders from Lender, as secured party, with respect to the disposition of the Collateral as contemplated in the Coinbase Prime Broker Agreement without further consent or direction from Borrower or any third-party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) *Control by Coinbase Custody*. For purposes of perfecting Lender's security interest in the Collateral, Coinbase Custody holds Collateral as agent for Lender, and has control over Collateral for the benefit and on behalf of Lender. Upon a Termination for Cause, Borrower hereby authorizes Coinbase Custody, as securities intermediary with respect to the Custodial Account, to comply with all instructions and entitlement orders from Lender, as secured party, with respect to the disposition of the Collateral as contemplated in the Coinbase Prime Broker Agreement without further consent or direction from Borrower or any third-party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Lender agrees not to deliver any instructions or entitlement orders to CB Agent (other than in connection with clause (h) below) or Coinbase Custody with respect of the Collateral without the consent or direction of Borrower prior to a Termination for Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Upon a Termination for Cause, Lender is authorized to exercise its right of set-off or other remedies as a secured party with respect to the Collateral, in each case in accordance with the Coinbase Prime Broker Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Borrower acknowledges and agrees that until any Trade Credit is repaid in accordance with Section 7(b)(i) or Section 7(b)(ii), as applicable, CB Agent will keep the proceeds of any purchase or sale Order executed with the use of such Trade Credit in the Trading Balance; <u>provided</u> that immediatelyupon repayment of such Trade Credit in full in accordance with Section 7(b)(i) or Section 7(b)(ii), as applicable, CB Agent shall comply with Borrower's instructions with respect to such proceeds.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **Repayment of the Trade Credits** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Borrower agrees to fully repay to Lender the Trade Credits extended during a Defined Interval by the Settlement Deadline for that Defined Interval. Borrower is permitted to repay the Trade Credits at any time during the Defined Interval.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Borrower must repay Lender with the same type of asset that Lender provided in extending the applicable Trade Credit. Borrower's repayment obligation shall be satisfied when Lender or CB Agent receives or is deemed to have received good funds for Cash Trade Credits or the relevant Digital Asset for Digital Asset Trade Credits. The parties agree that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Borrower shall have repaid Lender in full for any Cash Trade Credit upon CB Agent's receipt in the Trading Balance of an amount of cash in good funds equal to or greater than the notional amount of such Cash Trade Credit; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Borrower shall have repaid Lender in full for any Digital Asset Trade Credits upon Borrower instructing Coinbase Custody to transfer to the Trading Balance Digital Asset that are of the same type and in equal (or greater) number as the Digital Asset Trade Credit and Borrower does not subsequently successfully cancel such instruction **.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any Trade Credits that are repaid during a Defined Interval can be re-borrowed during the same Defined Interval but must be fully repaid by the Settlement Deadline for that Defined Interval. Upon execution of this CTF Agreement, Lender shall provide Borrower with standing settlement instructions for the repayment of the Trade Credits through the Trading Balance in accordance with clause (b) hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** Fees for Trade Credits

Borrower agrees to pay Lender a fee for Lender's extension of financing to Borrower as set forth in Appendix I.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** [ **Reserved** ]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **Termination; Modification** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless otherwise provided in this CTF Agreement, Section 25 of the General Terms shall govern any suspension, restriction, termination or modification of the CTF Agreement provided hereunder. All obligations of Borrower with respect to outstanding Trade Credits, and rights of Lender in connection therewith, shall survive the termination of this CTF Agreement, including Lender's security interest in the Collateral; <u>provided</u> that, for the avoidance of doubt, if the CTF Agreement is terminated such security interest shall be terminated immediately upon the repayment of the Trade Credits in full.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) [Reserved]

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **Financial Information** 

Borrower will deliver to Lender: (i) as soon as available and in any event within 120 days after the end of each fiscal year of Borrower, the annual audited financial statements of Borrower prepared in accordance with generally accepted accounting principles in the United States of America, together with an audit report thereon issued by independent certified public accountants certified in the United States of America and of recognized national standing (without a "going concern" or like qualification or exception and without any qualification or exception as to the scope of such audit); (ii) within 20 days after the end of each calendar month, the net asset value of Client as of the last Business Day of such month as determined by its administrator in accordance with its offering memorandum; and (iii) promptly upon request, such additional information reasonably requested by Lender's credit department for credit due diligence purposes; <u>provided</u> that, in each case, such information shall solely be provided to Coinbase's credit department solely for purposes of evaluating Client's creditworthiness in connection with the extension of credit under this CTF Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.** **Conflicts** 

In the event of any conflict between this CTF Agreement and the Coinbase Prime Broker Agreement, this CTF Agreement shall control.

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**Appendix 1-A**

**to the Coinbase Prime Broker Agreement** 

**<u>COINBASE PRIME FEE SCHEDULE (NON-ETP)</u>**

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**Appendix 1-ETP**

**to the Coinbase Prime Broker Agreement**

**<u>COINBASE PRIME FEE SCHEDULE</u>**

**<u>(ETPs)</u>**

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**<u>ADDENDUM NO. 1</u>**

**<u>PRIME BROKER AGREEMENT</u>**

[Redacted]

**[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]**

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**<u>EXHIBIT A</u>**

**DATA PROTECTION: PERSONAL INFORMATION SUPPLEMENT**

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**<u>EXHIBIT B</u>**

**<u>[RESERVED]</u>**

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**<u>EXHIBIT C</u>**

INSURANCE

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**<u>EXHIBIT D</u>**

**[BUSINESS CONTINUITY & DISASTER RECOVERY POLICY]**

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**<u>EXHIBIT E</u>**

**<u>INFORMATION SECURITY</u>**

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**<u>EXHIBIT F</u>**

**<u>MARKET DATA TERMS</u>**

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**ADDENDUM NO. 2**

**TO THE COINBASE PRIME BROKER AGREEMENT**

## Exhibit 10.2

**Exhibit 10.2**

**AMENDMENT TO THE COINBASE PRIME BROKER AGREEMENT**

This Amendment (this "**Amendment**") to the Third Amended and Restated Coinbase Prime Broker Agreement, dated May 21, 2024 (the "**Agreement**"), by and between Coinbase Inc., on behalf of itself and as agent for Coinbase Custody Trust Company, LLC and Coinbase Credit, Inc, and the party or parties identified as client on the signature page(s) of this Amendment ("**Client**"), is by and between the Coinbase Entities and Client and effective as of the last signature date set forth below (the "**Effective Date**"). Capitalized terms used but not defined herein shall have the respective meanings set forth in the Agreement. Each Coinbase Entity and Client may be individually referred to as a "**Party**" and collectively, the "**Parties**."

**WHEREAS**, the Parties desire to amend the Agreement as set forth in this Amendment.

**NOW, THEREFORE,** in consideration of the mutual agreement as set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, the Parties hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** <u>Amendments</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. **Exhibit A. Custodial Services Agreement**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Section 2.1***. The existing Section 2.1 shall be deleted in its entirety and replaced with the below new Section 2.1.

*2.1 In General*. The Custodial Services shall permit the Client (i) to hold its Vault Balance in its Custodial Account and transfer Digital Assets to and from its Trading Balance, (ii) to deposit supported Digital Assets from a public blockchain address controlled by Client into its Custodial Account, (iii) subject to Section 2.2 of Exhibit A, withdraw supported Digital Assets from its Custodial Account to a public blockchain address controlled by Client and (iv) certain additional services as may be agreed to between the Client and Coinbase Custody from time to time. Each such deposit or withdrawal shall be referred to as a "Custody Transaction" and shall conform to Instructions provided by Client through the Coinbase Prime Broker Site. Client shall only withdraw or deposit Digital Assets to public blockchain addresses and accounts, in each case, for which Client has conducted the necessary Know Your Customer ("KYC") and anti-money laundering ("AML") due diligence as determined by the Client using its commercially reasonable discretion; provided, for the avoidance of doubt, that withdrawals, deposits and other transfers performed by a Coinbase Entity hereunder are not considered withdrawals or deposits by Client for purposes of this sentence. Digital Assets shall be held in Client's Custodial Account in accordance with the terms of this Custody Agreement and shall not be commingled with other clients' Digital Assets. Coinbase Custody reserves the right to refuse to process or to cancel any pending Custody Transaction as required by applicable law or in response to a subpoena, court order or other binding government order, or to apply any restrictions on such Custody Transactions as agreed between the Coinbase Entities and the Client under the Prime Broker Agreement, in each case as communicated to Client (with relevant details and rationale related to such restriction) as soon as reasonably practicable where Coinbase Custody is permitted to do so, or if Coinbase Custody reasonably believes that the Custody Transaction may violate or facilitate the violation of an applicable law, regulation or rule of a governmental authority or self-regulatory organization.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) ***Section 2.2***. The below new sentence shall be added to Section 2.2.

For the avoidance of doubt, notwithstanding anything to the contrary in this Coinbase Prime Broker Agreement (including any SLAs associated therewith), while a Trade Credit remains unpaid, Client may make withdrawals of Digital Assets from the Custodial Account to public blockchain addresses provided that an amount equivalent to such Trade Credit is kept in the aggregate of the Borrower's Trading Balance and Vault Balance following such withdrawal. Subject to confirmation of the foregoing required minimum balance, Coinbase Custody shall process a withdrawal of Digital Assets from the Custodial Account to a public blockchain address within 12 hours of obtaining an Instruction from Client or Client's Authorized Representatives.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. **Exhibit D. Coinbase Committed Trade Financing Agreement**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) ***Section 6(h)***. The existing Section 6(h) shall be deleted in its entirety and replaced with the below new Section 6(h).

Borrower acknowledges and agrees that until any Trade Credit is repaid in accordance with Section 7(b)(i) or Section 7(b)(ii), as applicable, CB Agent will keep an amount equivalent to such Trade Credit in the aggregate of the Borrower's Trading Balance and Vault Balance; provided that immediately upon repayment of such Trade Credit in full in accordance with Section 7(b)(i) or Section 7(b)(ii), as applicable, CB Agent shall comply with Borrower's instructions with respect to such amounts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** <u>Counterparts</u>. This Amendment may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Amendment in a portable document format (pdf) or by another electronic format shall be as effective as delivery of a manually executed original counterpart of this Amendment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** <u>Ratification</u>. Upon the Effective Date, the Agreement shall be, and be deemed to be, modified and amended in accordance with this Amendment. Except as specifically amended hereby, all of the terms, provisions and conditions of the Agreement are in all respects ratified and confirmed, and all the terms, provisions and conditions thereof shall be and remain in full force and effect. The Agreement as amended by this Amendment sets out all terms agreed between the Parties and supersedes all other agreements between the Parties relating to its subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** <u>Governing Law</u>. This Amendment including its enforcement and any disputes arising out of or relating to it shall be governed by and construed in accordance with the laws of the state of New York without regard to conflicts of law principles.

[*Signature Page Follows*]

------

**COINBASE, INC. For itself and as agent for the Coinbase Entities** 

---

| | |
|:---|:---|
| **By:** | <u>/s/Lauren Abendschein</u>  |

---

---

| | |
|:---|:---|
| **Name:** | Lauren Abendschein |

---

---

| | |
|:---|:---|
| **Title:** | VP |

---

---

| | |
|:---|:---|
| **Date:** | September 16, 2024 |

---

------

**ISHARES BITCOIN TRUST ETF (f/k/a ISHARES BITCOIN TRUST), as Client, by BLACKROCK FUND ADVISORS, acting on behalf of Client and solely in its capacity as Agent**

---

| | |
|:---|:---|
| **By:** | **<u>/s/ Shannon Ghia</u>**  |

---

---

| | |
|:---|:---|
| **Name:** | **Shannon Ghia** |

---

---

| | |
|:---|:---|
| **Title:** | **Managing Director** |

---

**ISHARES ETHEREUM TRUST ETF (f/k/a ISHARES ETHEREUM TRUST), as Client, by BLACKROCK FUND ADVISORS, acting on behalf of Client and solely in its capacity as Agent**

---

| | |
|:---|:---|
| **By:** | **<u>/s/ Shannon Ghia</u>**  |

---

---

| | |
|:---|:---|
| **Name:** | **Shannon Ghia** |

---

---

| | |
|:---|:---|
| **Title:** | **Managing Director** |

---

## Exhibit 10.3

**Exhibit 10.3**

**JOINDER AND AMENDMENT TO THE COINBASE PRIME BROKER AGREEMENT**

This Joinder and Amendment (this "<u>Amendment</u>"), dated as of February 11, 2026, to the Third Amended and Restated Coinbase Prime Broker Agreement, dated May 21, 2024, by and between Coinbase, Inc. ("<u>Coinbase</u>"), on behalf of itself and as agent for Coinbase, Coinbase Custody Trust Company, LLC ("<u>Coinbase Custody</u>"), and, as applicable, Coinbase Credit, Inc. ("<u>Coinbase Credit</u>," and collectively with Coinbase and Coinbase Custody, the "<u>Coinbase Entities</u>"), and the party or parties identified as a client thereunder (as such Coinbase Prime Broker Agreement may have been amended from time to time, the "<u>Original Agreement</u>"), is entered into by the Coinbase Entities and each Client identified on Schedule I hereto. Each Coinbase Entity and each Client may be individually referred to as a "<u>Party</u>" and collectively, the "<u>Parties</u>".

WHEREAS, the Parties desire to amend the Original Agreement as set forth in this Amendment.

NOW THEREFORE, in consideration of the mutual agreement as set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, the Parties hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Defined Terms</u>. Capitalized terms used in this Amendment and not defined herein shall have the meanings assigned to such terms in the Original Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Amendments</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Client listed on <u>Schedule I</u> attached hereto shall constitute a "Client" under the Original Agreement as modified hereby, and any party that was a "Client" under the Original Agreement but is not a party to this Amendment shall no longer be a "Client" under the Original Agreement as modified hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Client listed on <u>Schedule I</u> attached hereto shall be deemed to have entered into the Original Agreement as modified hereby on a several but not joint basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Original Agreement as modified hereby shall constitute a series of separate agreements, each between a single Client and the Coinbase Entities, as if such Client had executed a separate Original Agreement as modified hereby naming only itself as the Client, and no Client shall have any liability for the obligations of any other Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Section 2(d) within Exhibit C to Addendum No. 2 of the Original Agreement is hereby deleted and replaced as set forth in <u>Exhibit A</u> attached hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Counterparts</u>. This Amendment may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Amendment in a portable document format (pdf) or by another electronic format shall be as effective as delivery of a manually executed original counterpart of this Amendment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Effectiveness</u>. This Amendment shall be deemed effective as of the first date set forth above in the introductory paragraph.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Ratification</u>. Upon this Amendment becoming effective pursuant to <u>Section 4</u> above, the Original Agreement shall be, and be deemed to be, modified and amended in accordance with this Amendment. Except as specifically amended hereby, all of the terms and conditions of the Original Agreement are in all respects ratified and confirmed, and all the terms, provisions and conditions thereof shall be and remain in full force and effect. The Original Agreement as amended by this Amendment sets out all terms agreed between the Parties and supersedes all other agreements between the Parties relating to its subject matter.

------

**COINBASE, INC. for itself and as agent for the Coinbase Entities**

---

| | |
|:---|:---|
| **By:** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **/s/**Lauren Abendschein |
| **Name:** | Lauren Abendschein |
| **Title:** | VP |
| **Date:** | February 12, 2026 |

---

**COINBASE CREDIT, INC. as Lender**

---

| | |
|:---|:---|
| **By:** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **/s/**Matt Boyd |
| **Name:** | Matt Boyd |
| **Title:** | Head of Prime Finance |
| **Date:** | February 12, 2026 |

---

**COINBASE CUSTODY TRUST COMPANY, LLC, as agent to Lender**

---

| | |
|:---|:---|
| **By:** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **/s/**Lauren Abendschein |
| **Name:** | Lauren Abendschein |
| **Title:** | VP |
| **Date:** | February 12, 2026 |

---

**ISHARES BITCOIN PREMIUM INCOME ETF, as Client, by BLACKROCK FUND ADVISORS, acting on behalf of Client and solely in its capacity as Agent** 

---

| | |
|:---|:---|
| **By:**  | /s/Bryan Bowers |
| **Name:** | Bryan Bowers |
| **Title:** | Managing Director |
| **Date:**  | February 12, 2026 |

---

------

**<u>ISHARES STAKED ETHEREUM TRUST ETF</u>, as Client, by BLACKROCK FUND ADVISORS, acting on behalf of Client and solely in its capacity as Agent** 

---

| | |
|:---|:---|
| **By:**  | /s/Bryan Bowers |
| **Name:** | Bryan Bowers |
| **Title:** | Managing Director |
| **Date:**  | February 12, 2026 |

---

**<u>ISHARES BITCOIN TRUST ETF</u>, as Client, by BLACKROCK FUND ADVISORS, acting on behalf of Client and solely in its capacity as Agent** 

---

| | |
|:---|:---|
| **By:**  | /s/Bryan Bowers |
| **Name:** | Bryan Bowers |
| **Title:** | Managing Director |
| **Date:**  | February 12, 2026 |

---

**<u>ISHARES ETHEREUM TRUST ETF</u>, as Client, by BLACKROCK FUND ADVISORS, acting on behalf of Client and solely in its capacity as Agent** 

---

| | |
|:---|:---|
| **By:**  | /s/Bryan Bowers |
| **Name:** | Bryan Bowers |
| **Title:** | Managing Director |
| **Date:**  | February 12, 2026 |

---

**BLACKROCK FUND ADVISORS, in its principal capacity solely with respect to Section 5.21** 

---

| | |
|:---|:---|
| **By:**  | /s/Bryan Bowers |
| **Name:** | Bryan Bowers |
| **Title:** | Managing Director |
| **Date:**  | February 12, 2026 |

---

------

**Schedule I**

**Client**

---

| | | | |
|:---|:---|:---|:---|
| **Client** | **Agent** | **Applicable Prime Fee Schedule** | **Facilitation Account Applicable** |
| iShares Bitcoin Trust ETF | BLACKROCK FUND ADVISORS, acting as trustee | Appendix 1-ETP | No |
| iShares Ethereum Trust ETF | BLACKROCK FUND ADVISORS, acting as trustee | Appendix 1-ETP | No |
| **iShares Bitcoin Premium Income ETF** | **BLACKROCK FUND ADVISORS, acting as trustee** | **Appendix 1-ETP** | No |
| **iShares Staked Ethereum Trust ETF** | **BLACKROCK FUND ADVISORS, acting as trustee** | **Appendix 1-ETP** | No |

---

Schedule I-1

------

**Exhibit A**

## Exhibit 10.6

**Exhibit 10.6**

**BFA MASTER SERVICES AGREEMENT**

**among**

**Each BFA Recipient Listed in Exhibit A, BlackRock Fund Advisors**

**and**

**The Bank of New York Mellon**

Dated as of October 24, 2023

------

**TABLE OF CONTENTS**

**1.** **BACKGROUND AND STRUCTURE** **1** 

**2.** **SERVICE PRINCIPLES** **2** 

**3.** **CUSTODY SERVICES** **4** 

**4.** **FUND ADMINISTRATION AND ACCOUNTING SERVICES** **5** 

**5.** **TRANSFER AGENCY SERVICES** **8** 

**6.** **PERFORMANCE; SERVICE LEVELS** **12** 

**7.** **PROVIDER PERSONNEL; USE OF LOCATIONS** **14** 

**8.** **BFA RESPONSIBILITIES; RELIANCE ON INFORMATION** **19** 

**9.** **FEES, INVOICING AND PAYMENT** **22** 

**10.** **TERM AND TERMINATION** **26** 

**11.** **DISENGAGEMENT ASSISTANCE** **32** 

**12.** **COMPLIANCE WITH LAWS, POLICIES AND USE RESTRICTIONS** **33** 

**13.** **DATA PROTECTION** **37** 

**14.** **PERSONAL INFORMATION** **41** 

**15.** **INTELLECTUAL PROPERTY RIGHTS** **42** 

**16.** **CONTRACT AND PROJECT MANAGEMENT** **44** 

**17.** **AUDIT / RECORDS / LEGAL DISCOVERY** **45** 

**18.** **CONFIDENTIALITY** **49** 

**19.** **REPRESENTATIONS AND WARRANTIES** **53** 

**20.** **INSURANCE AND RISK OF LOSS** **56** 

**21.** **INDEMNIFICATION** **56** 

**22.** **LIABILITY; LIABILITY LIMITATIONS** **61** 

**23.** **DISPUTE RESOLUTION** **63** 

**24.** **DEFINITIONS** **64** 

**25.** **MISCELLANEOUS** **73** 

Master Services Agreement CONFIDENTIAL

-i-

------

---

| | |
|:---|:---|
| **Exhibit A** | **BFA Recipients and Applicable Series** |
| **Exhibit B** | **Change Procedures**  |
| **Exhibit C** | **Governance Procedures** |
| **Exhibit D** | **Physical Security and Data Safeguards** |
| **Exhibit E** | **Disengagement Assistance** |
| **Schedule 1-A** | **Service Levels** |
| **Schedule 1-B** | **KPIs** |
| **Schedule 1-C** | **Commercial Terms Schedule** |

---

Master Services Agreement CONFIDENTIAL

-ii-

------

**MASTER SERVICES AGREEMENT**

This Master Services Agreement (this "<u>Agreement</u>") is made and entered into on this 24<sup>th</sup> day of October, 2023 (the "<u>Effective Date</u>") by and among The Bank of New York Mellon, a bank organized under the laws of the state of New York ("<u>Provider</u>"), the entities (and respective funds and series thereof) set forth in <u>Exhibit A</u> (subject to <u>Section 1.3(a)</u>, each, a "<u>BFA Recipient</u>"), and BlackRock Fund Advisors ("<u>BFA</u>"), acting on behalf of each of the BFA Recipients. Except as specifically stated, each BFA Recipient executing this Agreement will be obligating itself only with respect to itself, and not with respect to any other entity. References to a "<u>Party</u>" herein refer to either Provider or the applicable BFA Recipient or BFA Recipients, and references to the "<u>Parties</u>" herein refer to Provider, BFA and the applicable BFA Recipient or BFA Recipients. This Agreement consists of the general terms and conditions below and all Exhibits and Schedules attached hereto.

NOW, THEREFORE, for and in consideration of the Parties' agreements set forth below and intending to be legally bound, the Parties hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **BACKGROUND AND STRUCTURE** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.1** **Background and Purpose.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The BFA Recipients are exchange-traded products.<sup></sup>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Provider specializes in performing for other companies the types of services encompassed by the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The purpose of this Agreement is to establish the general terms and conditions applicable to Provider's provision of certain investment administration, accounting, cash custody, transfer agency, and related information technology services to the applicable BFA Recipients.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.2** **Objectives.** Subject to <u>Section 25.14(c)</u>, the Parties have agreed upon the following objectives to be accomplished by this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to leverage Provider's capability to deliver Services in accordance with the Standard of Care;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to gain access to Provider's high caliber, knowledgeable, experienced and skilled pool of resources that will provide each BFA Recipient with value-added strategic thought, vision and leadership; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) to use technologically current tools, Equipment and Software in performing the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.3** **Structure of Agreement.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Master Services Agreement</u>. This Agreement is a master agreement governing the relationship between the Parties solely with regard to Provider's provision of Services to each BFA Recipient. Any iShares entity that has executed this Agreement but does not have any funds or series that are receiving Services hereunder as of the date hereof, shall not be a BFA Recipient nor bound by the terms hereof except and until any funds or series of such iShares entity is added in accordance with <u>Section 6.5</u> at which point such iShares entity and its respective funds and series thereof shall become BFA Recipients for all purposes hereunder.

Master Services Agreement CONFIDENTIAL

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Fees</u>. Provider will charge each applicable BFA Recipient or BFA, on behalf of such BFA Recipient, for any Services rendered pursuant to this Agreement in accordance with the applicable terms and conditions set forth in <u>Schedule 1-C</u> (Commercial Terms Schedule). Provider will not charge any BFA Recipient or BFA, on behalf of such BFA Recipient, any implementation fees, except as set forth in <u>Schedule 1-C</u> (Commercial Terms Schedule).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **SERVICE PRINCIPLES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.1** **Generally.** Provider will provide the services, functions and responsibilities set forth in this Agreement, including any that may be modified in accordance with the Change Procedures set forth in <u>Section 2.4</u> and <u>Exhibit B</u> during the term of this Agreement and as they may be supplemented, enhanced, modified or replaced (collectively, the " <u>Services</u> ") for the applicable BFA Recipients:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the services, functions and responsibilities described in <u>Article 3</u>, <u>Article 4</u> and <u>Article 5</u> and <u>Schedule</u> <u> </u> <u>1-A</u> (Service Levels) and <u>Schedule</u> <u> </u> <u>1-B</u> (KPIs) hereto, excluding any services, functions or responsibilities that are expressly described as the responsibility of BFA, a BFA Recipient or a third party (other than a Subcontractor); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any services, functions or responsibilities not specifically described in this Agreement, but which are an inherent part of the Services and required for the proper performance or provision of the Services.

Except as provided above, Provider will not be responsible for any duties or obligations that it does not expressly undertake to perform pursuant to the terms of this Agreement and no such duties will be implied or inferred. Provider's duties will not include any obligation to monitor compliance by any BFA Recipient or any other person with any restriction or guideline imposed by such BFA Recipient's formation or offering documents, by contract or by Law or otherwise, including, but not limited to, the manner in which the assets of the BFA Recipients are invested.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.2** **Non-Exclusive Services/Cooperation with Third Parties/New Services**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>No Minimum Commitments</u>. The Parties acknowledge that the Services contain no minimum volume or revenue commitments to be provided by BFA or any BFA Recipient to Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Insourcing</u>. BFA or any BFA Recipient may terminate any Service (or portion thereof) and bring the performance of such Service inhouse to be performed by BFA or any Affiliate thereof, provided that BFA or the BFA Recipient shall provide at least one hundred and eighty (180) days' prior written notice of such termination to the Provider. In such event, the Parties will negotiate in good faith adjustments to the Fees, Service Levels, scope of the Services and the BFA Recipients to remain with Provider, as applicable; <u>provided</u>, that if the Parties do not agree to such adjustments within twelve (12) months after Provider's receipt of written notice, Provider may provide BFA with written notice to terminate the remaining Services in whole (or portion thereof, as agreed by BFA). For the avoidance of doubt, BFA and BFA Recipients shall be entitled to Disengagement Assistance after such termination.

Master Services Agreement CONFIDENTIAL

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Third Party Service Providers</u>. Nothing set forth in this Agreement shall prohibit any entity for which BFA acts in a capacity as investment advisor, trustee and/or agent that is not a BFA Recipient as of the Effective Date from entering into an arrangement with third parties to provide to such entity (or respective fund or series thereof) services similar to the Services provided by Provider hereunder to the BFA Recipients.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>New Services</u>. BFA or any BFA Recipient may, at its discretion, perform itself or enter into arrangements with third parties to provide New Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Provider Cooperation</u>. To the extent that BFA or any BFA Recipient performs any New Services itself or Services that it is permitted to perform for itself in accordance with the terms of this Agreement, or retains Third Party Providers to do so, Provider will cooperate and coordinate with such entities as BFA or such BFA Recipient reasonably requests, including by using Commercially Reasonable Efforts to modify its interfaces to those of the BFA Recipient or other Third Party Providers to ensure compatibility among such systems and those of Provider, subject to reimbursement by such BFA Recipient for material cost incurred by Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.3** **Services Evolution.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Services Evolution</u>. Throughout the Term (including any Extension Period or Renewal Term, if applicable), Provider will seek to improve the quality, efficiency and effectiveness of the Services to keep pace with technological advances and support the evolving business needs and efforts of each BFA Recipient to maintain competitiveness in the markets in which such BFA Recipient competes. Provider will do this by: (i) discussing with the BFA Recipients "best practice" techniques and methods in providing the Services; (ii) applying such techniques to the Services to the extent practicable and consistent with Provider's overall servicing strategy; (iii) maintaining a reasonable training program for Provider Personnel in relevant new techniques and technologies that are used generally within Provider's organization or first class international financial services providers of asset processing and related services; (iv) developing in conjunction with the applicable BFA Recipient a training program designed to train Provider Personnel and applicable Subcontractors in relevant new techniques and technologies used by the BFA Recipients or used generally at first class international financial services providers of asset processing and related services; and (v) making investments that Provider reasonably believes are necessary to maintain the currency of the tools, infrastructure and other resources Provider uses to render the Services. Upon request from any BFA Recipient, Provider will provide to such BFA Recipient any service that Provider is providing to another of its customers, subject to mutual agreement on equitable pricing and other terms for such services and applicable third party restrictions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.4** **Changes.** The Change Procedures (as set forth in <u>Exhibit B</u>) will be used by the Parties for all Changes to the Services. Except as otherwise provided herein or therein, each BFA Recipient reserves the right to reject Provider's request for a Change to the Services if such BFA Recipient believes the proposed Change will have a material impact on the provision of the Services, or if such BFA Recipient or BFA, on behalf of such BFA Recipient, is required to pay any fee or contribute any other resources to the Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.5** [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.6** **Due Diligence Complete.** Provider hereby acknowledges that as of the Effective Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The BFA Recipients have delivered or made available to Provider information and documents Provider has deemed necessary, including information and documents requested by Provider, for Provider to understand fully its obligations under this Agreement; and

Master Services Agreement CONFIDENTIAL

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Provider's due diligence is complete and there will be no changes to this Agreement related in any way to Provider's performance or non-performance of its due diligence.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **CUSTODY SERVICES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.1** Terms of Appointment as Cash Custodian.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Provider Appointed as Cash Custodian</u>. Each BFA Recipient hereby appoints Provider as a custodian of such BFA Recipient's cash (" <u>Cash Assets</u> ") delivered to Provider from time to time during the term of this Agreement for credit to such BFA Recipient's separate cash deposit account or accounts (each, a " <u>BFA Account</u> ") and Provider agrees to act as such upon the terms and conditions hereinafter set forth.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Safekeeping</u>. As custodian, Provider shall have general responsibility for the safekeeping of all such Cash Assets of each applicable BFA Recipient as listed in <u>Exhibit A</u> (as may be amended from time to time) that is received and accepted by Provider. All Cash Assets shall be segregated on Provider's books and records from property held by Provider for its own account and for the account of Provider's other customers, including the Cash Assets of any BFA Recipient from the Cash Assets of any other BFA Recipient. All such Cash Assets will be held or disposed of by Provider only upon receipt of Proper Instructions (which may be standing instructions).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.2** **Cash Assets.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>On-book Accounts</u>. Provider shall open, maintain and operate a separate deposit account or deposit accounts in the name of each BFA Recipient (or in another name requested by the BFA Recipient that is acceptable to Provider) for the deposit and collection of any and all Cash Assets in any currency supported and received by or on behalf of Provider for the account of the BFA Recipient (hereinafter referred to as " <u>On-book Accounts</u> ") on the books of Provider, and shall hold in such On-book Accounts, subject to the provisions hereof, all Cash Assets received by it from or for the account of the BFA Recipient. Each such On-book Accounts may be denominated in U.S. Dollars. Any amount standing to the credit of the On-book Accounts is a debt due from Provider, as banker to each applicable BFA Recipient. The responsibilities of Provider to each applicable BFA Recipient for deposits accepted on Provider's books shall be that of a U.S. bank for a similar deposit held at a domestic branch office. The State of New York is the "bank's jurisdiction" (as defined in UCC Section 9-304(b)) of Provider and any Affiliate of Provider with respect to each On-book Account and all funds credited thereto. Provider will use best efforts to ensure that such On-Book Accounts are insured to the maximum extent possible by all applicable deposit insurers including, without limitation, the Federal Deposit Insurance Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Deposit Insurance</u>. Upon receipt of Proper Instructions, Provider shall take such reasonable actions as the applicable BFA Recipient deems necessary or appropriate to cause each deposit account established by Provider pursuant to this <u>Section 3.2</u> to be insured to the maximum extent permitted by all applicable deposit insurers including, without limitation, the Federal Deposit Insurance Corporation.

Master Services Agreement CONFIDENTIAL

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.3** **Segregation and Registration.** Provider will, upon receipt of Proper Instructions on behalf of each applicable BFA Recipient, establish and maintain additional BFA Accounts for and on behalf of each such BFA Recipient, into which account or accounts Cash Assets may be transferred.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.4** **Maintenance of Records.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) At all times during the term of this Agreement, Provider shall furnish to the BFA Recipients access to Provider's then-existing online, electronic account reporting and information system with respect to each BFA Recipient's BFA Accounts. The Parties agree that the use of such system shall be subject to the https://nexen.bnymellon.com/app/nxn/termsOfUse or any successor website the address of which is provided by Provider to each BFA Recipient, except to the extent otherwise agreed by the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Provider will furnish each BFA Recipient with such daily information regarding the positions and activity of the BFA Recipient's Cash Assets as Provider and such BFA Recipient will from time to time agree.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.5** Provider will assist generally in providing data for BFA's preparation of reports to shareholders and others, audits of accounts, and other ministerial matters of like nature.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.6** **Service Levels.** <u>Schedule 1-A</u> (Service Levels) and <u>Schedule 1-B</u> (KPIs) set forth the Service Levels and Key Performance Indicators applicable to the Services under this <u>Article 3</u>. Provider will perform the Services under this <u>Article 3</u> in accordance with such Service Levels, Key Performance Indicators and <u>Article</u> <u> </u> <u>6</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **FUND ADMINISTRATION AND ACCOUNTING SERVICES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.1** **Provider Responsibilities.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Fund Administration and Accounting Services</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Each BFA Recipient is engaging Provider to provide the Fund Administration and Accounting Services specified in <u>Schedule 1-A</u> (Service Levels) with respect to such BFA Recipient subject to the terms and conditions of this Agreement. Provider agrees to act as such upon the terms and conditions hereinafter set forth.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider agrees to provide the Fund Administration and Accounting Services, as described in <u>Schedule 1-A</u> (Service Levels), as such Schedule may be amended from time to time by the consent of the Parties, in connection with the operations of such BFA Recipient, which shall generally include the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) <u>Valuation and Computation Accounting Services</u>.

Provider shall provide the following valuation and computation accounting services for the BFA Recipient:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Journalize investment, capital share and income and expense activities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Maintain individual ledgers for BFA Recipient assets;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Maintain certain financial books and records for the BFA Recipient, including creation and redemption books and records, and BFA Recipient accounting records;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Maintain historical tax lots for BFA Recipient assets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Reconcile Cash Assets (if applicable) and investment balances of the BFA Recipient with the BFA Recipient's custodian;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Calculate various contractual expenses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) Calculate capital gains and losses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) Obtain quotes from Authorized Data Sources as directed and approved by BFA, or if such quotes are unavailable, then obtain such prices from BFA, and in either case, calculate the market value of the BFA Recipient's assets in accordance with the BFA Recipient's valuation policies or guidelines; <u>provided</u>, <u>however</u>, that Provider shall not under any circumstances be under a duty to independently price or value any of the BFA Recipient's assets itself or to confirm or validate any information or valuation provided by BFA or any other pricing source, nor shall Provider have any liability relating to inaccuracies or otherwise with respect to such information or valuations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) Compute Net Asset Value and Net Asset Value per Share (as defined below), calculated in the manner described in the BFA Recipient's Offering Materials;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(10) Transmit or make available a copy of the daily portfolio valuation to BFA; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(11) Publish basket to NSCC [(or as designated by BFA by market value)] on each day on which trading occurs on the primary exchange on which the BFA Recipient's shares trade.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) <u>Financial Reporting</u>.

Provider shall provide the following financial reporting services for the BFA Recipient:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Financial Statement Preparation & Review

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Prepare financial statements for the BFA Recipient;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Prepare the BFA Recipient's periodic shareholder reports, including certain information furnished by the BFA Recipient to Provider, as required pursuant to the Exchange Act; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Prepare, circulate and maintain the BFA Recipient's financial reporting production calendar;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) <u>Fund Administration</u>.

Provider shall provide the following fund administration services for the BFA Recipient:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Establish appropriate expense accruals and compute expense ratios, maintain expense files and coordinate the payment of BFA Recipient approved invoices;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Calculate BFA Recipient approved income and per share amounts required for periodic distributions to be made by the BFA Recipient;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Calculate total return information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Coordinate the BFA Recipient's annual audit;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Supply various normal and customary portfolio and BFA Recipient statistical data as requested on an ongoing basis; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Provide information as requested to support tax reporting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) In performing the Fund Administration and Accounting Services hereunder, Provider shall at all times act in conformity with and informed by: (i) the BFA Recipients' Declaration of Trust or Articles of Incorporation (or other formation document) and by-laws (or similar document), as the same may be amended from time to time; (ii) the investment objectives, policies, restrictions and other practices set forth in the BFA Recipients' registration statements (or other offering documents), as the same may be amended from time to time; and (iii) all applicable requirements of the Provider Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Written Procedures</u>. Written procedures applicable to the Fund Administration and Accounting Services and other Services to be performed hereunder may be established from time to time by mutual agreement of the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.2** **Digital Asset Related Information and Additional Reliances by Provider.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Provider shall calculate the BFA Recipient's Net Asset Value in the manner described in the Prospectus. The method of valuation of Digital Assets or other assets and the method of computing the Net Asset Value shall be as set forth in the then currently effective Prospectus of the BFA Recipient. To the extent the description of the valuation methodology of Digital Assets, or computation of Net Assets Value as specified in the BFA Recipient's then currently effective Prospectus is at any time inconsistent with any Laws, the BFA Recipient shall promptly so notify Provider in writing and thereafter shall either furnish Provider at all appropriate times with the values of such Digital Assets, and Net Asset Values, or instruct Provider in writing as to the appropriate valuation methodology to be employed by Provider to compute Net Asset Values in a manner that the BFA Recipient then represents in writing to be consistent with all applicable Laws. The BFA Recipient may also from time to time deliver to Provider a Proper Instruction to compute the Net Asset Values in a manner other than as specified in this Agreement (such Proper Instruction, a " <u>Manager Mark</u> "). By giving any Manager Mark, the BFA Recipient shall be deemed to have represented that such instruction is consistent with all applicable Laws and the then currently effective Prospectus. Provider shall have no duty, responsibility or obligation to validate, confirm, reconcile or otherwise verify any Manager Marks provided to Provider by or on behalf of the BFA Recipient in respect of Digital Assets or any other asset held by the BFA Recipient including, without limitation, any Manager Marks furnished by BFA or any BFA Affiliate. Provider shall have no responsibility for monitoring the BFA Recipient's portfolio or investments to determine whether the BFA Recipient is in compliance with its investment objectives, guidelines and restrictions.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) At any time and from time to time, the BFA Recipient may, if consistent with and to the extent permitted by the Prospectus, furnish Provider with bid, offer, index price, market values of assets or Manager Marks of Digital Assets and instruct Provider to use such information in its calculations hereunder. Provider shall, in its sole discretion during the Term, engage pricing or other similar service providers reasonably selected by Provider in connection with Provider's provision of services hereunder; provided; however, and notwithstanding the foregoing, Provider shall at no time be required or obligated to commence or maintain either any utilization of, or subscriptions to, any securities pricing or similar service or any arrangements with any brokers, dealers or market makers, index providers or specialists, in each case, as described in the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the event Provider's computations hereunder rely, in whole or in part, upon information, including (i) bid, offer, index price, or market values of assets, or accruals of interest or earnings thereon, from an Authorized Data Source, or (ii) prices or values supplied by the BFA Recipient or by Authorized Data Sources described in the Prospectus, Provider shall not be responsible for, under any duty to inquire into, or deemed to make any assurances with respect to, the accuracy or completeness of such information. Provider shall not be required to inquire into any valuation of Digital Assets or other assets by the BFA Recipient or any third party described above, even though Provider in performing Services similar to the Services provided pursuant to this Agreement for others may receive different valuations of the same or different assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Provider, in performing the Services, shall be entitled to rely fully, without inquiry, on the accuracy and validity of any and all Proper Instructions, Manager Marks, explanations, information, specifications and documentation furnished to it by or on behalf of BFA or a BFA Recipient or any Third Party Provider, including the BFA Recipient's Digital Asset custodian, and shall have no duty or obligation to review the accuracy, validity or propriety of such Proper Instructions, explanations, information, specifications or documentation, including the amounts or formula for calculating the amounts and times of accrual liabilities and expenses; and the amounts receivable and the amounts payable on the sale or purchase of Digital Assets or any other asset.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **TRANSFER AGENCY RELATED COVENANTS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.1** **Terms of Appointment.** Each BFA Recipient hereby employs and appoints Provider to act, and Provider agrees to act, as transfer agent for each BFA Recipient's authorized and issued shares of beneficial interest (" <u>Shares</u> "), dividend disbursing agent and agent in connection with any accumulation, open-account or similar plans provided to the shareholders of each BFA Recipient (" <u>Shareholders</u> ") and set out in the then currently effective prospectus(es) and statement(s) of additional information (or similar document), as each may be amended from time to time (the " <u>Prospectus</u> "), of each BFA Recipient, including without limitation, any periodic investment plan or periodic withdrawal program.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.2** **Purchases and Redemptions.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Generally</u>. Provider will duly process requests to purchase and redeem Shares of each BFA Recipient in accordance with the provisions of <u>Schedule 1-A</u> (Service Levels), which shall include the following activities:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Perform and facilitate the performance of purchases and redemption of Creation Units;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Prepare and transmit by means of DTC's book entry system payments for dividends and distributions on or with respect to the Shares, if any, declared by the BFA Recipient;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Maintain the record of the name and address of the DTC and the number of Shares issued by the BFA Recipient and held by the DTC and the creation and redemption activity of each Authorized Participant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Record the issuance of Shares of the BFA Recipient and maintain a record of the total number of Shares of the BFA Recipient which are outstanding and authorized, based upon data provided to it by the BFA Recipient. Provider shall have no obligation, when recording the issuance of Shares, to monitor the issuance of such Shares or to take cognizance of any laws relating to the issue or sale of such Shares, which functions shall be the sole responsibility of the BFA Recipient.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Prepare and transmit to the BFA Recipient and BFA and to any applicable securities exchange (as specified to Provider by the BFA Recipient or its administrator) information with respect to purchases and redemptions of Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) On days that the BFA Recipient may accept orders for purchases or redemptions, calculate and transmit to the Distributor and the BFA the number of outstanding Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) On days that the BFA Recipient may accept orders for purchases or redemptions (pursuant to an Authorized Participant Agreement), transmit to Provider, the BFA Recipient and DTC the amount of Shares purchased or redeemed on such day;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) Confirm to DTC the number of Shares issued to the DTC, as DTC may reasonably request;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) Prepare and deliver other reports, information and documents to DTC as DTC may reasonably request;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) Extend the voting rights to the DTC for extension by DTC to Shareholders and the beneficial owners of Shares in accordance with policies and procedures of DTC for book-entry only securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) Distribute or maintain, as directed by the BFA Recipient, amounts related to purchases and redemptions of Creation Units, dividends and distributions, variation margin on derivative securities and collateral;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii) Maintain those books and records of the BFA Recipient specified by the BFA Recipient as set forth in Section 5.2(a)(xxi) below;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) Prepare a monthly report of all purchases and redemptions of Shares during such month on a gross transaction basis, and identify on a daily basis the net number of Shares either redeemed or purchased on such business day and with respect to each Authorized Participant (as defined in each Authorized Participant Agreement) purchasing or redeeming Shares, the amount of Shares purchased or redeemed;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv) Receive from the trustee, or BlackRock Investments, LLC ("BRIL"), an affiliate of the trustee, or from its agent, purchase orders from Authorized Participants for Creation Units of Shares received in good form and accepted by or on behalf of the BFA Recipient by the trustee or BRIL, transmit appropriate trade instructions to the National Securities Clearance Corporation, if applicable, and pursuant to such orders issue the appropriate number of Shares of the BFA Recipient and hold such Shares in the account of DTC for the Shares of the BFA Recipient;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xv) Receive from the trustee, or BRIL, Authorized Participant redemption requests, deliver the appropriate documentation thereof to the BFA Recipient's sponsor or trustee with respect to redemptions, provide asssitance for BRIL to generate and transmit or cause to be generated and transmitted confirmation of receipt of such redemption requests to the Authorized Participants submitting the same; transmit appropriate trade instructions to the National Securities Clearance Corporation, if applicable, and pursuant to such orders redeem the appropriate number of s Shares of the BFA Recipient held in the account of the DTC for the Shares of the BFA Recipient; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvi) Confirm the name, U.S. taxpayer identification number and principal place of business of each Authorized Participant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvii) The BFA Recipient and/or BFA will be responsible for confirming the receipt of assets in connection with creation activity and the withdrawal of assets in connection with redemption activity prior to the creation or redemption of Creation Units by Provider. Provider has no responsibility to independently verify the accuracy of such information provided to it by the BFA Recipient.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xviii) Except as otherwise instructed by the BFA Recipient, Provider shall process all transactions for the BFA Recipient in accordance with the policies and procedures mutually agreed upon between the BFA Recipient and Provider with respect to the proper Net Asset Value to be applied to creation orders received in good order by Provider before any cut-offs established by the BFA Recipient, and such other matters set forth in items (i) through (xvi) above as these policies and procedures are intended to address.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xix) Provider may maintain and manage, as agent for the BFA Recipient, such accounts as Provider shall deem necessary for the performance of its duties under this Agreement, including, but not limited to, the processing of Creation Unit purchases and redemptions; and the payment of dividends and distributions. Provider may maintain such accounts at financial institutions deemed appropriate by Provider in accordance with applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xx) In addition to the services set forth above, Provider shall: perform the customary services of a transfer agent and dividend disbursing agent including, but not limited to, maintaining the account of BFA Recipient at DTC, maintaining the items set forth in the section immediately below, and performing such services identified in each Authorized Participant Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xxi) Books and Records to be Maintained by Provider in Connection with Transfer Agency Services:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) Source Documents requesting Creations and Redemptions (including dates and times of orders)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) Correspondence/Authorized Participant Inquiries

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) Reconciliations, bank statements, copies of canceled checks, cash proofs

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) Daily/Monthly reconciliation of outstanding Shares between the BFA Recipient and DTC

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) Dividend Records

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(F) Year-end Statements and Tax Forms

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(G) Provider shall maintain books on which the registered ownership of each Share and transfers, if any, of such registered ownership shall be recorded.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Suspended or Discontinued Sale</u>. Provider shall not be required to issue any Shares of a BFA Recipient where it has received a written instruction from the BFA Recipient (or BFA, on behalf of the BFA Recipient) or written notification from any appropriate federal or state authority that the sale of the Shares of the BFA Recipient in question has been suspended or discontinued, and Provider shall be entitled to rely upon such written instructions or written notification.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>BFA Responsibilities</u>. The BFA Recipient or its agent (which may be Provider or its Affiliate) will notify Provider of the declaration of any dividend or distribution. The BFA Recipient or its agent (which may be Provider or its Affiliate) shall furnish to Provider Proper Instructions specifying the date of the declaration of such dividend or distribution, the date of payment thereof, the record date as of which Shareholders entitled to payment shall be determined, the amount payable per share to Shareholders of record as of such record date and the total amount payable to Provider on the payment date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Withholding of Payment</u>. If Provider shall not receive sufficient cash to make payment to all Shareholders of the BFA Recipient as of the record date, the Proper Instruction referred to in <u>Section 5.2(b)</u> shall be deemed to be suspended until such time as Provider shall have received sufficient cash to make payment to all Shareholders of the BFA Recipient as of the record date. BFA and each BFA Recipient hereby acknowledges and agrees that Provider shall have no duty, responsibility or obligation with respect the facilitation of or the provision or performance of any services relating to, or in respect of, the receipt of and acceptance of payments for the purchase of Shares made by Authorized Participants in the form of Digital Assets and Provider shall have no duty, responsibility, or obligation in respect of the disbursement of any Digital Assets to any Authorized Participants including, but not limited to, as a form of redemption payment.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Taxes</u>. It is understood that the trust is considered a "non-mortgage widely held fixed investment trust" for U.S. federal income tax purposes and Provider shall annually furnish a grantor trust tax reporting statement pursuant to Treasury Regulation Section 1.671-5. Provider shall withhold such taxes, penalties or other sums as are required to be withheld by applicable Provider Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Written Procedures</u>. Written procedures applicable to the Services to be performed hereunder may be established from time to time by mutual agreement of the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.3** **Covenants of Provider.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Provider hereby agrees to establish and maintain facilities and procedures reasonably acceptable to the BFA Recipient for safekeeping of BFA and BFA Recipient signature imprinting functions (e.g., signature stamps, electronic signatures), if applicable; and for the preparation or use, and for keeping account of, such signatures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In case of any requests or demands for the inspection of the Shareholder records of the BFA Recipient, Provider will endeavor to notify the BFA Recipient and to secure instructions from an authorized officer of the BFA Recipient as to such request or demand. Provider reserves the right, however, to exhibit the Shareholder records to any person whenever it is advised by its counsel that it may be subject to enforcement or other action by any court or regulatory body for the failure to exhibit the Shareholder records to such person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Provider shall promptly notify the BFA Recipients in the event its registration as a transfer agent as provided in Section 17A(c) of the Exchange Act is revoked or if any proceeding is commenced before the SEC that may lead to such revocation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Provider shall at all times act in conformity with and be informed by: (i) the BFA Recipients' Declaration of Trust or Articles of Incorporation (or other formation document) and by-laws (or similar document), as the same may be amended from time to time; (ii) the investment objectives, policies, restrictions and other practices set forth in the BFA Recipients' Prospectus(es), as the same may be amended from time to time, which amendments shall be provided to Provider promptly after such amendments become effective; and (iii) all applicable requirements of the Securities Act, the Exchange Act, the USA PATRIOT Act of 2001, as amended, and any other laws, rules and regulations of Governmental Authorities with jurisdiction over Provider and all Provider Laws, as such may be applicable to the provision of Transfer Agency Services by Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **PERFORMANCE; SERVICE LEVELS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.1** **Standard of Care.** Provider will perform the Services (including in selecting, retaining and using Subcontractors) in a manner that meets the following standards of performance (collectively, the " <u>Standard of Care</u> ") as applicable to each:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) with the exercise of that level of care at least at the same standard of care as Provider provides for itself and/or its Affiliates with respect to similar services, and without the exercise of any Bad Acts;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in a manner reasonably designed to satisfy Provider's obligations under this Agreement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) with the skill and care that may reasonably be expected of a first class international financial services provider of asset processing and related services.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.2** **Service Levels.** Subject to the terms and conditions of this Agreement, each Party will perform its obligations under the Service Level Schedules and cause its third party providers to do likewise. Provider and the applicable BFA Recipients (or BFA, on behalf of the BFA Recipients) may agree, from time to time, to replace Key Performance Indicators with other Service Levels to be treated as such.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.3** **Performance Issues.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Provider Non-Performance</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If Provider becomes aware of a situation where it has failed or reasonably expects to fail (or a Subcontractor has failed or reasonably expects to fail) to comply with the Service Levels, or otherwise with its other obligations under this Agreement in any material respect, Provider will promptly inform the applicable Authorized Person of such situation, the situation's impact or expected impact and Provider's action plan to minimize or eliminate such impact.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider will promptly notify such Authorized Person upon becoming aware of any circumstances that may reasonably be expected to jeopardize the timely and successful completion or delivery of any Service, Project or deliverable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provider will inform such Authorized Person of any steps Provider is taking or will take to minimize, eliminate or remediate such impact, and the projected actual completion (or delivery) time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>BFA Recipient Non-Performance</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If a BFA Recipient becomes aware of a situation where it has failed or reasonably expects to fail (or a Third Party Provider has failed or reasonably expects to fail) to comply with its obligations hereunder in any material respect, such BFA Recipient will promptly inform Provider of the situation's impact or expected impact.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider will use Commercially Reasonable Efforts to perform its obligations on time and to prevent or circumvent such problem or delay, notwithstanding such BFA Recipient's (or its Third Party Provider's) failure to perform.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Service Failures</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) To the extent Provider experiences a problem or delay in providing the Services, Provider will promptly notify the applicable Authorized Person and use Commercially Reasonable Efforts to continue performing the Services in accordance with the Service Levels.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The BFA Recipients will use Commercially Reasonable Efforts to mitigate the impact of Provider's non-performance to the extent the problem or delay relates to matters described in <u>Section 6.3(b)(i)</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If Provider is unable to meet its obligations under this Agreement as a result of the matters described in <u>Section 6.3(b)(i)</u>, Provider's non-performance of the affected Services will be excused to the extent that Provider provides the affected BFA Recipients with reasonable notice of such non-performance and uses Commercially Reasonable Efforts to perform notwithstanding such BFA Recipient's failure to perform.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Material costs incurred by either Party in the event of a delay or failure for reasons outside of the control of the Parties will be allocated as agreed between the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Resource Reprioritization</u>. If Provider becomes aware of a situation where it has failed or reasonably expects to fail (or a Subcontractor has failed or reasonably expects to fail) to comply with the Service Levels, or otherwise with its other obligations hereunder, Provider will use Commercially Reasonable Efforts to reprioritize or reset the schedule for Provider Personnel's existing work activities without impacting the established schedule for other tasks or the performance of the Services in accordance with the Standard of Care. If an impact cannot be avoided, Provider will promptly notify the applicable Authorized Person of the anticipated impact.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.4** **Adjustments.** At least annually the Parties will review the Service Levels and will make adjustments to them as appropriate to reflect changing business priorities or improved performance capabilities associated with advances in technology and methods used to perform the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.5** **Additional BFA Recipients.** If additional series of exchange-traded products in addition to those listed in <u>Exhibit A</u> hereto are established and BFA, on behalf of such series, desires to have Provider render Custody Services, Fund Administration and Accounting Services and/or Transfer Agency Services under the terms of this Agreement, it shall so notify Provider in writing, and if Provider agrees in writing to provide such Services, such series of exchange-traded products shall each become a BFA Recipient hereunder and <u>Exhibit</u> <u> </u> <u>A</u> shall be appropriately amended. <u>Schedule 1-C</u> (Commercial Terms Schedule) will be amended as necessary if any classes are added to any BFA Recipient.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **PROVIDER PERSONNEL; USE OF LOCATIONS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.1** **Provider Personnel.**" <u>Provider Personnel</u> " means all of the employees of Provider and Provider Affiliates who perform any Services. A BFA Recipient may request, and Provider will furnish, a staffing plan regarding Provider Personnel for a Service at any time during the Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Qualifications</u>. All Provider Personnel must be:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) suitable and fully trained (including satisfying relevant regulatory training and competence requirements);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) properly supervised and subject to well-defined operating procedures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) familiar with the products of the applicable BFA Recipient and the applicable regulatory requirements to the extent reasonably necessary for the performance of the applicable function; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) available upon reasonable prior notice when required by a BFA Recipient for training.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Advisements</u>. Provider acknowledges and agrees that, in the course of providing the Services, Provider Personnel may have access to, or acquire, knowledge of confidential, proprietary or sensitive information regarding the BFA Recipients or clients or other parties with whom the BFA Recipients have a relationship. Provider will advise such Provider Personnel of the standards imposed upon them with respect to the Services they render pursuant to the terms of this Agreement, which advisement may occur through, among other things, general policies (*e.g.*, standard of conduct) of Provider that are applicable to Provider Personnel.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Agreements</u>. Provider shall at all times have in place with all Provider Personnel agreements (either directly or indirectly through their respective employers): (i) with respect to confidentiality, the scope of which includes BFA Confidential Information and which contains confidentiality obligations consistent with Provider's obligations under this Agreement; and (ii) respecting Intellectual Property Rights as necessary for Provider to fulfill its obligations under this Agreement. This obligation with respect to Provider Personnel may be fulfilled through Provider's general policies (*e.g.*, Provider standard of conduct) in effect from time to time, provided that such general policies are consistent with the requirements set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Compliance with Code of Conduct</u>. Provider will at all times through the Term maintain a code of conduct applicable to its personnel and enforce such code of conduct. Upon request by BFA or any BFA Recipient, Provider will provide a copy of such code of conduct to BFA or the applicable BFA Recipient.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Background Checks</u>. Provider will maintain as part of its standard hiring practices a requirement to perform background checks with respect to Provider Personnel and Contract Workers and for its Subcontractors to perform background checks in accordance with applicable Law. To the extent permitted under applicable Law, Provider will conduct adequate background screenings based on FDIC guidelines, federal bonding requirements and any other applicable regulatory requirements on all Provider Personnel and Contract Workers who will provide Services to the BFA Recipients that, subject to any local Law restrictions or requirements, at a minimum address criminal and sanctions searches, and, for personnel in the United States, fingerprinting and drug testing as applicable given the nature of an individual's position and role, in accordance with applicable Law. Provider will not assign to any BFA matter, any individual (i) that has been convicted of a crime involving dishonesty, breach of trust or money laundering, or (ii) is disqualified in accordance with FDIC guidelines. Provider or its Subcontractor will conduct pre-employment screenings of all new Provider Personnel and Contract Workers who will provide Services to the BFA Recipients in a manner consistent with Provider's pre-employment screening policies and procedures. Upon BFA's request, Provider will provide to BFA a summary of Provider's hiring practices and pre-employment screening policies and procedures (including the typical background checks), for each location from which the Services (other than shared or centralized custody functions within Provider or technology infrastructure, development or support) are performed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Resource Sufficiency; Reductions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) On a semi-annual basis (or at such frequency otherwise agreed to by the Parties), Provider will provide a report to the BFA Recipients indicating the headcount for Provider Personnel who are providing Services generally during the prior period. Such reports will reflect how resourcing is allocated across each function and provide status updates on any previously agreed to changes that are in process.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) During meetings on a semi-annual basis (or at such frequency otherwise agreed by the Parties), the Parties will discuss any concerns that the BFA Recipients may have with respect to any turnover and, as applicable, the plans of Provider to address excessive turnover, and the status of Provider's implementation of such plans.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provider will notify the BFA Recipients prior to implementing any plan to materially decrease its staffing of the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Replacement</u>. Any BFA Recipient may request that Provider reassign any Provider Personnel from the team that provides Services to such BFA Recipient on any lawful grounds. Provider will consider the input of such BFA Recipient when determining, at its sole discretion, whether to reassign such Provider Personnel. The timing for transfer, reassignment or replacement of Provider Personnel will be closely coordinated with the requirements for timing and other elements of the Services so as to maintain continuity in the performance of the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Immigration</u>. Each Party is responsible for handling and processing all immigration and employment-related issues and requirements (including processing visas and ensuring compliance with all applicable Laws) arising in connection with its personnel, and the other Party will not be required to participate in any such immigration or visa activities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Non-Disclosure of Service Relationship</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Generally</u>. During the Term, Provider (including its Affiliates and their personnel) will refrain from directly or indirectly publicly naming BFA, any BFA Recipient, or any of their products as customers of the Services in any marketing or advertising campaigns (including, without limitation, in any press release) without BFA's or such BFA Recipient's prior consent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Remediation</u>. Provider will make reasonable efforts to promptly remediate any violation, including, if so requested by a BFA Recipient, by affirmatively retracting prohibited disclosures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>Exceptions</u>. Disclosures that would otherwise be prohibited under this <u>Section</u> <u> </u> <u>7.1</u> will be permitted if Provider determines based on advice of counsel, such disclosures are necessary for Provider to fulfill legal obligations or regulatory requirements. In addition to any other permitted disclosures, Provider will be permitted to disclose the identity of BFA or a BFA Recipient as a client (A) internally at Provider and Affiliates thereof (such permitted internal disclosure shall extend to Subcontractors), (B) in response to specific questions posed to Provider by securities analysts or institutional investors, (C) in any Provider RFP response, (D) in a list of representative clients in individual client presentations, or (E) upon consent of BFA, which will not be unreasonably withheld, conditioned or delayed. For the avoidance of doubt, Provider is permitted to include information with respect to the Services when Provider provides aggregated, non-client-specific statistics with respect to the scope of its overall industry servicing, including, without limitation, assets under custody and assets under administration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.2** **Key Provider Positions.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Prior Notice of Removal/ Replacement</u>. Provider shall not remove or replace with any other person, any individual serving in a Key Provider Position without providing prior notice to the BFA Relationship Manager unless such person in a Key Provider Position is being terminated or suspended and notification is not practicable under the circumstances.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>BFA Review</u>. Before assigning an individual to a Key Provider Position  ***,*** **  whether as an initial assignment or as a replacement, Provider will: (i) notify the affected BFA Recipients of the proposed assignment; (ii) specify how long that individual has been employed by Provider; (iii) at a BFA Recipient's request, introduce the individual to appropriate representatives of such BFA Recipient; and (iv) consult with such BFA Recipient prior to implementing such assignment. A BFA Recipient may reasonably request different or additional Key Provider Positions during the Term, and Provider will comply with such requests except as prohibited by applicable Laws. The Parties may agree upon other conditions relating to Key Provider Positions from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Governance Positions</u>. The Parties will establish a governance structure for the provision of Services to the BFA Recipients in accordance with the governance procedures set forth in <u>Exhibit C</u> and will consult with one another with respect to the appointment of persons to the positions for internal face-off on day-to-day matters. Each of Provider and the BFA Recipients, in its sole discretion, will make the final determination with respect to persons appointed on its behalf.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.3** **Subcontractors.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Notice and Approval</u>. Provider will provide thirty (30) days' prior written notice (in accordance with <u>Section 25.9</u>) to any affected BFA Recipient of Provider's intention to subcontract any of its obligations hereunder, except in connection with any Permitted Delegation. Provider will not under any circumstances subcontract any obligations hereunder, other than: (i) Permitted Delegations; and (ii) non-Core Services or auxiliary services that facilitate the Services which are a part of Provider's platform (*e.g.,* document warehousing and retrieval, print services, etc.), as otherwise permitted hereunder. Such notice will identify the proposed Subcontractor, and except with respect to any Permitted Delegation, Non-Core Services or auxiliary services, such BFA Recipient may reject any proposed Subcontractor if BFA, on behalf of any BFA Recipients, is not reasonably satisfied that (A) the Subcontractor's personnel are suitably qualified, trained and supervised and/or (B) Provider's arrangement with such Subcontractor satisfies the requirements set forth in this Agreement. Upon request therefor, Provider shall provide the BFA Recipients with a list of its global Subcontractors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Subcontractor Services</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Except as expressly provided otherwise under this Agreement, Provider will remain responsible for obligations, services and functions performed by, and other acts or omissions of, its Subcontractors and their employees to the same extent as if these obligations, services and functions were performed by Provider, regardless of whether a BFA Recipient has exercised its right to reject Provider's use of any proposed Subcontractor, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider will be the sole point of contact for each BFA Recipient with respect to Subcontractors.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provider represents and warrants that, with respect to each existing or proposed Subcontractor of a material portion of the Services, it has (or will have) a due diligence and third party oversight program that meets regulatory requirements under Provider Laws and that Provider, acting reasonably, has determined is appropriate in light of the nature of the services performed by the Subcontractor and the nature of the information relating to Provider's customers or a BFA Recipient's customers that the Subcontractor is Processing or expected to be Processing. This due diligence includes and shall include, but not be limited to, matters relating to data security, technology recovery, and personnel background screening appropriate to the nature of sub-contracted Services, and Provider shall take appropriate action with respect to adverse findings arising out of its due diligence and other oversight. Provider shall, upon request, meet with BFA to discuss its due diligence and oversight program, both in general and, subject to any confidentiality provisions in the relevant subcontract, with respect to any given Subcontractor of a material portion of the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Provider will require that all Subcontractors and Permitted Delegations maintain policies and procedures with regard to confidentiality, data protection, compliance with Law, and security that are reasonably designed in light of the services being performed or information being Processed (including hosting, maintaining or accessing BFA Data). The Subcontractor and Permitted Delegations will be required to meet reasonably designed standards that are substantially similar in the aggregate to the policies and procedures required for Provider hereunder and applicable to Provider Personnel to the extent appropriate given the Services being performed and BFA Data being processed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Provider will be responsible for providing BFA, each BFA Recipient, and their respective regulators with copies of records relating to the Subcontractor's and , Permitted Delegation's performance of its services with respect to the Services as may be reasonably necessary for BFA, the BFA Recipients and the regulators to exercise the audit and oversight rights contemplated by this Agreement. Subject to applicable Law and to the extent practicable and appropriate, in the context of the Services being subcontracted, Provider also shall use Commercially Reasonable Efforts upon request to obtain the Subcontractor's and Permitted Delegation's consent to allow BFA and its regulators direct (with Provider involvement) review and audit rights of such Subcontractors and Permitted Delegations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.4** **Service Locations.** The Services (other than shared or centralized custody functions within Provider or technology infrastructure, development or support) will be provided initially from locations identified by Provider as of the Effective Date. In conjunction with the audit processes described in <u>Section 17</u>, Provider will meet with BFA annually at an agreed upon date to review how the Services are provided from various locations and to address any inquiries BFA may have with respect thereto. Provider will provide from time to time upon request from BFA an updated list containing information regarding the locations from which the various components of the Services are provided. Additionally, Provider shall not perform any part of the Services in a country other than the countries identified by Provider as of the Effective Date as being locations from which the Services will be provided (a " <u>New Country Location</u> ") unless, notwithstanding applicable Law in that country, Provider is able to comply with the requirements of this Agreement relating to protection of BFA Data, including the requirements set forth in <u>Exhibit D</u>. Provider shall consult with BFA in advance of performing a material part of the Services in a New Country Location and provide reasonable assurances to BFA of its ability to comply with those requirements. Furthermore, Provider shall not transfer a material part of the Core Services to a location outside the United States of America without BFA's prior approval, which approval shall not be denied if BFA is reasonably satisfied that the personnel who will be providing the Core Services so transferred will be suitably qualified, trained and supervised. In this regard, if BFA does not object within sixty (60) days from its receipt of notice of the proposed transfer of the Core Services, BFA will have been deemed to have consented to any such proposed changes. Notwithstanding the foregoing, consistent with Provider's business continuity planning, Provider may in its sole discretion without advance notice use a different location to provide Services if Provider determines such action is necessary or prudent to prevent business disruption.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **BFA RESPONSIBILITIES; RELIANCE ON INFORMATION** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.1** **BFA Obligations.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Other than breaches by a BFA Recipient of its obligations to indemnify or adhere to obligations with respect to confidentiality or the use or protection of Provider's Intellectual Property Rights, or failure by a BFA Recipient (or BFA, on behalf of a BFA Recipient), to pay undisputed amounts when due, the failure of a BFA Recipient to perform any of its responsibilities will not be deemed a breach of this Agreement solely for the purposes of determining Provider's rights to terminate or suspend Services under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subject to <u>Sections 6.3</u> and <u>8.1(a)</u> above, the BFA Recipients will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) perform, and cause Third Party Providers to perform, as required hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) give Provider such Proper Instructions as Provider reasonably requests to enable Provider to fulfill its duties and obligations hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) provide, and cause Third Party Providers to make available, information and data to Provider as reasonably required for Provider to be able to perform its obligations hereunder; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) use commercially reasonable review and control procedures that are designed to ensure that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) all trade instructions delivered to Provider are duly authorized and comply with applicable Laws and internal compliance procedures, policies and investment restrictions applicable to such BFA Recipients; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) information and data provided by the BFA Recipients is accurate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as otherwise provided herein, the BFA Recipients (or BFA, on behalf of the applicable BFA Recipients) will bear all expenses incurred by such BFA Recipients' operation of their businesses. Notwithstanding the foregoing, BFA and the BFA Recipients will not be responsible for the cost of any conversions to Provider systems or changes required to be made to BFA Technology in order to accommodate such conversions, except to the extent such a Change is expressly requested to be accelerated or otherwise modified in any material respect by BFA or a BFA Recipient and with the agreement of BFA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Deemed Representations and Warranties</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) To the extent Provider is required to give (or is deemed to have given) any representation or warranty to a third party relating to any BFA Recipient in order to complete the relevant transaction in connection with the issuance or transmission of trade notifications, confirmations and/or settlement instructions, whether using facsimile transmission, industry messaging utilities and/or the proprietary software of Third Party Providers, clearing agencies, depositories and other securities systems, such BFA Recipient will be deemed to have made such representation or warranty to Provider, except to the extent that any breach or alleged breach of such representation or warranty results from Provider's failure to perform its obligations hereunder in accordance with the Standard of Care.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) To the extent that Provider is required to give (or will be deemed to give) any such representation or warranty relating to the BFA Recipients other than in accordance with normal market practices, it will notify and obtain the written consent of the BFA Recipients (or BFA, on behalf of the BFA Recipients) in advance of giving such representation or warranty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provider will provide each BFA Recipient with a quarterly report setting forth all actions taken on behalf of such BFA Recipient under this <u>Section 8.1(d)</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Proper Instructions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Provider will follow such authentication procedures as may be agreed upon with each BFA Recipient from time to time for purposes of verifying that purported Proper Instructions have been originated by an Authorized Person. The applicable BFA Recipient will cause all instructions to comply with such agreed upon procedures and shall cause oral instructions to be promptly confirmed in writing. Oral instructions may be accepted by Provider if it reasonably believes them to have been originated by an Authorized Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The BFA Recipients acknowledge that the authentication procedures agreed to by the Parties are intended to provide a commercially reasonable degree of protection against unauthorized transactions of certain types and that such authentication procedures are not designed to detect errors. Such procedures may include the introduction of security codes or passwords in order that Provider may verify that electronic transmissions of instructions have been originated by an Authorized Person. Any purported Proper Instruction received by Provider in accordance with an agreed upon authentication procedure will be deemed to have originated from an Authorized Person and will constitute a Proper Instruction hereunder for all purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provider will use Commercially Reasonable Efforts to act upon and comply with any subsequent Proper Instruction that modifies a prior instruction, but cannot guarantee that such efforts will be successful in the event that it has already acted upon the original Proper Instruction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Provider's sole obligation with respect to any written Proper Instruction that is intended to confirm a prior oral instruction shall be to use Commercially Reasonable Efforts to detect any discrepancy between the original instruction and such confirmation in a manner consistent with the Standard of Care and to report such discrepancy to such BFA Recipient. Such BFA Recipient will be responsible, at its expense, for taking any action, including any reprocessing, necessary to correct any such discrepancy or error, and, to the extent such action requires Provider to act, such BFA Recipient will give Provider specific Proper Instructions as to the action required.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) An appropriate officer of each BFA Recipient will maintain on file with Provider his or her certification to Provider, of the names, powers and signatures of the Authorized Persons. If there is any change in the information set forth in the most recent certification on file (including, without limitation, any person named in the most recent certification who is no longer an Authorized Person as designated therein), an appropriate officer of the applicable BFA Recipient will sign a new or amended certification that will include any additional or omitted names, signatures or powers. Provider will be entitled to rely and act upon any request, direction, instruction, or certification in writing that is signed by an Authorized Person of a BFA Recipient who is named in the most recent certification given to Provider by BFA (only with respect to such BFA Recipient). Any request, direction, instruction, or certification in writing signed by an Authorized Person of the BFA Recipient shall remain in effect only until such time as Provider has had a reasonable opportunity to begin to act upon the immediately subsequent request, direction, instruction, or certification in writing signed by an Authorized Person of the BFA Recipient.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) If and subject to appropriate security procedures agreed by the Parties, Proper Instructions may include communication effected directly between electromechanical or electronic devices.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) Provider will have no obligation to act in accordance with purported Proper Instructions to the extent Provider reasonably believes that they conflict with the terms of this Agreement or applicable Law; <u>provided</u> *,* <u>however</u> *,* that Provider will have no obligation to ensure that any instruction received by it would not contravene any of the terms of this Agreement or any such Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) Provider will provide the relevant BFA Recipient with prompt notification if it decides not to act in accordance with purported Proper Instructions and such notice will specify the reasons for its determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) If the Parties are in disagreement with respect to the existence of such a conflict, the dispute will be escalated in accordance with the dispute resolution procedures under <u>Section 23</u>, except that the Parties agree to accelerate the timeframes therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Signature Authority</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Each BFA Recipient will appoint Provider as its authorized signatory for the limited purpose of signing communications issued by Provider on behalf of and in the name of such BFA Recipient in connection with the discharge by Provider of its duties hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider will exercise the foregoing authority in each instance by one of the following methods: (A) application of the facsimile signature of an authorized employee of any BFA Recipient, as the same may be provided by such BFA Recipient from time to time; (B) manual signature of a Provider employee authorized to act on behalf of such BFA Recipient; or (C) as otherwise agreed by the Parties from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Parties will at all times maintain an updated list of Provider Personnel authorized to exercise the signature authority conferred hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The authority of Provider granted under this <u>Section 8.1</u> will commence and be in full force and effect as of the Effective Date, and such authority will remain in force and be binding up to the time of the receipt by Provider of a written revocation of said authority and reasonable opportunity to act thereon or the termination or expiration of this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Provider will provide each BFA Recipient with a quarterly report setting forth all actions taken on behalf of such BFA Recipient under this <u>Section 8.1(f)</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.2** **Reliance on Information.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In the course of discharging its duties hereunder, Provider may act in reasonable reliance on the data and information provided to it by or on behalf of a BFA Recipient or by any persons authorized by a BFA Recipient including, without limitation, any Third Party Providers or Authorized Data Sources, provided such data or information does not conflict with Proper Instructions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Provider will perform certain reconciliations, variance or tolerance checks or other specific forms of data review: (i) as specified herein; and (ii) in a manner consistent with all applicable procedures of Provider. Except as provided in the preceding sentence, Provider will have no responsibility for, or duty to review, verify or otherwise perform any investigation as to the completeness, accuracy or sufficiency of, any data or information provided by any BFA Recipient, any persons authorized by any BFA Recipient or any Third Party Providers, including, without limitation, any Authorized Data Sources or Authorized Persons. Provider will promptly notify the relevant BFA Recipient if it becomes aware that any information received by it is incomplete, inaccurate or insufficient in a material respect, or in the event of a failure or delay by any person to provide information required by Provider to discharge its duties hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.3** **Digital Asset Acknowledgements.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each BFA Recipient acknowledges that the Services will under no circumstances include any service, function or activity that would constitute a "virtual currency business activity" for purposes of regulations issued by the Superintendent of the New York State Department of Financial Services (23 N.Y.C.R.R. Part 200).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each BFA Recipient acknowledges that the BFA Recipient will be solely responsible for ensuring that the Services are suitable for the BFA Recipient's intended purpose, including without limitation, ensuring and verifying that such Services, and BFA Recipient's use thereof, will comply with Digital Asset Laws. Each BFA Recipient acknowledges and agrees that the Services provided by Provider pursuant to this Agreement are not intended to, and do not constitute, the performance of any oversight or supervisory function required by such Digital Asset Laws. Nothing contained herein, expressed or implied, is intended or shall be construed to confer upon Provider any duty or obligation to ensure that the BFA Recipeint or any related entities are acting in compliance with any Digital Asset Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **FEES, INVOICING AND PAYMENT** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.1** **Fees.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For the Services rendered pursuant to <u>Article 3</u>, <u>Article 4</u> or <u>Article 5</u>, the BFA Recipient (or BFA, on behalf of the BFA Recipient) agrees to pay to Provider the fees and expenses set forth in <u>Schedule 1-C</u> (Commercial Terms Schedule) to this Agreement (the " <u>Fees</u> "). Unless otherwise agreed in <u>Schedule 1-C</u> (Commercial Terms Schedule), Provider will be responsible for the compensation of all Subcontractors and its other agents (in each case, to the extent selected by Provider).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The applicable BFA Recipient (or BFA on behalf of the applicable BFA Recipient), will not be required to pay Provider any amounts for or in connection with performing the Services and fulfilling Provider's obligations hereunder other than the Fees and any amounts that Provider is expressly permitted to charge under the terms of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Except as Provider and the applicable BFA Recipients may otherwise agree, amounts payable with respect to a Project or Change will be payable upon acceptance by such BFA Recipients in accordance with applicable acceptance testing procedures, if any.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.2** **Expenses.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Provider acknowledges and agrees that expenses that it incurs in performing the Services (including travel and lodging, document reproduction and shipping, and long distance telephone) are included in the charges and rates in <u>Schedule 1-C</u> (Commercial Terms Schedule). No such expenses will be separately reimbursable by BFA or the BFA Recipients. Notwithstanding the foregoing, out-of-pocket expenses as indicated in <u>Schedule 1-C</u> (Commercial Terms Schedule) shall be passed through and borne by the applicable BFA Recipients (or BFA, on behalf of a BFA Recipient).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any travel and expenses incurred by Provider that the Parties agree are separately reimbursable by a BFA Recipient (or BFA, on behalf of a BFA Recipient), must be approved for reimbursement by such BFA Recipient (or BFA, on behalf of such BFA Recipient), in advance and incurred by Provider in accordance with the then current applicable travel and expense policy of such BFA Recipient (or BFA). The Parties may agree to additional limitations on Provider expenses from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.3** **Taxes.**" <u>Taxes</u> " means all taxes, levies or other like assessments, charges or fees, including, without limitation, income, gross receipts, excise, *ad valorem*, property, goods and services, value added (" <u>VAT</u> "), import, export, sales, use, license, payroll, franchise, utility and privilege taxes or other taxes, fees, duties, charges, levies, regulatory fees, surcharges or assessments of any kind whatsoever (whether payable directly or by withholding), together with any interest and any penalties, additions to tax or additional amounts, imposed by the United States, or any state, county, local or foreign government or subdivision or agency thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Property Taxes</u>. Each Party is responsible for all real property, personal property, and similar *ad valorem* Taxes imposed on such Party with respect to any item of property that it owns or leases, to the extent applicable hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Income Taxes</u>. Each Party is responsible for its own Taxes (including franchise and privilege Taxes) imposed on the performance or provision of Services that are based upon or measured by overall net or gross income or receipts over a period of time and any other Taxes incurred by such Party in connection with its business, except as otherwise provided in this <u>Section 9.3</u>.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Withholding Taxes</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any and all payments made by a BFA Recipient (or BFA, on behalf of a BFA Recipient), hereunder will be made free and clear of and without deduction or withholding for any and all Taxes; <u>provided</u>, <u>however</u>, that if the applicable BFA Recipient is required under applicable Law to deduct or withhold any taxes from such payments, then: (A) the sum payable will be decreased as necessary for all required deductions or withholdings (including deductions or withholdings applicable to additional sums payable under this <u>Section 9.3</u>); (B) such BFA Recipient will make such deductions or withholdings; and (C) such BFA Recipient or BFA, on behalf of such BFA Recipient, will pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Without limitation to any applicable Service Levels:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) Any such BFA Recipient will provide Provider with the appropriate certificates from the relevant Tax authorities confirming the amount of the Taxes withheld and paid over by such BFA Recipient in accordance with this <u>Section 9.3</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) The Parties further agree to complete and submit to the relevant Tax authorities within a reasonable period of time such forms, certifications or other documents as may be required to reduce or establish an exemption from the requirement to withhold Tax on the payments by a BFA Recipient (or BFA, on behalf of a BFA Recipient), to Provider hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) Provider will respond to reasonable requests by a BFA Recipient to complete and submit such forms, certifications or other documents as may be required to reduce or establish an exemption from the requirement to withhold Taxes on the payments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Transfer Taxes</u>. All charges and other sums payable hereunder are exclusive of any applicable excise, property, goods and services, VAT, import, export, sales, use, consumption, gross receipts (which are transactional in nature), utility, customs duties, or other Taxes, fees or surcharges (including regulatory fees or surcharges) relating to or assessed on the provision, purchase or consumption of the Services (including any equipment element, as applicable) hereunder (" <u>Transfer Taxes</u> "). All such Transfer Taxes shall be the responsibility of, and will be paid by, the applicable BFA Recipients. Provider will itemize on each invoice all Transfer Taxes and/or Transfer Tax credits due or owed by or to a BFA Recipient with respect to the Services covered by such invoice. Provider will adjust the Transfer Taxes applied to any charges in accordance with this <u>Section</u> <u> </u> <u>9.3</u> for any increases or decreases in the rate or changes in applicability of such Transfer Taxes during the Term. Provider shall properly invoice, collect and remit such Transfer Taxes to the appropriate taxing authority, and will bear any interest and penalties for failure to remit such Transfer Taxes in a timely manner to the appropriate taxing authority, provided that the applicable BFA Recipient has paid to Provider the invoiced amount corresponding to such Transfer Tax when due.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Refunds</u>. If any taxing authority refunds any Transfer Tax to Provider that any BFA Recipient (or BFA, on behalf of any BFA Recipient) originally paid to Provider in accordance with this <u>Section 9.3</u>, or Provider otherwise becomes aware that any such Transfer Tax was incorrectly and/or erroneously collected from any BFA Recipient (or BFA, on behalf of any BFA Recipient), or Provider otherwise receives an economic benefit (such as an audit offset) as the result of incorrectly and/or erroneously receiving such collected Transfer Taxes from any BFA Recipient (or BFA, on behalf of any BFA Recipient), then Provider will remit to any such BFA Recipient (or BFA, on behalf of such BFA Recipient) the amount of refund or tax erroneously or incorrectly collected, together with any interest thereon received from the relevant taxing authority. In accordance with <u>Section 9.3(h)</u>, the BFA Recipients (or BFA, on behalf of any BFA Recipient) will as promptly as practicable take such reasonable actions to assist Provider in obtaining a refund (to the extent that Provider has not already received the refund) of the Transfer Taxes erroneously or incorrectly collected. The BFA Recipients (or BFA, on behalf of any BFA Recipient) will promptly forward to Provider any refund of Transfer Taxes erroneously or incorrectly collected (including interest paid on such refunds) that they may receive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Impact of Relocating or Re-Routing the Delivery of Services</u>. Notwithstanding the provisions of <u>Section 9.3(d)</u>, any Transfer Taxes assessed on the provision of the Services for a particular site resulting from Provider's relocating or re-routing the delivery of Services for Provider's convenience to, from or through a location other than the locations used to provide the Services as of the Effective Date will be borne by Provider, but only to the extent that they exceed the sum of the Transfer Taxes that otherwise would be payable by a BFA Recipient (or BFA, on behalf of a BFA Recipient) on the provision of the Services from, through or by the locations used to provide the Services as of the Effective Date and any reduction in the charges to a BFA Recipient that may arise as a result of such a change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Provider Intra-Corporate Transfers</u>. The calculation of Transfer Taxes, as applicable, will not include, and the BFA Recipients (or BFA, on behalf of the BFA Recipients) will not pay, any Taxes that are imposed on intra-corporate transfers or intermediate suppliers of the Services within Provider's corporate family (including any Affiliates).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Cooperation and Notification</u>. The Parties agree to fully cooperate with each other to enable each Party to more accurately determine its own Tax liability (insofar as it relates to the Services) and to minimize such liability to the extent legally permissible and administratively reasonable, including in connection with the filing of any Tax return or claim for refund, provided that this does not result in material costs (including additional Taxes) for the other Party. Each Party will provide and make available to the other any exemption certificates, resale certificates, information regarding out-of-state or out-of-country sales or use of equipment, materials or Services, and other information reasonably requested by the other Party. Each Party will notify the other within a reasonable amount of time of, and coordinate with the other on, the response to and settlement of any claim for Taxes asserted by applicable Tax authorities for which such other Party is responsible hereunder. If a situation occurs where Provider chooses to exercise its right to back bill the relevant BFA Recipients for Transfer Taxes incurred pursuant to any audit, notice or assessment for which such BFA Recipients (or BFA, on behalf of such BFA Recipients) are obligated to pay hereunder, Provider agrees to make every good faith effort to timely notify such BFA Recipients of its intent to exercise said right.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Other</u>. Provider shall have no responsibility or liability to pay for any Taxes now or hereafter imposed on the BFA Recipients or on Provider with respect to the Cash Assets of any BFA Recipient by the tax laws of the United States (or of any state or political subdivision thereof) or any other political jurisdiction.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.4** **Invoicing and Payment Due.** <u>Schedule 1-C</u> (Commercial Terms Schedule) and this <u>Section 9.4</u> set forth the invoicing and payment terms and procedures associated with the charges payable to Provider for performance of the Services. Provider will include on each invoice the calculations used to establish the charges therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Supporting Documentation</u>. Provider will maintain complete and accurate records of, and supporting documentation for, the amounts billable to and payments made by a BFA Recipient (or BFA, on behalf of a BFA Recipient), hereunder, in accordance with generally accepted accounting principles applied on a consistent basis. Provider will provide the applicable BFA Recipient (or BFA, on behalf of the BFA Recipient), with documentation and other information with respect to each invoice as may be reasonably requested by a BFA Recipient or BFA to verify accuracy and compliance with the provisions hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Disputed Charges</u>. Each BFA Recipient or BFA, on behalf of each BFA Recipient, will pay all charges (other than those that are disputed in accordance with the terms hereof) when those payments are due. A BFA Recipient (or BFA, on behalf of a BFA Recipient), may withhold payment of particular charges that the BFA Recipient (or BFA, on behalf of the BFA Recipient), disputes in good faith; <u>provided</u>, <u>however</u>, that such BFA Recipient (or BFA, on behalf of such BFA Recipient), sends Provider a written statement of the disputed portions within ninety (90) days of the time of the applicable withholding, stating in reasonable detail the nature of and reason for any such dispute. The Parties will work diligently and in good faith to effect an expeditious resolution of any such dispute. Except as otherwise agreed by the Parties from time to time, in no event will any BFA Recipient (or BFA, on behalf of any BFA Recipient), have the right to withhold any payment of any invoiced fees or expenses on the basis of dissatisfaction with the quality of the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Invoice Aging</u>. No BFA Recipient (nor BFA, on behalf of any BFA Recipient), will be required to pay any invoices issued by Provider or any third party more than three (3) months after the month on which the fees owed thereunder have accrued. Notwithstanding the foregoing, for any Services provided by any Subcontractor that is not an Affiliate of Provider, such three-month period shall not begin until Provider receives the invoice from the applicable Subcontractor, but in no event will a BFA Recipient (or BFA, on behalf of a BFA Recipient), be required to pay any invoices issued by Provider or any third party for such Subcontractor services more than fifteen (15) months after the month on which the fees accrued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Currency</u>. Provider will invoice the applicable BFA Recipient receiving the Services (or BFA, on behalf of the BFA Recipient), in the currency mutually agreed upon and set forth in <u>Schedule 1-C</u> (Commercial Terms Schedule).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **TERM AND TERMINATION.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.1** **Term, Extension and Renewal.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Initial Term</u>. The initial term of this Agreement shall begin on the Commencement Date and continue for two (2) years (the " <u>Initial Term</u>," and together with any renewals, if applicable, the " <u>Term</u> ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Renewals</u>. After the Initial Term, the term of this Agreement will automatically continue for successive one-year terms on the terms and conditions (including pricing) set forth in this Agreement, unless earlier terminated pursuant to the terms hereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Termination for Convenience</u>. After the Initial Term, either Party may subject to Disengagement Assistance, terminate this Agreement without the payment of any penalty, on ninety (90) days prior written notice by BFA or the BFA Recipient to Provider or on one hundred eight (180) days prior written notice by Provider to BFA or the BFA Recipent; for the avoidance of doubt, such notice may be given during the Initial Term upon the expiration of the Initial Term;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Disengagement Assistance</u>. In the event that either Party does not renew this Agreement pursuant to <u>Section 10.1(b)</u> or either Party otherwise terminates this Agreement pursuant to this <u>Article 10</u>, Provider shall continue to provide the Services during the Disengagement Assistance Period as described in the Exhibit E (not to exceed twenty-four- (24) months from the effective date of the termination) until BFA's or the BFA Recipient's termination of Services in accordance with the terms of this Agreement, unless otherwise set forth in this Article 10.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.2** **Termination, Generally.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Termination by a Party of this Agreement will be without prejudice to and with full reservation of any other rights and remedies available to the other Parties. Termination by BFA or any BFA Recipient of this Agreement will not affect Provider's obligations with respect to any other BFA Recipient that remains a Party to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No BFA Recipient (nor BFA, on behalf of any BFA Recipient), will be obliged to pay any termination charges or wind-down fees in connection with the termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If BFA or a BFA Recipient chooses to terminate this Agreement in part pursuant to any applicable provision herein, the Fees payable pursuant to such Services will be: (i) adjusted in accordance with <u>Schedule 1-C</u> (Commercial Terms Schedule) to the extent the Services terminated have separate fees associated with them; or (ii) equitably adjusted to only reflect those Services that are not terminated in all other circumstances.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Termination will not affect any of the obligations either Party owes to the other arising under this Agreement prior to such termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.3** **Termination.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>By BFA Recipients</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>For Cause</u>. A BFA Recipient may terminate (with respect to itself only) or BFA may terminate (on behalf of itself or any BFA Recipients) this Agreement or one or more of the Services, in whole or in part, by giving written notice to Provider, with immediate effect, subject to <u>Article 11</u>, if Provider:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) commits a material breach of its duties or obligations under this Agreement, which breach is not cured (to the extent capable of cure) within thirty (30) days after such BFA Recipient or BFA notifies Provider of such breach;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) commits numerous or repeated breaches of its duties or obligations hereunder, even if no single breach is material, where the collective impact would constitute a material breach (" <u>Persistent or Pervasive Breach</u> "), provided that, such BFA Recipient and/or BFA (1) has notified Provider of the individual breaches comprising the Persistent or Pervasive Breach and given it a reasonable opportunity to cure the same, (2) has notified Provider that a Persistent or Pervasive Breach has occurred; and (3) provides thirty (30) days' notice of termination;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) commits a material breach of its obligations hereunder regarding compliance with any applicable Provider Law (including, without limitation, as provided in <u>Article 12</u>), which breach is not cured (to the extent capable of cure) within thirty (30) days after the BFA Recipient notifies Provider of such breach, or fails to maintain (or has revoked) the legal status required to perform the Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) fails to qualify as custodian of the Cash Assets of the BFA Recipients; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) becomes subject to a consent decree, settlement agreement, letter of acceptance, waiver and consent, or other order from, or agreement with, a regulatory body, securities or commodities exchange, or other financial services authority that has a material adverse impact on Provider's ability to perform the Services, except to the extent that Provider reasonably demonstrates that an Affiliate of Provider is capable of performing the Services without a material adverse impact thereon.

For the avoidance of doubt, BFA Recipients may terminate individual Services for cause, along with any other Services that would be adversely affected by the termination of such individual Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Other BFA Termination Rights</u>. BFA may terminate (on behalf of any BFA Recipient(s)) this Agreement, in whole or in part, as of the date of such termination notice in the event:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) of the liquidation of any BFA Recipient, including in connection with a merger of such BFA Recipient with or into an entity (or fund or series thereof) that is not a BFA Recipient; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) if BFA ceases being the trustee of such BFA Recipient and no successor agreement between BFA and such BFA Recipient for the provision of administrative trustee services is subsequently executed within ninety (90) days after the termination of such trustee arrangement between BFA and such BFA Recipient.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>For Enduring Force Majeure Events</u>. If a Force Majeure Event substantially prevents or delays performance of Services necessary for the performance of functions reasonably identified by BFA or a BFA Recipient as critical for more than three (3) consecutive days, then, at the option of BFA or such BFA Recipient, BFA (acting on behalf of itself or any BFA Recipient) or such BFA Recipient may terminate all or any portion of this Agreement and the Services so affected, as of a date specified by BFA or such BFA Recipient in a written notice of termination to Provider, in which case Provider's Fees will be equitably adjusted as necessary to reflect the value of any remaining Services.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) <u>Occasioned by Law</u>. BFA or a BFA Recipient may terminate this Agreement, in whole or in part, as of a date specified in such termination notice: (A) if Provider's ability to perform the Services is materially adversely impacted or affected by a Law or change in Law that cannot be addressed to the applicable BFA Recipients' reasonable satisfaction through the processes set forth in <u>Section 12.1(e)</u>; (B) any Governmental Authority, regulatory organization or other entity with statutory or regulatory authority over a BFA Recipient issues an order, letter, directive or similar communication concerning the BFA Recipient's continued use of the Services or continuing participation in this Agreement; or (C) if by operation of Law, this Agreement is required to be terminated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) <u>Failure to Receive Consent</u>. BFA may terminate (with respect to any applicable BFA Recipients) this Agreement, in whole or in part, as of a date specified in such termination notice, in the event that a BFA Recipient fails to receive any consent required by Law for Provider to continue to provide such Services for such BFA Recipient and/or the BFA Recipient instructs BFA that Provider should not continue to act as provider of such Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) <u>For Provider</u> <u>'</u> <u>s Insolvency</u>. BFA may terminate this Agreement in its entirety if (A) Provider or any parent entity thereof: (1) becomes insolvent or is unable to meet its debts as they mature; (2) files a voluntary petition in bankruptcy or seeks reorganization or to effect a plan or other arrangement with creditors; (3) files an answer or other pleading admitting, or fails to deny or contest, the material allegations of an involuntary petition filed against it pursuant to any applicable statute relating to bankruptcy, arrangement or reorganization; (4) will be adjudicated as bankrupt or will make an assignment for the benefit of its creditors generally; (5) will apply for, consent to or acquiesce in the appointment of any receiver, conservator or trustee (including the FDIC) for all or a substantial part of its property; or (6) becomes subject to any receivership or conservatorship (including the FDIC); (B) the auditors of Provider (or any parent entity thereof) issue an opinion expressing doubt as to whether Provider (or the parent entity) can maintain itself as a "going concern"; or (C) there is, in BFA's reasonable discretion, a significant risk of any of the foregoing. In order to facilitate such determination, Provider shall provide BFA with mutually agreed periodic statements as to the state of Provider's financial condition.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) <u>For Change of Control of Provider</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) <u>"Change of Control of Provider</u> " means any transaction, or series of related transactions, however structured (including, without limitation, a purchase of Securities or other equity interest, merger, tender offer (whether or not contested by Provider), or transfer or other disposition of assets) that results in any of the following, and will be deemed to have occurred upon the earliest of any of the following to occur:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) any unaffiliated person or group (within the meaning of Section 13(d) or 14(d) of the Exchange Act) has become, directly or indirectly, the beneficial owner (within the meaning of Rule 13d3 of the Exchange Act), by way of merger, consolidation or otherwise, of thirty percent (30%) or more of the voting power of the then-outstanding voting Securities of Provider, on a fully diluted basis, after giving effect to the conversion and exercise of all outstanding warrants, options and other Securities of Provider (whether or not such Securities are then currently convertible or exercisable);

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) the sale, lease, transfer or other disposition of all or substantially all of the consolidated assets of the organization used by Provider to provide Services to any unaffiliated person or group;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Provider consolidates with or merges with or into another unaffiliated person or any such person consolidates with, or merges with or into, Provider, in any such event pursuant to a transaction in which immediately after the consummation thereof the persons beneficially owning the then-outstanding voting Securities of Provider immediately prior to such consummation will not beneficially own a majority of the aggregate (by reason of such prior ownership) of the then-outstanding voting Securities of Provider or the surviving entity if other than Provider;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) the execution of any binding contract or arrangement that if consummated would result in any of the events specified in either <u>clause (1)</u>, <u>(2)</u> or <u>(3)</u> above; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) during any period of two (2) consecutive calendar years, individuals who at the beginning of such period constituted the board of directors of Provider, together with any new members of such board of directors whose election by such board of directors or whose nomination for election by the stockholders of Provider was approved by a vote of at least a majority of the members of such board of directors then still in office who were directors at the beginning of such period or whose election or nomination for election was previously approved, cease for any reason to constitute a majority of the directors of Provider then in office.

Provider will give the BFA Recipients prompt written notice of any occurrence of any of the events specified in <u>clauses (1)</u> through <u>(5)</u> above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) BFA or any BFA Recipient may, by giving written notice to Provider, terminate (with respect to itself only) this Agreement as of a date specified in such termination notice in the event of a Change of Control of Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) <u>Consequences of Non-Compliance</u>. If a Governmental Authority makes a determination of a BFA Recipient's material non-compliance or material violation of Law, and imposes a fine, penalty or other formal consequence, as a result of a material failure by Provider or Provider Personnel to comply with the applicable Provider Laws, the BFA Recipient may terminate (with respect to itself only) this Agreement in whole or in part for cause, except to the extent Provider is able to cure such failure to comply within thirty (30) days after such determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) <u>For Insourcing of Services</u>. BFA or any BFA Recipient shall have the right to terminate Provider's provision of the portion of the Services that is insourced pursuant to BFA's or any BFA Recipient's exercise of its rights set forth in <u>Section 2.2(b)</u>.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) <u>Digital Assets</u>. BFA or any BFA Recipient may terminate this Agreement, in whole or in part, at BFA's or any BFA Recipient's convenience and without cause upon twelve (12) months written notice if BFA or any BFA Recipient in good faith determines to no longer provide services for customers investing in Digital Assets.

Notwithstanding the time periods set forth in <u>Section 2.2(b)</u>, BFA or any BFA Recipient shall have the right to reallocate and/or insource Services with immediate effect upon termination of Provider's provision of Services under <u>Section 10.3(a)(i)-(viii)</u>. In such event, the Parties will negotiate in good faith adjustments to the Fees and Service Levels, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>By Provider</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>For Cause</u>. In addition to its other termination rights set forth in this Agreement, Provider may, by giving written notice to the relevant BFA Recipient and respecting the Disengagement Assistance Period (except as modified below), terminate this Agreement with respect to any BFA Recipient as of a date specified in the notice of termination if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) BFA or such BFA Recipient is five (5) months in arrears on undisputed Fees payable to Provider and fails to make payment within thirty (30) days following a notice from Provider that it will terminate this Agreement if the undisputed Fees remain unpaid; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) such BFA Recipient materially breaches (which shall be deemed to include any material breach by any Third Party Provider or other agent of such BFA Recipient) any of its obligations to indemnify or adhere to obligations with respect to confidentiality hereunder, which breach is not cured (to the extent capable of cure) within thirty (30) days after Provider notifies BFA of such breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Occasioned by Law</u>. Provider may terminate this Agreement, in whole or in part, as of a date specified in such termination notice: (A) if Provider's ability to perform the Services is materially adversely impacted or affected by a Law or change in Law that cannot be addressed to Provider's reasonable satisfaction through the processes set forth in Section 12.1(e); (B) any Governmental Authority, regulatory organization or other entity with statutory or regulatory authority over Provider issues an order, letter, directive or similar communication concerning Provider's continued provision of the Services or continuing participation in this Agreement that materially adversely impacts Provider's ability to perform the Services; or (C) if by operation of Law, this Agreement is required to be terminated. Upon such a change in Law or receipt of such notice, notwithstanding the Disengagement Assistance Period, the Provider will, if necessary, seek permission from such Govnerment Authority to provide Disengagement Assistance for 180 days following the effective date of such termination and the Parties will collectively discuss in good faith an exit plan which affords the efficient transfer of the Services to an alternative provider or an alternative succession plan, subject to Provider's compliance with all Laws.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>Digital Assets</u>. Provider may terminate this Agreement, in whole or in part, at Provider's convenience and without cause upon twelve [(12) months] written notice if Provider in good faith determines to no longer provide services for customers investing in Digital Assets.

If Provider terminates this Agreement pursuant to this Section 10.3(b), the Parties agree that Provider shall only be required to provide Disengagement Assistance for one-hundred eighty (180) days following the effective date of such termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Expiration of Termination Rights</u>. Except with respect to termination for Change of Control of Provider under <u>Section 10.3(a)(vii)</u>, neither Party may invoke any termination right under this <u>Section 10.3</u> after one (1) year following the later of: (i) the date upon which such Party obtains actual knowledge of the event which first gave rise to such termination right, and (ii) the date upon which such Party becomes aware of the full and final impact of such event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If BFA no longer plans to sponsor or act as trustee for any BFA Receipient, the Provider shall no longer be obligated to provide Services from the date of BFA's removal as trustee of such BFA Recipient.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **DISENGAGEMENT ASSISTANCE** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.1** **Disengagement Assistance**. In connection with the termination or expiration by BFA or any BFA Recipient of its participation in this Agreement, Provider will perform the disengagement assistance services for the affected BFA Recipient(s) as provided in <u>Exhibit E</u> hereto (" <u>Disengagement Assistance</u> ") and continue to provide the Services for the period of the Disengagement Assistance prior to BFA's or the BFA Recipient's termination of applicable Services. The provision of Disengagement Assistance by Provider shall be subject to any restrictions or limitations imposed by applicable Law. Provider Confidential Information received in connection with any such Disengagement Assistance shall be subject to the provisions of Article 18.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.2** **Divestitures**. Except to the extent prohibited by applicable Law, if BFA or any BFA Recipient relinquishes Control of all or part of a business unit, or a particular function or facility of BFA or any BFA Recipient after the Effective Date (each, a " <u>Divested Entity</u> "), then at the request of BFA or any BFA Recipient, Provider will continue to provide the Services, including Disengagement Assistance, to such Divested Entity for a period of time that BFA or any BFA Recipient requests, which period will not extend beyond the earlier to occur of: (a) twenty four (24) months after such entity becomes a Divested Entity; or (b) the end of the period during which Provider is required to provide Disengagement Assistance under this Agreement, at the rates and in accordance with the terms and conditions set forth herein; <u>provided</u>, that such Divested Entity agrees in writing with Provider to abide by the terms and conditions of this Agreement. BFA or such BFA Recipient, as applicable, shall remain primarily liable for the obligations of the Divested Entity under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.3** **Continuous Service.** Upon receipt of a notice of termination from a BFA Recipient for all or part of the Services by reason of the appointment of a conservator or receiver for Provider in accordance with 12 U.S.C. §1821(c) or similar and successor provisions, Provider will take such actions as may be reasonably necessary to provide continuous service to the BFA Recipients and will take such other actions as the Parties may agree from time to time.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.** **COMPLIANCE WITH LAWS, POLICIES AND USE RESTRICTIONS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.1** **Compliance with Law; BFA Policies.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Generally</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Provider will, and will require its Subcontractors to: (A) review and comply with all applicable Law and regulations and rules that may be in effect during the Term and that would be applicable to Provider or the Subcontractor in their performance of the Services; and (B) perform the Services in a manner compliant with Law applicable to the delivery of the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider will, and will require its Subcontractors to, obtain and maintain all necessary approvals, licenses, consents, permits or authorization of any person or entity, or any notice to any person or entity, the granting of which is required by Law applicable to such Provider or its Subcontractors, as applicable, for: (A) the consummation of the transactions contemplated by this Agreement; and (B) the provision of the Services in compliance with all the Laws applicable to Provider or its Subcontractors, as applicable. Each BFA Recipient will, and will require its subcontractors and agents, as applicable to, obtain and maintain all necessary approvals, licenses, consents, permits or authorization of any person or entity, or any notice to any person or entity, the granting of which is required by Law applicable to such BFA Recipient for: (A) the consummation of the transactions contemplated by this Agreement; and (B) the receipt of the Services in compliance with all the Laws applicable to such BFA Recipient. Upon reasonable request therefor, each Party will provide reasonable cooperation to the other Party, at such other Party's expense, to obtain and maintain any such approvals.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Anti-Money Laundering.</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Provider</u>. Provider represents that it has implemented an AML (anti-money laundering) Compliance Program (" <u>AML Program</u> ") that complies with the requirements of AML Laws applicable to Provider; and it maintains an AML Program consistent with applicable AML Laws. As part of its AML Program, Provider certifies that it: (A) has a duly appointed AML Compliance Officer; (B) has policies, procedures and internal controls in place, including those that are reasonably designed to detect and report suspicious activity; (C) conducts periodic anti-money laundering training to personnel performing critical job functions; and (D) has a periodic independent assessment to review the effectiveness of its AML Program.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>BFA and BFA Recipients</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) Each BFA Recipient acknowledges and agrees that, in connection with the Services provided by Provider under this Agreement, each of BFA Recipient's Authorized Participants is not a customer or joint customer with Provider. Each BFA Recipient (and not Provider) has the responsibility to, and will, obtain representations from Authorized Participants or their agents regarding fulfilling any compliance requirement or obligation with respect to each of its Authorized Participants under all applicable AML Laws. Without limiting any obligation imposed on a BFA Recipient by AML Laws, throughout the Term, BFA Recipient will maintain, or contract with a third party to provide, a compliance program with respect to its investors that includes the following: (i) a know-your-customer program in order to understand and verify the identity of each authorized participant, in accordance with the requirements of the Bank Secrecy Act and the relevant regulations thereunder, (ii) a transaction surveillance and monitoring program, and (iii) a policy for identifying and reporting any suspicious transactions and/or activities with respect to each Authorized Participant to the appropriate law enforcement and regulatory authorities and to Provider where related to the Services provided by Provider hereunder.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) Each BFA Recipient will cooperate with Provider and provide assistance reasonably requested by Provider in connection with any anti-money laundering and terrorist financing or Sanctions inquiries as allowed under applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) Provider may decline to act or provide Services in respect of any BFA Account, and take such other actions as it, in its reasonable discretion, deems necessary or advisable, in connection with the matters referenced in this <u>Section 12.1(b)(ii)</u> and <u>Section 12.1(d)(iv)</u>. If Provider declines to act or provide Services as provided in the preceding sentence, except as otherwise prohibited by applicable Laws or official request, Provider will inform BFA Recipient as soon as reasonably practicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Anti-Corruption</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Provider represents and warrants that it complies with, and will remain in compliance with, all domestic and foreign anti-bribery and anti-corruption laws applicable to it in the performance of the Services. Provider shall maintain in place throughout the Term its own policies and procedures, including procedures reasonably designed for Provider and Provider Personnel to comply with anti-bribery and anti-corruption laws and will enforce them where appropriate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider and Provider Personnel have not taken and shall not take any action in furtherance of an offer, payment, promise to pay, receipt, acceptance or authorization of the payment or giving or receiving of anything of value, either directly or indirectly, to or from any person in connection with Provider's provision of the Services while knowing that all or some portion of the money or value will be offered, given or promised to anyone to improperly influence official action, to obtain or retain business or otherwise to secure an improper advantage. Provider shall promptly report to BFA any request or demand for, or offer of, any bribe received by Provider and/or Provider Personnel in connection with this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Sanctions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Provider has implemented policies and procedures designed to comply with Sanctions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider further represents that it is not majority owned or controlled by an individual or entity that is the subject of any Sanctions or organized or located in a jurisdiction that is the subject of Sanctions.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provider and Provider Personnel (A) have not violated and shall not violate any Sanctions in connection with this Agreement; (B) are not on any United States, United Kingdom or European Union government list of parties that are sanctioned; and (C) shall not use funds derived or received from BFA or the BFA Recipients to directly or, indirectly violate Sanctions, including, without limitation, by transferring such funds to or benefitting entities, persons and/or governments subject to Sanctions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Throughout the Term, BFA and each BFA Recipient: (A) will have in place and will implement policies and procedures designed to prevent violations of Sanctions, including measures to accomplish effective and timely scanning of all relevant data with respect to its Shareholders (to the extent the Cash Assets are Shareholder assets) and with respect to incoming or outgoing assets or transactions relating to this Agreement; (B) will ensure that neither BFA, the BFA Recipient nor any of their respective Affiliates, directors, officers, employees or Authorized Participants (to the extent the Cash Assets are Authorized Participant assets) is an individual or entity that is, or is owned or controlled by an individual or entity that is: (1) the target of Sanctions or (2) located, organized or resident in a country or territory that is, or whose government is, the target of Sanctions and (C) will not, directly or indirectly, use the BFA Accounts in any manner that would result in a violation by BFA Recipient or Provider of Sanctions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) BFA agrees that Provider shall have no obligation to perform, and shall not be in breach of its obligations hereunder for any failure to perform any activity that: (A) would cause Provider to breach any provisions of any Sanctions (as applicable to Provider); or (B) involves any party that is the target of any Sanctions (as applicable to Provider) in violation of Sanctions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Change in Law</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Provider shall promptly identify and notify the BFA Recipients of any change in Law of which it may become aware that it expects to have a material impact on the provision of the Services or the performance of Provider's obligations under this Agreement. The BFA Recipients shall promptly identify and notify Provider of any change in Digital Assets Laws of which it may become aware that it expects to have a material impact on the receipt of the Services or the performance of Provider's obligations under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If a change to applicable Law or Digital Assets Law requires a material change to the provision of any of the Services, the Parties shall follow the Change Procedures set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If the change in applicable Law results in a material change to the Services that materially increases Provider's costs or risk associated with provision of the Services, in accordance with the Change Procedures set forth in this Agreement, Provider shall be entitled to request an appropriate increase in the Fees or other adjustment to the terms and conditions under which the applicable Service is provided. Notwithstanding the foregoing, Provider agrees that any requested increase in Fees or other adjustments to the terms and conditions of this Agreement shall be, on a proportionate basis, less than or equal to the increase in Fees generally obtained by Provider of its other customers for custodial and fund accounting services.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) To the extent that the delivery of the Services will be impacted by such change, Provider shall notify the BFA Recipients of the change to the Services (collectively, " <u>Changes to the Services</u> ") and the impact. Subject to subsections (i) and (ii) above, Provider shall promptly implement such Changes to the Services as may be necessary to comply with any Law or changes in Law and, where practicable, shall use reasonable efforts to complete the implementation at least ninety (90) days prior to the deadline imposed by the Governmental Authority having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Non-Compliance</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If Provider becomes aware that Provider Personnel or a Subcontractor has committed a violation of any Provider Laws in the course of performing the Services or Provider's other obligations under this Agreement, Provider will promptly notify BFA and the affected BFA Recipients in writing. Unless such non-compliance is caused by a BFA Recipient, Provider shall promptly implement such Changes to the Services as may be necessary to correct such non-compliance at Provider's sole cost and expense. If non-compliance is caused by a BFA Recipient, Provider shall promptly implement such Changes to the Services at BFA Recipient's sole cost and expense, subject to the Parties' mutual agreement via the Change Procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If any BFA Recipient becomes aware of any non-compliance of Provider Personnel or a Subcontractor with any Law and becomes aware that such non-compliance affects Provider's ability to perform its obligations under this Agreement, such BFA Recipient will promptly notify Provider in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Fines, Penalties and Excise Taxes</u>. Notwithstanding any other provision contained in this Agreement, Provider shall have no duty or obligation with respect to, including any duty or obligation to determine, or advise or notify BFA or any BFA Recipient of: (i) the taxable nature of any distribution or amount received or deemed received by, or payable to, the BFA Recipient; (ii) the taxable nature or effect on the BFA Recipient or the Shareholder of any corporate actions, class actions, tax reclaims, tax refunds, or similar events; (iii) the taxable nature or taxable amount of any distribution or dividend paid, payable or deemed paid, by the BFA Recipient to the Shareholder; or (iv) the effect under any income tax laws of the BFA Recipient making or not making any distribution, dividend payment, or election with respect thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Other Assistance</u>. To the extent permitted by applicable Law, Provider will supply to the applicable BFA Recipients copies of all annual financial accounts of the BFA Recipients in respect of compliance with applicable legal and regulatory requirements and, upon request, other information maintained by Provider on behalf of the BFA Recipients to the extent required by the BFA Recipients in order to demonstrate their compliance with applicable Laws and to conduct business with their customers. Provider will also reasonably cooperate with and assist the affected BFA Recipients with their dealings with regulatory authorities; completion of and filing of reports and returns required by regulatory authorities; and applications for authorizations and permits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Sarbanes-Oxley</u>. Without limiting the foregoing, Provider shall provide the BFA Recipients on a quarterly basis with mutually-agreed certifications in connection with the BFA Recipients' certification responsibilities required under the Sarbanes-Oxley Act of 2002, as amended, and the rules and regulations promulgated thereunder, including Section 302 and Section 404 and the rules and regulations promulgated thereunder.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Notification</u>. To the extent permitted by applicable Law, Provider shall promptly notify BFA (and provide BFA with details) to the extent the foregoing statements in this <u>Section</u> <u> </u> <u>12.1</u> become untrue or of any material violation of Law (inclusive of any anti-bribery or anti-corruption laws applicable to the Services provided hereunder). Upon receipt of such notification, or in the event that BFA determines that a breach of any of the representations and warranties in this <u>Section 12.1</u> has occurred or is likely to occur that it reasonably determines would be likely to have a material adverse effect on BFA or the BFA Recipients, BFA or the BFA Recipients shall have the right to withhold payment under this Agreement until such time as it has received confirmation to its satisfaction that no breach has occurred or is likely to occur within thirty days after providing such notice; and/or pursue any other remedies available to it. For the avoidance of doubt, any amounts withheld pursuant to the foregoing shall still be owed by the relevant BFA Recipient to the Provider until they are fully paid to the Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.2** **Compliance with Certain Policies and Use Restrictions**. Each Party will comply in all material respects with the other Party's rules and regulations applicable to visitors when on the premises of the other Party, provided that each Party's employment policies shall apply to such Party's personnel and not the policies of the other Party. Provider will maintain physical security procedures that are designed to safeguard BFA Data and BFA Confidential Information provided to Provider as part of the Services against unauthorized access, which procedures will at all times meet the standards set forth in <u>Exhibit D</u> and standards that are reasonably likely to be as protective of BFA Data and BFA Confidential Information in all material respects, and in any event are at least as protective, as Provider's protection of its own data and Confidential Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.3** **BFA**. BFA shall not be obligated under this Agreement to take any action or omit to take any action that it believes, in good faith, would cause it to be in violation of any applicable domestic or foreign anti-bribery or anti-corruption Laws. Each BFA Recipient will comply with all BFA Recipient Laws applicable to its receipt of the Services hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.** **DATA PROTECTION** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.1** **BFA Data**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>"BFA Data</u> " means all data and information: (i) submitted to or held by Provider by or on behalf of such BFA Recipient, including data submitted by or relating to providers, members and customers of such BFA Recipient; (ii) obtained by or on behalf of Provider Personnel in connection with Services that relate to a BFA Recipient, or providers, members and customers of BFA or a BFA Recipient; or (iii) to which Provider Personnel have access in connection with the provision of the Services that relates to a BFA Recipient, or providers, members and customers of such BFA Recipient, and including all Personal Information. All BFA Data is, or will be, and will remain the property of the applicable BFA Recipient and will be deemed BFA Confidential Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Without limiting the foregoing, no ownership rights in BFA Data will accrue to Provider or any Provider Personnel by reason of Provider or any Provider Personnel entering, deleting, modifying or otherwise processing any BFA Data.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Use Restrictions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Without approval from the applicable BFA Recipient (in its sole discretion), BFA Data will not be: (A) used by Provider other than as necessary to perform the Services hereunder or as otherwise specifically set forth in this Agreement; (B) disclosed, sold, assigned, leased or otherwise provided to third parties by Provider; or (C) commercially exploited (including, without limitation, via processing or data mining) by or on behalf of Provider or any Provider Personnel. For the avoidance of doubt, under no circumstances will Provider allow representatives of Provider's asset management division or any Affiliates engaged in asset management to access or use the BFA Data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider will not possess or assert liens or other rights in or to BFA Data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provider hereby irrevocably and perpetually assigns, transfers and conveys to the applicable BFA Recipients without further consideration all of its and their right, title and interest, if any, in and to BFA Data. At BFA's request, Provider will execute and deliver to the BFA Recipients any financing statements or other documents that may be reasonably necessary or desirable under any Law to preserve, or enable such BFA Recipients to enforce, their rights hereunder with respect to BFA Data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) No removable media on which BFA Data is stored may be used or re-used to store data of any other customer of Provider or to deliver data to a third party, including another Provider customer, unless securely erased in a manner consistent with the Standard of Care.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Each BFA Recipient will provide Provider with written notice of any applicable security or confidentiality obligations or disclosure, notification or consent requirements applicable to the use or transfer of the BFA Data transmitted to Provider that are in addition to the requirements set forth in this Agreement; <u>provided</u>, <u>however</u>, that any change to Provider's obligations as a result thereof shall be subject to the Change Procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Return of Data/Record Retention</u>. At the request of a BFA Recipient at any time during the Term or upon the expiration or earlier termination of this Agreement, Provider will: (i) promptly return to such BFA Recipients, in a useable machine ready format or such other format as Provider and such BFA Recipient shall agree upon, all or any part of the BFA Data attributable to such BFA Recipient; and (ii) erase or destroy all or any part of such BFA Data in Provider's possession, in each case to the extent so requested by such BFA Recipient, subject to any data or record retention requirements applicable to Provider under applicable Law and excluding any data that Provider is no longer maintaining as part of its then-current electronic records. Notwithstanding anything herein to the contrary, Provider may retain copies of BFA Data to pursue or defend claims or other actions under or relating to this Agreement and as otherwise consistent with its regulatory and audit (including fund audit) obligations, which data shall remain subject to the confidentiality rights and obligations hereunder.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>BFA Access</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Provider will make available to the BFA Recipients any BFA Data that is held in paper form within a reasonable time after request therefor. In addition, Provider will store and make available to the BFA Recipients any BFA Data that it maintains in electronic form on the Provider Technology in a manner that enables it to be: (A) properly identified as information relating to the provision of the Services to the BFA Recipients; and (B) easily, promptly and independently extracted, copied or transferred from any storage media on which it is kept.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Except as specifically set forth in this Agreement or as otherwise required under applicable Law, Provider will have no implied right to access any data files, directories of files, or other BFA Confidential Information, except to the extent necessary to perform the Services and will access and/or use such files and BFA Confidential Information only as and to the extent necessary to perform the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.2** **Data Safeguards and Security.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Compliance with Data Security Laws</u>. Provider will comply with all Provider Laws, as well as the written security procedures set forth in <u>Exhibit D</u>, with respect to the security of BFA Data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Safeguards</u>. Provider will establish and maintain (i) safeguards to protect the confidentiality, integrity and availability of BFA Data and the systems Provider uses to provide the Services against the destruction, loss, or alteration of BFA Data; (ii) safeguards against the unauthorized access to such data; and (iii) network and internet security procedures, protocols, security gateways and firewalls with respect to such data. All of the foregoing shall be no less rigorous than those safeguards and procedures set forth in <u>Exhibit D</u>. Any material changes that degrade the safeguards in <u>Exhibit D</u> that are specifically designated as safeguards that Provider has agreed to adopt specifically for the BFA Recipients will require prior review and approval from the affected BFA Recipients, which approval shall not be unreasonably withheld.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Physical Security</u>. Provider will maintain and enforce, at any facilities other than BFA facilities where any Services are performed, safety and security procedures that are at Best Commercial Practices and as rigorous as those procedures set forth in <u>Exhibit D</u>. In addition, Provider will comply with all reasonable requirements of BFA and its Affiliates with respect to security at BFA facilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Provider</u> <u>'</u> <u>s Information Security Policies</u>. Without limiting the generality of the foregoing, Provider's information security policies shall provide for (i) continual assessment and re-assessment of the risks to the security of BFA Data and systems acquired or maintained by Provider and its agents and contractors in connection with the Services, including (A) identification of internal and external threats that could result in a Data Security Breach, (B) assessment of the likelihood and potential damage of such threats, taking into account the sensitivity of BFA Data, and (C) assessment of the sufficiency of policies, procedures, effectiveness of controls, and information systems of Provider and its agents and contractors, and other arrangements in place, to control risks; and (ii) appropriate protection against such risks.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Media</u>. Provider shall remove all BFA Data from any media taken out of service and shall destroy or securely erase such media. No removable media on which BFA Data is stored may be used or re-used to store data of any other customer of Provider or to deliver data to a third party, including another Provider customer, unless securely erased.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Corrections</u>. Unless otherwise agreed in writing by the Parties, to the extent possible, Provider will promptly correct any errors or inaccuracies in BFA Data caused by Provider's failure to meet the Standard of Care or in the reports delivered to the applicable BFA Recipients hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Remediation</u>. In the event Provider becomes aware of any Data Security Breach due to Provider acts or omissions other than in accordance with the terms of this Agreement, Provider shall, at its own expense, (i) promptly, within forty-eight (48) hours of Provider's confirmation of such Data Security Breach notify BFA of such Data Security Breach and perform a root cause analysis thereon, (ii) investigate such Data Security Breach, (iii) provide BFA with a high level remediation plan (which will reasonably incorporate input from BFA) to address the Data Security Breach and that is reasonably designed to prevent and mitigate any further incidents, (iv) remediate the effects of such Data Security Breach in accordance with such remediation plan, and (v) cooperate with BFA and any law enforcement or regulatory official investigating such Data Security Breach. Without limiting the foregoing, BFA shall make the final decision on notifying BFA customers, employees and/or service providers of such Data Security Breach and the implementation of the remediation plan (at a high level). If a notification to a BFA customer is required under any Law or pursuant to any of BFA's policies and procedures, then notifications to all customers who are affected by the same event (as reasonably determined by BFA) shall be considered legally required. Provider shall reimburse BFA for all Notification Related Costs incurred by BFA arising out of or in connection with any such Data Security Breach resulting in a requirement for legally required notifications (as determined in accordance with the previous sentence). " <u>Notification Related Costs</u> " shall include, but are not limited to, BFA's internal and external costs associated with addressing and responding to the Data Security Breach, including: (A) preparation and mailing or other transmission of legally required notifications; (B) preparation and mailing or other transmission of such other communications to customers, agents or others as BFA deems reasonably appropriate; (C) establishment of a call center or other communications procedures in response to such Data Security Breach (*e.g.*, customer service FAQs, talking points and training); (D) public relations and other similar crisis management services; (E) legal and accounting fees and expenses associated with BFA's investigation of and response to such event; and (F) costs for commercially reasonable credit reporting services that are associated with legally required notifications or are advisable under the circumstances. Unless otherwise agreed by the Parties in writing, in the event that Provider becomes aware of any Data Security Breach which is not due to Provider acts or omissions other than in accordance with the terms of this Agreement, Provider shall promptly, with forty-eight (48) hours of Provider's confirmation of such Data Security Breach, notify BFA of such Data Security Breach, and the Parties shall reasonably cooperate regarding which of the foregoing or other activities may be appropriate under the circumstances, including any applicable charges for the same.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Right to Review</u>. Each BFA Recipient reserves the right to review summaries of Provider's policies and procedures used to maintain the security and confidentiality of BFA Data, subject to the limitation set forth in <u>Article 17</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.3** **Data Security Breaches; Remediation of Malicious Code.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Data Security Breaches</u>. Provider will monitor and record security related events on all systems and log such events. If Provider discovers or become aware of an actual Data Security Breach, Provider shall, except to the extent instructed by legal or regulatory authorities not to do so:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) promptly notify the BFA Relationship Manager by telephone and e-mail as soon as practicable but in any event within the earlier of any of the following: (i) forty-eight (48) hours after detecting or becoming aware of such breach or (ii) within a shorter timeframe if required under a BFA Recipient Law of which Provider is notified;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) provide confirmatory written notice to the BFA Relationship Manager as soon as practicable after detecting or becoming aware of such breach; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) investigate and remediate the effects of the breach, and provide the applicable BFA Recipients with reasonable assurance that safeguards consistent with Provider's obligations under this <u>Article 13</u> have been implemented.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Malicious Code</u>. Generally, the Parties will provide reasonable cooperation to one another in order to mitigate the impact of any Malicious Code on the Services, regardless of the origin of such Malicious Code. Without limiting any Party's other obligations hereunder, if any Malicious Code is found to have been introduced by such Party (or any third party acting on such Party's behalf or direction) into any system used to provide or receive the Services, such Party will remove such Malicious Code at its expense or, at the election of such other Party, compensate the other Party for the reasonable expense of any such removal, and in any case (wherever such Malicious Code originated), such Party will exercise Commercially Reasonable Efforts, at no charge to the other Party, to eliminate, and reduce the effects of, the Malicious Code. If such Malicious Code causes a loss of operational efficiency or loss of data, Provider will mitigate such losses and use Commercially Reasonable Efforts to restore any data lost from the Provider Technology, subject to reimbursement for reasonable expenses incurred on account of Malicious Code introduced by a BFA Recipient (or any third party acting on its behalf or direction).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.** **PERSONAL INFORMATION** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.1** **Generally.** Each Party acknowledges and agrees that, with the exception of professional biographies and contact details of its employees (" <u>Business Contact Data</u> "), and in limited instances as required solely for local market accounts, employee passport numbers (" <u>Passport Information</u> ") it does not intend pursuant to the Agreement to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) make available to the other Party any other information relating to an identified or identifiable natural person, or any other information within the definition of personal data under data protection legislation applicable to that Party from time to time (" <u>Personal Information</u> "); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) process any Personal Information originating from the other Party other than Business Contact Data and Passport Information received from the other Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.2** **Processing.** The Parties acknowledge and agree that each Party may process any Business Contact Data and Passport Information received from the other Party as controller (as such term is defined in applicable data protection legislation) for the purpose of: (a) carrying out diligence and administrative tasks prior to the provision or receipt of the Services; (b) providing the Services, (c) applicable legal or regulatory requirements; (d) requests and communications from competent authorities, courts or tribunals; (e) protecting its rights; and (f) administrative, financial accounting, risk analysis, fraud/crime prevention and business relationship purposes (the " <u>Purposes</u> "). The Parties further acknowledge that Business Contact Data and Passport Information may be disclosed by the receiving Party to, and processed by, other members of the receiving Party's group of companies, competent authorities, courts and tribunals, the receiving Party's professional advisors, and other third party service providers of the receiving Party (" <u>Disclosees</u> ") for one or more of the Purposes.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.3** **Legal Requirements.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Party shall comply with data protection legislation applicable to that Party from time to time when processing Business Contact Data and Passport Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Party shall ensure that any Business Contact Data or Passport Information one Party makes available to the other Party has been collected lawfully, fairly and in a transparent manner so as to enable such Business Contact Data or Passport Information to be processed by the receiving Party and its Disclosees for all of the Purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.4** **Notice.** If, notwithstanding <u>Section 14.1</u>, BFA accidentally, unknowingly or otherwise discloses to Provider Personal Information other than Business Contact Data or Passport Information of which Provider becomes aware, Provider shall notify BFA promptly and shall, at the discretion of BFA, return or destroy such Personal Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.5** **Data Protection Agreement.** In the event that the Parties agree to the processing of Personal Information, other than Business Contact Data, under or pursuant to this Agreement (including as a result of a change to the Services), the Parties agree to enter into a Data Protection Agreement mutually agreed upon at such time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.6** **Privacy Notices.** The Parties shall each make available to the other its privacy notice (as may be in effect from time to time) detailing the way in which Personal Information is processed. BFA's Client and Vendor Privacy Notice can be found at *https://www.blackrock.com/corporate/compliance/privacy-policy* (or such future URL as may be used by BFA from time to time). Provider's applicable Privacy Notices can be found at https://www.bnymellon.com/us/en/privacy-policy.html.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.** **INTELLECTUAL PROPERTY RIGHTS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.2** **Independent Work**. BFA and Provider shall each exclusively retain all Intellectual Property Rights which they (or their Affiliates or, solely with respect to Provider, its Subcontractors) create that constitute Independent Work.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.3** **Work Product**. All Work Product shall be exclusively owned by BFA, and Provider hereby assigns, and shall cause its Affiliates, Subcontractors and all Provider Personnel to assign, to BFA all right, title and interest in and to the Work Product. To the extent any Work Product has applicability to Provider's provision of similar services to Provider client's generally and does not constitute Confidential Information of BFA or BFA Recipients and to the extent not otherwise agreed in writing by BFA and Provider, BFA shall grant to Provider a non-exclusive, worldwide, non-transferable, perpetual, irrevocable, non-terminable (except for terminations in connection with certain breach events), fully paid-up, royalty-free license to use, load, access, execute, store, transmit, copy, display, perform and otherwise exploit such Work Product in connection with the provision of services similar to the Services to Provider's clients on terms to be negotiated in good faith by BFA and Provider; provided that no such license shall become effective prior to the date that is two (2) years from the date such Work Product is first used commercially or in production by BFA or a BFA Recipient in connection with the Services.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**16.** **CONTRACT AND PROJECT MANAGEMENT** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**16.1** **Governance, Meetings and Reports.** Provider acknowledges and agrees that one of the key business requirements of the BFA Recipients is for Provider to provide the Services in a consistent, integrated manner across all Provider locations, regardless of geography. To meet such requirement, Provider will organize its relationship with the BFA Recipients and its service delivery team in accordance with the governance committee, processes and procedures set forth in the Service Level Schedule and this <u>Article 16</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**16.2** **Change Procedures.** Any Change to the general terms and conditions herein (including changes to the Schedules and Attachments) will be made in accordance with <u>Exhibit</u> <u> </u> <u>B</u>. Each Party agrees to consider in good faith any Change request of the other Party and will not unreasonably withhold, condition or delay its approval of any such request.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.** **AUDIT / RECORDS / LEGAL DISCOVERY** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.1** **BFA Audit Rights.** Unless prohibited by applicable Laws, the BFA Recipients, their auditors (internal or external) and regulators (to the extent legally required), each as a BFA Recipient may from time to time designate (collectively, the " <u>BFA Auditors</u> "), may perform audits, inspections and examinations of: (x) any location or facility or portion thereof at or from which Provider Personnel are providing the Services; (y) Subcontractors (subject to the limitations in <u>Section</u> <u> </u> <u>17.2(a)(iv)</u> below); and (z) data, books, logs, records and other documentation in any media relating to the Services for the following purposes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to verify and ascertain the accuracy and correctness of volume calculations, Service Levels and other measures of performance, Fees, credits and other amounts due and payable to the applicable Parties hereunder (including by means of access to the most recent publicly available audited financial statements of Provider and/or its Subcontractors, as applicable, and relevant information on applicable insurance coverages to the extent available to Provider);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to verify the confidentiality, integrity and availability of BFA Confidential Information and Provider's or its Subcontractors' compliance with their duties and obligations with respect to information protection, security, conflicts of interest and confidentiality;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) to assess (A) Provider's compliance with its data security obligations hereunder and (B) whether any incident has occurred that has compromised the security of Provider Technology in a manner such that BFA Data has been improperly disclosed or altered (a " <u>Data Security Breach</u> "); <u>provided</u> that such access may include access to Provider Technology consistent with the access provided to BFA Recipients in connection with the Services, but excluding (I) access to Provider Technology that would permit the auditor to view information of other clients of Provider and (II) the ability to perform any penetration or similar testing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) to verify Provider's compliance with Provider Laws in any country from or to which Services are provided, including to verify the integrity and correctness of the training and certification qualifications offered to and obtained by Provider Personnel where training or certification is required to comply with Provider Laws;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) to verify the integrity of any data provided by Provider hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) to verify Provider's compliance with regulatory inquiries relating to the BFA Recipients;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) to verify Provider's compliance with policies and procedures of a BFA Recipient to which Provider is required to comply hereunder; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) to verify Provider's compliance with any other provision of this Agreement.

Provider will make Provider Personnel available to the BFA Auditors for the purposes described in this <u>Section 17.1</u>. Notwithstanding the foregoing, (i) to the extent required by Provider's policies and procedures relating to data security, Provider may provide summary materials in lieu of the full text of policies, procedures, test results (in which BFA does not participate), and other similar documentation, and (ii) the scope of BFA's access to Provider's premises and personnel and review rights with respect to Provider's BCP Plan shall be as agreed by the Parties in writing from time to time.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.2** **Limitations and Cooperation.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Limitations</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Audits will be conducted during Provider's business hours and upon reasonable notice to Provider except in the case of emergency or as otherwise may be legally required. Each BFA Recipient and the BFA Auditors will: (A) comply with Provider's reasonable security and confidentiality requirements when accessing locations, facilities or other resources owned or controlled by Provider; and (B) cooperate with Provider to minimize any disruption to Provider's business activities, subject to the requirements of any regulatory authorities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Audit rights of the BFA Recipients will be subject to Provider's rights to impose reasonable limitations on the frequency and timing of such audits and inspections requested by the BFA Recipients, except that Provider will not limit the frequency or timing of audits or inspections by regulators of the BFA Recipients.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Provider will not disclose or make any information available or provide access to: (A) the extent that such information is subject to legal privilege; (B) the extent that disclosure or access would result in a breach of law or duty of confidentiality or privacy owed to a third party or any Provider Personnel; (C) the extent that such information is unrelated to the BFA Recipients or the provision of the Services; (D) Provider's internal audit reports, compliance or risk management plans or reports, work papers and other reports and information relating to management functions; or (E) the extent that such access by the BFA Recipients would, in Provider's reasonable opinion, compromise the security of its technology systems.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any audits of Subcontractors permitted hereunder shall be subject to all terms and conditions applicable thereto under any agreement between Provider and such Subcontractors, which audit rights Provider will request in good faith from such Subcontractor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Provider Cooperation</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Subject to the limitations set forth in <u>Section 17.2(a)</u>, Provider and Provider Personnel will provide such assistance as may be reasonably required to carry out audits as permitted hereunder, including providing reasonable use of Provider locations, facilities and other resources reasonably required in connection therewith, subject to reimbursement for any material out-of-pocket expenses incurred by Provider in cooperating with audit activities directed by a BFA Recipient that are outside the ordinary course of customary audits that would be expected in connection with services similar to the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Subject to the limitations set forth above, Provider further agrees to cooperate with and facilitate: (A) audits of BFA Recipients conducted by independent auditors; and (B) audits or performance of "agreed upon procedures" by outside auditors as requested by the BFA Recipients.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.3** **Audit Follow-Up and Remedial Action.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Audit Follow-Up</u>. At the conclusion of an audit or examination, Provider will have an opportunity to review issues identified during the review, and will cooperate with the applicable BFA Recipients to provide factual concurrence with issues identified in the review. Provider and such BFA Recipients will meet to review each final audit report promptly after the issuance thereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Compliance Corrections</u>. If an audit reveals any breach by Provider of any of its material obligations hereunder and Provider is notified of such breach, Provider will promptly use Commercially Reasonable Efforts to cure such breach, provided such breach is capable of cure. To the extent that any BFA Recipient becomes aware of a breach revealed by an audit, such BFA Recipient will notify Provider of such breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Overcharge</u>. If, as a result of an audit regarding Provider's charges, it is determined that Provider has overcharged a BFA Recipient, such BFA Recipient will notify Provider of the overcharged amount and Provider will promptly pay to such BFA Recipient or BFA, on behalf of such BFA Recipient, such amount plus interest at the prevailing Federal Funds rate, calculated from the date of Provider's receipt of the overcharged amount until the date of payment to such BFA Recipient or BFA, on behalf of such BFA Recipient. If any such audit reveals an undercharge to Provider of five percent (5%) or more of the annual service charges for the period audited, the BFA Recipient will notify Provider and pay such undercharge, without interest, within thirty (30) days of discovery of such undercharge. If any such audit reveals an overcharge to a BFA Recipient of five percent (5%) or more of the annual service charges for the period audited, Provider will, at the option of such BFA Recipient, issue to such BFA Recipient or BFA, on behalf of such BFA Recipient, a credit (including such interest) against the charges attributable to the overcharge and reimburse such BFA Recipient for the reasonable out-of-pocket expenses of such audit relating to such charges.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.4** **Provider-Conducted Audits.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Generally</u>. Provider will conduct all audits under this <u>Section 17.4</u> pertaining to the Services through an independent auditor, generally consistent with Provider's audit practices, except to the extent otherwise expressly provided hereunder. Such independent auditor may be Provider's internal audit department, provided that Provider reasonably determines that this department is operated independently of the business lines it audits and BFA receives a SOC audit pursuant to this <u>Section 17.4</u>. To the extent that Provider becomes aware of a breach revealed by an audit pursuant to this Agreement, Provider will notify the BFA Recipients of such breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>SOC Audit</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Provider will cause either a SOC 1 or a SOC 2 audit to be conducted at least annually, which audit conducted pursuant to this Agreement will not be materially diminished in scope as compared to the scope of Provider's SOC 1 or SOC 2 audits performed as of the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Provider will promptly provide each BFA Recipient with its updated SOC report, if any, upon request, which request may be made on an annual basis. To the extent Provider obtains a SOC-2 report after previously only obtaining a SOC 1 report, Provider will provide BFA with its updated SOC 2 results. Thereafter, Provider will provide to the BFA Recipients certifications indicating material changes to Provider's internal control environment with such frequency as the BFA Recipients may reasonably request to discharge their duties under applicable Law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Data Security and Confidentiality Audits</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If Provider does not provide a SOC 2 audit pursuant to <u>Section 17.4(b)</u> above, Provider shall perform an audit for the purpose of determining compliance by Provider with its data security obligations under this Agreement and shall be conducted at least annually.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) BFA shall be entitled to such summary report of the audit that will describe whether Provider has met its data security obligations hereunder and whether or not a Data Security Breach has occurred, but that shall otherwise exclude information that Provider reasonably deems appropriate to exclude.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If any such audit reveals that Provider has failed to meet its data security obligations hereunder or that a Data Security Breach has occurred, upon BFA's request (and at Provider's sole cost and expense), Provider shall: (A) provide the affected BFA Recipients with sufficient information to determine the length, scope and impact of such failure; and (B) perform a follow-up audit to determine whether Provider has: (I) cured its failure to meet its data security obligations hereunder; or (II) remediated the Data Security Breach such that an improper disclosure or alteration of BFA Data is no longer reasonably likely to occur as a result of the incident giving rise to the follow-up audit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Additional follow-up audits may be required to the extent any such audit reveals that the data security matters have not been remediated in all material respects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) The results of any such audits and reports provided in connection therewith shall be Confidential Information of Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.5** **Record Maintenance and Retention**. Provider will maintain accurate, complete, and up-to-date books and records relating to the Services which constitute part of the BFA Recipients' official books and records for purposes of the BFA Recipient Laws. Provider will maintain such books and records in compliance with applicable Provider Laws (which will be deemed to include, as may be applicable with respect to a particular BFA Recipient, without limitation, Section 17 of the Exchange Act and the rules thereunder) and in a mutually-agreed form sufficient for the purposes of enabling the BFA Recipients to comply with BFA Recipient Laws. Any records required to be maintained by any recordkeeping obligations under the Rule 17Ad-6 and Rule 17Ad-7 under the Exchange Act, each as may be applicable with respect to a particular BFA Recipient (" <u>Required BFA Recipient Records</u> "), will be preserved for the periods and maintained in a manner prescribed under such rules. Each BFA Recipient and its authorized representatives (including those of its commodity pool operator and commodity trading advisor), and employees and agents of the SEC, CFTC and NFA, as applicable, shall have reasonable access to Provider's records relating to the Services at all times during Provider's normal business hours. The BFA Recipients will retain ownership of such books and records, with each BFA Recipient owning those books and records that pertain to the Services provided hereunder to which such BFA Recipient is a party; <u>provided</u>, <u>however</u>, that BFA acknowledges that Provider shall own the custody records to the extent they are not Required BFA Recipient Records. Provider will report as soon as possible any matters that are reasonably likely to materially adversely affect performance of its record maintenance and retention obligations hereunder. Unless prohibited by applicable Laws, Provider will maintain and provide access upon a BFA Recipient's request to the records, documents and other information (other than any BFA Data or BFA Confidential Information returned by Provider in accordance herewith) required to comply with audit rights hereunder until the later of: (a) ten (10) years after expiration or termination of this Agreement or such longer period required by applicable Law; or (b) when pending matters relating hereto (*e.g.*, disputes) are closed or applicable statutes of limitations have lapsed. In the event of a termination or expiration of Services provided hereunder, all related records will be delivered to the BFA Recipient as of the date of termination or expiration or at such other time as may be mutually agreed upon by the Parties.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.6** **Communication with Regulators.** If a Party receives any inquiry from any regulator regarding Provider, BFA, a BFA Recipient or its Shareholders in relation to the Services, then, except to the extent such inquiry relates to other customers or clients of Provider, a BFA Recipient or its shareholders, such Party will, to the extent legally permissible, consult the other Parties before responding to such inquiry and will comply with the such other Party's reasonable requests regarding the content or timing of such response; <u>provided</u> *,* <u>however</u> *,* that the foregoing shall not limit or restrict Provider, BFA, or any BFA Recipient in any manner in complying with its regulatory obligations in a manner that it, in its sole discretion, shall determine to be compliant with applicable Law or necessary for the maintenance of its ongoing relationships with its regulatory authorities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.7** **Regulatory Assistance**. Provider will permit regulators with jurisdiction over BFA or any BFA Recipient to examine Provider's activities relating to its performance under this Agreement and the Services. Subject to <u>Section 17.6</u>, Provider will cooperate and provide all information reasonably requested by the regulator in connection with any such examination and provide reasonable assistance and access to all equipment, records, and systems requested by the regulator relating to the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.8** **Legal Discovery**. Provider acknowledges and agrees that each BFA Recipient is required to preserve and produce electronic data in support of such BFA Recipient's legal discovery obligations, as they may arise, for investigations and/or litigation. As part of the Services, and to the extent not prohibited by applicable Laws, Provider will make available to such BFA Recipient BFA Data that Provider maintains and that is the subject of any legal discovery obligation of such BFA Recipient, subject to reimbursement for out-of-pocket costs reasonably incurred by Provider to the extent such assistance is not capable of being performed by Provider Personnel during normal business hours without disruption to the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.9** **Other Disclosures.** Provider will furnish each BFA Recipient with such daily information regarding the positions and activity of the BFA Recipient's Cash Assets, Securities and other assets, as Provider and such BFA Recipient will from time to time agree.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**18.** **CONFIDENTIALITY** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**18.1** **Definition of Confidential Information.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Definition</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>"Confidential Information</u> " of a Party means any non-public, commercially sensitive information belonging to, concerning or in the possession or control of a Party or its Affiliates (the " <u>Furnishing Party</u> ") that is furnished, disclosed or otherwise made available of the other Party or its Affiliates (the " <u>Receiving Party</u> "), and which is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) either marked or identified in writing as confidential, proprietary, secret or with another designation sufficient to give notice of its sensitive nature;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) of a type that a reasonable person would recognize it to be commercially sensitive; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) BFA Confidential Information or Provider Confidential Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>"BFA Confidential Information</u> " includes all information to which Provider has access in BFA Locations or systems, BFA Proprietary Information, BFA Data, BFA Software and other Intellectual Property Rights of BFA Recipients and related systems access codes and information concerning BFA Recipients and their Affiliates' existing or proposed products, product types, product structures, product strategies, target markets, timing of new product launches, historic trade data, fund performance data, corporate actions determinations, trading information, trading strategies, processes, trend information, securities lending data and markets, billing data, marketing strategies, financial affairs, employees, shareholder list and information related to shareholders, customers or suppliers, and any non-public personal information as defined by Regulation S-P, regardless of whether or how it is marked.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>"Provider Confidential Information</u> " includes Provider proprietary information, Work Product and all other Intellectual Property Rights of Provider, client lists, marketing strategies, and all data and information concerning Provider's clients, in their capacity as Provider's clients, financial affairs, product types, product structures, product strategies, timing of new product launches, and fees for Services or other products or services, regardless of whether or how such materials are marked.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>No Implied Rights</u>. Each Party's Confidential Information will remain the property of that Party. Nothing contained in this <u>Article 18</u> will be construed as obligating a Party to disclose its Confidential Information to the other Party, or as granting to or conferring on a Party, expressly or by implication, any rights or license to the Confidential Information of the other Party. Any such obligation or grant will only be as provided by other provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Exclusions</u>. None of the Confidential Information, Provider Confidential Information or BFA Confidential Information shall include any information that the Receiving Party can demonstrate: (i) was, at the time of disclosure to it, in the public domain; (ii) after disclosure to it, is published or otherwise becomes part of the public domain through no fault of the Receiving Party; (iii) was in possession of the Receiving Party at the time of disclosure to it and was not the subject of a pre-existing confidentiality obligation; (iv) was received after disclosure to it from a third party who had a lawful right to disclose such information to it; or (v) was independently developed by the Receiving Party without use of the Confidential Information of the Furnishing Party. Any exclusion from the definition of Confidential Information contained herein will not apply to Personal Information.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**18.2** **Confidentiality Obligations.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Generally</u>. The Receiving Party will: (i) not disclose, publish, release, transfer or otherwise make available the Furnishing Party's Confidential Information in any form to, or for the use or benefit of, any person or entity without the Furnishing Party's consent; (ii) secure and protect the Furnishing Party's Confidential Information from unauthorized use or disclosure by using at least the same degree of care as the Receiving Party employs to avoid authorized use of or disclosure of its own Confidential Information, but in no event less than reasonable care; and (iii) not duplicate any material containing the Furnishing Party's Confidential Information except in the direct performance of its obligations hereunder. Confidential Information may not be used by the Receiving Party or any of its Affiliates, officers, directors, agents, professional advisors, subcontractors and employees other than for the purposes contemplated by this Agreement. In connection with the provision of the Services and the discharge of its other obligations under this Agreement, Provider may collect and store BFA Confidential Information and share such BFA Confidential Information with its Affiliates, Subcontractors, Authorized Data Sources, Third Party Market Utility Providers, and agents solely to the extent reasonably necessary to carry out (A) the provision of Services contemplated under this Agreement, and (B) the internal management of its businesses, including, but not limited to, financial and operational management and reporting, risk management, and legal and regulatory compliance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Provider Duties</u>. In addition to its other obligations with respect to BFA Confidential Information, Provider will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) not permit any BFA Confidential Information to be disclosed to any entity that competes with any BFA Recipient or any products thereof (including the asset management division of Provider or its asset management Affiliates) or other clients;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) provide access to BFA Confidential Information to its employees only on a need-to-know basis for the provision of Services hereunder and will not provide such access to Confidential Information to any employee who directly services a business that competes now or in the future with BFA Recipients (provided that BFA Data may be provided to Provider employees performing Services on a shared services basis so long as such employees are advised as to Provider's confidentiality obligations hereunder and instructed to comply therewith and are only permitted to share such BFA Data with other shared services employees);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) protect BFA Confidential Information, by configuration of its information and processing systems or by adopting other appropriate measures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) include in its agreements with each of its Subcontractors confidentiality terms, which, taken as a whole, will be protective of BFA Confidential Information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) take such other actions as the Parties may agree from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Notice of Unauthorized Acts</u>. The Receiving Party will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) notify the Furnishing Party promptly upon its becoming aware of any unauthorized possession, use, or knowledge of the Furnishing Party's Confidential Information by any person;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) promptly furnish to the Furnishing Party full details that the Receiving Party has or may obtain regarding such unauthorized access and use reasonable efforts to assist the Furnishing Party in investigating or preventing the reoccurrence of any such access;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) cooperate with the Furnishing Party in any litigation and investigation against third parties deemed reasonably necessary by such Party to protect its proprietary rights; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) promptly take all reasonable actions necessary to prevent a reoccurrence of any such unauthorized access.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**18.3** **Permitted or Required Disclosures.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Receiving Party may disclose relevant aspects of the Furnishing Party's Confidential Information to its Affiliates, officers, directors, agents, professional advisors, subcontractors and employees and other third parties (including Governmental Authorities), to the extent that such disclosure is not restricted hereunder and only to the extent that such disclosure is reasonably necessary for: (i) the performance of its duties and obligations hereunder; (ii) the exercise of its rights hereunder or (iii) compliance with relevant reasonable policies and practices of its internal audit, risk management, and legal oversight functions. Provider may also disclose Confidential Information of BFA or any BFA Recipient to Third Party Providers in accordance with Proper Instructions and applicable Service Levels.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Receiving Party will take all reasonable measures to ensure that the Furnishing Party's Confidential Information is not disclosed or duplicated in contravention of the provisions of this Agreement by such officers, directors, agents, professional advisors, subcontractors and employees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Parties' respective obligations in this <u>Article 18</u> will not restrict any disclosure required pursuant to any Law or legal or regulatory process; <u>provided</u>, **  <u>however</u>, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) where legally permitted and reasonably practicable to do so, the Receiving Party will give reasonable and prompt advance notice of such disclosure requirement to the Furnishing Party and give the Furnishing Party reasonable opportunity to object to and contest such disclosure, to the extent legally permissible; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the Receiving Party will use reasonable efforts to secure confidential treatment for any such information that is required to be disclosed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**18.4** **Return or Destruction.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) As requested by the Furnishing Party during the Term, the Receiving Party will return or provide the Furnishing Party a copy of any designated Confidential Information of the Furnishing Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Receiving Party will return or, at the Furnishing Party's option, destroy all copies of materials containing the Furnishing Party's Confidential Information upon the Receiving Party's cessation of work, completion of its obligations associated with such information hereunder or upon any earlier termination of this Agreement for any reason whatsoever, except to the extent:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) that this Agreement provides for the Receiving Party to continue to use or retain items that constitute or contain the Furnishing Party's Confidential Information after the date of expiration or termination; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) otherwise required to comply with Law or to defend or pursue claims arising under this Agreement.

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In addition, the Receiving Party will destroy all notes, memoranda, compilations, derivative works, data files or other materials prepared by or on behalf of the Receiving Party that contain or otherwise reflect or refer to Confidential Information of the Furnishing Party to the extent reasonably practicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) At the Furnishing Party's request, the Receiving Party will certify in writing that it has returned or destroyed all copies of the Furnishing Party's Confidential Information in the possession or control of the Receiving Party or any of its Affiliates, officers, directors, agents, professional advisors, subcontractors and employees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Receiving Party will dispose of any "consumer report information," as such term is defined in Regulation S-P.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**18.5** **Duration of Confidentiality Obligations.** The Receiving Party's obligations under this <u>Article</u> <u> </u> <u>18</u> apply to Confidential Information of the Furnishing Party disclosed to the Receiving Party before or after the Effective Date and will continue during the Term and survive the expiration or termination of the Agreement as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) as to any portion of the Furnishing Party's Confidential Information that constitutes a trade secret under applicable law, the obligations will continue for as long as the Furnishing Party continues to treat such information as a trade secret; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) as to all other Confidential Information of the Furnishing Party, the obligations will survive for two (2) years after the Receiving Party's fulfillment of its obligations under <u>Section</u> <u> </u> <u>18.4</u> with respect to the Confidential Information in question.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**19.** **REPRESENTATIONS AND WARRANTIES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**19.1** **By Provider.** Provider makes the following representations, warranties and covenants to each BFA Recipient:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Custodian Eligibility</u>. Provider represents and warrants that it (i) has and will maintain at least the minimum qualifications required to act as custodian of the Cash Assets of each BFA Recipient *,* and (ii) is otherwise qualified and eligible to act as custodian under the terms of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Policies and Procedures</u>. Provider represents and warrants that it has adopted, and covenants that it shall continue to adopt, written policies and procedures that are reasonably designed to prevent violation of the "Federal Securities Laws," as such term is defined in Rule 38a-1 under the Investment Company Act of 1940, as amended., with respect to (i) the Fund Administration and Accounting Services to be provided to the BFA Recipients under <u>Article 4</u> and (ii) the Transfer Agency Services to be provided to the BFA Recipients under <u>Article 5</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Adequate Resources, Skill and Experience</u>. Provider warrants and covenants that it will use adequate numbers of qualified Provider Personnel with suitable training, education, experience and skill to perform the Services in accordance with the Standard of Care. Provider represents that it is skilled and experienced in providing services similar to the Services for customers other than the BFA Recipients.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Software Ownership</u>. Provider is authorized to grant to the BFA Recipients such rights, title, interest and ownership (or license rights to use, as applicable) necessary for BFA or BFA Recipients to use any Provider Technology provided to BFA or BFA Recipients in connection with BFA's and BFA Recipients' right to use the Services provided hereunder and in accordance with the terms hereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Equal Opportunity Employer</u>. Provider is an equal opportunity employer complying with all applicable Laws relating to equal opportunity employment, and will maintain in effect and use reasonable efforts to adhere to a corporate policy intended to maintain such compliance. Provider acknowledges that BFA considers inclusion and diversity at BFA as key to BFA's success. BFA is committed to developing a supplier and service provider base that is diverse and reflects all the markets, clients and communities BFA serves and BFA expects its service providers to operate in a similar manner. Upon request, Provider will provide BFA with information on the actions it is taking in furtherance of this goal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>No Debarment</u>. Neither Provider nor any of Provider Personnel to Provider's knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) has been debarred by a Governmental Authority;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) has currently, or has had in the past, a debarment proceeding initiated against them by a Governmental Authority; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) will use, in any capacity, in connection with the activities to be performed hereunder, any person or entity who, to Provider's knowledge, has been debarred or against whom a debarment proceeding has been initiated by any Governmental Authority.

If Provider learns that a person or entity performing on its behalf hereunder has been debarred by any Governmental Authority, or has become the subject of debarment proceedings by any Governmental Authority, Provider will promptly so notify the applicable BFA Recipients and will prohibit such person or entity from performing on Provider's behalf hereunder, unless otherwise consented to in writing by such BFA Recipients.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Qualifying Office</u>. Provider is a securities intermediary with respect to each BFA Account. Provider had on the date that Provider and the BFA Recipient entered into this Agreement an office in the State of New York or another State (as defined in the UCC) that engaged in the regular activity of maintaining securities accounts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**19.2** **By the BFA Recipients.** Each BFA Recipient makes the following representations, warranties and covenants to Provider:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Regulation GG</u>. Such BFA Recipient does not engage in an "Internet gambling business," as such term is defined in Section 233.2(r) of Federal Reserve Regulation GG (12 CFR 233). Such BFA Recipient shall promptly notify Provider if it does engage in an Internet gambling business; <u>provided</u>, <u>however</u>, failure of such BFA Recipient to notify Provider shall not result in any additional Provider rights pursuant to <u>Article 10</u> or any additional right to indemnification by BFA or such BFA Recipient pursuant to <u>Article 21</u>. In accordance with Regulation GG, such BFA Recipient is hereby notified that "restricted transactions," as such term is defined in Section 233.2(y) of Regulation GG, are prohibited in any dealings with Provider pursuant to this Agreement or otherwise between or among any Party hereto.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each BFA Recipient represents and warrants that it has policies and procedures reasonably designed to determine the value of the BFA Recipient's Digital Assets for financial statement purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each of BFA and each BFA Recipient represents and warrants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The BFA Recipient and BFA are knowledgeable about currency, Digital Assets, securities and commodities trading, as applicable, and aware of the risk of substantial loss in such trading;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The BFA Recipient and BFA are knowledgeable about Digital Asset networks, cryptography, open source technology and protocols;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) A registration statement under the Securities Act on behalf of the BFA Recipient will become effective prior to any sales of Shares of a BFA Recipient (excluding seed contribution, if any), will remain effective, and appropriate state securities law filings will be made prior to any sales of Shares of a BFA Recipient and will continue to be made, with respect to all Shares of the BFA Recipient being offered;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The BFA Recipient or BFA, as trustee of the BFA Recipient, will maintain policies and procedures reasonably designed to ensure that all investments for the BFA Recipient are conducted in compliance with BFA Recipient Laws, including applicable AML Laws, and it will cooperate with Provider and provide reasonable assistance with Provider in connection with any inquiries related to AML Laws or Sanctions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) The BFA Recipient is not relying on or engaging Provider to provide any storage or other custodial services in respect of any Digital Assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**19.3** **Mutual Representations and Warranties.** Each Party represents, warrants and covenants to the other that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Power and Authority</u>. It has the requisite corporate power and authority to enter into, and to carry out the transactions contemplated by, this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>No Inducements</u>. Such Party has not violated applicable Laws or regulations or policies in connection with securing this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Duly Authorized and No Material Default</u>. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby: (i) have been duly authorized by the requisite corporate action on the part of such Party and will not constitute a violation of any judgment, order or decree; and (ii) will not constitute a material default under any material contract by which it or any of its Affiliates or any of their respective material assets are bound, or an event that would, with notice or lapse of time or both, constitute such a default.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Adequate Rights</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) It has obtained and will retain, at its sole expense, any and all necessary rights, licenses, consents and approvals from Governmental Authorities and third parties to perform its obligations hereunder, including the right to grant the other Party any rights granted hereunder.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) It is the owner of, or has the right to use and grant access to, any Intellectual Property Rights made available to the other Party hereunder to which it is a signatory, including in the case of Provider, any Work Product, Independent Work, or Provider Technology that it makes available.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>No Pending Proceedings; Litigation</u>. There is no claim, litigation, proceeding, arbitration, investigation or material controversy pending or, to the knowledge of such Party, threatened that challenges or may have a material adverse effect on any of the provision of Services contemplated herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Foreign Corrupt Practices Act</u>. Neither it nor any of its Affiliates or agents, nor any officer or employee of it or its Affiliates or agents, has taken or will take any action or make any payment in violation of, or which may cause it, its Affiliates or agents to be in violation of, the Foreign Corrupt Practices Act of 1977, as amended, or any comparable Laws in any country from or to which Service is provided. Such Party further represents that no person employed by it or any of its Affiliates in connection with its obligations hereunder to which it is a signatory is an official of the government of any country or of any agency thereof, and that no part of any monies or consideration paid hereunder will accrue for the benefit of any such official.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**20.** **INSURANCE AND RISK OF LOSS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**20.1** **Generally.** Provider will, throughout the Term, maintain in full force and effect from an insurer who is rated at least "A-" or better in Best's Insurance Guide, or is otherwise acceptable to a BFA Recipient, customary insurance coverage for its operations worldwide, with coverages and terms as may be agreed by the Parties from time to time. Where applicable, all required insurance will be primary, and all insurance or self-insurance maintained by BFA Recipients is strictly excess and secondary and will not contribute with BFA Recipients' insurance or self-insurance. Provider agrees to be liable for all costs within the deductible or self-insured retentions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**20.2** **Evidence of Coverage.** Within ten (10) days from the Effective Date, Provider will provide to the BFA Recipients a then-current listing of its insurance coverage relevant to this Agreement and will, upon request therefor, provide an updated listing of such coverage. Provider shall notify BFA Recipients of any cancellation or material reduction of coverage within thirty (30) days of Provider's receipt of notice of such cancellation or material reduction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**20.3** **Jurisdictions.** Each Party will ensure that the insurance required of it permits payment in each of the jurisdictions in which its insured is permitted to do business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.** **INDEMNIFICATION** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.1** **By Provider.** Subject to this <u>Article 21</u> and <u>Article 22</u>, Provider will indemnify, defend and hold harmless BFA and the BFA Recipients and their respective Affiliates, and their and their Affiliate's respective officers, directors, employees, agents and permitted successors and assigns from any and all Losses arising from or in connection with any third party claim or threatened third party claim to the extent that such Losses are based on or arising out of any of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a material breach by Provider, any Provider Personnel or any Subcontractor of any of Provider's obligations hereunder (including data protection, information security or confidentiality obligations), or of the Standard of Care, except to the extent that such Losses arise out the negligence, bad faith, actual fraud or willful misconduct of BFA, any BFA Recipient or their respective Affiliates, or of any Third Party Provider;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) changes made by any BFA Recipient or by a third party at the direction of a BFA Recipient to the Provider Infringement Items;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) changes to the Provider Infringement Items recommended by Provider and not made due to a request from any BFA Recipient, provided that Provider has notified such BFA Recipient that failure to implement such recommendation would result in infringement within a reasonable amount of time for such BFA Recipient to so implement following such notification;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any BFA Recipient's combination of the Provider Infringement Items with products or services not provided or approved in writing by Provider, except to the extent such combination arises out of any BFA Recipient's use of the Provider Infringement Items in a manner consistent with the applicable business requirements documentation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) designs or specifications that in themselves infringe and that are provided by or at the direction of any BFA Recipient (except in the event that Provider, at the time of receiving such direction, knows or reasonably should know that an infringement or misappropriation would occur if such designs or specifications are implemented); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) use or distribution by a BFA Recipient of any of the Provider Infringement Items in a manner that is not consistent with the applicable business requirements documentation or otherwise not permitted under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any employment-related claim or action by, on behalf of, or related to, any prospective, then-current or former Provider Personnel, arising from or in connection herewith, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) any claim arising under occupational health and safety, worker's compensation or other similar applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) any claim arising from the interview or hiring practices, actions or omissions of employees of Provider;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) any claim relating to any violation by Provider, its Affiliates, or their respective officers, directors, employees, representatives or agents of any Law or any common law protecting persons or members of protected classes or categories, such laws or regulations prohibiting discrimination or harassment on the basis of a protected characteristic; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) any claim based on a theory that such BFA Recipient is an employer or joint employer of any such prospective, then-current or former employee of Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the failure by Provider to obtain, maintain, or comply with any governmental approvals as required under this Agreement or Provider Laws; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any claim initiated by an Affiliate or potential or actual Subcontractor of Provider asserting rights in connection herewith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.2** **By BFA Recipients.** Each BFA Recipient will indemnify, defend and hold harmless Provider, its Affiliates and their respective officers, directors, employees, agents and permitted successors and assigns from any and all Losses arising from or in connection with any third party claim, or threatened third party claim, to the extent that such Losses are based on or arising out of any of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any breach by such BFA Recipient of any of its confidentiality obligations hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any employment-related claim or action by, on behalf of, or related to, any prospective, then-current or former employee of such BFA Recipient arising from or in connection herewith, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any claim arising under occupational health and safety, worker's compensation or other applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any claim arising from the interview or hiring practices, actions or omissions of such BFA Recipient;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any claim relating to any violation by such BFA Recipient, or its officers, directors, employees, representatives or agents, of any Law or any common law protecting persons or members of protected classes or categories, such laws or regulations prohibiting discrimination or harassment on the basis of a protected characteristic; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any claim based on a theory that Provider is an employer or joint employer of any such prospective, then-current or former employee of such BFA Recipient;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any actions taken by Provider in accordance with any Proper Instructions received from BFA or a BFA Recipient in providing Services, or acts in accordance with the terms of this Agreement or omissions not in breach of this Agreement, except, in each case, to the extent such Losses arise from Provider's, its Affiliates' or its Subcontractors' material breach of the Standard of Care in taking such actions or making such omissions.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any (i) reasonable actions taken by Provider in reliance upon any Law or reasonable interpretation of such Law in connection with this Agreement and the provision of Services by Provider or (ii) any opinion of reputable external legal counsel engaged by BFA Recipient or Provider;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any transactions or other activities of the BFA Recipient which occurred prior to the Commencement Date of this Agreement; or

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) the Offering Materials (excluding information provided by Provider).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.3** **Mutual.** Each Party will indemnify, defend and hold harmless the other Party and its officers, directors, employees, agents, successors and assigns from any and all Losses arising from or in connection with any of the following, including Losses arising from or in connection with any third party claim or threatened third party claim:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the death or bodily injury of an agent, employee, customer, business invitee or business visitor or other person caused by the tortious or criminal conduct of the other Party; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the damage, loss or destruction of real or tangible personal property caused by the tortious or criminal conduct of the other Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.4** **Infringement Remedy.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If any item or process used by Provider to provide the Services and made available to the BFA Recipients becomes, or in Provider's reasonable opinion is likely to become, the subject of an infringement or misappropriation claim or proceeding, Provider will use Commercially Reasonable Efforts to, in Provider's sole discretion, take the following actions at no additional charge to such BFA Recipient as soon as reasonably practicable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) secure the right to continue using the item or process;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) replace or modify the item or process to make it non-infringing, provided that the replacement or modification will not degrade performance or quality in any material respect; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) if neither <u>(i)</u> nor <u>(ii)</u> immediately above is available to Provider on commercially reasonable terms, remove the item or process from the Services and equitably reduce Provider's charges to reflect such removal, provided that no such removal will diminish the scope of Provider's obligation to perform the Services hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Provider's obligations in this <u>Section 21.4</u> and its related indemnification obligations under <u>Section 21.1(c)</u> shall be the affected BFA Recipient's sole rights and remedies in connection with infringement claims described herein. For the purposes of clarification, nothing in this <u>Section 21.4</u> will limit a BFA Recipient's ability to seek remedies for Provider's failure to provide the Services under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.5** Indemnification Procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Any Third Party Claim</u>. If any third party claim is commenced against a Party entitled to indemnification under this <u>Article 21</u> (the " <u>Indemnified Party</u> "), notice thereof will be given to the Party obligated to indemnify such claim (the " <u>Indemnifying Party</u> ") as promptly as practicable. No Indemnified Party shall settle or compromise any third party claim that may be the subject of an indemnification claim against the Indemnifying Party, whereby such claim involves the payment of money, injunctive relief or any admission by, or obligation imposed on, the Indemnifying Party, without the prior written consent of the Indemnifying Party, except as set forth herein. Any settlement or compromise of such third party claim without such consent from the Indemnifying Party shall relieve the Indemnifying Party of any obligation with respect to such claim.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If, after such notice, the Indemnifying Party acknowledges and agrees that the terms of this Agreement apply to such claim, then such Party may, in a notice promptly delivered to the Indemnified Party, but in no event less than ten (10) days prior to the date on which a response to such claim is due, immediately take control of the defense and investigation of such claim and employ and engage attorneys reasonably acceptable to the Indemnified Party to handle and defend the same, at the Indemnifying Party's sole cost and expense, subject to the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) no settlement of a claim that involves a remedy other than the payment of money by the Indemnifying Party (which includes as an unconditional term thereof the giving by each claimant or plaintiff to such Indemnified Party of a release from all liability with respect to such claim) will be entered into without the prior written consent of the Indemnified Party, which will not be unreasonably withheld, conditioned or delayed;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) after notice by the Indemnifying Party to the Indemnified Party of its election to assume full control of the defense of any such claim, the Indemnifying Party will not be liable to the Indemnified Party for any legal expenses incurred thereafter by such Indemnified Party in connection with the defense of that claim; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) the Indemnified Party will cooperate, at the cost of the Indemnifying Party, in all reasonable respects with the Indemnifying Party and its attorneys in the investigation, trial and defense of such claim and any appeal arising therefrom; <u>provided</u>, <u>however</u>, that the Indemnified Party may, at its own cost and expense (except as otherwise would be the responsibility of the Indemnifying Party hereunder), participate, through its attorneys or otherwise, in such investigation, trial and defense of such claim and any appeal arising therefrom.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If the Indemnifying Party does not assume full control over the defense of a claim as provided in this <u>Section 21.5(a)</u>, the Indemnified Party may retain control of the investigation and defense of such claim and employ and engage attorneys reasonably acceptable to the Indemnifying Party to handle and defend the same, at the Indemnifying Party's sole cost and expense, provided that the Indemnifying Party may participate in such defense at its sole cost and expense. If the Indemnified Party retains control of the defense of any such claim, any settlement shall be subject to: (A) a waiver of the Indemnified Party's rights to further indemnification; and (B) prior written approval of the Indemnifying Party, which will not be unreasonably withheld, conditioned or delayed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Governmental Authority Claims</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Notwithstanding <u>Section 21.5(a)</u>, if a claim subject to indemnification is brought against the Indemnified Party by any Governmental Authority or a BFA Recipient customer, then the Indemnified Party may, in a notice promptly delivered to the Indemnifying Party, but in no event less than ten (10) days prior to the date on which a response to such claim is due, retain control of the defense and investigation of such claim and employ and engage attorneys reasonably acceptable to the Indemnifying Party to handle and defend the same, at the Indemnifying Party's sole cost and expense; <u>provided</u>, <u>however</u>, that the Indemnifying Party may participate in such defense, at its sole cost and expense. No settlement of a claim that involves a remedy other than the payment of money by the Indemnifying Party will be entered into without the prior written consent of the Indemnified Party, which will not be unreasonably withheld, conditioned or delayed.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If the Indemnified Party does not assume full control over the defense of a governmental claim or a claim by a BFA Recipient customer subject to such defense as provided in this <u>Section 21.5(b)</u>, the Indemnifying Party will be entitled to assume control of the defense, in which case the relevant provisions of <u>Section</u> <u> </u> <u>21.5(a)</u> will apply.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.6** **Enforcement.** If the Indemnified Party is required to bring a claim against the Indemnifying Party to enforce the Indemnified Party's rights under this <u>Article 21</u>, and the Indemnified Party prevails in such claim, then the Indemnifying Party will indemnify and reimburse the Indemnified Party for and from any costs and expenses (including reasonable legal fees) incurred in connection with the enforcement of this <u>Article 21</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.7** **Subrogation.** If an Indemnifying Party will be obligated to indemnify an Indemnified Party, the Indemnifying Party will, upon fulfillment of its obligations with respect to indemnification, including payment in full of all amounts due pursuant to its indemnification obligations, be subrogated to the rights of the Indemnified Party with respect to the claims to which such indemnification relates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.8** **Other Rights.** For the purposes of clarification, nothing in this <u>Article 21</u> will limit a BFA Recipient's ability to seek remedies for Provider's failure to provide the Services under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**22.** **LIABILITY; LIABILITY LIMITATIONS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**22.1** **Generally.** Provider will be liable for Damages to the extent of its failure to meet its obligations under this Agreement, including the Standard of Care, subject to the clarifications and exceptions set forth in this <u>Article 22</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Provider will be liable for all acts and omissions of its Subcontractors to the same extent as if Provider was itself performing the relevant duties, except as provided in <u>Section</u> <u> </u> <u>22.2</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Party will be responsible for damage to the other Party's locations if such damage is caused by the personnel of such Party (or their respective guests), including such personnel's intentional misconduct, abuse, misuse, neglect, or gross negligence or failure to comply with its other obligations respecting the other Party's location.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Reasonable expenses incurred by a BFA Recipient to recover any Damages properly owed to it hereunder (including reasonable attorneys' fees) will be treated as direct Damages hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party (and their respective Affiliates) will have a duty to mitigate Damages or Losses for which either Party is responsible, including where any Damages or Losses can be mitigated by lawfully pursuing recovery from third parties pursuant to a contractual claim against such third parties, in which case each Party will conduct or permit Commercially Reasonable Efforts to so recover.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**22.2** **Provider Liability Limitations**. Subject to Provider's obligations under this Agreement to mitigate Damages or Losses, Provider will not be liable, will not be in breach of this Agreement and will not be required to indemnify any BFA Recipient in respect of any Damages or Losses suffered or incurred by any such BFA Recipient to the extent that such Damages or Losses arise as a result of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any insolvency or financial default or act or omission of a Subcontractor chosen by or at the direction of such BFA Recipient, provided that: (i) a BFA Recipient's exercise of its right to reject any Subcontractor hereunder will not be considered a choice or direction of such BFA Recipient; (ii) Provider diligently enforces such rights as it may have against such Subcontractor at the expense of, and as directed by, such BFA Recipient; and (iii) Provider notified the BFA Recipient promptly upon Provider's knowledge of any assignment of such Subcontractor or if such Subcontractor chosen by or at the direction of such BFA Recipient fails Provider's due diligence or operational vetting requirements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any obligations now or hereafter imposed directly on the BFA Recipients or Provider solely as custodian of the BFA Recipient's account by the tax law of the United States or of any state or political subdivision thereof or any other political jurisdiction outside of the United States (which obligations the BFA Recipients shall promptly satisfy in full);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) acts or omissions of a third party that occurred prior to the applicable Effective Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Provider's reliance on Proper Instructions, except to the extent such Damages or Losses result from Provider's failure to meet its Standard of Care in acting in accordance with Proper Instructions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Without limiting Provider's responsibility for Damages or Losses directly caused by its failure to meet the Standard of Care or its obligations under Section 6.3 and Article 8 as set forth elsewhere in this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any act of, or a failure to perform or a breach by, any BFA Recipient of its obligations under this Agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any revisions to calculation methods made by a BFA Recipient unless such revisions are communicated in writing to Provider;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any acts or omissions of Authorized Data Sources (which may include the provision by such Authorized Data Sources of inaccurate, incomplete or corrupt data on which Provider has relied in providing the relevant Services);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any act or omission by a Third Party Provider (which may include the provision by such Third Party Provider of inaccurate, incomplete or corrupt data on which Provider has relied in providing the relevant Services);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) erroneous information provided by a Third Party Market Utility Provider;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Provider relying in good faith upon the accuracy and completeness of any information provided to it by any BFA Recipient or Third Party Provider;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) any unavailability of BFA Technology;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any improper use by the BFA Recipient or its agents, Distributor, Authorized Participants or BFA of any valuations or computations supplied by Provider in accordance with its Standard of Care under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) the method of valuation of the Digital Assets, securities and the method of computing Net Assets, as set forth in the Prospectus or as directed by the BFA Recipient, and if the Prospectus so indicate, the value of Net Assets per Share;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) the legality of the issue, sale or transfer of any Shares, the sufficiency of the amount to be received in connection therewith, or the authority of the BFA Recipient to request such issuance, sale or transfer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the legality of the purchase of any Shares, the sufficiency of the amount to be paid in connection therewith, or the authority of the BFA Recipient to request such purchase;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) the legality of the declaration of any dividend by the BFA Recipient, or the legality of the issue of any Shares in payment of any stock dividend;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) the legality of any recapitalization or readjustment of the Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) any Losses of Provider with respect to the applicable BFA Recipient's withholding, depositing and/or reporting obligations under the Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) the negligence, bad faith, actual fraud or willful misconduct of BFA, any BFA Recipient or their respective Affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**22.3** **Liability Limitations.** In no event will any Party, its officers, directors, employees, Affiliates, subsidiaries, suppliers or subcontractors be liable for consequential, indirect, special or incidental damages hereunder, whether in contract, in tort (including breach of warranty, negligence and strict liability in tort), or otherwise, even if such Party has been advised of the possibility of such damages in advance; <u>provided</u>, that none of the foregoing limitations will apply to direct damages suffered by either Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**23.** **DISPUTE RESOLUTION.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**23.1** **Informal Dispute Resolution.** Any dispute arising out of or relating to this Agreement will be referred to the senior relationship contact at each Party to attempt to resolve the dispute. The senior relationship management representatives will meet within five (5) Business Days of referral to attempt to resolve the dispute. If the senior relationship management representatives cannot resolve the dispute within ten (10) days after their first meeting, then the dispute will be escalated to authorized representatives of the Parties' senior management who are empowered to resolve the dispute. Such representatives will meet within ten (10) days of such escalation. If such representatives cannot resolve the dispute within twenty (20) days after their first meeting, then the Parties will submit the dispute to mediation as set forth in <u>Section 23.2</u>.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**23.2** **Mediation.** Except as provided herein, no civil action with respect to any dispute, claim or controversy arising out of or relating to this Agreement may be commenced until the matter has been submitted to JAMS Alternative Dispute Resolution Inc. (" <u>JAMS</u> ") for mediation. Either Party may commence mediation by providing to JAMS and the other Party a written request for mediation, setting forth the subject of the dispute and the relief requested. The Parties will cooperate with JAMS and with one another in selecting a mediator from JAMS panel of neutrals, and in scheduling the mediation proceedings. The Parties covenant that they will participate in the mediation in good faith, and that they will share equally in its costs. Either Party may seek equitable relief as described in <u>Section 23.4</u> prior to the mediation to preserve the status quo pending the completion of that process. Except for such an action to obtain equitable relief, neither Party may commence a civil action with respect to the matters submitted to mediation until after the completion of the initial mediation session, or forty-five (45) days after the date of filing the written request for mediation, whichever occurs first. Mediation may continue after the commencement of a civil action, if the Parties so desire. The provisions of this <u>Article 23</u> may be enforced by any court of competent jurisdiction, and the Party seeking enforcement will be entitled to an award of all costs, fees and expenses, including reasonable attorneys' fees, to be paid by the Party against whom enforcement is ordered. Unless the Parties otherwise agree: (a) the mediation will take place in San Francisco, California; and (b) the Parties will in good faith select a single mediator from the JAMS panel of neutrals within ten (10) days after the dispute was submitted to mediation. The Parties will consider the location of the mediation in making such selection. Notwithstanding the foregoing, the Parties will also have the right to pursue their other rights and remedies at Law or in equity following such mediation. All negotiations and proceedings pursuant to <u>Sections 23.1</u> and <u>23.2</u> are confidential and will be treated as compromise and settlement negotiations for purposes of applicable rules of evidence and any additional confidentiality protections provided by applicable Law. Notwithstanding the foregoing, evidence that is otherwise admissible or discoverable will not be rendered inadmissible or non-discoverable as a result of its use in any informal dispute resolution or mediation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**23.3** **Other Remedies.** The initiation of the dispute resolution process as described above will not prevent any Party from exercising any of its other rights or remedies hereunder including the right to terminate this Agreement in accordance with <u>Article 10</u> or seek injunctive relief as described in <u>Section 23.4</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**23.4** **Equitable Remedies.** Each Party acknowledges and agrees that a breach of any of its obligations under this Agreement with respect to BFA Confidential Information, BFA Proprietary Information, BFA Data, Provider Confidential Information, or its infringement or misappropriation of any of the other Party's Intellectual Property Rights may irreparably harm the other Party in a way that could not be adequately compensated by money damages. In such a circumstance, the aggrieved Party may proceed directly to court. If a court of competent jurisdiction should find that a Party has breached (or attempted or threatened to breach) any such obligations, such Party agrees that, without any additional findings of irreparable injury or other conditions to injunctive relief, it will not oppose the entry of an appropriate order compelling its performance of such obligations and restraining it from any further breaches (or attempted or threatened breaches) of such obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**23.5** **Continuity of Services.** In the event of a dispute between the Parties, Provider will continue to so perform its obligations under this Agreement in good faith during the resolution of such dispute unless and until such Services are terminated in accordance with the provisions hereof (or after the expiration of any applicable Disengagement Assistance, if later).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**24.** **DEFINITIONS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**24.1** **General.** The following definitions shall be applied to the terms used in this Agreement for all purposes (unless otherwise clearly indicated or noted herein or in any exhibits, schedules or annexes hereto):

"<u>Affiliate</u>" means any entity that, directly or indirectly, Controls, is Controlled by or is under common Control with, such entity.

"<u>Agreement</u>" has the meaning given in the preamble to this Agreement.

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"<u>AML Laws</u>" means the USA PATRIOT Act of 2001, as amended, the Bank Secrecy Act, as amended, the rules and regulations promulgated thereunder and any other anti-money laundering Laws applicable to the relevant Party.

"<u>AML Program</u>" has the meaning given in <u>Section 12.1(b)(i)</u>.

"<u>Authorized Data Sources</u>" means Third Party Providers or third party security pricing providers, each acting as sources of data and information used by Provider for the provision of the Services, including sources of securities prices, currency exchange rates, interest rates, corporate actions, income and tax data, credit ratings and other market data and information. For avoidance of doubt, any source of data or information identified by the BFA Recipient for the Provider's use in providing the Services and calculating the Net Asset Values shall be considered an Authorized Data Source.

"<u>Authorized Participant</u>" shall have the meaning given to such term as such term is defined in the Prospectus.

"<u>Authorized Participant Agreement</u>" shall mean the Authorized Participant Agreements, among the BFA Recipeint's trustee, sponsor and each Authorized Participant.

"<u>Authorized Person</u>" means any of the persons duly authorized to give Proper Instructions or otherwise act on behalf of any single BFA Recipient in accordance with applicable authentication procedures, and identified in a certificate pursuant to the terms hereof.

"<u>Bad Acts</u>" means any negligent, reckless, dishonest, fraudulent or criminal act or omission or willful misconduct.

"<u>BCP Plan</u>" has the meaning given in <u>Section 25.2</u>.

"<u>Best Commercial Practices</u>" means, with respect to any objective or obligation, the exercise of such effort, skill, diligence, prudence, foresight and judgment equal to or exceeding the level of effort, skill, diligence, prudence, foresight, and judgment as a highly skilled and experienced person in the applicable services industry, providing services comparable to the Services under similar circumstances would exercise in performing those services.

"<u>BFA</u>" has the meaning given in the preamble to this Agreement.

"<u>BFA Account</u>" has the meaning given in <u>Section 3.1(a)</u>.

"<u>BFA Auditors</u>" has the meaning given in <u>Section 17.1</u>.

"<u>BFA Confidential Information</u>" has the meaning given in <u>Section 18.1(a)(ii)</u>.

"<u>BFA Data</u>" has the meaning given in <u>Section 13.1(a)</u>.

"<u>BFA Location</u>" means each location at which a BFA Recipient receives the Services.

"<u>BFA Proprietary Information</u>" means all right, title and interest in and to the Trade Secrets of any BFA Recipient or BFA or any of its clients or customers.

"<u>BFA Proprietary Technology</u>" means the systems and application software, middleware, communications links, equipment and other devices and technology 3owned or controlled by any BFA Recipient or BFA and that may be used by Provider from time to time in the performance of the Services.

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"<u>BFA Recipient</u>" has the meaning given in the preamble to this Agreement.

"<u>BFA Recipient Laws</u>" means all Laws that are directly applicable to the BFA Recipients, including the Digital Asset Laws.

"<u>BFA Relationship Manager</u>" means an individual designated (by written notice to Provider) from time to time by BFA or the BFA Recipients.

"<u>BFA Technology</u>" means the BFA Proprietary Technology and BFA Third Party Technology.

"<u>BFA Third Party Technology</u>" means the systems and application software, middleware, communications links, equipment and other devices and technology owned or controlled by a third party and licensed to any BFA Recipient or BFA and that will be used by Provider from time to time in the performance of the Services.

"<u>Board</u>" means a BFA Recipient's Board of Trustees/Directors, as applicable.

"<u>Business Contact Data</u>" has the meaning given in <u>Section 14.1</u>.

"<u>Business Days</u>" means the days that the applicable BFA Recipient is open for business, which will be Monday through Friday unless otherwise specified in the offering documents of the BFA Recipient.

"<u>Cash Assets</u>" has the meaning given in <u>Section 3.1(a)</u>.

"<u>CFTC</u>" means the Commodity Futures Trading Commission.

"<u>Change</u>" has the meaning given in <u>Exhibit B</u>.

"<u>Change of Control of Provider</u>" has the meaning given in <u>Section 10.3(a)(vii)(A)</u>.

"<u>Change Procedures</u>" means the procedures set forth in <u>Exhibit B</u>.

"<u>Changes to the Services</u>" has the meaning given in <u>Section 12.1(e)(iv)</u>.

"<u>Commencement Date</u>" shall mean the date upon which the Provider commences providing Services in accordance with this Agreement.

"<u>Commercially Reasonable Efforts</u>" means acting in a determined, prudent and reasonable manner to perform its obligations.

"<u>Confidential Information</u>" has the meaning given in <u>Section 18.1(a)(i)</u>.

"<u>Contract Worker</u>" means an individual employed by Provider on a contract or temporary basis to perform the Services.

"<u>Control</u>" and derivatives thereof means, with respect to any entity, (i) 50.1% or more of the ownership of such entity, or (ii) the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such entity, whether through the ownership of voting securities (or other ownership interest), by contract or otherwise.

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"<u>Core Services</u>" means the review, oversight and final sign-off of the following components of the Fund Administration and Accounting Services and Transfer Agency Services performed from the Provider's offices: (a) NAV oversight / fund events; (b) accounting controls; (c) fund administration / regulatory reporting; (d) operational service delivery; (e) pricing; and (f) certain tax services as may be agreed to by the Parties.

"<u>Creation Units</u>" shall mean units ordinarily issued for the purchase and redemption of Shares of the BFA Recipient only in aggregations of Shares (currently 40,000 Shares, which amount can be changed over time).

"<u>Custody Services</u>" means the Services provided under <u>Article 3</u>.

"<u>Damages</u>" means all damages, fines, penalties, deficiencies, losses, and liabilities (including judgments and amounts reasonably paid in settlement).

"<u>Data Security Breach</u>" has the meaning given in <u>17.1(c)</u>.

"<u>Digital Asset</u>" means any digital unit or other form of digitally stored medium of representation of value that is recorded on a cryptographically secured distributed ledger or other decentralized system using cryptography in which transactions are verified and records maintained.

"<u>Digital Asset Laws</u>" means applicable Laws with respect to the use and treatment of Digital Assets, including Laws applicable to Digital Asset networks, cryptography, open source technology and protocols.

"<u>Disclosees</u>" has the meaning given in <u>Section 14.2</u>.

"<u>Disengagement Assistance</u>" has the meaning given in <u>Section 11.1</u>.

"<u>Distributor</u>" means the entity engaged by a BFA Recipient to distribute the BFA Recipient's Shares.

"<u>Divested Entity</u>" has the meaning given in <u>Section 11.2</u>.

"<u>DTC</u>" means the Depository Trust Company.

"<u>Effective Date</u>" has the meaning given in the preamble.

"<u>Equipment</u>" means equipment and hardware, including computers and related equipment, such as central processing units and other processors, servers, controllers, modems, communications and telecommunications equipment (voice, data and video networks and datalines), cables, storage devices, printers, terminals, other peripherals and input and output devices, and other tangible mechanical and electronic equipment intended for the processing, input, output, storage, manipulation, communication, transmission and retrieval of information and data.

"<u>Exchange Act</u>" means the Securities Exchange Act of 1934, as amended.

"<u>Extension Period</u>" has the meaning given in <u>Section 10.1(c)</u>.

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"<u>FDIC</u>" means the Federal Deposit Insurance Corporation.

"<u>Feedback</u>" means any feedback, comments or suggestions provided by BFA or any BFA Recipient regarding any Independent Work of Provider or any of its Affiliates or Subcontractors.

"<u>Feedback Intellectual Property</u>" means any Intellectual Property Rights that Provider or any of its Affiliates or Subcontractors (or any Provider Personnel) creates, whether alone or jointly with others, after the Effective Date that is based on, incorporates or otherwise results from, refers to or relies on any Feedback.

"<u>Fees</u>" has the meaning given in <u>Section 9.1(a)</u>.

"<u>FERSA</u>" means the Federal Employees' Retirement System Act of 1986.

"<u>Force Majeure Event</u>" has the meaning given in <u>Section 25.1(a)</u>.

"<u>Fund Administration and Accounting Services</u>" means the Services provided under <u>Article 4</u>.

"<u>Furnishing Party</u>" has the meaning given in <u>Section 18.1(a)(i)</u>.

"<u>Governmental Authority</u>" means any federal, state, municipal, local, territorial or other government department, regulatory authority, judicial or administrative body, domestic, international or foreign.

"<u>Indemnified Party</u>" has the meaning given in <u>Section 21.5(a)</u>.

"<u>Indemnifying Party</u>" has the meaning given in <u>Section 21.5(a)</u>.

"<u>Industry Event</u>" means large-scale failure, malfunction or error of any third party telecommunications, electrical, mechanical, or technological infrastructure, service or system or other event that results in the closure of any securities, cash or other market(s) in which BFA Recipients participate.

"<u>Initial Term</u>" has the meaning given in <u>Section 10.1(a)</u>.

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"<u>Intellectual Property Rights</u>" means all right, title and interest in and to intellectual and industrial property rights recognized in any jurisdiction, including (a) patents, patent applications, statutory invention registrations, registered designs and similar or equivalent rights in inventions and designs, and all rights therein provided by international treaties and conventions, and all related continuations, continuations-in-part, divisionals, reissues, re-examinations, renewals, substitutions and extensions (including any supplemental protection certificate); (b) trademarks, trade dress, trade names, brand names, corporate names, service marks, certification marks, designs, logos, slogans and other indications of origin, the goodwill associated with the foregoing and registrations in any jurisdiction of, and applications in any jurisdiction to register, the foregoing, including any extension, modification or renewal of any such registration or application; (c) registered and unregistered copyrights, works of authorship (including rights in Software as a work of authorship), (d) copyrightable works (published or unpublished) and all applications and registrations therefor; (e) Software; (f) Trade Secrets; (g) moral rights, economic rights, database rights, design rights, industrial property rights, publicity rights, and privacy rights; (h) rights associated with domain names, uniform resource locators, Internet Protocol addresses, social media handles and other names, identifiers, and locators associated with Internet addresses, sites and services; (i) other similar or equivalent intellectual property rights anywhere in the world; and (j) all actions and rights to sue at law or in equity for past, present and future infringement, misappropriation, dilution or other violation or impairment of any of the foregoing, including the right to receive all proceeds and damages therefrom, and all rights to obtain renewals, continuations, divisionals or other extensions of legal protections pertaining thereto.

"<u>Investment Advisor</u>" means the investment advisor or investment manager of a BFA Recipient.

"<u>JAMS</u>" has the meaning given in <u>Section 23.2</u>.

"<u>Key Performance Indicators</u>" means the Service Levels that are designated as "critical service levels" in a Service Level Schedule.

"<u>Key Provider Position</u>" means positions of Provider identified in <u>Exhibit C</u>, as such list is amended from time to time.

"<u>Law</u>" means any of the following, now existing or hereafter enacted, and in each case as applicable to the Services: (a) country, state, provincial, local or other law or statute, (b) rule or regulation issued by a regulatory body, (c) written or authoritative interpretation by a regulatory body of any such law, statute, rule or regulation, (d) enforceable regulatory guidance, judicial, governmental, or administrative order, judgment, decree or ruling, or written and enforceable requirements of self-regulatory bodies and organizations, or (e) FERSA, OCC Regulation 9, the USA PATRIOT Act of 2001, as amended, the Bank Secrecy Act, as amended, the Securities Act, or the Exchange Act.

"<u>Losses</u>" means all Damages and expenses (including interest, court costs, reasonable fees and expenses of attorneys, accountants and other experts or other reasonable fees and expenses of litigation or other proceedings or of any claim, default or assessment).

"<u>Malicious Code</u>" means any code, program, or sub-program whose known or intended purpose is to damage or interfere with the operation of the computer system containing the code, program or sub-program, or to halt, disable or interfere with the operation of the software, code, program, or sub-program, itself.

"<u>Manager Mark</u>" has the meaning given in <u>Section 4.2(a)</u>.

"<u>Net Asset Value</u>" shall mean total assets less total liabilities, including unrealized profits and losses on open positions, accrued income and expense, calculated in a manner more fully described in each BFA Recipient's Prospectus.

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"<u>New Country Location</u>" has the meaning given in <u>Section 7.4</u>.

"<u>New Services</u>" means services that are materially different from, and in addition to or outside the scope of, the then-existing Services. New Services will not include any work: (i) comprising the "Services" (as defined herein) or that is an inherent, necessary or customary part thereof; (ii) that Provider requires to meet the Standard of Care; or (iii) that can be completed using existing Provider resources without impacting the Service Levels.

"<u>NFA</u>" means the National Futures Association.

"<u>Notification Related Costs</u>" has the meaning given in <u>Section 13.2(g)</u>.

"<u>OCC Regulation 9</u>" means the Office of the Comptroller of the Currency's regulations on fiduciary activities codified in 12 CFR Part 9.

"<u>On-book Accounts</u>" has the meaning given in <u>Section 3.2(a)</u>.

"<u>Party</u>" or "<u>Parties</u>" has the meaning given in the preamble.

"<u>Permitted Delegation</u>" means any of the following delegations by Provider of its obligations under this Agreement: (a) the use of third party providers with respect to technology (except with respect to specific technology that is contracted for hereunder) and technology development; (b); use of locations identified by Provider in accordance with <u>Section 7.4</u>; and (c) the delegation of any of its obligations to any Affiliate of Provider.

"<u>Persistent or Pervasive Breach</u>" has the meaning given in <u>Section 10.3(a)(i)(B)</u>.

"<u>Personal Information</u>" has the meaning given in <u>Section 14.1(a)</u>.

"<u>Project</u>" has the meaning given in the Change Procedures.

"<u>Proper Instructions</u>" means (a) instructions given by an Authorized Person in such form and manner as Provider and the applicable BFA Recipient will agree upon from time to time, (b) instructions (which may be continuing instructions) regarding other matters signed or initialed by an Authorized Person, and (c) instructions received by Provider in accordance with agreed upon authentication procedures.

"<u>Prospectus</u>" has the meaning given in <u>Section 5.1</u>.

"<u>Provider</u>" has the meaning given in the preamble to this Agreement.

"<u>Provider Affiliate</u>" means an Affiliate of Provider.

"<u>Provider Confidential Information</u>" has the meaning given in <u>Section 18.1(a)(iii)</u>.

"<u>Provider Infringement Items</u>" has the meaning given in <u>Section 21.1(c)</u>.

"<u>Provider Laws</u>" means all Laws that are directly applicable to Provider and related to the Services.

"<u>Provider Personnel</u>" has the meaning given in <u>Section 7.1</u>.

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"<u>Provider Technology</u>" means (a) collectively, the systems and application software, middleware, communications links and other devices and technology, owned or controlled by Provider and used in the performance of the Services, and (b) Provider Third Party Technology.

"<u>Provider Third Party Technology</u>" means the hardware, systems and application software, middleware, communications links and other devices and technology owned or controlled by third parties and licensed to Provider and that Provider may use from time to time in the performance of the Services.

"<u>Purposes</u>" has the meaning given in <u>Section 14.2</u>.

"<u>Receiving Party</u>" has the meaning given in <u>Section 18.1(a)(i)</u>.

"<u>Renewal Term</u>" has the meaning given in <u>Section 10.1(b)</u>.

"<u>Required BFA Recipient Records</u>" has the meaning given in <u>Section 17.5</u>.

"<u>Sanctions</u>" means economic sanctions and other Laws, executive orders and regulations promulgated, administered or enforced by the United States and the Office of Foreign Assets Control, the United Nations, the European Union, and His Majesty's Treasury of the United Kingdom or other applicable sanctions authority.

"<u>SEC</u>" means the Securities and Exchange Commission.

"<u>Securities Act</u>" means the Securities Act of 1933, as amended.

"<u>Security</u>" will have the same meaning as when such term is used in the Securities Act, including, without limitation, any note, stock, treasury stock, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit sharing agreement, collateral-trust certificate, pre-organization certificate or subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit for a security, fractional undivided interest in oil, gas, or other mineral rights, any put, call, straddle, option, or privilege on any security, certificate of deposit, or group or index of securities (including any interest therein or based on the value thereof), or any put, call, straddle, option, or privilege entered into on a national securities exchange relating to a foreign currency, or, in general, any interest or instrument known as a "security" or a "financial asset" (each as defined in the UCC) or any certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to, or option contract to purchase or sell any of the foregoing, and futures, forward contracts and options thereon.

"<u>Service Level Schedules</u>" means the schedules that describe the Service Levels and Key Performance Indicators and the respective obligations of Provider and the applicable BFA Recipients in relation thereto.

"<u>Service Levels</u>" means the Service levels and Key Performance Indicators and the respective obligations of Provider and the applicable BFA Recipients in relation thereto.

"<u>Services</u>" has the meaning given in <u>Section 2.1</u>.

"<u>Shareholders</u>" has the meaning given in <u>Section 5.1</u>.

"<u>Shares</u>" has the meaning given in <u>Section 5.1</u>.

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"<u>SOC</u><u> </u><u>1</u>" means the AICPA System and Organizational Controls for Service Organizations – SOC 1: Report on Controls at a Service Organization Relevant to User Entities' Internal Control over Financial Reporting audit, as amended or superseded or replaced from time to time, or other modified or replacement or successor report

"<u>SOC</u><u> </u><u>2</u>" means the AICPA System and Organizational Controls for Service Organizations – SOC 2: Reporting on an Examination of Controls at a Service Organization Relevant to Security, Availability, Processing Integrity, Confidentiality, or Privacy audit, as amended or superseded or replaced from time to time, or other modified or replacement or successor report.

"<u>Software</u>" means all computer programs (whether in source code, object code, human readable form or other form), code (including software implementations of algorithms, models and methodologies), applications, application programming interfaces, firmware, software development kits, library functions, operating systems and virtualization environments, user interfaces, diagnostic tools, compilers and version control systems, together with all boot, compilation, configuration, debugging, performance analysis and runtime files, libraries and documentation, including user manuals and training materials, related to any of the foregoing.

"<u>Standard of Care</u>" has the meaning given in <u>Section 6.1</u>.

"<u>Subcontractor</u>" means any Affiliate or other agent, subcontractor or consultant of Provider that Provider engages to perform any of its obligations under this Agreement, including Permitted Delegations, but excluding, for the avoidance of doubt, Authorized Data Sources, or Third Party Market Utility Providers.

"<u>Taxes</u>" has the meaning given in <u>Section 9.3</u>.

"<u>Term</u>" has the meaning given in <u>Section 10.1(a)</u>.

"<u>Third Party Market Utility Provider</u>" means any provider (not being an Authorized Data Source or Third Party Provider) of (i) generally used industry messaging and payment transfer systems (including SWIFT, CHIPS and CHAPS) and (ii) market facilities and infrastructure generally used by the financial investment intermediary industry including investment exchanges, alternative trading systems, clearing houses, securities and investment depositories and systems for the settlement of transactions in relation to securities, investments and foreign exchange.

"<u>Third Party Provider</u>" means any provider of services to any BFA Recipient (other than Provider, a Subcontractor or delegate), including, without limitation, any investment adviser or sub-adviser, custodian, Distributor, dealer, transfer agent, administrator, accounting agent or fiduciary in respect thereof. For avoidance of doubt, any Digital Asset custodian shall be considered a Third Party Provider.

"<u>Trade Secrets</u>" means trade secrets, know-how and industrial secret rights, rights in confidential information (including technical information, inventions and invention disclosures (whether or not patented or patentable and whether or not reduced to practice), data (including user data, whether in identifiable or anonymized form), databases, data collections, designs, processes, testing procedures, testing results and business, financial, sales and marketing plans) and other proprietary intellectual property rights in any jurisdiction with respect to the foregoing, in each case, that derives independent economic value, whether actual or potential, from not being generally known to other persons.

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"<u>Transfer Agency Services</u>" means the Services provided under <u>Article 5</u>.

"<u>Transfer Taxes</u>" has the meaning given in <u>Section 9.3(d)</u>.

"<u>UCC</u>" means the Uniform Commercial Code as in effect from time to time in the State of New York.

"<u>VAT</u>" has the meaning given in <u>Section 9.3</u>.

"<u>Work Product</u>" means any Intellectual Property Rights conceived, created or produced by Provider Personnel, whether alone or jointly with others, in the course of (i) performing the Services or (ii) otherwise created, developed or invented in connection with this Agreement at or upon the request or requirement of BFA or any BFA Recipient for the use of BFA or any BFA Recipient(s), including, in each case of (i) or (ii), any modifications, enhancements or derivative works thereof or based thereon, and in each case of (i) or (ii), that is the subject of a Project request pursuant to Section 2.1 of Exhibit B, but excluding, in each case of (i) and (ii), any (x) Independent Work of Provider or its Affiliates or Subcontractors, (y) data and information of Authorized Data Sources, or (z) Provider Third Party Technology that is incorporated therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.** **MISCELLANEOUS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.1** **Force Majeure.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Neither Party will be liable for failure to perform or delay in performing its obligations to the extent such failure or delay is caused by or resulting from fire, flood, earthquake, elements of nature or acts of God, wars, riots, civil disorders, rebellions or revolutions, acts of terrorism, pandemics, nationalization, expropriation, currency restrictions, political risk (including exchange control restrictions, confiscation, insurrection, civil strife or armed hostilities) to the extent beyond such Party's reasonable control, or other facts or circumstances beyond such Party's reasonable control (a " <u>Force Majeure Event</u> "); <u>provided</u> that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the non-performing Party (and such Party's Subcontractors or Third Party Providers, as applicable) are without material fault in causing the default or delay;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the default or delay could not have been prevented by reasonable precautions and cannot reasonably be circumvented by the non-performing Party through the use of alternate sources, workaround plans or other means (including, with respect to Provider, the implementation of any business continuity or disaster recovery plan required to be maintained by it under this Agreement); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the non-performing Party uses Commercially Reasonable Efforts to minimize the impact of such default or delay.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Provided that Provider has exercised reasonable care and diligence and complied with its obligations to implement its disaster recovery and business continuity plan and reasonable work-arounds to mitigate the effect of a Force Majeure Event, a Force Majeure Event will include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) an Industry Event; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any industry-wide strike, lockout or labor dispute involving a Party's personnel or refusal of such Party's employees to enter a facility that is the subject of such a labor dispute, to the extent such refusal is based upon a reasonable fear of harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Provider will not be entitled to any additional payments from any BFA Recipients (or BFA, on behalf of any BFA Recipients), for costs or expenses incurred by Provider as a result of any Force Majeure Event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Notwithstanding the provisions of <u>Section 25.1(a)</u>, the BFA Recipients will have the termination right provided in <u>Section 10.3(a)(ii)</u> with respect to Force Majeure Events.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.2** **Business Continuity.** Provider will develop, maintain and regularly test a business continuity plan (a " <u>BCP Plan</u> ") that is designed to provide reasonable assurances regarding the continued operation of the Services to BFA Recipients in the event of a business interruption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.3** **Parties** ' **Relationship.** The Parties hereto are independent parties. Provider, in furnishing the Services, is acting as an independent contractor. Provider has the sole right and obligation to supervise, manage, contract, direct, procure, perform or cause to be performed all work to be performed by Provider Personnel under this Agreement. At no time will any Provider Personnel represent himself or herself as an employee of any BFA Recipient or BFA, or be considered an employee of any BFA Recipient or BFA. Provider is not a joint venturer with, nor an employee or partner of any BFA Recipient or BFA, and has no authority to represent or bind any BFA Recipient or BFA as to any matters, except as expressly authorized in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.4** **Assignment.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>By Provider</u>. Provider acknowledges and agrees that the Services are personal in nature. Without the prior written consent of all affected BFA Recipients (which consent may be withheld in any BFA Recipient's sole discretion), Provider will not have the right to transfer or assign its rights or obligations under this Agreement, except as part of a resolution or other insolvency proceeding for such Provider or a parent entity thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>By BFA Recipient</u>. Each BFA Recipient will have the right in its sole discretion to transfer or assign its rights or obligations under this Agreement (in whole or in part) upon the provision of prior written notice to Provider, to: (i) any Affiliate of such BFA Recipient so long as the assignee remains an Affiliate of a BFA Recipient; (ii) a purchaser of all or substantially all of the capital stock or assets of a BFA Recipient, provided that such purchaser or entity agrees in writing to be bound by this Agreement with respect to the applicable Services; or (iii) an entity with which a BFA Recipient consolidates or merges. In such circumstances, each such BFA Recipient shall remain primarily liable for its obligations under this Agreement, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.5** **Public Disclosures.** Except as: (a) required by Law; (b) required to discharge its obligations under this Agreement; (c) permitted pursuant to <u>Section</u> <u> </u> <u>7.1(i)(iii)</u> herein; (d) permitted pursuant to <u>Section 18.1(c)</u>; or (e) otherwise permitted upon the written consent of the other Party, neither Party will use or announce, release, disclose, or discuss with any third parties, information regarding this Agreement or the Services, including the other Party's name or trademark in any media releases, advertising or marketing materials, without the other Party's prior consent. Use of any trademarks or service marks of any Party (or marks of related companies) by the other Party is prohibited, unless the Parties otherwise agree in writing. Any grants of publicity rights to Provider by a BFA Recipient hereunder may not exceed twelve (12) months and may be renewed only upon written approval of such BFA Recipient. Nothing in this <u>Section 25.5</u> shall preclude a BFA Recipient or BFA from identifying Provider as its service provider.

Master Services Agreement CONFIDENTIAL

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.6** **No Waiver.** No failure, delay or omission by a Party to exercise any right, remedy or power it has hereunder will impair or be construed as a waiver of such right, remedy or power. A waiver by any Party of any breach or covenant will not be construed to be a waiver of any succeeding breach or any other covenant. All waivers will be in writing and signed by an authorized representative of the waiving Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.7** **Remedies Cumulative.** Except as otherwise set forth herein: (a) all remedies provided for herein will be cumulative and in addition to and not in lieu of any other remedies available to either Party at law, in equity or otherwise, and (b) the election by a Party of any remedy provided for herein or otherwise available to such Party will not preclude such Party from pursuing any other remedies available to such Party at law, in equity, by contract or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.8** **Covenant of Good Faith.** Each Party, in its dealings with the other Party under or in connection with this Agreement, will act reasonably and in good faith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.9** **Notices.** Any formal notice, consent, approval, acceptance, agreement or other communication given pursuant to this Agreement will be in writing and will be effective either when delivered personally to the Party for whom intended, by email (with confirmation of delivery) or overnight delivery services (with confirmation of delivery) (unless delivered after normal business hours, in which case it will be deemed the next Business Day), addressed to such Parties as specified below. A Party may designate a different address by notice to the other Party given in accordance herewith.

---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For BFA or a BFA Recipient: | BlackRock Fund Advisors |
|  | 400 Howard Street |
|  | San Francisco, CA 94105 |
|  | Attention: Derek Stein |
|  | Email: [\*\*\*] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;with copy (which shall not |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;constitute notice) to: | BlackRock Fund Advisors |
|  | 400 Howard Street |
|  | San Francisco, CA 94105 |
|  | Attention: General Counsel |
|  | Email: [\*\*\*] |
|  | and |
|  | BlackRock, Inc. |
|  | 55 East 52<sup>nd</sup> Street |
|  | New York, NY 10022 |
|  | Attention: Phil Evans |
|  | Email: [\*\*\*] |

---

Master Services Agreement CONFIDENTIAL

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---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For Provider: | The Bank of New York Mellon |
|  | 240 Greenwich Street |
|  | New York, NY 10286 |
|  | Attention: Mark Moor |
|  | Email: [\*\*\*] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;with copy (which shall not |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;constitute notice) to: | The Bank of New York Mellon |
|  | 240 Greenwich Street |
|  | New York, NY 10286 |
|  | Attention: General Counsel |
|  | Email: [\*\*\*] |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.10** **Governing Law/Proceedings.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Governing Law</u>. The Parties irrevocably agree that any legal action, suit or proceeding arising out of this Agreement will be brought solely and exclusively in the State of New York. This Agreement will be construed and governed under and in accordance with the Laws of the State of New York, without regard to its conflict of law provisions. All disputes arising out of this Agreement will be exclusively resolved in a court of competent jurisdiction in the State of New York. Each Party expressly consents to the jurisdiction of the U.S. District Court for the Southern District of New York, and waives any objections or right as to *forum non conveniens*, lack of personal jurisdiction or similar grounds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Certain Laws Not Applicable</u>. The Parties agree that, to the extent permitted under applicable Law, the provisions of the Uniform Computer Information Transactions Act, the Electronic Signatures in Global and National Commerce Act, the Uniform Electronic Transactions Act, the U.N. Convention on Contracts for the International Sale of Goods, any federal or state statutory adoptions or equivalents of the aforementioned Acts and Convention, and any other state or federal laws related to electronic contracts or electronic signatures will not apply to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Proceedings</u>. Provider will, except to the extent legally impermissible, advise all affected BFA Recipients of actual legal or other proceedings relating to the Services of which Provider becomes aware and that materially adversely affect Provider's ability to meet its obligations under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party expressly waives any right to a trial by jury with respect to any dispute arising out of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.11** **Third Party Beneficiaries.** There will be no third party beneficiaries under this Agreement, except for Affiliates of the BFA Recipients that are receiving the benefit of Services, or as required by Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.12** **Waiver of Liens.** Provider shall not have any power or authority to assign, hypothecate, pledge, or otherwise dispose of any Cash Assets of a BFA Recipient in Provider's "control" (within the meaning of UCC Sections 8-106, 9-104 or 9-106), except pursuant to Proper Instructions from a BFA Recipient or as may be agreed to by the Parties from time to time, and the Cash Assets shall not be subject to any lien or charge of any kind in favor of Provider or any person claiming through Provider, except as may be agreed to by the Parties from time to time. Provider, for itself, its employees, permitted Subcontractors and materialmen, hereby waives and relinquishes all right to file, have or maintain a mechanic's or similar claim or lien against any property of any BFA Recipient or any part thereof for or on account of the work or any materials or equipment furnished hereunder. Except as may be agreed to by the Parties from time to time, Provider will not create or permit to be created or remain any lien, encumbrance or charges levied on account of any mechanic's lien or claim that may become a lien, encumbrance or charge upon any of the Cash Assets of any BFA Recipient or any part thereof.

Master Services Agreement CONFIDENTIAL

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.13** **Conflicts of Interest.** Provider will maintain procedures and controls to prevent conflicts of interest within its custody, fund accounting, fund administration and transfer agency businesses from adversely affecting the BFA Recipients.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.14** **Rules of Construction.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Entire Agreement</u>. This Agreement, consisting of these general terms and conditions and the attached <u>Exhibit A</u> through <u>Exhibit F</u> and <u>Schedule 1-A</u> through <u>Schedule 3</u>, constitute the sole and entire agreement among the Parties with respect to the subject matter hereof. This Agreement merges, integrates and supersedes all prior and contemporaneous discussions, agreements and understandings between the Parties, whether written or oral, with respect to the matters contained herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Use of Certain Words</u>. Unless the context requires otherwise: (i) "including" (and any of its derivative forms) means including but not limited to; (ii) "may" means has the right, but not the obligation to do something and "may not" means does not have the right to do something; (iii) "will" and "shall" are expressions of command, not merely expressions of future intent or expectation; (iv) "written" or "in writing" is used for emphasis in certain circumstances, but that will not derogate from the general application of the notice requirements set forth in <u>Section</u> <u> </u> <u>25.9</u> in those and other circumstances; and (v) use of the singular imports the plural and vice versa.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Construction of Objectives</u>. The objectives set forth in <u>Section 1.2</u> or elsewhere in this Agreement provide a general introduction to this Agreement or the terms set forth in a particular Section of this Agreement. They are not intended to alter the plain meaning of this Agreement or to expand the scope of the Parties' express obligations under it.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Interpretation</u>. The terms and conditions of this Agreement are the result of negotiations between the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Headings and Article, Section and Exhibit References</u>. The Article and Section headings, **Table of Contents**, and Table of Exhibits are for reference and convenience only and will not be considered in the interpretation of this Agreement. Unless otherwise indicated, Article or Section references are to Articles or Sections of the document in which the reference is contained. References to numbered Articles or Sections of this Agreement also refer to and include all subsections of the referenced Article or Section. References to Exhibits of this Agreement also refer to and include all Attachments of the referenced Exhibit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Order of Precedence</u>. If a conflict occurs between this Agreement and any Exhibit to this Agreement, the terms of this Agreement will prevail to the extent necessary to resolve the conflict.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Survival</u>. Any and all provisions of this Agreement which by their nature or effect are required or intended to be observed, kept, or performed after the expiration or termination of this Agreement will survive the expiration or any termination of this Agreement and remain binding upon and for the Parties' benefit.

Master Services Agreement CONFIDENTIAL

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Severability</u>. If any provision of this Agreement is found by a court of competent jurisdiction to be invalid, illegal, or otherwise unenforceable, the same will not affect the other terms or provisions hereof or the whole ofi this Agreement, but such term or provision will be deemed modified to the extent necessary in the court's opinion to render such term or provision enforceable, and the Parties' rights and obligations will be construed and enforced accordingly, preserving to the fullest permissible extent the Parties' intent and agreements set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Amendment</u>. This Agreement may be amended or modified solely in a writing signed by an authorized representative of each Party. Any terms and conditions varying from the terms and conditions hereof on any order or written notification from either Party will not be effective or binding on the other Party unless agreed to in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Counterparts</u>. This Agreement may be executed in any number of counterparts, each of which will be deemed an original, but all of which taken together will constitute one single agreement between the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.15** **Amendments to Agreement.** Nothing contained within this Agreement will prevent the Parties from agreeing to additional provisions in writing from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.16** **Separate Agreement**. Execution of this Agreement by a BFA Recipient on behalf of each of its funds or series (severally and not jointly) shall not create any contractual or other obligation between or among such funds or series or any other BFA Recipient (or their respective funds or series), and this Agreement shall constitute a separate agreement among Provider, BFA and each BFA Recipient on behalf of each of its funds or series. Every reference to a BFA Recipient shall be construed to be a reference solely to the particular BFA Recipient (and each of its funds and series severally) that is a party to the relevant transaction or action. Each of the Parties agrees that under no circumstances shall any rights, obligations, remedies or liabilities of a particular BFA Recipient, or with respect to transactions or actions to which a particular BFA Recipient is a party, be deemed to constitute rights, obligations, remedies or liabilities applicable to any other BFA Recipient or to transactions or actions to which other BFA Recipients are parties, and Provider shall have no right to set off claims of any BFA Recipient against any other BFA Recipients. All transactions and actions are entered into in reliance on the fact that this Agreement constitutes a separate agreement among Provider, BFA on behalf of each BFA Recipient and each BFA Recipient.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**25.17** **Individual Fund Basis/Limitation on Liability**. This Agreement is executed by BFA on behalf of each BFA Recipient, and the obligations hereunder are not binding upon any of the trustees, directors, officers or shareholders of BFA, any BFA Recipient or any series (as applicable), individually.

**[Signature Pages Follow]**

Master Services Agreement CONFIDENTIAL

------

**IN WITNESS WHEREOF**, each Party hereto has executed or caused this Master Services Agreement to be executed as of the date set forth above by its duly authorized representative.

BLACKROCK FUND ADVISORS, acting on

behalf of itself and each BFA Recipient listed in

<u>Exhibit A</u> to this Master Services Agreement

By: <u>/s/ Shannon Ghia</u><u> </u><u> </u><u> </u>

Name: Shannon Ghia

Title: Managing Director

**THE BANK OF NEW YORK MELLON**

By: <u>/s/ Linda Roth</u><u> </u><u> </u><u> </u>

Name: Linda Roth

Title: Managing Director

Master Services Agreement CONFIDENTIAL <br> [Signature Page]

## Exhibit 10.7

**Exhibit 10.7**

AMENDMENT TO THE BFA MASTER SERVICES AGREEMENT

This Amendment is an amendment to the BFA Master Services Agreement by and among The Bank of New York Mellon ("BNY Mellon"), each BFA recipient listed in Exhibit A (each, a "BFA Recipient") and BlackRock Fund Advisors ("BFA") dated October 24, 2023 (the "Agreement").

The effective date of this Amendment is as of January 6, 2026.

Intending to be legally bound, BNY Mellon and BFA hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The entity named below is hereby added to Exhibit A, List of BFA Recipients:

**iShares Staked Ethereum Trust ETF**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Exhibit A to the Agreement is hereby amended and restated in its entirety as set forth in Exhibit A attached hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The parties hereto expressly agree that this Amendment may be executed in one or more counterparts and expressly agree that such execution may occur by manual signature on a physically delivered copy of this Amendment, by a manual signature on a copy of this Amendment transmitted by facsimile transmission, by a manual signature on a copy of this Amendment transmitted as an imaged document attached to an email, or by "Electronic Signature", which is hereby defined to mean inserting an image, representation, or symbol of a signature into an electronic copy of this Amendment by electronic, digital, or other technological methods. Each counterpart executed in accordance with the foregoing will be deemed an original, with all such counterparts together constituting one and the same instrument. The exchange of executed counterparts of this Amendment or of executed signature pages to counterparts of this Amendment, in either case by facsimile transmission or as an imaged document attached to an email transmission, will constitute effective execution and delivery of this Amendment and may be used for all purposes in lieu of a manually executed and physically delivered copy of this Amendment.

Each party hereto has caused this Amendment to be executed by its duly authorized representative indicated below. An authorized representative, if executing this Amendment by Electronic Signature, affirms authorization to execute this Amendment by Electronic Signature and that the Electronic Signature represents an intent to enter into this Amendment and an agreement with its terms.

Agreed:

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| | | | |
|:---|:---|:---|:---|
| BLACKROCK FUND ADVISORS, acting on behalf of itself and each BFA Recipient listed in <u>Exhibit A</u> | BLACKROCK FUND ADVISORS, acting on behalf of itself and each BFA Recipient listed in <u>Exhibit A</u> | The Bank of New York Mellon | The Bank of New York Mellon |
| By: | /s/Shannon Ghia | By: | /s/KevinC. Browne |
| Name: | Shannon Ghia | Name: | Kevin Browne |
| Title: | Managing Director | Title: | Senior Vice President |

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------

EXHIBIT A

Revised as of January 6, 2025

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The iShares Bitcoin Trust, a Delaware statutory trust

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The iShares Ethereum Trust, a Delaware statutory trust

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. iShares Staked Ethereum Trust ETF

## Exhibit 10.8

**Exhibit 10.8**

**ETF SERVICES AGREEMENT**

**THIS ETF SERVICES AGREEMENT** (this "<u>Agreement</u>") is made as of this 16th day of January 2026, by and among the iShares Staked Ethereum Trust ETF, a Delaware statutory trust ("<u>Company</u>"), BlackRock Fund Advisors ("<u>BFA</u>"), acting as administrative trustee on behalf of Company, and BlackRock Investments, LLC ("<u>BRIL</u>"), a Delaware limited liability corporation.

**WHEREAS,** the Company's shares of beneficial interest ("<u>Shares</u>") are registered with the SEC under the Securities Act of 1933, as amended (the "<u>1933 Act</u>"); and

**WHEREAS,** the Company create and redeem Shares on a continuous basis at its net asset value only in aggregations constituting Creation Units with Authorized Participants (each, as defined in the current Prospectus applicable to the Company, as such term is defined in <u>Section</u><u> </u><u>3.02(g)</u>); and

**WHEREAS,** BRIL is registered as a broker-dealer with the SEC under the Securities Exchange Act of 1934, as amended (the "<u>1934</u><u> </u><u>Act</u>"), and is a member of the Financial Industry Regulatory Authority, Inc. ("<u>FINRA</u>"); and

**WHEREAS,** BRIL and its affiliates have developed an ETF servicing platform (the "<u>ESP</u>") to facilitate the provision of certain order processing and other services with respect to the issuance and distribution of Creation Units (the "<u>ETF Services</u>") for the Company; and

**WHEREAS,** the Company desires to retain BRIL to provide the ETF Services as set forth in this Agreement.

**NOW, THEREFORE,** in consideration of the mutual covenants hereinafter contained and intending to be legally bound, the parties hereby agree as follows:

---

| | |
|:---|:---|
| **SECTION 1** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**APPOINTMENT; ETF SERVICES; MIGRATION** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.01 <u>Appointment</u>. The Company hereby appoints BRIL to provide the ETF Services for the Company in accordance with the terms set forth in this Agreement. BRIL accepts such appointment and agrees to furnish certain related services as set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.02 <u>ETF Services</u>. BRIL will perform for the Company the ETF Services as set out in <u>Exhibit A</u> hereto, as may be amended from time to time. BRIL agrees to use its best efforts to perform the ETF Services on a continuous basis.

---

| | |
|:---|:---|
| **SECTION 2** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**SERVICE LEVELS** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.01 <u>Service Levels</u>. <u>Exhibit B</u>, as may be amended from time to time, sets forth the Service Levels applicable to the ETF Services. "<u>Service Levels</u>" means the ETF Service levels and Key Performance Indicators and the respective obligations of BRIL and the Company in relation thereto. "<u>Key Performance Indicators</u>" means the Service Levels that are designated as "critical service levels" in <u>Exhibit</u><u> </u><u>B</u>. BRIL will perform the ETF Services in accordance with the Service Levels. Subject to the terms and conditions of this Agreement, each party will perform its obligations under the <u>Exhibit B</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.02 <u>Governance, Meetings and Reports</u>. BRIL acknowledges and agrees that one of the key business requirements of the Company is for BRIL to provide the ETF Services in a consistent, integrated manner. To meet such requirement, BRIL will organize its relationship with the Company and its service delivery team in accordance with the processes and procedures set forth in <u>Exhibit B</u> and this <u>Section</u><u> </u><u>2</u>. BRIL and BFA, on behalf of the Company, will meet bi-annually to discuss the performance of the ETF Services and mutually agree to any changes to the Service Levels as necessary to accurately reflect the then-current Service Levels. During such bi-annual discussions, the parties shall review the Service Levels and make adjustments to them as appropriate to reflect changing business needs or improved performance capabilities associated with advances in technology and methods used to perform the ETF Services. BRIL and BFA, on behalf of the Company, will meet annually to discuss and mutually agree to any changes to the ETF Servicing Fees (as defined in <u>Section</u><u> </u><u>4.01</u>), subject to approval by the Company.

---

| | |
|:---|:---|
| **SECTION 3** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**REPRESENTATIONS, WARRANTIES AND COVENANTS** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.01 <u>Representations, Warranties and Covenants of the Company</u>. The Company represents, warrants and covenants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) it is duly organized, validly existing and in good standing under the laws of the state of its formation, and has all requisite power under the laws of such state and applicable federal law to conduct its business as now being conducted and to perform its obligations as contemplated by this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) this Agreement when executed and delivered by the Company, will constitute a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws relating to or affecting creditors' rights and to general equity principles (whether enforcement is sought by proceedings in equity or at law);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) it is not a party to any, and there are no, pending or, to the Company's knowledge, threatened legal, administrative, arbitral or other proceedings, claims, actions or governmental or regulatory investigations or inquiries (collectively, "<u>Actions</u>") of any nature against it or its properties or assets which would reasonably be expected to, individually or in the aggregate, have a material adverse effect upon its business or financial condition, and there is no injunction, order, judgment, decree, or regulatory restriction imposed upon it or any of its properties or assets that would prohibit its ability to perform its obligations hereunder, in each case as of the date of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the Company has obtained all registrations required under applicable law to make a public offering of the Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) it is and will continue to be in compliance with all applicable laws and regulations aimed at the prevention and detection of money laundering and/or the financing of terrorism and other criminal activities including without limitation the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, (collectively, the "<u>USA PATRIOT Act</u>") and the applicable rules and regulations adopted by the, U.S. Treasury Department, including the Office of Foreign Asset Control ("<u>OFAC</u>"), Financial Crimes and Enforcement Network ("<u>FinCEN</u>") and the SEC; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) it has an anti-money laundering program ("<u>AML Program</u>"), that at minimum includes, (i) an AML compliance officer designated to administer and oversee the AML Program, (ii) ongoing training for appropriate personnel, (iii) internal controls and procedures reasonably designed to prevent and detect suspicious activity monitoring and terrorist financing activities; (iv) procedures to comply with know your customer requirements and to verify the identity of all customers; and (v) appropriate record keeping procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.02 <u>Representations, Warranties and Covenants of BRIL</u>. BRIL hereby represents, warrants and covenants to the Company as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) it is duly organized, validly existing and in good standing under the laws of the state of its formation, and has all requisite power under the laws of such state and applicable federal law to conduct its business as now being conducted and to perform its obligations as contemplated by this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) it has full power, right and authority to execute and deliver this Agreement; the execution and delivery of this Agreement has been duly and validly authorized and approved by all requisite actions on its part, and no other proceedings on its part are necessary to approve this Agreement; this Agreement has been duly executed and delivered by it; this Agreement constitutes a legal, valid and binding obligation, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws relating to or affecting creditors' rights and to general equity principles (whether enforcement is sought by proceedings in equity or at law);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) it is not a party to any, and there are no, pending or, to BRIL's knowledge, threatened Actions of any nature against it or its properties or assets which would reasonably be expected to, individually or in the aggregate, have a material adverse effect upon its business or financial condition, and there is no injunction, order, judgment, decree, or regulatory restriction imposed upon it or any of its properties or assets that would prohibit its ability to perform its obligations hereunder, in each case as of the date of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) it is registered as a broker-dealer with the SEC under the 1934 Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) it is and will remain in compliance in all material respects with all applicable laws, rules and regulations, including, without limitation, all applicable provisions of the 1934 Act or the rules and regulations of any securities association registered under the 1934 Act and the rules and regulations adopted under the 1934 Act, including without limitation any net capital requirements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) it is a member in good standing of FINRA and will act in material compliance with all applicable FINRA rules as they relate to the ETF Services performed pursuant to this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) it shall not give any information or make any representations relating to the Company other than those contained in the current Prospectus of the Company filed with the SEC or contained in shareholder reports or other material that may be prepared by or on behalf of the Company for BRIL's use. As used in this Agreement, the term, "<u>Prospectus</u>" means the registration statement of the Company as amended or supplemented and currently in effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) it is and will continue to be in compliance with all applicable laws and regulations aimed at the prevention and detection of money laundering and/or the financing of terrorism and other criminal activities including without limitation the USA PATRIOT Act and the applicable rules and regulations adopted by the, U.S. Treasury Department, including OFAC, FinCEN and the SEC;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) it has an AML Program compliant in all material respects with the USA PATRIOT Act, as applicable to its business as a registered broker-dealer, that at minimum includes, (i) an AML compliance officer designated to administer and oversee the AML Program, (ii) ongoing training for appropriate personnel, (iii) internal controls and procedures reasonably designed to prevent and detect suspicious activity monitoring and terrorist financing activities; (iv) procedures to comply with know your customer requirements and to verify the identity of all customers; and (v) appropriate record keeping procedures; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) it will maintain compliance policies and procedures reasonably designed to prevent violations of the federal securities laws with respect to BRIL's provision of ETF Services to the Company under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.01 BRIL will be responsible for collecting from Authorized Participants in connection with transactions involving Creation Units of the Company fees in connection with providing the ETF Services ("<u>ETF Servicing Fees</u>"). BRIL will calculate ETF Servicing Fees at the rates set forth in <u>Exhibit C</u>, as may be amended from time to time. BRIL will also be responsible for collecting from Authorized Participants any costs charged by a Company custodian in connection with transactions involving Creation Units of the Company ("<u>Custody Transaction Costs</u>"). BRIL will reimburse Custody Transaction Costs to BFA to reimburse to Company custodians according to the amounts invoiced by such Company custodians. For the avoidance of doubt, BRIL may collect ETF Servicing Fees and Custody Transaction Costs as a single fee from Authorized Participants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.02 For the ETF Services rendered pursuant to this Agreement, BRIL will be entitled to retain all ETF Servicing Fees. For the avoidance of doubt, BRIL will not be entitled to retain any Custody Transaction Costs other than as required to facilitate reimbursement of Custody Transaction Costs to Company custodians. BRIL, in its sole discretion, may waive ETF Servicing Fees and/or Custody Transaction Costs owed by any Authorized Participant; <u>provided</u> that BRIL will bear any Custody Transaction Costs in the event that BRIL waives such costs for an Authorized Participant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.03 BRIL will pay all of its costs and expenses (other than expenses and costs deemed payable by a Company, as may be set forth in <u>Exhibit C</u> from time to time, and other than expenses which one or more Authorized Participants may bear pursuant to any agreement with BRIL) incurred by it in connection with the performance of the ETF Services. Unless otherwise agreed in <u>Exhibit C</u>, BRIL will be responsible for the compensation of all subcontractors and other agents (in each case, to the extent selected by BRIL).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.04 BRIL will be entitled to no other compensation pursuant to this Agreement other than the ETF Servicing Fees and any amounts that BRIL is expressly permitted to charge Authorized Participants under the terms of this Agreement. Notwithstanding anything in this Agreement to the contrary, BRIL and its affiliates may receive compensation or reimbursement from a Company or BFA with respect to any services not included under this Agreement, as may be agreed upon by the parties from time to time. Neither the Company (nor BFA, on behalf the Company) will be required to pay BRIL any amounts for or in connection with performing the ETF Services.

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| | |
|:---|:---|
| **SECTION 5** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**STANDARD OF CARE; LIMITATION OF LIABILITY AND INDEMNIFICATION** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.01 It is expressly understood and agreed that in exercising its rights and performing its obligations hereunder, BRIL owes no fiduciary duty to the Company. BRIL shall not be liable for any costs, expenses, damages, liabilities or claims (including reasonable attorneys' and accountants' fees) incurred by the Company, except to the extent those costs, expenses, damages, liabilities or claims result from BRIL's material breach of this Agreement or BRIL's negligence, willful misconduct, bad faith, or reckless disregard of its obligations and duties hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.02 BRIL shall be responsible for the performance only of such duties as are set forth in this Agreement and shall have no responsibility for the actions or activities of any other party, including other service providers, except for any subcontractor engaged by BRIL to provide services hereunder. BRIL shall have no liability for any costs, expenses, damages, liabilities or claims resulting from the performance or nonperformance of its duties hereunder except as provided in <u>Section</u><u> </u><u>5.01</u> above. In no event shall either party be liable to the other for special, indirect, incidental, punitive or consequential damages, including lost profits, of any kind whatsoever arising under or in connection with this Agreement or for any such damages arising out of any act or failure to act hereunder, each of which is hereby excluded by agreement of the parties regardless of whether such damages were foreseeable or whether either party or any entity had been advised of the possibility of such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.03 BRIL shall not be responsible or liable for any failure or delay in performance of its obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its control, including without limitation: fire; flood; earthquake; elements of nature or acts of God; wars; riots; civil disorders; rebellions or revolutions; acts of terrorism; pandemics; nationalization; expropriation; currency restrictions; political risk (including exchange control restrictions; confiscation; insurrection; civil strife or armed hostilities); an "Industry Event," which means large-scale failure, malfunction or error of any third party telecommunications, electrical, mechanical, or technological infrastructure, service or system or other event that results in the closure of any securities, cash or other market(s) in which the Company participates; or any industry-wide strike, lockout or labor dispute involving a party's personnel or refusal of such party's employees to enter a facility that is the subject of such a labor dispute, to the extent such refusal is based upon a reasonable fear of harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.04 The Company shall indemnify and hold BRIL and its directors, officers, employees and agents harmless from all loss, cost, damage and expense, including reasonable fees and expenses for counsel, incurred by BRIL resulting from any claim, demand, action or suit in connection with BRIL entering into this Agreement, any action or omission by it in the performance of its duties hereunder, or as a result of acting upon any instructions reasonably believed by it to have been duly authorized by the Company or upon reasonable reliance on information or records given or made by the Company or BFA; <u>provided</u> that this indemnification shall not apply to actions or omissions of BRIL, or any subcontractor engaged by BRIL to provide services hereunder, or to their respective officers or employees in cases of its or their own negligence or willful misconduct.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.05 The limitation of liability and indemnification contained herein shall survive the termination of this Agreement.

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| | |
|:---|:---|
| **SECTION 6** | &nbsp;&nbsp;&nbsp;&nbsp;**TERM AND TERMINATION** |

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This Agreement will be effective with respect to the Company upon its execution and will continue in force unless terminated as provided herein. This Agreement may be terminated with respect to the Company at any time without penalty upon written notice to BRIL, or by BRIL upon not less than sixty days prior written notice to the other party. In the event the Company gives notice of termination, all reasonable expenses associated with the movement (or duplication) of records and materials and to a successor service BRIL will be borne by the Company to the extent a reasonably detailed invoice of such expenses is provided to the Company. The provisions of <u>Section</u><u> </u><u>7.11</u> shall survive the termination of this Agreement.

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| | |
|:---|:---|
| **SECTION 7** | &nbsp;&nbsp;&nbsp;&nbsp;**MISCELLANEOUS** |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.01 [Intentionally Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.02 <u>Records</u>. The books and records pertaining to the Company, which are in the possession or under the control of BRIL, will be the property of the Company. Such books and records will be prepared and maintained as required under Rules 17a-3 and 17a-4 under the 1934 Act, and other applicable securities laws, rules and regulations. The Company and its authorized persons will have access to such books and records at all times during BRIL's normal business hours. Upon the reasonable request of the Company, BRIL will make available copies of such books and records to the Company or its authorized persons, at the Company's expense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.03 <u>Independent Contractor</u>. BRIL will undertake and discharge its obligations hereunder as an independent contractor. Neither BRIL nor any of its officers, directors, employees or representatives is or will be an employee of a Company in connection with the performance of BRIL's duties hereunder. BRIL will be responsible for its own conduct and the employment, control, compensation and conduct of its agents and employees, and for any injury to such agents or employees or to others through its agents and employees. Any obligations of BRIL hereunder may be performed by one or more third parties or affiliates of BRIL.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.04 <u>Notices</u>. Any formal notice, consent, approval, acceptance, agreement or other communication given pursuant to this Agreement will be in writing and will be effective either when delivered personally to the party for whom intended, by email (with confirmation of delivery) or overnight delivery services (with confirmation of delivery) (unless delivered after normal business hours, in which case it will be deemed the next business day), addressed to such parties as specified below. A party may designate a different address by notice to the other party given in accordance herewith.

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| | |
|:---|:---|
| For BRIL: | BlackRock Investments, LLC |
|  | 1 University Square Drive |
|  | Princeton, NJ 08540 |
|  | Attention: Legal and Compliance |
|  | Email: brokerdealer@blackrock.com |
| For the Company: | BlackRock Fund Advisors |
|  | 400 Howard Street |
|  | San Francisco, CA 94105 |
|  | Attention: Legal and Compliance |
|  | Email: Marisa.Rolland@blackrock.com |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.05 <u>Orders</u>. The Company reserves the right to reject any order, consistent with the provisions of the current Prospectus applicable to the Company and any separate agreement governing transactions with Authorized Participants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.06 <u>Suspension of Sale of Shares</u>. The Company shall have the right to suspend the sale of Shares at any time in response to conditions in the securities markets or otherwise, and to suspend the redemption of Shares of any Fund at any time as permitted by the 1933 Act or the rules and regulations thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.07 <u>Entire Agreement; Amendments</u>. This Agreement constitutes the entire agreement between the parties hereto and supersedes any prior agreement, draft or agreement or proposal with respect to the subject matter hereof. This Agreement or any part hereof may be amended or waived only by an instrument in writing signed by the party against which enforcement of such amendment or waiver is sought.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.08 <u>Governing Law</u>. This Agreement will be governed by and construed in accordance with the laws of the State of New York without giving effect to any conflict of laws or choice of laws rules or principles thereof. To the extent that the applicable laws of the State of New York, or any of the provisions of this Agreement, conflict with the applicable provisions of the 1940 Act, the latter will control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.09 <u>Counterparts</u>. This Agreement may be executed in two or more counterparts, all of which will constitute one and the same instrument. Each such counterpart will be deemed an original, and it will not be necessary in making proof of this Agreement to produce or account for more than one such counterpart. This Agreement will be deemed executed by both parties when any one or more counterparts hereof or thereof, individually or taken together, bears the original, scanned or facsimile signatures of each of the parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10 <u>Severability</u>. Any provision of this Agreement that is determined to be invalid or unenforceable in any jurisdiction will be ineffective to the extent of such invalidity or unenforceability in such jurisdiction, without rendering invalid or unenforceable the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. If a court of competent jurisdiction declares any provision of this Agreement to be invalid or unenforceable, the parties agree that the court making such determination will have the power to reduce the scope, duration, or area of the provision, to delete specific words or phrases, or to replace the provision with a provision that is valid and enforceable and that comes closest to expressing the original intention of the parties, and this Agreement will be enforceable as so modified.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.11 <u>Confidential Information</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) BRIL and the Company (in such capacity, the "<u>Receiving Party</u>") acknowledge and agree to maintain the confidentiality of Confidential Information (as hereinafter defined) provided by BRIL and the Company (in such capacity, the "<u>Disclosing Party</u>") in connection with this Agreement. The Receiving Party will not disclose or disseminate the Disclosing Party's Confidential Information to any Person other than (a) those employees, agents, contractors, subcontractors and licensees of the Receiving Party, or (b) with respect to BRIL as a Receiving Party, to those employees, agents, contractors, subcontractors and licensees of any agent or affiliate, who have a need to know it in order to assist the Receiving Party in performing its obligations, or to permit the Receiving Party to exercise its rights under this Agreement. In addition, the Receiving Party (a) will take all reasonable steps to prevent unauthorized access to the Disclosing Party's Confidential Information, and (b) will not use the Disclosing Party's Confidential Information, or authorize other Persons to use the Disclosing Party's Confidential Information, for any purposes other than in connection with performing its obligations or exercising its rights hereunder. As used herein, "reasonable steps" means steps that a party takes to protect its own, similarly confidential or proprietary information of a similar nature, which steps will in no event be less than a reasonable standard of care.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The term "<u>Confidential Information</u>," as used herein, will mean all business strategies, plans and procedures, proprietary information, methodologies, data and trade secrets, and other confidential information and materials (including, without limitation, any Nonpublic Personal Information, as defined under Section 248.3(t) of Regulation S-P ("<u>Regulation</u><u> </u><u>S-P</u>"), promulgated under the Gramm-Leach-Bliley Act (the "<u>GLB Act</u>")), of the Disclosing Party, its affiliates, their respective clients or suppliers, or other Persons with whom they do business, that may be obtained by the Receiving Party from any source or that may be developed as a result of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The provisions of this <u>Section</u><u> </u><u>7.11</u> respecting Confidential Information will not apply to the extent, but only to the extent, that such Confidential Information is: (a) already known to the Receiving Party free of any restriction at the time it is obtained from the Disclosing Party, (b) subsequently learned from an independent third party free of any restriction and without breach of this Agreement; (c) or becomes publicly available through no wrongful act of the Receiving Party or any third party; (d) independently developed by or for the Receiving Party without reference to or use of any Confidential Information of the Disclosing Party; or (e) required to be disclosed pursuant to an applicable law, rule, regulation, government requirement or court order, or the rules of any stock exchange; <u>provided</u>, <u>however</u>, that the Receiving Party will advise the Disclosing Party of such required disclosure promptly upon learning thereof in order to afford the Disclosing Party a reasonable opportunity to contest, limit and/or assist the Receiving Party in crafting such disclosure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Receiving Party will advise its employees, agents, contractors, subcontractors and licensees, and will require its agents and affiliates to advise their employees, agents, contractors, subcontractors and licensees, of the Receiving Party's obligations of confidentiality and non-use under this <u>Section</u><u> </u><u>7.11</u>, and will be responsible for ensuring compliance by its and its affiliates' employees, agents, contractors, subcontractors and licensees with such obligations. In addition, the Receiving Party will require all persons that are provided access to the Disclosing Party's Confidential Information, other than the Receiving Party's accountants and legal counsel, to execute confidentiality or non-disclosure agreements containing provisions substantially similar to those set forth in this <u>Section</u><u> </u><u>7.11</u>. The Receiving Party will promptly notify the Disclosing Party in writing upon learning of any unauthorized disclosure or use of the Disclosing Party's Confidential Information by such persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Notwithstanding anything in this Agreement to the contrary, each party hereto agrees that: (i) any Nonpublic Personal Information disclosed by a party hereunder is for the specific purpose of permitting the other party to perform the ETF Services, and (ii) with respect to such information, each party will comply with Regulation S-P and the Act and will not disclose any Nonpublic Personal Information received in connection with this Agreement to any other party, except to the extent as necessary to carry out the ETF Services or as otherwise permitted by Regulation S-P or the Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Upon the Disclosing Party's written request following the termination of this Agreement, the Receiving Party promptly will return to the Disclosing Party, or destroy, all Confidential Information of the Disclosing Party provided under or in connection with this Agreement, including all copies, portions and summaries thereof. Notwithstanding the foregoing sentence, the Receiving Party may retain one copy of each item of the Disclosing Party's Confidential Information for purposes of identifying and establishing its rights and obligations under this Agreement, for archival or audit purposes and/or to the extent required by applicable law; <u>provided</u>, <u>however</u>, that all such Confidential Information retained by the Receiving Party will remain subject to the provisions of <u>Section</u><u> </u><u>7.11</u> for so long as it is so retained. If requested by the Disclosing Party, the Receiving Party will certify in writing its compliance with the provisions of this paragraph.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.12 <u>Use of Name</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Company will not use the name of BRIL, or any of its affiliates, in any Prospectus, sales literature, and other material relating to the Company in any manner without the prior written consent of BRIL (which will not be unreasonably withheld or delayed); <u>provided</u>, <u>however</u>, that BRIL hereby approves all lawful uses of the names of BRIL and its affiliates in the Prospectus of the Company and in all other materials which merely refer in accurate terms to their appointment hereunder or which are required by applicable law, regulations or otherwise by the SEC, FINRA, or any state securities authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Neither BRIL nor any of its affiliates will use the name of Company in any publicly disseminated materials, including sales literature, in any manner other than with respect to representative client lists, without the prior written consent of such Company (which will not be unreasonably withheld or delayed); <u>provided</u>, <u>however</u>, that the Company hereby approves all lawful uses of its name in any required regulatory filings of BRIL which merely refer in accurate terms to the appointment of BRIL hereunder, or which are required by applicable law, regulations or otherwise by the SEC, FINRA, or any state securities authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.13 <u>Insurance</u>. Each of the parties hereby represents that it maintains adequate insurance coverage with respect to its responsibilities pursuant to this Agreement.

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**IN WITNESS WHEREOF,** the parties hereto have each duly executed this Agreement, as of the day and year above written.

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| | |
|:---|:---|
| BLACKROCK FUND ADVISORS, acting on behalf of the Company | BLACKROCK FUND ADVISORS, acting on behalf of the Company |
| By: | /s/ Matthew Leonard |
| Name: | Matthew Leonard |
| Title: | Managing Director |
| iSHARES STAKED ETHEREUM TRUST ETF, by iShares Delaware Trust Sponsor on behalf of the Company | iSHARES STAKED ETHEREUM TRUST ETF, by iShares Delaware Trust Sponsor on behalf of the Company |
| By: | /s/ Shannon Ghia |
| Name: | Shannon Ghia |
| Title: | President and Chief Executive Officer |
| BLACKROCK INVESTMENTS, LLC | BLACKROCK INVESTMENTS, LLC |
| By: | /s/ Jonathan Maro |
| Name: | Jonathan Maro |
| Title: | Managing Director |

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11<br>

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**EXHIBIT A**

*List of ETF Services*

BRIL will provide the following ETF Services, as described in more detail in the Service Levels:

● communicate with Authorized Participants and provide support services to Authorized Participants;

● perform ETF primary order processing, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o order fulfillment

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ ETF order and basket routing

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ ETF order economics calculation

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ AP confirm production

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o ETF collateral calculation and instruction

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o ETF share registration

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o settlement instruction

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ basket

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ cash component

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ AP fees;

● forward any complaints concerning a Fund/Company received by BRIL to the Fund/Company, assist in resolving such complaints, and maintain a log of such complaints as required by applicable law;

● keep and maintain all books and records relating to the services provided by BRIL as may be required in accordance with applicable law; and

● such other related services as may be agreed upon by the parties.

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**EXHIBIT B**

*Service Levels*

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| | | | |
|:---|:---|:---|:---|
| Section | Service | BRIL Activities | Service Level Metric/Timing |
| Share Registration | BRIL will send ETF Order<br> Messaging to provider (TA) | On Trade date, BRIL will instruct<br> the ETF Order share registration<br> messages to the provider | 99% |
| Order<br> Fulfillment | BRIL will calculate and distribute NSCC ETF Order<br> File (11300) | On Trade date, BRIL will calculate<br> and distribute the end-of-day ETF<br> Order File (11300) to the provider<br> and DTC/NSCC. BRIL will monitor<br> any errors / discrepancies received<br> through DTCC response messages<br> to the order file (11300) | NSCC<br> SLA<br> 10:00PM EST |
| Order<br> Fulfillment | BRIL will send AP Confirm to<br> transacting AP | On Trade date, AP Confirm and<br> order economics delivered | 99% |
| Order<br> Fulfillment | Order Instruction | Detail below | 10:00 PM<br> EST |
|  | BRIL will instruct Market Trades | On Trade Date BRIL will instruct Market Trades basket components in Fund's portfolio to provider |  |
|  | BRIL will instruct In-Kind Trades | On Trade Date BRIL will instruct In-Kind Trades in Fund's portfolio to provider |  |
|  | BRIL will instruct Capital Stock Message | On Trade Date, BRIL will instruct provider of total Capital Stock Message |  |
|  | BRIL will instruct Capital Flow Message which will include the Cash Component, Slippage, Spread | On Trade date and through to<br> settlement BRIL to provide Capital<br> Flow Message (Cash Component,<br> Slippage, Spread and fixed income specific data elements such as interim interest and in-cycle coupons, where applicable)) of each order to provider |  |
|  | BRIL will serve as ETF<br> Settlement agent | BRIL will facilitate settlement of<br> each order on contractual settlement date or within a reasonable period thereafter, including collateral management and collection of all outstanding obligations to the fund for settlements outside of the NSCC's<br> continuous net settlement ("CNS")<br> process as part of fulfillment |  |

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Service

Level

**EXHIBIT C**

*Commercial Terms Schedule*

**ETF Servicing Fees**

## Exhibit 10.9

**Exhibit 10.9**

![anchorage.jpg](anchorage.jpg)

**ORDER FORM**

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| | |
|:---|:---|
| **Anchorage Contact** | **Client Contact** |
| Name: Matthew Zablotny | Name: Robert McLardy |
| Email: matthew.zablotny@anchorlabs.com | Email: robert.mclardy@blackrock.com |

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This MASTER CUSTODY SERVICE AGREEMENT ("**Agreement**") is made and entered into as of the Effective Date provided herein, by and between Anchorage Digital Bank N.A. ("**Anchorage**"), and each Client as provided herein (each a "**Client**") (Anchorage and Client, each a "**Party**" and collectively, the "**Parties**"). Each Client, acting through BlackRock Fund Advisers (the "**Agent**ˮ), severally and not jointly enters into this Agreement with Anchorage. This Agreement shall constitute separate agreements, each between a single Client and Anchorage, as if such Client had executed a separate Agreement naming only itself as the Client, and no Client shall have any liability for the obligations of any other Client. Any reference to "Agreement" shall be construed to refer to the respective Agreement between a Client and Anchorage.

The Agreement consists of the terms in this Order Form and the immediately following Standard Terms and Conditions, which together, shall form the Agreement.<u> </u>

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| | |
|:---|:---|
| **1. Effective Date:** | April 7, 2025 |
| **2. Initial Term:**  | Three (3) year |
| **3. Renewal Term:**  | One (1) year |
| **4. Client(s).** Each "**Client**" listed herein is subject to the Agreement as if this Agreement were between such individual Client and Anchorage, except specifically the Fees will be calculated on an aggregated basis, including the sum of all Clients' Assets Under Custody. For the avoidance of doubt, notwithstanding anything herein to the contrary, each Client shall only be responsible for Fees and liabilities attributable to its assets held in its own Account pursuant to such Client's Agreement with Anchorage, and under no circumstances will any Client be responsible for the Fees or liabilities of any other Client or person. | **4. Client(s).** Each "**Client**" listed herein is subject to the Agreement as if this Agreement were between such individual Client and Anchorage, except specifically the Fees will be calculated on an aggregated basis, including the sum of all Clients' Assets Under Custody. For the avoidance of doubt, notwithstanding anything herein to the contrary, each Client shall only be responsible for Fees and liabilities attributable to its assets held in its own Account pursuant to such Client's Agreement with Anchorage, and under no circumstances will any Client be responsible for the Fees or liabilities of any other Client or person. |
|  | iShares Bitcoin Trust ETF, a Delaware Statutory Trust<br> iShares Ethereum Trust ETF, a Delaware Statutory Trust |

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&nbsp;&nbsp;&nbsp;&nbsp;**5.** **Fees.** 

[Redacted]

**[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]**

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&nbsp;&nbsp;&nbsp;&nbsp;**6.** **Address for Notices:** 

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| | |
|:---|:---|
| **To Client(s):** | **Invoice Email:** fundadmininvoices@blackrock.com<br> **Notice Email:** groupcryptoopsleadershipteam@blackrock.com<br> **Attention:** <br> Digital Assets at BlackRock, Inc. |

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| | |
|:---|:---|
| **To Anchorage:** | <u>legal@anchorage.com</u> AND<br> <u>custodyexecutive@anchorage.com</u><br> Anchorage Digital Bank N.A.<br> 101 S. Reid Street, Suite 329<br> Sioux Falls, South Dakota 57103 |

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IN CONSIDERATION AND WITNESS WHEREOF, Anchorage and Client, by their duly authorized representatives, hereby execute this Agreement as of the Effective Date.

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| | |
|:---|:---|
| **ANCHORAGE DIGITAL BANK N.A.** | **ON BEHALF OF EACH CLIENT SET FORTH HERETO** |
| By: <u>/s/ Nathan McCauley</u><u> </u> | By: <u>/s/ Shannon Ghia</u><u> </u><u> </u><u> </u> |
| Name: Nathan McCauley | Name: Shannon Ghia |
| Title: Chief Executive Officer | Title: Managing Director |
|  | Company: BlackRock Fund Advisors |

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AFFILIATED BUSINESS DISCLOSURE

**AND CONFLICT OF INTEREST WAIVER**

Anchorage Digital Bank N.A. ("**Anchorage Digital Bank**") is affiliated with Anchor Labs, Inc., Anchorage Hold LLC, Anchorage Digital Singapore Pte. Ltd., and other affiliates (each an "**Anchorage Affiliate**"), through common ownership and management. In particular, Anchor Labs, Inc. provides certain administrative, technology, marketing, and other support services for custodial accounts on behalf of Anchorage Digital Bank. Because Anchorage Digital Bank and Anchorage Affiliates are under common ownership and management, the owners of Anchor Labs, Inc. will receive an indirect benefit from any fees you pay to Anchorage Digital Bank. In addition, Anchorage Digital Bank and Anchorage Affiliates may each provide services to its own clients that are also participating in any additional optional services supported by both Anchorage Digital Bank and Anchorage Affiliates. Anchorage Digital Bank and Anchorage Affiliates may refer clients to each other, and cooperate with each other, for the performance of these shared services. If Anchorage Digital Bank offers additional optional services to clients to participate in a network of services offered by Anchorage Affiliates, and you choose to participate in such services, you hereby acknowledge and consent to the sharing of Client Data (as defined in this Agreement) between Anchorage Digital Bank and Anchorage Affiliates solely in order to provide such services to you. Any sharing of Client Data shall be subject to the Data Processing Addendum (as defined in this Agreement) agreed between the applicable parties, and all applicable Laws. Your use of services of Anchorage Digital Bank may result in benefits from such referral to the other companies by virtue of the companies' common ownership and management. For the avoidance of doubt, all relationships between Anchorage Digital Bank and Anchorage Affiliates, and all provision of Services to each Client, are in compliance with all applicable laws and regulations and industry best practices, including, without limitation, those concerning conflicts of interest, and this Agreement.

<u>ACKNOWLEDGEMENT</u>

I, duly authorized and on behalf of each Client as set forth in the Order Form, have read this disclosure form, and I acknowledge and understand that Anchorage Digital Bank and Anchorage Affiliates are under common ownership and control. I further acknowledge and understand that by retaining Anchorage Digital Bank, I am providing an indirect financial benefit to the owners of Anchorage Affiliates. Understanding the common ownership and control of the companies, I agree to utilize the services of Anchorage Digital Bank of my own free will. I also understand and agree that Anchorage Digital Bank may share Client Data with any Anchorage Affiliate solely for the purpose of facilitating additional optional services to participate in a network of services offered by Anchorage Digital Bank, and Anchorage Affiliates, that Client has agreed to receive. I acknowledge and understand that any referrals for services among Anchorage Digital Bank and Anchorage Affiliates may result in the owners of the referring company receiving an indirect financial benefit from the services provided.

*[Signature page to follow]* 

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| |
|:---|
| **ON BEHALF OF EACH CLIENT SET FORTH HERETO** |
| By<u>:/s/ Shannon Ghia</u><u> </u><u> </u><u> </u> |
| Name: **Shannon Ghia** |
| Title: **Managing Director** |
| Company: **BlackRock Fund Advisors** |

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**ANCHORAGE DIGITAL BANK**

**STANDARD TERMS AND CONDITIONS**

*Capitalized terms not defined in the Order Form, body of these Terms and Conditions, or supporting Schedules are defined in Schedule A (Definitions).* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Anchorage Appointment and Provision of the Services.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1. <u>Appointment</u>. Client appoints Anchorage to provide the Services, including acting as custodian of Client Digital Assets pursuant to this Agreement, and Anchorage hereby accepts such appointment. Anchorage is a qualified custodian as defined under Investment Advisers Act of 1940 ()"**Advisers Act** ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2. <u>Provision of the Services</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject to (i) Client's successful completion of the account acceptance process as provided in Section 2.1, and (ii) the terms of this Agreement, during the Term, Anchorage will provide the Services to Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Anchorage will reasonably determine the requirements for any Direction, including Authenticated Instructions, and whether such requirements have been satisfied as to any Direction, at all times subject to this Agreement. Anchorage shall not act on a direction or instruction which is not an Authenticated Instruction. Subject to the terms of, and provided Anchorage complies with its obligations under, this Agreement, Anchorage is entitled to rely upon a Direction in all respects. Client and Anchorage agree and acknowledge that (i) Anchorage's acceptance of Directions related to Client's deposit and withdrawal of assets is based on the parameters of Authenticated Instructions and in accordance with Anchorage's Services requirements under this Agreement; (ii) Anchorage has no duty to inquire into or investigate the legality, validity, or accuracy of any information, data, or instructions related to a Direction that it reasonably believes is genuine following authentication, subject to, and provided Anchorage complies with its obligations under, this Agreement; and (iii) Anchorage shall act in a commercially reasonable manner, and in conformance with the following: (a) Directions shall continue in full force and effect until executed, cancelled or superseded; (b) if any Directions are ambiguous or if in in Anchorage's reasonable opinion any Directions are likely to be inaccurate, Anchorage shall notify Client and may refuse to execute such Directions until any such ambiguity has been resolved to Anchorage's satisfaction; and (c) Anchorage may refuse to execute Directions if in Anchorage's reasonable opinion such Directions are outside the scope of its obligations under this Agreement or are contrary to any applicable laws, rules and regulations, and Anchorage will promptly notify Client of such refusal. Anchorage is responsible for losses resulting from its errors in executing a Direction from the Client (e.g., if Client provides the correct destination address for executing a withdrawal transaction, but Anchorage erroneously sends Client's Digital Assets to another destination address).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Services are available only in connection with those Digital Assets and protocols that Anchorage, in its sole discretion, supports. The type and scope of Services that Anchorage supports for each Digital Asset, and applicable Fees for such Services, may differ. Under no circumstances should Client attempt to use the Services to store, send, request, or receive Digital Assets and protocols that Anchorage does not support. Anchorage assumes no responsibility in connection with any attempt to use any Account or Vault with Digital Assets that Anchorage does not support, and any such unsupported Digital Assets deposited to or received in any Account or Vault are subject to forfeiture and loss. The Digital Assets that Anchorage supports may change from time to time, based on Anchorage's sole and absolute discretion. Anchorage will notify Client in advance if it ceases to support a particular Digital Asset for which Anchorage has previously provided Services to Client. In the case of bitcoin and ether, Anchorage shall provide Client with one hundred and eighty (180) days' written notice before ceasing to support custody services for bitcoin and ether, unless Anchorage is required to cease such support by court order, statute, law, rule (including a self-regulatory organization rule), regulation, code, or other similar requirement, in which case written notice shall be provided promptly upon Anchorage determining it will not be able to support custody services for bitcoin and ether.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Anchorage shall only follow the Directions from Client. Anchorage is released and held harmless by Client for following the Directions from the Client, subject to the terms of, and provided Anchorage complies with its obligations under, this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) [Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) From time to time, Anchorage may, in its sole discretion, offer Client additional optional services involving settlement services ()"**Optional Settlement Services** "). Client may elect to accept Optional Settlement Services by signing a separate agreement involving such Optional Settlement Services. For the avoidance of doubt, by entering this Agreement, the Client has not elected to accept Optional Settlement Services from Anchorage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Anchorage is solely responsible for any gas or network fees necessary for the transfer of Digital Assets pursuant to Client Directions. Anchorage shall be liable for paying any gas or network fees on behalf of Client and shall be liable for any canceled Directions due to insufficient gas or network fees.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3. <u>Storage of Digital Assets</u>. Anchorage will receive Digital Assets for storage in Client's Account by generating Private Keys and their Public Key pairs, with Anchorage retaining custody of such Private Keys. Upon receipt, Anchorage will custody the Digital Assets in Client's name in an Account established for the benefit of the Client and no other person. The Private Keys controlling the Digital Assets belonging to Client shall be securely held by Anchorage in offline cold storage at all times. Anchorage shall be deemed to have received a Digital Asset after the Digital Asset's receipt has been confirmed on the relevant Blockchain, except for Digital Assets deemed to be spam or gas by Anchorage and the Client. Digital Assets in Client's Account shall (i) be segregated at a unique blockchain address or addresses on the relevant Blockchain (e.g., in the case of bitcoin, the Blockchain associated with the Bitcoin network) from the assets held by Anchorage as principal and the assets of other customers of Anchorage and any other person, (ii) not be treated as general assets of Anchorage, and Anchorage shall have no right, title or interest in such Digital Assets, (iii) Anchorage serves as a fiduciary and custodian on Client's behalf, and the Digital Assets in Client's Account are considered fiduciary assets that remain Client's property at all times. Digital Assets shall be held in Client's Account in accordance with the terms of this Agreement and shall not be commingled with other customers', Anchorage's, or any other person's Digital Assets. Client's Account(s) and all Digital Assets in the Client's Account shall be held by Anchorage at all times.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4. <u>Accounting for and ownership of Client Digital Assets and fiat currency</u>. At all times, Client owns Digital Assets and fiat currency (if applicable) held by Anchorage on behalf of Client under this Agreement. Client Digital Assets and fiat currency of the Client are custodial assets that shall be kept separate from the assets of Anchorage and shall not be reflected on Anchorage's balance sheet as assets of Anchorage. Anchorage will record on its books and records all Digital Assets and fiat currency (if applicable) received by it for the Account and will segregate Client Digital Assets from those of any other person or entity at a unique blockchain address or addresses at which only Digital Assets belonging to Client shall be held at all times. Anchorage will provide Client with access to the Technology Platform for transaction records and holdings and will provide Client daily statements that show balances and transaction records of Client Digital Assets. Upon commercially reasonable notice to Anchorage, Anchorage will provide Client copies of the books and records pertaining to the Client that are in the possession or under the control of Anchorage. The books and records maintained by Anchorage will, to the extent applicable, be prepared and maintained in all material respects as required by applicable Laws, and shall separately identify Client's Digital Assets at all times such that in an insolvency of Anchorage, the receiver or other administrator appointed in respect of Anchorage would be able to identify and trace Client's Digital Assets separately from the assets of Anchorage's own assets and those of all other persons. Upon request from Client in writing, Anchorage shall reasonably cooperate with Client's authorized independent public accountant, and provide Client's authorized independent public accountant confirmation of and access to information sufficient to confirm (i) Client's Digital Assets and fiat currency as of such date as such accountant may specify, and (ii) Client's Digital Assets are held in a separate account under Client's name, and (iii) such other information as Client's authorized independent public accountant may reasonably request in connection with any audit or examination of Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5. <u>Authority to Assign or Pledge</u>. Client's Digital Assets and fiat currency shall not be subject to any right, charge, security interest, lien or claim of any kind in favor of Anchorage or any of its Affiliates or of any creditor of any of them, and Anchorage shall not have the independent right or authority to assign, hypothecate, pledge, encumber or otherwise dispose of any Client Digital Assets or fiat currency of Client. The Digital Assets in the Account and the fiat currency in the Deposit Account, as defined in Section 2.7, are not general assets of Anchorage or of any of its Affiliates and are not available to satisfy claims of any creditors of Anchorage or of any of its Affiliates.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6. <u>Application of UCC</u>. Client Digital Assets in the Account and fiat currency will be treated as "financial assets" under Article 8 of the New York Uniform Commercial Code ("Article 8"). Anchorage is a "securities intermediary," the Account is a "securities account," and Client is an "entitlement holder" under Article 8. This Agreement sets forth how Anchorage will satisfy its Article 8 duties. Treating Client assets in the Account as financial assets under Article 8 does not determine the characterization or treatment of the cash and digital assets of Client under any other law or rule. New York will be the securities intermediary's jurisdiction with respect to Anchorage for purposes of Article 8, and New York law will govern all issues addressed in Article 2(1) of the Hague Securities Convention. Anchorage will credit the Client with any payments or distributions on any Client assets it holds for Client's Account. Anchorage will comply with Client's Directions with respect to Client assets in Client's Account, subject to the terms of this Agreement. Anchorage is obligated by Article 8 to maintain sufficient digital assets to satisfy all entitlements of customers of Anchorage, respectively, to the same digital assets. Anchorage shall not grant any person or entity a lien, security interest, encumbrance, mortgage, pledge, or adverse claim or interest of any kind in the digital assets in the Client's Account. Digital assets in Client's Account are custodial assets. Under Article 8, the digital assets in the Client's Account are not general assets of Anchorage, and are not available to satisfy claims of creditors of Anchorage or any of its Affiliates. Anchorage will comply at all times with the duties of a securities intermediary under Article 8, including but not limited to those set forth at UCC sections 8-504(a), 8-505(a), 8-506(a), 8-507 and 8-508.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7. <u>Rights of Use; Limits on Use</u>. Subject to the terms of this Agreement, Anchorage hereby grants to Client a non-sublicensable (except to Affiliates of Client or to any Authorized Person, Agent, and any Third Party in accordance with this Section 1.7), non-exclusive, royalty-free worldwide right during the Term to access the Technology Platform. Client may sublicense its rights to access and use the Technology Platform to any of its Affiliates, Authorized Persons, Agent, and Third Parties authorized by Client in accordance with Section 2.3(b). Client will not, and will not permit its Affiliates, Authorized Persons, Agent or applicable Third Parties to: (i) directly or indirectly copy, disseminate, display, distribute, publish, sell, or otherwise disclose any part of the Technology Platform, or create any works or other materials based on or derived from any part of the Technology Platform in a manner not contemplated under this Agreement or otherwise directed by Anchorage or its Affiliates or Agent during the Term; (ii) reverse engineer, decompile, or disassemble the software used in the Technology Platform; (iii) sell, rent, lease, or license Client's right to use the Technology Platform except as may be set out under this Agreement; or (iv) use the Technology Platform or Services in any other way not expressly authorized by this Agreement. Client will be responsible for all acts and omissions of Authorized Persons in connection with or relating to this Agreement; provided that the foregoing will not in any way limit or reduce Anchorage's duties and obligations to Client under this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8. <u>Support and Maintenance</u>. Subject to applicable Law, as part of the Services and at no additional cost to Client, Anchorage will (i) make available the Technology Platform, and (ii) provide other Support Services as described in this Agreement, including the Addendum 1 and the Service Level Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9. <u>Business Continuity Policy</u>. Anchorage shall maintain a business continuity policy applicable to Anchorage's performance of Services as described in the Addendum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10. <u>Forks, Airdrops</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Should a Fork occur: (i) Anchorage retains the right, in its sole discretion, to determine whether or not to support (or cease supporting) either Forked Network; (ii) in connection with determining whether to support a Forked Network, Anchorage may suspend certain operations, in whole or in part (with or without advance notice), for however long Anchorage reasonably deems necessary, in order to take the necessary steps, as determined in its sole discretion, to perform obligations hereunder with respect to supporting a Forked Network; (iii) Client hereby agrees that Anchorage shall determine, in its sole discretion, whether to support such Forked Network and that Client shall have no right or claim against Anchorage related to value represented by any change in the value of any Digital Asset (on a Forked Network), including with respect to any period of time during which Anchorage exercises its rights described herein with respect to Forks and Forked Networks; and (iv) Anchorage will use commercially reasonable efforts to timely select, in its sole discretion, at least one (1) of the Forked Networks to support and will identify such selection in a written notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) With respect to a Forked Network that Anchorage chooses not to support, it may, in its sole discretion, elect to (x) abandon or otherwise not pursue obtaining the Digital Assets from that Forked Network, or (y) if Client provides written consent to take delivery of such Digital Assets from the Forked Network, deliver the Digital Assets from that Forked Network to Client within a time period as determined by Anchorage in its sole discretion, together with any credentials, keys, or other information sufficient to gain control over such Digital Assets (subject to the withholding and retention by Anchorage of any amount reasonably necessary, as determined in Anchorage's sole discretion, to fairly compensate Anchorage for the efforts expended to obtain and deliver such Digital Assets to Client).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) With respect to Forked Networks that Anchorage chooses to support, Client may be responsible for the reasonable fees for such support (to be negotiated), and Client acknowledges and agrees that Anchorage assumes no responsibility with respect to any Forked Network and related Digital Assets that it chooses not to support.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Client acknowledges that Digital Asset values can fluctuate substantially which may result in a total loss of the value of Digital Assets. The supply of Digital Assets available as a result of a Forked Network and Anchorage's ability to deliver Digital Assets resulting from a Forked Network may depend on circumstances or Third Party providers that are outside of Anchorage's control. Anchorage does not own or control any of the protocols that are used in connection with Digital Assets and their related Digital Asset networks, including those resulting from a Forked Network. Accordingly, Anchorage disclaims all liability relating to a Forked Network and any change in the value of any Digital Assets (whether on a Forked Network or otherwise) due to the operation of Digital Asset networks which affect all holders of Digital Assets on such networks as a class, and makes no guarantees regarding the security, functionality, or availability of such protocols or Digital Asset networks, provided Anchorage shall act in accordance with this Agreement. In the event that a Digital Asset network, entity or person (a "**Sender**") attempts to or does contribute (sometimes called "airdropping" or "bootstrapping") its Digital Assets (collectively, "**Airdropped Digital Assets**") to holders of Digital Assets on an existing Digital Asset network and Client notifies Anchorage in writing that Client agrees in writing that it is willing to take possession of the Airdropped Digital Assets associate with Client's Digital Assets, Anchorage may, in its sole discretion, elect to: (i) subject to a reasonable airdrop fee to be determined, support the Airdropped Digital Asset for custody and, if appropriate, reconcile Account(s); (ii) abandon or otherwise not pursue obtaining the Airdropped Digital Assets; or (iii) within a time reasonable period as determined by Anchorage, deliver the Airdropped Digital Assets from that Digital Asset network to Client, together with any credentials, keys, or other information sufficient to gain control over such Airdropped Digital Assets (subject to the withholding and retention by Anchorage of any amount reasonably necessary, as determined in Anchorage's sole discretion, to fairly compensate Anchorage for the efforts expended to obtain and deliver such Airdropped Digital Assets to Client). If Anchorage supports, obtains or delivers Airdropped Digital Assets, such actions will not create any relationship between the Sender and Anchorage, grant any interest or rights to the Sender (including, without limitation, any Third Party beneficiary rights), or subject Anchorage to any obligations as it relates to the Sender. Under no circumstances will Anchorage include any Airdropped Digital Assets in Client's custody holdings without Client's express written approval.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the event that an announcement of a Fork in Bitcoin or Ethereum is to occur pursuant to Section 1.10(b), upon a written notice by either Party, Parties agree to enter into a good faith discussion about which Fork can be supported by Anchorage and Anchorage will support at least one branch of such Fork, unless expressly prohibited by Law or Anchorage's US prudential regulator. Notwithstanding anything to the contrary herein, Anchorage agrees to provide advance written notice to the Client announcing which Forked Network Anchorage intends to support for Bitcoin and Ethereum, promptly upon becoming aware of such a potential suspension, and to use commercially reasonable efforts to give Client a reasonable opportunity to withdraw Client's Digital Assets following such announcement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11. <u>Generally</u>. Client agrees that Anchorage will perform only such duties as are expressly set forth herein, including complying with applicable Law. Anchorage has the authority to do all acts that Anchorage reasonably determines are necessary, proper, or convenient for it to perform its obligations under this Agreement, provided it shall at all times comply with and be subject to this Agreement and shall have no obligation to perform acts which it reasonably believes do not comply with applicable Laws.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **Client Responsibilities and Acknowledgements.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. <u>Account Acceptance; Authorized Person Designations</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Services will be provided only after Client's successful completion of the account acceptance process, including but not limited to the onboarding process in Section 2.3(a), as determined in Anchorage's sole discretion. Anchorage may terminate this Agreement upon fourteen (14) days' prior written notice to the Client due to Client's failure to complete the onboarding process with Anchorage; provided that this right will no longer apply after the date of execution of this Agreement by both parties. To complete the acceptance process, Client shall provide Anchorage with information and documents, which include but are not limited to, information necessary for Anchorage's compliance with the Bank Secrecy Act ()"**BSA** "), and all Laws and regulations relating to anti-money laundering ()"**AML** "), Know-Your-Customer ()"**KYC** "), counter-terrorist financing, sanctions screening requirements, or any other legal obligations, in each case, as determined by Anchorage in its sole discretion. Upon acceptance of Client by Anchorage, Client shall nominate and manage Authorized Persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In order to be approved as an Authorized Person, nominated persons must agree to data collection permissions and related policies provided in the Anchorage application and Technology Platform, including privacy policies and other terms, which may be amended from time to time. A copy of the then-current versions of such privacy policies and other terms will be provided at the written request of Client. Client is solely responsible for the actions or inactions of all Authorized Persons at all times, though Anchorage shall comply with its obligations under this Agreement, including the standard of care specified in Section 10 hereof. With respect to Client's primary custody Account, Client will initially nominate three (3) or more individuals as Authorized Persons prior to initiation of Client on-boarding by Anchorage, and a minimum of two (2) of three (3) Authorized Persons must approve an Authenticated Instruction. Anchorage reserves the right in its reasonable sole discretion to change the minimum number of Authorized Persons to be designated or which are required to approve a Direction; provided that Anchorage provides Client with 60 days' prior written notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Subsequent to the approval and on-boarding of initial Authorized Persons, Client may nominate additional Authorized Persons or revoke an Authorized Person's status, each through a Direction to be approved by a Quorum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. <u>Acceptable Devices</u>. Unless expressly agreed upon otherwise, Client shall maintain a separate Acceptable Device for each Authorized Person. The Acceptable Device must have Internet accessibility and meet other technical specifications prescribed by Anchorage in Schedule B.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. <u>Authorized Persons; Anchorage API</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each person nominated by Client as an Authorized Person must be confirmed by Anchorage as an Authorized Person. Authorized Persons may be required to successfully complete the onboarding process and training, which may include (i) installing the Anchorage application onto the person's Acceptable Device; and (ii) training on the Services regarding the creation of Directions or joining a Quorum. Upon completion of Anchorage's onboarding process and any training, to Anchorage's satisfaction in its sole discretion, the nominated person will be designated by Anchorage as one of Client's Authorized Persons and their device designated by Anchorage as an Acceptable Device, such that they may create Directions or join a Quorum. Upon such designation, Anchorage may rely on the validity of such appointment until such time as Anchorage receives Directions from Client revoking such appointment or designating a new Authorized Representative. Anchorage will disable the access of an Authorized Representative as soon as reasonably practicable upon request from Client and in no event greater than one day following the receipt of such request and the execution of any documents reasonably required by Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) As part of the Services, Anchorage may provide Client with access to the Anchorage API, through which Client may permit Third Party as well as Anchorage and its Affiliates access to the Account(s) or Technology Platform. Anchorage shall follow any Directions submitted via the Anchorage API, including Directions for withdrawals and external transfers of Client's Digital Assets, as though such Directions were submitted from and by Client and without additional authentication, unless otherwise specified in this Agreement. Authorized Persons may generate API keys and assign roles to a Third Party, including without limitation, a Third Party application, subject to their compliance with the Anchorage API's Documentation, and applicable Law. Client and all Authorized Persons shall use industry best practices to safeguard any generated Anchorage API keys. Client shall be responsible for all Third Party access to the Account(s) and Directions submitted via the Anchorage API, and Anchorage shall not be liable for following any instructions submitted via an Anchorage API key unless Anchorage's negligence or willful misconduct caused unauthorized access to or possession of such key.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. <u>On-Chain Services</u>. From time to time, Anchorage may, in its sole discretion, offer Client additional optional services involving on-chain transactions (other than deposits and withdrawals included in Anchorage's basic custody service), which may include staking, voting, vesting, signaling, and other activities requiring interaction with the applicable blockchain ()"**On-Chain Services** ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Offer and Acceptance of On-Chain Services. Anchorage may offer On-Chain Services by sending the offer in writing to Client. Any offer for On-Chain Services will include the following terms, which shall be reviewed and approved by Client in a separate agreement (any option to elect such services in the Anchorage application shall not be valid) to Authorized Persons of Client:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) a basic description of the On-Chain Service;

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ii) a disclosure of the material risks of the On-Chain Service;

iii) a description of any associated fees;

iv) any other key terms of the On-Chain Service, as applicable (for example, Anchorage will disclose if Digital Assets must be locked for a minimum period and would not be immediately accessible to Client); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v) an option to expressly agree to the On-Chain Service.

A Client may accept an On-Chain Service in a signed writing, which for avoidance of doubt, Client has not agreed to enter into by entering into this Agreement and shall enter into separately in the event Client elects to do so;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Cancellation of On-Chain Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) Any Authorized Person may cancel an On-Chain Service at any time; provided, however, that in cases where Digital Assets are locked up for a certain period pursuant to the blockchain protocol, Anchorage will release locked Digital Assets when and as permitted by the applicable blockchain protocol. If Client desires to cancel an On-Chain service, Client may do so through the Anchorage application.

ii) Anchorage may discontinue an On-Chain Service at any time without notice for any reason. If Anchorage decides to discontinue an On-Chain Service, Anchorage will endeavor to provide as much notice to Client as reasonably possible, however Anchorage shall not be liable for any loss of rewards, slashing, penalty, or additional fees that may be incurred by the Client on the blockchain protocol.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. <u>Legal Compliance</u>. Notwithstanding any other provision in this Agreement, Client agrees at all times to (i) fully satisfy Anchorage's information requests and other requirements, including but not limited to those relating to Authorized Persons or Digital Assets; (ii) fully comply with all applicable Laws to the extent relevant and material to its performance hereunder, including the BSA and all other Laws and regulations related to AML, KYC, counter-terrorist financing, sanctions screening requirements, or other legal obligations; (iii) notify Anchorage if Client becomes a target of any BSA or Digital Asset related action, investigation or prosecution; (iv) notify Anchorage of any changes in jurisdiction or material ownership; and (v) provide Anchorage full cooperation in connection with any inquiry or investigation made or conducted by the U.S. Office of the Comptroller of the Currency ()"**OCC** "). Client agrees to immediately notify Anchorage if it becomes aware of any suspicious activity or pattern of activity, or any activity which upon investigation may be a suspicious activity or pattern of activity under applicable Laws, involving Client's Account.

Notwithstanding any other provision in this Agreement, Anchorage agrees at all times to (i) fully satisfy Client's information requests and other requirements, including but not limited to those relating to Authorized Persons or Digital Assets, or any such request from Client's accountants or auditors; (ii) fully comply with all applicable Laws, including the BSA and all other Laws and regulations related to AML, KYC, counter-terrorist financing, sanctions screening requirements, or other legal obligations; (iii) notify Client if Anchorage becomes a target of any BSA or Digital Asset related action, investigation or prosecution; (iv) notify Client of any changes in jurisdiction or material ownership; and (v) provide Client full cooperation in connection with any inquiry or investigation made or conducted by any federal or state regulator. Anchorage agrees to immediately notify Client if it becomes aware of any suspicious activity or pattern of activity, or any activity which upon investigation may be a suspicious activity or pattern of activity under applicable Laws, involving Client's Account.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6. <u>Acknowledgements</u>. Client acknowledges that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Client is an "entitlement holder" in a "Financial Asset," as defined by, and for purposes of, the UCC;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Anchorage does not provide investment advice or exercise investment discretion. Client is capable of evaluating transaction and investment risks independently, both in general and with regard to all transactions and investment strategies. Client is solely responsible for, and Anchorage has no involvement in, determining whether any Digital Asset transaction (whether an investment or otherwise), investment strategy, or related transaction is appropriate for Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Anchorage has no control over the Blockchains and markets in which Digital Assets are purchased and traded, and such may be subject to technology flaws, manipulations, hacks, double spending, "51%" attacks, other attacks, and operational limitations, provided, Anchorage shall comply with its obligations under this Agreement and applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Anchorage does not control and makes no guarantee as to the functionality of any Blockchain's decentralized governance, which could, among other things, lead to delays, conflicts of interest, or operational decisions that may impact Client or its Digital Assets, provided, Anchorage shall comply with its obligations under this Agreement and applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Advancements in cryptography (such as enabled by quantum computing) could render current cryptography algorithms utilized by a Blockchain supporting a specific Digital Asset inoperative;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) The price and liquidity of Digital Assets has been subject to large fluctuations in the past and may be subject to large fluctuations in the future;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Deposits into Client's Accounts may not be considered "deposits," as that term may be used under the applicable Laws, rules, or regulations in Client's jurisdiction, provided, Anchorage shall comply with its obligations under this Agreement and applicable Law;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Digital Assets in Client's Accounts are not subject to deposit insurance protection of the Federal Deposit Insurance Corporation ()"**FDIC**") and may not be subject to the protection afforded customers under the Securities Investor Protection Act of 1970, as amended, provided, Anchorage shall comply with its obligations under this Agreement and applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Digital Assets are not legal tender and are not backed by any government;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Legislative and regulatory changes or actions at the state, federal, or international level may adversely affect the use, transfer, exchange, and value of Digital Assets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) Transactions in Digital Assets may be irreversible, and, accordingly, losses due to fraudulent or accidental transactions may not be recoverable, provided, Anchorage shall comply with its obligations under this Agreement and applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) Some Digital Asset transactions shall be deemed to be made when recorded on a public ledger, which is not necessarily the date or time that transaction was initiated, provided, Anchorage shall comply with its obligations under this Agreement and applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) The value of Digital Assets may be derived from the continued willingness of market participants to exchange fiat currency or Digital Assets for Digital Assets, which may result in the potential for permanent and total loss of value of a particular Digital Asset should the market for that Digital Asset disappear;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) There is no assurance that a person who accepts a Digital Assets as payment today will continue to do so in the future;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) Due to the volatility and unpredictability of the price of Digital Assets relative to fiat currency trading and owning Digital Assets may result in significant loss over a short period of time;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) The nature of Digital Assets may lead to an increased risk of fraud or cyber-attack, provided, Anchorage shall comply with its obligations under this Agreement and applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) Any bond, insurance or trust account maintained by Anchorage for the benefit of its customers may not be sufficient to cover all losses incurred by Client, provided, Anchorage shall comply with its obligations under this Agreement and applicable Law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) The Fees and any other payments or compensation otherwise agreed to by Anchorage and Client represent reasonable compensation for Anchorage's Services and expenses.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7. <u>Fiat Currency Instructions and Acknowledgements; Undirected Cash Disclosures</u>. Anchorage may, in its sole discretion, offer Fiat Services to Client. If Anchorage offers Fiat Services, and Client accepts Fiat Services and Anchorage will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Deposit all cash deposited by Client with Anchorage, for which the Client has not already provided transfer instructions, into deposit accounts at FDIC-insured, regulated depository institutions selected by Anchorage (each, a "**Fiat Institution** "), which accounts will be held for the benefit of (FBO) Anchorage clients ()"**Deposit Accounts** "). Deposit Accounts will be non-interest-bearing and may be segregated by client or pooled into omnibus accounts. Anchorage will title the Deposit Accounts it maintains with U.S. depository institutions and maintain records of Client's interest in a manner that enables Anchorage to secure receipt of Federal Deposit Insurance Corporation ("FDIC") deposit insurance, where applicable and up to the deposit insurance limits applicable under FDIC regulations and guidance, on cash deposited by Client for the Client's benefit on a pass- through basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Enter into such sub-accounting agreements as may be required by the Fiat Institution, and;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Initiate wire transfer requests from time to time for the withdrawal of Client funds from the Deposit Accounts, which requests are to be honored by the Fiat Institution for withdrawal of Client's funds from such Deposit Accounts for distributions, investments, fees and other disbursements directed or agreed to by an Authorized Person. All applicable wire transfer fees shall be paid by the Client.

For the sub-account held for the benefit of Client, Anchorage will keep records to obtain pass-through FDIC coverage of up to the maximum coverage level of $250,000 per Client at a single Fiat Institution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **Ownership and Intellectual Property Rights.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1. <u>Services and Documentation</u>. As between the Parties and subject to Sections 3.2 (Outputs of Services) and 3.3 (Client Data), Anchorage owns all right, title and interest in and to the Services, the Documentation, and all Intellectual Property Rights in the Services and the Documentation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2. <u>Outputs of Services</u>. Anchorage hereby grants Client a perpetual, royalty-free, non-transferable (except as provided in Section 12.10), non-sublicensable, (except to Affiliates of Client, Authorized Persons, Agent, and any Third Parties authorized by Client in accordance with Section 1.7), worldwide license to use, import, distribute, copy, reproduce, display, transmit, perform, excerpt, reformat, adapt, or otherwise modify and create derivative works of all output materials and results from use of the Services and documentation by Client, its Affiliates, Agent, or Authorized Persons, including any reports, graphics, data, specification, programs and all other materials or computer output ()"**Outputs** ").

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3. <u>Client Data</u>. As between the Parties, Client owns all right, title and interest in and to Client Data, including all Intellectual Property Rights in Client Data. Client hereby grants Anchorage, and any of its Affiliates approved by Client in writing to provide Services, a perpetual, royalty-free, non-transferable (except as provided in this Section 3.3 or Section 12.10), non-sublicensable, worldwide license to disclose and use Client Data solely to (i) operate, manage, and improve the Services provided to Client, its Affiliates, Authorized Persons or applicable Third Parties pursuant to this Agreement; (ii) monitor, process and support Directions or as necessary to effect, administer, or enforce a transaction or directive that Client otherwise requests or authorizes, including to facilitate use of Services provided by Anchorage Affiliates; and (iii) comply with legal or regulatory obligations applicable to the Services including financial reporting and retention of related data. For clarity, Anchorage may not use Client Data for any other purpose without the express written consent of Client. Notwithstanding the foregoing, Anchorage may only disclose and use Client Data in a de-identified and anonymized form and in aggregation with data from Anchorage's other clients. For purposes of this Agreement, Client Data is "de-identified" or "anonymized" only if all identifiers that directly or indirectly identify the source and subject of such data with Client have been removed, and it does not enable a Third Party to discern, decompile, recreate, or reverse engineer any particular trading strategy of Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4. <u>Feedback</u>. From time to time, Client may submit or provide suggestions, requests for features, recommendations, or ideas to Anchorage ()"**Feedback** "). For clarity, Client is not required to submit any Feedback under this Agreement and Client retains all right, title, and interest in and to Feedback, including all Intellectual Property Rights in Feedback. To the extent Client provides Feedback to Anchorage during the Term, Client hereby grants Anchorage a non-exclusive, worldwide, royalty-free, irrevocable, non-sub-licensable, perpetual license to use the Feedback, without consideration or compensation to Client or Authorized Persons, Affiliates, agents, partners, or personnel (except to Affiliates of Anchorage approved by Client in writing to provide Services).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5. <u>Reservation of Rights</u>. Except for the rights and licenses granted under this Agreement, each Party agrees that, subject to applicable Law, (a) nothing in this Agreement will be construed as granting any rights of a Party to the other Party, by license or otherwise, in or to any Confidential Information or Intellectual Property Rights of such Party or its Affiliates, and (b) all rights in and to the Intellectual Property Rights of such Party that are not expressly granted herein are reserved by such Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **Term and Termination.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1. <u>Term</u>. This Agreement is effective as of the Effective Date and will continue in full force and effect for the Initial Term period in the Order Form, and will be automatically renewed on the same terms for each successive Renewal Term specified in the Order Form (the Initial Term and each Renewal Term collectively referred to herein as the "**Term** "). The Client may elect not to renew the Agreement by providing written notice of cancellation and non-renewal no less than thirty (30) days prior to the expiration of the current Term or unless sooner terminated as set forth in this Agreement. Anchorage may elect not to renew the Agreement by providing written notice of cancellation and non-renewal no less than one hundred eighty (180) days prior to the expiration of the current Term or unless sooner terminated as set forth in this Agreement.

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4.2.<u> </u> <u>Termination for Cause or Anchorage Cause</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless specifically permitted herein, Anchorage shall not suspend, restrict, terminate or modify and shall continue to provide the Services, including, (i) the custody of Client's Digital Assets on Client's behalf, the processing of withdrawals, deposits, and the other Services, or (ii) access to the Technology Platform, in each case unless and until Anchorage provides 180 days' (the "**Notice Period**") prior written notice to Client describing in reasonable detail the suspension, restriction, termination or modification that Anchorage will implement or, solely with respect to the Transition Services, the end of the Transition Period; provided however, that if after the date of the Agreement, there occurs any change in or adoption of any applicable law, rule, or regulation which, in the reasonable opinion of counsel to Anchorage will prohibit or materially impede some or all of the arrangement contemplated by this Agreement (a "**Change in Law** "), the parties will, in good faith and acting in a commercially reasonable manner intended to produce a commercially reasonable result, agree on modifications to the Agreement or Services that would enable compliance with such Change in Law or, in the case of a material impediment, reduce the impact to the parties of such Change in Law and Anchorage shall continue to provide the Services as contemplated herein unless prohibited from doing so by the Change in Law. If the parties cannot agree on modifications within thirty (30) day's following notice from Anchorage or if the Change in Law requires that Anchorage immediately ceases providing any Services, Anchorage may, only following notice in writing to Client, suspend, restrict or terminate the Services solely to the extent necessary to account for the Change in Law, provided that Anchorage agrees that any suspension, restriction, termination or modification arising from a Change in Law shall be narrowly tailored to enable compliance with such Change in Law and, to the extent not prohibited by the Change in Law, Anchorage will continue to provide, at a minimum, the Transition Services following any Change in Law. Anchorage represents, warrants and covenants that it will promptly notify Client of any proposed or announced change in law, rule or regulation that may result in a Change in Law hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Anchorage may terminate this Agreement in its entirety for any reason and without Cause by providing at least 180 days' prior written notice to Client and Client may terminate this Agreement in whole or in part for any reason by providing at least thirty (30) days' prior written notice to Anchorage, provided, however, in each case, Anchorage shall not restrict, suspend, or modify the Services following any termination without Cause or any termination by Client until the end of any such notice period and neither party's termination of this Agreement shall be effective until Client and Anchorage have fully satisfied their obligations hereunder.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Regardless of any other provision of this Agreement, but subject to Section 4.2(i) below, upon the occurrence and during the continuance of an event that constitutes Cause (as defined below) (unless, with respect to a non-continuing event that constitutes Cause, Anchorage has already commenced exercising its rights under this Section or has otherwise notified Client that it will promptly do so, in each case while such event is continuing) and after giving effect to any notice requirement and cure period that may apply, Anchorage may, in its reasonable discretion, take any of the following actions: (i) terminate, in whole or in part, the Agreement, and/or (ii) suspend, restrict or terminate the Client's Services, except for the Transition Services during the Transition Period.

"**Cause**" shall mean: (i) Client materially breaches any provision of this Agreement and such breach remains uncured for a period of thirty (30) calendar days after notice of such breach is provided by Anchorage to Client; or (ii) a Bankruptcy Event (as defined below) occurs and is continuing with respect to Client.

"**Bankruptcy Event**" means the party is (i) dissolved (other than pursuant to a consolidation, amalgamation or merger); (ii) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (iii) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (iv) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors' rights, or a petition is presented for its winding-up or liquidation, and in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (I) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (II) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (v) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (vi) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (vii) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (viii) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (i) to (vii) (inclusive); or (ix) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If Anchorage elects to exercise its remedies hereunder, Anchorage will notify Client in writing prior to exercising such remedies, unless a court order or other legal or regulatory process prohibits Anchorage from providing Client with such notice.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Upon receipt of written notice from Client of any event that constitutes Cause, if Anchorage fails to exercise any of its rights and remedies above for a period of 20 days following the receipt of such notice requesting a waiver, then Anchorage shall have waived its right to terminate the Agreement or exercise any other rights or remedies by reason of such event and such event shall be deemed to have been cured regardless of whether it continues after such waiver; provided however that this provision (i) does not limit Anchorage's right to take any actions with respect to an event that constitutes Cause as the result of the separate occurrence of such event or the occurrence of any other such event and (ii) shall not apply to any Bankruptcy Event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Regardless of any other provision of this Agreement, upon the occurrence and continuance of an Anchorage Termination Event (as defined below) (unless, with respect to a non-continuing event that constitutes an Anchorage Termination Event, Client has already commenced exercising its rights under this Section or has otherwise notified Anchorage that it will promptly do so, in each case while such event is continuing) and after giving effect to any notice requirement and cure period that may apply, Client may, in its reasonable discretion, take any of the following actions: (i) terminate, in whole or in part, the Agreement and accelerate the obligations hereunder, (ii) cancel outstanding withdrawals or deposits (including those that have been submitted or are in the process of being fulfilled), (iii) make a written demand on Anchorage for the return of all Client assets, including Client Digital Assets and fiat currency, (iv), seek Specific Performance (as defined below) with respect to any obligations hereunder, and (v) with respect to a Bankruptcy Event, or an Anchorage Termination Event, exercise its right of set-off hereunder, and (vi) determine its claim against Anchorage using the Benchmark Valuation and seek payment thereof. In addition, Client's payment obligations under the Agreement shall be suspended upon the occurrence and during the continuance of an Anchorage Termination Event. Notwithstanding anything herein to the contrary, all rights granted hereby shall be without prejudice to any right to which Client is at any time is otherwise entitled (whether by operation of law, contract or otherwise) and, other than as specifically provided herein, no delay or omission by Client in exercising any right or remedy hereunder shall operate as a waiver of the future exercise of that right or remedy or of any other rights or remedies hereunder. In the event Client exercises its remedies hereunder, Anchorage shall, upon demand, pay to Client all documented and reasonable costs and expenses, including reasonable attorneys' fees and court costs, and trading fees incurred by Client in connection with the enforcement of its rights hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) If an Anchorage Termination Event occurs and Client elects to exercise its remedies hereunder against Anchorage, Client will notify Anchorage in writing prior to exercising such remedies, unless a court order or other legal or regulatory process prohibits Client from providing Anchorage with such notice.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) "**Anchorage Termination Event**" means the occurrence and continuance of (i) a Bankruptcy Event with respect to Anchorage, (ii) the failure of Anchorage to withdraw or transfer Client bitcoin or ether in accordance with Client's Directions within the time periods set forth in this Agreement and such failure is not cured within two (2) Business Day following Client providing written notice to Anchorage ()"**Anchorage Return Cure** "); provided, however, that (A) if, prior to the expiration of the Anchorage Return Cure, Anchorage transfers cash to Client in an amount equal to the value of the bitcoin or ether based on the Benchmark Valuation as of the time that the request to transfer or withdraw was originally made by Client (the "**BTC/ETH Cash Value**") or if Anchorage delivers cash collateral to an account designated by Client and in which Client has a perfected, first priority security interest and in an amount equal to the BTC/ETH Cash Value until the relevant Digital Asset is sold, withdrawn or transferred or Client elects to receive such amount in cash in lieu of Anchorage's obligation to withdraw or transfer the relevant Digital Asset, in each case, such failure will be deemed cured; provided, further that, Client shall have the right to choose whether to receive the BTC/ETH Cash Value in lieu of the relevant Digital Asset or receive the BTC/ETH Cash Value as cash collateral, or (B) if such failure is due to a technology or security issue where, in the commercially reasonable opinion of Anchorage, returning the relevant Digital Assets would result in material risk to Client or Anchorage or may result in the relevant Digital Assets being lost or otherwise not successfully returned and Anchorage promptly notifies Client promptly upon Client's notice of such failure, (1) Client may request that Anchorage still withdraw or transfer the Digital Assets, but Anchorage will have no liability with respect to any such withdrawal or transfer (unless Anchorage acts with negligence unrelated to such technology or security issue) and any failure to withdraw or transfer shall not result in an Anchorage Termination Event if Client does not receive the withdrawn or transferred Digital Assets or the proceeds of any such sale due to such technology or security issue, or (2) if Client does not elect to have Anchorage still make the withdrawal or transfer, an Anchorage Termination Event shall not occur while the relevant security or technology event is occurring and continuing, (iii) the failure of Anchorage to withdraw or transfer cash to Client in accordance with Client's Directions within the time periods set forth in this Agreement and such failure is not cured within one (1) Business Day following Client providing written notice to Anchorage, (iv) Anchorage intentionally or willfully, materially breaches any provision of the Agreement and such breach remains uncured for a period of 10 calendar days after notice of such breach is provided by Client to Anchorage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Notwithstanding any termination of the Agreement for Cause, during any Transition Period (as defined below) Anchorage shall continue to provide the Transition Services (as defined below) and render such assistance as the Client or its affiliates may reasonably request to enable the continuation and orderly assumption of the Transition Services to be effected by the Client, an affiliate of the Client or any alternative service provider and shall continue to provide the Transition Services pursuant to the Agreement, except to the extent any Transition Service is prohibited under applicable law (including but not limited to applicable sanctions programs) or by a facially valid subpoena, court order, or binding order of a government authority; and (ii), notwithstanding anything to the contrary herein, in no event shall Anchorage, its affiliates, or their respective officers, directors, agents, employees and representatives have any liability to Client or Agent for any Claims or Losses arising out of or relating to the Agreement during the 91st day through the end of the Transition Period, which do not result from its gross negligence, fraud, material violation of applicable law or willful misconduct; provided that throughout the Transition Period Anchorage shall act in good faith and in a commercially reasonable manner to provide the same level of service with respect to the Transition Services as was provided prior to the start of the Transition Period. For the avoidance of doubt, during the Transition Period, Fees will continue to apply to the Transition Services.

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"**Transition Period**" means a 180-day period (or such extended period as agreed in writing by Anchorage and Client) commencing on the date Client is notified of any termination of the Agreement pursuant to this Section 4.2(c).

"**Transition Services**" means the Services consisting of (i) the custody of Client's Digital Assets on Client's behalf, the processing of deposits and withdrawals and the other Services, and (ii) access to the Technology Platform.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3. <u>Effect of Termination Notice</u>. Upon termination of this Agreement, Client will pay Anchorage all Fees, as provided in the Order Form, and documented expenses permitted by this Agreement, if any, for Services rendered to Client through the effective date of termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4. <u>Other Obligations and Rights on Termination</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Digital Assets. A Digital Asset will be deemed to have been returned to Client when: (i) a transfer of the Digital Asset initiated by Anchorage to Client's designated destination address has received a commercially reasonable number of confirmations on the relevant Blockchain; or (ii) via an alternative method specified in Section 4.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Confidential Information and Client Data. At the Disclosing Party's written request, the Receiving Party will return or destroy any or all of the Disclosing Party's Confidential Information. In addition, upon Client's written request, Anchorage will return or destroy all Client Data. Notwithstanding the foregoing, either Party may retain a copy of Confidential Information and Client Data as permitted by this Agreement, provided that Section 8 shall continue to apply to all such retained information, notwithstanding termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **Fees and Taxes.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1. <u>Fees</u>. Client will pay Anchorage the Fees for the Services as set forth in the Order Form, in any addendum or attachment to this Agreement, or as otherwise agreed in writing between the Parties. Upon termination, Client shall be responsible for payment of any Fees accrued until the Client transfers all of Client's assets out of Client's Account, or until the assets are abandoned and forfeited.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2. <u>Invoices; Payment Terms</u>. Anchorage will submit invoices for the Services as set forth in the Order Form. Except as otherwise set forth in the Order Form, Client agrees to pay all undisputed invoices net thirty (30) days following receipt. If Client reasonably disputes any portion of an invoice, including the difference between CryptoCompare.com as referenced in the definition of "AUC" and Benchmark Valuation, Client agrees, within the foregoing 30-day period, to (i) pay the undisputed amounts; and (ii) provide a detailed explanation with all supporting documentation of the basis for its dispute. The first invoice will be sent after the end of the calendar month including the Fees Commencement Date, unless otherwise agreed in writing by the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3. <u>Taxes.</u> The Fees do not include all taxes, assessments, duties, and other governmental and similar charges ()"**Taxes**") that may be assessed on Client or Client's assets by governmental authorities, which are Client's sole obligation to remit unless otherwise mandated by law. Client shall be liable for all Taxes relating to any Digital Assets held on behalf of Client or any transaction related thereto. Client shall remit to Anchorage for the amount of any Tax that Anchorage is required under applicable Laws (whether by assessment or otherwise) to pay on behalf of, or in respect of activity in the Account of Client. In the event that Anchorage is required under applicable law to pay any Tax on behalf of Client, Anchorage shall promptly notify Client of the amount required and Client shall promptly transfer to Anchorage the amount necessary to pay the Tax. Anchorage agrees that the Client may withhold or deduct Taxes as may be required by applicable law. Anchorage agrees that the Client may withhold or deduct Taxes from any payment of Fees to Anchorage as may be required by applicable law and as documented by Client to Anchorage and any such amounts so withheld or deducted shall be treated as having been paid to Anchorage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4. <u>Reserve</u>. With Client's prior written agreement, Anchorage may establish a reserve account to ensure Client pays Fees ()"**Reserve Account**") if Client: (i) breaches this Agreement; (ii) is subject to a material regulatory action or proceeding that Anchorage reasonably determines makes it prudent for it to engage counsel or incur expenses to manage the Account; or (iii) is likely to become the subject of bankruptcy or insolvency proceedings, each as reasonably determined by Anchorage. If Anchorage creates a Reserve Account, Anchorage will provide prior written notice to the Client of the reasons therefore and the required Reserve Account balance. Anchorage may use Reserve Account funds to pay Client obligations to Anchorage, and if such funds are used, Anchorage will account to Client for such funds used in Client's monthly statements. In no case shall any amounts held in the Reserve Account constitute "demand deposits" or be withdrawable by check or similar means for payment to Third Parties or others, within the meaning of 12 U.S.C. 1841(c)(2)(D)(iv)(1).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **Representations and Warranties; Disclaimers.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1. <u>Mutual Representations and Warranties</u>. Each Party represents, warrants, and covenants that: (i) it is a validly organized entity under the laws of the jurisdiction of its incorporation; (ii) it has all rights, power, and authority necessary to enter into this Agreement and perform its obligations hereunder; and (iii) its performance of this Agreement, and the other Party's exercise of its rights under this Agreement, will not conflict with or result in a breach or violation of any of the terms or provisions or constitute a default under any agreement by which it is bound or any applicable Laws.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2. <u>Anchorage Representations and Warranties</u>. Anchorage represents, warrants and covenants as of the Effective Date and each calendar day during the Term that: (i) the Services will conform to this Agreement; (ii) it is the owner of or is duly authorized to provide all Services; (iii) it has all rights necessary to grant all the rights and licenses that it purports to grant and perform all of its obligations under this Agreement; (iv) it is not aware of any claim that the Services, and the use thereof by any Authorized Person in accordance with this Agreement, infringe upon or otherwise violate any statutory, common law or other rights of any Third Party in or to any Intellectual Property Rights therein; and (v) as of the Effective Date, there is no pending, threatened, or anticipated claim, suit, or proceeding affecting or that could affect Anchorage's ability to perform and fulfill its obligations under this Agreement.

In addition, Anchorage represents, warrants and covenants as of the Effective Date and each calendar day during the Term that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Anchorage has adopted, implemented, and shall maintain and follow a reasonable risk- based sanctions compliance program ()"**Sanctions Program**") that complies with all applicable economic sanctions laws and regulations imposed by the United States (including as administered and/or enforced by the Office of Foreign Assets Control), the United Kingdom, the European Union, the United Nations and other applicable jurisdictions (collectively "**Sanctions Laws** "). That Sanctions Program prevents Digital Assets, deposits, withdrawals, transfers or transactions from being directly or indirectly derived from or associated with persons, entities or jurisdictions that are the target or subject of sanctions in violation of any Sanctions Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Anchorage has also adopted, implemented and shall maintain and follow an anti-money laundering program ()"**AML Program**") that complies with (i) all applicable laws and regulations relating to anti-money laundering, including the Bank Secrecy Act, as amended by the USA PATRIOT Act and the Anti-Money Laundering Act of 2020 (collectively "**AML Laws** "), and (ii) industry best practice. As part of its AML Program, Anchorage performs both initial and ongoing due diligence on each of its customers, as well as ongoing transaction monitoring that is designed to identify and report suspicious activity conducted through customer accounts, as required by law. The above AML controls are applied to all transactions and asset transfers conducted by Anchorage, and to all customer accounts opened at Anchorage, including any opened by authorized participants of the Client or trading counterparties of the Client (collectively known as "**Counterparty Accounts**") for the purpose of facilitating bitcoin or ethereum deposits to, and withdrawals from, the Client's Account].

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All fund movements, whether from a public blockchain address outside Anchorage or from an account within Anchorage, into Client's Account or a Counterparty's Account at Anchorage will be sanctions screened, including with blockchain analytics software, to ensure that bitcoin or ethereum in kind transactions did not originate from persons, entities or jurisdictions that are the target or subject of sanctions, or associated with such persons, entities or jurisdictions, or otherwise in violation of any Sanctions Laws, prior to any onward transfer to the Client's Account(s) at Anchorage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) In the event sanctions screening results in a bitcoin or ethereum in-kind transaction being suspected or determined to be in violation of any Sanctions Laws, Anchorage will (a) block or reject the deposit of such bitcoin or ethereum into Client's Account or the Counterparty Account, as applicable, in accordance with applicable Sanctions Laws, and (b) promptly inform the Client if any fund movement or attempted fund movement into Client's Account, including between a Counterparty Account at Anchorage and the Client's Account(s) at Anchorage, involves the aforementioned. Furthermore, in the event of blocking, Anchorage will assess the need to segregate the assets and file a report on blocked property in accordance with applicable Sanctions Laws. Anchorage will inform the Client should it file such a report as legally permitted

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Anchorage also agrees to provide Client with (i) a quarterly report or attestation, as applicable, on the sanctions screening results of any fund movement between a Counterparty Account at Anchorage and the Client's Account(s), after the end of the calendar quarter, and (ii) to the extent permitted by law, such information as it may reasonably request, to enable Client to fulfill its obligations under Sanctions Laws and AML Laws, including an annual attestation regarding Anchorage's AML Laws and Sanctions Laws controls. Client is permitted to share this report with service providers of the Client and authorized participants and trading counterparties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Anchorage complies with all applicable Laws, including U.S. securities laws and regulations, as well as AML Laws, Sanctions Laws, banking laws, and any other laws and regulations to which it is subject.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) It possesses and will maintain, all licenses, registrations, authorizations and approvals required by any applicable government agency or regulatory authority for it to operate its business and provide the Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) It is and shall remain in good standing with all relevant government agencies, departments, regulatory and supervisory bodies to the extent relevant and material to its performance hereunder, and it will, to the extent permitted under applicable law and by such relevant government agency, department, regulatory and supervisory body, promptly notify Client if it ceases to be in good standing with any regulatory authority;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) It shall promptly provide information as the Client may reasonably request in writing from time to time in connection with its provision of the Services, to the extent reasonably necessary for the Client to comply with any applicable laws, rules, and regulations (including money laundering statutes, regulations and conventions of the United States or other jurisdictions), or the guidance or direction of, or request from, any regulatory authority or financial institution, in each case related to its performance hereunder and to the extent that providing such information is not prohibited by applicable law;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) It has all rights necessary to provide Client with access to the Technology Platform and any other tech/data provided by Anchorage (the "Anchorage Tech") as contemplated herein; and the intended use by Client of the Anchorage Tech as described in and in accordance with this Agreement shall not infringe, violate or misappropriate the intellectual property rights of any third party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) Anchorage and each Anchorage Affiliate has policies and procedures in place that are designed to mitigate conflicts of interest. Anchorage and each Anchorage Affiliate will maintain appropriate and effective arrangements to eliminate or manage conflicts of interest, including segregation of duties, information barriers and training. Anchorage will notify Client, on behalf of itself and each Anchorage Affiliate, in accordance with the notice provisions hereof of changes to its or such Affiliate's business that are material to its or its Affiliate's ability to manage its conflicts of interest.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) Anchorage shall only permit the transfer of Digital Assets to Client's Account from, or withdraw assets from Client's Account to, a public wallet address on the Blockchain that Anchorage has onboarded through its AML Program and performed sanctions screening on, including with blockchain analytics software (such address, a "**whitelisted address** ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3. <u>Client Representations and Warranties</u>. The Client represents, warrants and covenants as of the Effective Date and as of each Direction from Client provided hereunder that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Client has policies and procedures in place reasonably designed to maintain compliance with all applicable Laws to the extent relevant and material to its performance hereunder, including U.S. securities laws and regulations, as well as AML Laws, to the extent relevant and material to its performance hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Client is and shall remain in good standing with all relevant government agencies, departments, regulatory, and supervisory bodies to the extent relevant and material to its performance hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Client shall promptly provide information as Anchorage may reasonably request in writing from time to time regarding: Client's use of the Services to the extent reasonably necessary for Anchorage to comply with any applicable laws, rules, and regulations (including money laundering statutes, regulations and conventions of the United States), or the guidance or direction of, or request from, any regulatory authority or financial institution, in each case related to its performance hereunder, provided that such information may be redacted to remove Confidential Information not relevant to the requirements of this Agreement;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Client's use of the Services shall be for commercial, business purposes only;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Client is, and will at all times remain, the owner or beneficial owner of all Digital Assets handled under this Agreement, subject only to liens and encumbrances granted to Anchorage pursuant to this Agreement, if any, or otherwise created as part of the Client's business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any Digital Assets or fiat currency deposited into any Account are not to Client's knowledge proceeds of a crime.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4. The Agent represents to Anchorage, that the Client (a) has duly authorized Agent to execute and deliver the Agreement on behalf of such Client and (b) has the power to so authorize Agent.

Notwithstanding anything to the contrary contained in this Agreement or any annex, schedule, addendum, confirmation or other document issued or delivered in connection with any transaction hereunder, Anchorage acknowledges and agrees that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Agent is acting in connection with any transaction hereunder solely in its capacity as agent and trustee to the Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Neither Agent nor any of its affiliates, subsidiaries or successors, in each case, to the extent that such affiliates, subsidiaries or successors are not Clients under this Agreement shall have any obligation of any kind or nature whatsoever, by guaranty, enforcement or otherwise, with respect to the performance of any Client's obligations, agreements, representations or warranties under the Agreement or any transaction hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Other than with respect to the payment of Fees, Agent and its affiliates shall have no responsibility or liability to pay any costs, expenses, damages or claims arising under or in connection with or in any way relating to this Agreement or any transaction hereunder entered into on behalf of a Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) No recourse of any kind or nature whatsoever shall be had against the Agent or any affiliate, subsidiary or successor to Agent, or against any incorporator, shareholder, officer, director, member, manager, employee or agent of any Agent (each, an "**Agent Party**") with respect to any of the covenants, agreements, representations or warranties contained in this Agreement or any annex, or schedule hereto, or any addendum, or any other document issued or delivered in connection with any transaction entered into under this Agreement, in each case unless otherwise provided in the relevant document or if any Agent Party is or becomes a Client under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Other than with respect to the Fees, under no circumstances shall the Agent or any Agent Party be in any way individually or personally liable under this Agreement and Anchorage shall look solely to the assets and property of the Client that are under management by Agent for performance of the Agreement or payment of any claim under the Agreement with respect to such Client; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Agent acknowledges and agrees that the payment of Fees is the obligation of Agent as principal and Agent shall be liable to Anchorage for the failure to pay such fees when due under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5. <u>Anchorage Disclaimers</u>. **Except to the extent set forth herein, THE SERVICES ARE PROVIDED** "**AS IS** "**AND** "**AS AVAILABLE,** "**WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED. EXCEPT AS PROVIDED HEREIN, ANCHORAGE EXPLICITLY DISCLAIMS ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT, AND ANY WARRANTIES ARISING OUT OF THE COURSE OF DEALING OR USAGE OF TRADE.** The Parties further acknowledge and agree that Anchorage has no obligation to inquire into, and shall not be liable for any damages or other liabilities or harm to any person or entity relating to: (i) the authority of any Authorized Person to act on behalf of the Client with respect to a Digital Asset; (ii) the accuracy or completeness of any Client Data or information provided by Client or any Authorized Person with respect to a Digital Asset or Direction; or (iv) the collectability, insurability, or suitability of any Digital Asset.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6. <u>Prohibition Against Nested Transactions</u>. Deposits or withdrawals of assets to or from Client's Account shall be for Client's own benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **Security Requirements; Personal Information.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1. <u>Security Requirements; Personal Information</u>. Client and Anchorage hereby agree that the Data Processing Addendum provided in  **<u>Exhibit A</u>** to Addendum 1 below shall apply to and is hereby incorporated into this Agreement. Client will comply with and cause Authorized Persons and its Representatives to comply with the terms and conditions set forth in the Data Processing Addendum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2. <u>Breach Notifications</u>. Anchorage agrees to notify Client of any Personal Data Breach involving Client Data within twenty-four (24) hours of the occurrence of the Personal Data Breach.

7.3.<u> </u> <u>[Reserved.]</u> 

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **Confidentiality.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1. Client and Anchorage each agree that with respect to any non-public, confidential or proprietary information of the other Party, including the existence and terms of this Agreement, Client Data, Client's deposit and withdrawal details, and information relating to the other party's business operations or business relationships (including Fees), and any arbitration pursuant to this Agreement (collectively, "Confidential Information"), it (a) will not disclose such Confidential Information except to such party's officers, directors, agents, employees and professional advisors who need to know the Confidential Information for the purpose of assisting in the performance of this Agreement and who are informed of, and agree to be bound by obligations of confidentiality no less restrictive than those set forth herein and (b) will protect such Confidential Information from unauthorized use and disclosure. Each Party shall use any Confidential Information that it receives solely for purposes of (i) exercising its rights and performing its duties under the Agreement and (ii) complying with any applicable laws, rules and regulations. Confidential Information shall not include any (w) information that is or becomes generally publicly available through no fault of the recipient; (x) information that the recipient obtains from a third party (other than in connection with this Agreement) that, to the recipient's best knowledge, is not bound by a confidentiality agreement prohibiting such disclosure; (y) information that is independently developed or acquired by the recipient without the use of Confidential Information provided by the disclosing party; or (z) disclosure with the prior written consent of the disclosing Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2. Notwithstanding the foregoing, each Party may disclose Confidential Information of the other Party to the extent required by a court of competent jurisdiction or governmental authority, regulatory body or otherwise required by law, regulation or the rules of any exchange; provided, however, the Party making such required disclosure shall first notify the other Party (to the extent legally permissible) and shall afford the other Party a reasonable opportunity to seek confidential treatment if it wishes to do so and will consider in good faith reasonable and timely requests for redaction. All documents and other tangible objects containing or representing Confidential Information and all copies or extracts thereof or notes derived therefrom that are in the possession or control of the receiving Party shall be and remain the property of the disclosing Party and shall be promptly returned to the disclosing Party or destroyed, each upon the disclosing Party's request; provided, however, notwithstanding the foregoing, the receiving Party may retain one (1) copy of Confidential Information if (a) required by law or regulation; or (b) retained pursuant to an established document retention policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3. Other than as provided in this Section, Anchorage may not identify to any third party that Client is a customer or licensee of Anchorage without Client's prior written consent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4. Notwithstanding anything herein to the contrary, Client may disclose the existence of this Agreement to its investors and prospective investors. Additionally, notwithstanding anything herein to the contrary, Anchorage permit Client to reference Anchorage (including a description of Anchorage and/or business, as obtained from publicly available information on Anchorage's website or other public materials) as a service provider hereunder along with the existence and terms of this Agreement as may be required under applicable law, in its public disclosures contained in public filings. In addition, Client may file the Agreement as an exhibit in public filings with the Securities and Exchange Commission, as may be required under applicable law, provided that such information may be redacted to remove pricing and other proprietary information in the Agreement as permitted under applicable law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **Indemnification.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1. <u>Indemnification Obligation</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Client shall defend and indemnify and hold harmless Anchorage, its affiliates, and their respective officers, directors, agents, employees and representatives from and against any and all Third Party Claims and Losses arising out of or relating to Client's material breach of this Agreement, Client's violation of any law, rule or regulation related to the performance of its obligations under this Agreement, or Client's gross negligence, fraud or willful misconduct, in each case unless caused primarily by Anchorage's breach, negligence, willful misconduct, fraud, or failure to abide by the relevant standard of care as set forth in Section 10. This obligation will survive any termination of this Agreement as it relates to the Claims and Losses arising during the term of the Agreement or as it relates to activity during such term. Client shall not accept any settlement of any Claims or Losses if such settlement imposes any financial or non-financial liabilities, obligations or restrictions on, or requires an admission of guilt or wrong-doing from, any indemnified party pursuant to this Section 9.1(a), without such indemnified party's prior written consent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Anchorage shall defend and indemnify and hold harmless Client, its affiliates, and their respective officers, directors, agents, employees and representatives from and against any and all Claims and Losses to the extent arising out of or relating to Anchorage's: (i) any breach of Anchorage's confidentiality, data protection and/or information security obligations, (ii) violation of any law, rule or regulation with respect to the provision of the Services; (iii) the full amount of any Client Digital Assets lost (provided that clause (iii) will also include Claims and Losses that are direct damages to Client); (iv) gross negligence, fraud or willful misconduct; or (v) that Client's access or use of the Services, in accordance with the terms and conditions of this Agreement violates, misappropriates, or infringes upon any third party intellectual and/or industrial property rights, including patent rights, copyrights, moral rights, trademarks, trade names, service marks, trade secrets, rights in inventions (including applications for, and registrations, extensions, renewals, and re-issuances of the foregoing), in each case as it relates to the Claims and Losses arising during the term of the Agreement or as it relates to activity during such term (including, for the avoidance of doubt, any Transition Period). This obligation will survive any termination of this Agreement. Anchorage shall not accept any settlement of any Claims or Losses if such settlement imposes any financial or non-financial liabilities, obligations or restrictions on, or requires an admission of guilt or wrong-doing from, any indemnified party pursuant to this Section 9.1(b), without such indemnified party's prior written consent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2. For the purposes of this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) "Claim" means any action, suit, litigation, demand, charge, arbitration, proceeding (including any civil, criminal, administrative, investigative or appellate proceeding), hearing, inquiry, audit, examination or investigation commenced, brought, conducted or heard by or before, or otherwise involving, any court or other governmental, regulatory or administrative body or any arbitrator or arbitration panel; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) "Losses" means any liabilities, damages, diminution in value, payments, obligations, losses, interest, costs and expenses, security or other remediation costs (including any regulatory investigation or third party subpoena costs, reasonable attorneys' fees, court costs, expert witness fees, and other expenses relating to investigating or defending any Claim); fines, taxes, fees, restitution, or penalties imposed by any governmental, regulatory or administrative body, interest on and additions to tax with respect to, or resulting from, Taxes imposed on Client's assets, cash, other property, or any income or gains derived therefrom; and judgments (at law or in equity) or awards of any nature.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **Liability.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1. <u>CONSEQUENTIAL DAMAGES</u>. NEITHER PARTY HERETO SHALL BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, CONSEQUENTIAL OR SIMILAR LOSSES ("CONSEQUENTIAL DAMAGES"), EVEN IF THE OTHER PARTY HAD BEEN ADVISED OF OR KNEW OR SHOULD HAVE KNOWN OF THE POSSIBILITY THEREOF.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2. <u>DAMAGES LIMITATION</u>. OTHER THAN WITH RESPECT TO CLAIMS AND LOSSES ARISING FROM: (I) FRAUD OR WILFULL MISCONDUCT OF ANCHORAGE, (II) THE MUTUALLY CAPPED LIABILITIES (DEFINED BELOW), AND NOTWITHSTANDING ANY OTHER PROVISION HEREIN, IN NO EVENT WILL ANCHORAGE'S LIABILITY HEREUNDER EXCEED THE VALUE OF THE CASH OR AFFECTED DIGITAL ASSETS GIVING RISE TO SUCH LIABILITY. "MUTUALLY CAPPED LIABILITIES" MEANS (I) CLAIMS AND LOSSES ARISING FROM A PARTY'S BREACH OF ITS CONFIDENTIALITY OBLIGATIONS IN SECTION 8, (II) A PARTY'S INDEMNITY OBLIGATIONS SET FORTH IN SECTION 9 HEREOF (EXCEPT WITH RESPECT TO 9.1(b)(iii), WHICH SHALL NOT CONSTITUTE A MUTUALLY CAPPED LIABILITY), AND (III) CLAIMS AND LOSSES ARISING FROM THE VIOLATION, MISAPPROPRIATION, OR INFRINGEMENT BY A PARTY OF ANY THIRD PARTY INTELLECTUAL AND/OR INDUSTRIAL PROPERTY RIGHTS, INCLUDING PATENT RIGHTS, COPYRIGHTS, MORAL RIGHTS, TRADEMARKS, TRADE NAMES, SERVICE MARKS, TRADE SECRETS, RIGHTS IN INVENTIONS (INCLUDING APPLICATIONS FOR, AND REGISTRATIONS, EXTENSIONS, RENEWALS, AND RE-ISSUANCES OF THE FOREGOING). OTHER THAN WITH RESPECT TO LIABILITIES ARISING FROM A PARTY'S WILFULL MISCONDUCT OR FRAUD, AND NOTWITHSTANDING ANY OTHER PROVISION HEREOF, IN NO EVENT WILL ANY PARTY'S LIABILITY FOR A MUTUALLY CAPPED LIABILITY EXCEED THE GREATER OF FIVE MILLION US DOLLARS (US$5,000,000) AND THE AGGREGATE AMOUNT OF FEES PAID BY CLIENT TO ANCHORAGE IN THE 12- MONTH PERIOD PRIOR TO THE EVENT GIVING RISE TO SUCH LIABILITY. WITH RESPECT TO CLAIMS AND LOSSES RELATED TO A WITHDRAWAL OR TRANSFER OF DIGITAL ASSETS, THE VALUE OF SUCH DIGITAL ASSETS SHALL BE DETERMINED BY REFERENCE TO THE BENCHMARK VALUATION ON THE DATE DELIVERY OF SUCH DIGITAL ASSETS IN CONNECTION WITH SUCH WITHDRAWAL OR TRANSFER IS DUE IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION, FOR THE AVOIDANCE OF DOUBT, ADDENDUM 1. "**BENCHMARK VALUATION**" SHALL MEAN FOR DIGITAL ASSETS THE CME CF BITCOIN REFERENCE RATE NEW YORK ("BRRNY") OR THE CME CF ETHER-DOLLAR REFERENCE RATE NEW YORK ("ETHUSD_NY"), AS APPLICABLE, PUBLISHED BY CME GROUP AT 4PM ON THE VALUATION DATE.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3. <u>SPECIFIC PERFORMANCE</u>. TO THE EXTENT ANCHORAGE IS LIABLE FOR ANY CLAIMS OR LOSSES CLIENT INCURS IN CONNECTION WITH THE SERVICES OR WITH RESPECT TO ASSETS CREDITED TO OR THAT SHOULD BE CREDITED TO THE CLIENT'S ACCOUNT, CLIENT AND ANCHORAGE AGREE THAT IRREPARABLE DAMAGE WOULD OCCUR IN THE EVENT ANY PROVISION OF THIS AGREEMENT WAS NOT PERFORMED IN ACCORDANCE WITH THE TERMS HEREOF AND THAT CLIENT SHALL BE ENTITLED TO SPECIFIC PERFORMANCE OF THE TERMS HEREOF, IN ADDITION TO ANY OTHER REMEDY AT LAW OR IN EQUITY.

"SPECIFIC PERFORMANCE" IS DEFINED AS THE OBLIGATION, IMMEDIATELY UPON NOTICE, TO: FOR ANY ERROR OR FAILURE OF PERFORMANCE OR DELIVERY WITH RESPECT TO A DIRECTION TO DEPOSIT, WITHDRAW OR TRANSFER DIGITAL ASSETS, TO DELIVER THE CORRECT QUANTITY OF DIGITAL ASSETS AS IF THERE HAD BEEN NO SUCH ERROR OR FAILURE OF PERFORMANCE OR DELIVERY; AND WITH RESPECT TO ANY FAILURE OF ITS OBLIGATION TO MAINTAIN DIGITAL ASSETS OR CASH IN THE ACCOUNT, TO DELIVER SUCH DIGITAL ASSETS OR CASH IN THE QUANTITY OR VALUE, RESPECTIVELY, AFFECTED BY SUCH FAILURE.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4. <u>STANDARD OF CARE.</u> AT MINIMUM, ANCHORAGE SHALL PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT IN ACCORDANCE WITH THE STANDARD OF A PRUDENT, PROFESSIONAL, COMPETENT, AND REGULATED PROVIDER OF CUSTODY SERVICES IN THE FINANCIAL INDUSTRY, UNLESS A HIGHER STANDARD IS SPECIFIED BY THIS AGREEMENT OR APPLICABLE LAW OR REGULATION.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **Dispute Resolution; Binding Arbitration.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1. <u>Arbitration</u>. Any Claim arising out of or relating to this Agreement, or the breach, termination, enforcement, interpretation or validity thereof, including any determination of the scope or applicability of the agreement to arbitrate as set forth in this Section, shall be determined by arbitration in the state of New York, before one neutral arbitrator. The arbitration shall be administered by JAMS pursuant to its Comprehensive Arbitration Rules and Procedures, and the award of the arbitrator (the "Award") shall be accompanied by a reasoned opinion. Judgment on the Award may be entered in any court having jurisdiction. This Agreement shall not preclude the Parties from seeking provisional relief, including injunctive relief, in any court of competent jurisdiction. Seeking any such provisional relief shall not be deemed to be a waiver of such party's right to compel arbitration. The Parties expressly waive their right to a jury trial to the extent permitted by applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2. <u>Arbitration</u>. In any arbitration arising out of or related to this Agreement, the arbitrator shall award to the prevailing party, if any, as determined by the arbitrator, all of its costs and fees. "Costs and fees" mean all reasonable pre-award expenses of the arbitration, including the arbitrator's fees, administrative fees, travel expenses, out-of-pocket expenses such as copying and telephone, court costs, witness fees, and attorneys' fees.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.3. The Parties acknowledge that this Agreement evidences a transaction involving interstate commerce. Notwithstanding the provision herein with respect to applicable substantive law, any arbitration conducted pursuant to the terms of this Agreement shall be governed by the Federal Arbitration Act (9 U.S.C. §§ 1-16).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.** **General Provisions.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.1. <u>Independent Contractor</u>. It is understood by the Parties that Anchorage is an independent contractor, and that this Agreement does not create or constitute a partnership, joint venture or employment relationship between the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2. <u>No Third Party Beneficiaries</u>. This Agreement is not intended to and shall not be construed to give any Third Party any interest or rights (including, without limitation, any Third Party beneficiary rights) with respect to or in connection with any agreement or provision contained herein or contemplated hereby, except as otherwise expressly provided for in this Agreement.

12.3.<u> </u> <u>[Reserved]</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.4. <u>Force Majeure</u>. Neither Anchorage nor the Client shall be liable to the other for delays, suspension of operations, whether temporary or permanent, failure in performance of this Agreement, or interruption of service in each case to the extent it is directly due to a cause or condition entirely beyond the reasonable control of the Party affected by it, including any act of God; embargo; natural disaster; act of civil or military authorities; act of terrorists; hacking (provided in the case of Anchorage that Anchorage has taken reasonable precautions and acts in a manner consistent with applicable law and its applicable policies and procedures with respect to hacking risks, that these applicable policies and procedures are consistent with industry best practices, and that in carrying out its duties Anchorage is not negligent); government prohibitions; civil disturbance; war; strike or other labor dispute; fire; severe weather; interruption in telecommunications, Internet services, or network provider services; unavailability of Fedwire, SWIFT or banks' payment processes; outbreaks of infectious disease or any other public health crises, including quarantine or other required employee restrictions; or any other catastrophe or material event which is beyond the reasonable control of the Party affected by it. For the avoidance of doubt, a cybersecurity attack, hack or other intrusion by a third party or by someone associated with Anchorage is not a circumstance that is beyond Anchorage's reasonable control, to the extent directly caused by Anchorage's failure to comply with its obligations under this Agreement, including any addendum, exhibit, or supplement. In any such event, the time for the Party's performance shall be deferred for a period of time equal to the time lost by reason of such event, provided that the delayed Party shall notify the other Party of such event and shall reasonably cooperate with the other Party in minimizing any adverse impact of such event.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.5. Neither Party will be liable to the other Party for the failure to perform or delay in the performance of its obligations under this Agreement to the extent such failure or delay is caused by or results from a Force Majeure Event. The affected Party will not be held liable by the other Party for such non-performance or delay as long as the fact of the occurrence of such Force Majeure Event is duly proven or is reasonably provable. In addition, Anchorage will not be liable to Client for any costs or expenses incurred by Client as a result of any Force Majeure Event. Notwithstanding the foregoing, if the delay in performance exceeds thirty (30) days, the Party awaiting performance will be permitted to terminate this Agreement upon five (5) days' prior written notice to the other Party, with no further obligation to the Party claiming excusable delay.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.6. <u>Notices</u>. All notices required or permitted under this Agreement will be in writing and delivered by courier, mail, electronic mail, or within the Anchorage application (except for service of legal process which shall be by courier). A Party's email addresses, or physical address may be changed from time to time by either Party by providing written notice to the other in the manner set forth above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.7. <u>Execution in Counterparts and by Electronic Means</u>. This Agreement may be executed in counterparts and by electronic means and the Parties agree that such electronic means and delivery will have the same force and effect as delivery of an original document with original signatures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.8. <u>Entire Agreement; Amendment</u>. This Agreement includes all addendums, exhibits, schedules, the Service Level Agreement and attachments referenced herein, all of which are incorporated herein by this reference. This Agreement is the final, complete, and entire agreement of the Parties. There are no other promises or conditions in any other agreement, oral or written. This Agreement supersedes and replace, as applicable, any prior promises, agreements, representations, undertakings, or implications whether made orally or in writing between the Parties related to the subject matter of this Agreement, including but not limited to, any prior Master Custody Services Agreements entered into between the Parties which shall be deemed terminated upon the execution of this Agreement. The Agreement may only be modified or amended in writing and signed by both Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.9. <u>Remedies Cumulative</u>. Each Party will have all of the rights and remedies provided by law in addition to the rights and remedies set forth in this Agreement and in any other agreement or writing between the Parties. All of a Party's rights and remedies are cumulative and may be exercised from time to time, and the pursuit of one right or remedy will not constitute an exclusive election or otherwise preclude or limit its pursuit of any other or additional right or remedy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.10. <u>Severability</u>. If any provision of this Agreement will be held to be invalid or unenforceable for any reason, the remaining provisions will continue to be valid and enforceable. If a court finds that any provision of this Agreement is invalid or unenforceable, but that by limiting such provision it would become valid and enforceable, then such provisions will be deemed to be written, construed and enforced as so limited.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.11. <u>Assignment</u>. No Party may assign any of its rights under this Agreement or delegate its performance under this Agreement without the prior written consent of the other Party except that either Party may assign its rights and delegate its performance under this Agreement to: (i) any entity that acquires all or substantially all of its assets; (ii) any Affiliate that controls, is controlled by, or is under common control; and (iii) any successor in a merger, acquisition, or reorganization, including any judicial reorganization provided that any entity providing services pursuant to assignment under each of (i), (ii) and (iii) above possess the necessary licenses to perform such services in compliance with applicable law and any entity providing custody services pursuant to this Agreement shall be a qualified custodian as defined under the Advisers Act. Any purported assignment in violation of this Section 12.11 will be null and void, ab initio, and of no force or effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.12. <u>Use of Affiliates</u>. Anchorage is, and will at all times be, responsible for the acts and omissions of its Affiliates, including Anchor Labs, Inc. Without limiting the generality of the foregoing, Anchorage hereby discloses that it is a subsidiary of Anchor Labs, Inc., which provides certain technology and administrative services to Anchorage in support of Anchorage's provision of Services hereunder, pursuant to an Intercompany Services Agreement between Anchorage and Anchor Labs, Inc., and all provisions under this Agreement that are applicable to Anchorage will apply equally to its Affiliates, including Anchor Labs, Inc. For the avoidance of doubt, this section does not apply to Anchorage's use of a Vendor, Fiat Institution, or other service provider. Notwithstanding the foregoing in no circumstances shall custodial services be provided by any entity other than Anchorage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.13. <u>Insurance.</u> Anchorage shall obtain and maintain, at its sole expense, insurance coverage in such types and amounts that are compliant with the requirements of Addendum 1 to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.14. <u>Governing Law</u>. This Agreement will be governed by and construed exclusively in accordance with the laws of the State of New York, without regard to its conflicts of laws provisions or rules. Subject to Section 11, the Parties hereby agree to submit to the exclusive jurisdiction of any appropriate court located in New York, New York, as a forum for litigation. Each of the Parties hereto hereby waives all right to trial by jury in any lawsuit, action, proceeding or counterclaim arising out of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.15. <u>Survival</u>. Any expiration or termination of this Agreement will not affect any accrued claims, rights or liabilities of Parties, and all provisions which must survive to fulfill their intended purposes, or by their nature are intended to survive such expiration or termination will survive, including Sections 2 - 12, and the Schedules.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.16. <u>Service Level Agreement</u>. Without prejudice to any other provision of this Agreement, the Anchorage Entities will use, at minimum, commercially reasonable efforts to perform its obligations under this Agreement (including, for the avoidance of doubt, any schedule, addendum, confirmation or other document issued or delivered in connection with any transaction hereunder) in accordance with the Service Level Agreement attached as  **<u>Exhibit A</u>** below, or to such higher standard as specified in this Agreement or by Applicable Law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.17. <u>Digital Asset Deposits and Withdrawals</u>. Anchorage will promptly, which in no event shall be longer than 12 hours, process supported Digital Asset deposit transactions into Client's Account according to the Authenticated Instruction received from Client or Client's Authorized Representatives, including, for the avoidance of doubt, Agent, and, except as otherwise explicitly set forth herein, Anchorage is not required to verify the accuracy of the Authenticated Instruction prior to processing. Client must verify the accuracy of all deposit and withdrawal information prior to submitting Directions to Anchorage regarding a Digital Asset deposit or withdrawal transaction. Except for its obligations under, and subject to, this Agreement, Anchorage shall have no liability, obligation, or responsibility for Client Digital Asset transfers conducted in reliance on Authenticated Instructions received from Client or Client's Authorized Representatives pursuant to this Agreement.

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**SCHEDULE A**

**DEFINITIONS**

"**Account**" means an account established in the name of, or for the benefit of a Client, in which the ownership of Digital Assets is recorded and to which Digital Assets are credited. Each Account is recorded separately on Anchorage's books and records and has one or more unique wallet addresses on the relevant Blockchain (e.g., in the case of bitcoin, the Blockchain associated with the Bitcoin network). An organization may have one or more Accounts, and an Account may have one or more Vaults. The Authorized Persons and Quorum requirements for each Account may differ from those of other Accounts.

"**Acceptable Device**" means a hardware device with software configuration set forth in Schedule B.

"**Affiliate**" means an entity controlling, controlled by or under common control with a Party.

"**Anchorage API**" means the application programming interface, as such may be modified from time to time, made available by Anchorage as part of the Services.

"**Annual Basis Points**" refers to the annual rate for custody fees. Monthly Custody Fees are charged at the rate of one-twelfth of the listed annual rate.

"**AUC**" or "**Assets Under Custody**" means the average daily balance of Client Digital Assets in Anchorage's custody each month, calculated after the conclusion of each month, where the average daily balance is determined by adding each daily balance and dividing the sum of the daily balances by the number of days in such month (or in the case of the first month, by the number of days in such month following the Fees Commencement Date). Daily balances are calculated in U.S. Dollars by applying closing prices, as provided by CryptoCompare.com at the close of each day (UTC), or if unavailable, other reliable, reputable third party pricing services, selected by Anchorage in its sole discretion, to the end of day holdings in the Account. If such source(s)' closing prices for certain Digital Assets are unavailable, or Anchorage reasonably determines that such prices are unreliable due to low or inconsistent trading volumes, Anchorage may use fixed pricing for such Digital Assets , which will be determined by prior written agreement with Client. 

"**Authenticated Instruction**" means a Direction (i) regarding specific Digital Assets; (ii) to add or remove Authorized Persons; (iii) to generate or remove, or change permissions for, Anchorage API keys; or (iv) which is otherwise provided for by the Services; by (a) an Authorized Person that has received Quorum approval (where such Quorum approval is required) or (b) an authorized application using an Anchorage API key (generated by an Authorized Person). All Authenticated Instructions shall be received and authenticated by Anchorage in accordance with reasonable security procedures, or they shall not constitute Authenticated Instructions. Anchorage's authentication processes and procedures, including security procedures defined herein, will be determined by Anchorage in its reasonable discretion, subject to this Agreement, and in accordance with applicable law and regulation and industry best practices of comparable custodians that are chartered banks and trust companies, from time to time, and will include various measures, including, without limitation, biometric authentication for each Authorized Person, which may include but are not limited to fingerprint, facial recognition, or voiceprint. Where the purpose of an Authenticated Instruction relates to Digital Assets, such an Authenticated Instruction is an entitlement order for purposes of Article 8.

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"**Authorized Person**" means a person nominated by Client, and thereafter approved by Anchorage pursuant to Section 2.1.

"**Basis Point**" means 1/100<sup>th</sup> of 1%.

"**Bitcoin**" or "**BTC**" (whether capitalized or not) is a type of Digital Asset that is the native asset of the Bitcoin network, which is peer-to-peer network of nodes which implement the Bitcoin protocol.

"**Blockchain**" means software operating a distributed ledger which is maintained by a network of computers, and that records all transactions in a Digital Asset in theoretically unchangeable data packages known as blocks, each of which are timestamped to reference the previous block so that the blocks are linked in a chain that evidences the entire history of transactions in the Digital Asset.

"**Client Data**" means any or all of the following, and all copies thereof, regardless of the form or media: (i) Personal Information of Client or an Authorized Person; and (ii) any non-public data or information provided or submitted by or on behalf of Client or an Authorized Person as part of the Services.

"**Confidential Information**" has the meaning given in the body of this Agreement.

"**Digital Asset**" means a digital representation of value that may function as a medium of exchange or medium for investment, including both bitcoin and Ethereum, and which is evidenced on, and can be electronically received and stored using distributed ledger technology. For the avoidance of doubt, Digital Assets held by Anchorage for the Client are "Financial Assets" for purposes of the UCC and are not assets of Anchorage.

"**Direction**" means Authenticated Instructions, through the Anchorage application made by Authorized Persons, or the Anchorage API, relating to the storage or transfer of Digital Assets. All Directions shall be Authenticated Instructions or they shall not constitute Directions.

"**Documentation**" means all Client manuals, training and marketing materials, guides, product descriptions, product specifications, technical manuals, supporting materials, and other information relating to the Services and provided by Anchorage to Client.

"**ETH**", "**ether**", or Ethereum (whether capitalized or not) means a type of Digital Asset called Ether that is the native asset of the Ethereum Mainnet. Ethereum can refer to either the Ethereum Mainnet itself or to the native asset of such network.

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"**Ethereum Mainnet**" means Ethereum's main network and Blockchain also known as the Ethereum layer 1 (L1).

"**Fee**" has the meaning provided in the Order Form.

"**Fiat Services**" means services related to the custody, management, and Directions related to fiat currencies owned by Client and held for Client's benefit by Anchorage, including (i) holding Client's fiat currency in an omnibus banking account held for the benefit of Anchorage's clients, and (ii) transferring Client's fiat currency as directed by Client or other Client designee.

"**Force Majeure Event**" has the meaning specified in the body of this Agreement.

"**Fork**" means (i) that the source code of a Digital Asset network as a whole has been changed in a way that makes it incompatible with the unchanged version of the Digital Asset network, (ii) a material population of miners, validators and/or node operators of the Digital Asset network accept the changes while the remainder do not, and (iii) that the two resulting Digital Asset networks have not been merged together in a timely manner, resulting in divergent blockchains for each. A Fork would create two separate Digital Asset networks (each, a "**Forked Network**"), and may result in Anchorage holding an identical amount of Digital Assets associated with each Forked Network.

"**including**" (irrespective of whether capitalized or not) means including, without limitation.

"**Intellectual Property Right(s)**" means, with respect to any thing, material or work (hereinafter, a "**Work**"): any and all (i) worldwide copyrights, trademarks, trade secrets and any other intellectual property and proprietary rights and legal protections in and to such Work including but not limited to all rights under treaties and conventions and applications related to any of the foregoing; (ii) all patents, patent applications, registrations and rights to make applications and registrations for the foregoing; (iii) all goodwill associated with the foregoing; (iv) all renewals, extensions, reversions or restorations of all such rights; (v) all works based upon, derived from, or incorporating the Work; (vi) all income, royalties, damages, claims, and payments now or hereafter due or payable with respect thereto; (vii) all causes of action, either in law or in equity for past, present or future infringement based on the Work; (viii) rights corresponding to each of the foregoing throughout the world; and (ix) all the rights embraced or embodied therein, including but not limited to, the right to duplicate, reproduce, copy, distribute, publicly perform, display, license, adapt, prepare derivative works from the Work, together with all physical or tangible embodiments of the Work.

"**Laws**" means all United States federal, state and local laws, statutes, ordinances, regulations, rules, executive orders, circulars, opinions, agency guidance, interpretive letters and other official releases, request, or recommendation of or by any government, or any authority, department or agency thereof.

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"**Monthly Custody Fee**" means (Annual Basis Points x AUC)/12 as calculated using the fee table in the Order Form.

"**Monthly Minimum Fee**" refers to the fees as agreed by Parties in the Order Form.

"**One-Time Onboarding Fee**" refers to the fees for establishing Client as an Anchorage customer, including KYC/AML processes; one in-person training session; Authorized Person onboarding; and remote training for up to ten (10) individuals. Credit, if any, may be applied to Client Fees only above the Monthly Minimum Fee, and will be applied fully each month until the credit has been fully expended within the Initial Term. Any remaining credit after the Initial Term shall be forfeited.

"**Personal Data Breach**" has the meaning provided for in the Data Processing Addendum attached as Exhibit A.

"**Personal Information**" means any information relating to an identified or identifiable individual, such as name, postal address, email address, telephone number, date of birth, Social Security number (or its equivalent), driver's license number, account number, personal identification number, health or medical information, fingerprint, voice print, or any other unique logical or biometric identifier specific to an individual, regardless of the media in which it is contained, that is: (i) disclosed to Anchorage, its Affiliates or Anchorage Representatives by Client or an Authorized Person in anticipation of, in connection with or incidental to the Services; (ii) processed at any time by Anchorage, an Anchorage Affiliate or Anchorage Representatives in connection with or incidental to the performance of its obligations under this Agreement; or (iii) derived by Anchorage, an Anchorage Affiliate or Anchorage Representatives from the information described in (i) and (ii) above.

"**Private Key**" means an alphanumeric string known only to the holder of a Digital Asset, which must be used to transact the Digital Asset represented by the corresponding Public Key on the applicable Blockchain.

"**Public Key**" means an alphanumeric string on a Blockchain that indicates ownership/possession of a specific amount of a Digital Asset by a specific network participant. The Public Key is visible to all participants in the Blockchain's network.

"**Quorum**" means the minimum number of Authorized Persons required to approve a Direction which requires a quorum. Unless otherwise specified in an applicable control agreement or instructions provided in connection therewith, (i) Client may designate the total number and the minimum number of Authorized Persons required to approve an Authenticated Instruction or other Direction so long as Client designates at least three (3) Authorized Persons, with at least two (2) required to approve any Direction.

"**Representative**" means any employees, officers, directors, representatives, contractors, and agents of a Party.

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"**Services**" means the services related to the custody and settlement of Digital Assets provided by Anchorage to Client under this Agreement (including any attachments, schedules, exhibits, or addendums), including the Technology Platform and Support Services. "Services" also includes Fiat Services or On-Chain Services if Anchorage has offered such services to Client, and Client has accepted such services. For the avoidance of doubt, "Services" expressly excludes the provision of legal, tax, brokerage, or investment advice or recommendations.

"**Support Services**" means services supporting the use of the Services, including access to Anchorage Representatives for support related to Account(s), training, etc.

"**Technology Platform**" means the technology platform and application provided by Anchorage and made available to Client to access the Services and Account(s), including the Anchorage API, and any changes, improvements, extensions thereto or other versions thereof in order to: (i) store Client's Digital Assets and provide related services; (ii) handle Digital Assets according to Authenticated Instructions; and (iii) determine the eligibility of Digital Assets for storage and continued storage. The Technology Platform includes but is not limited to (i) algorithms, computer programs, concepts, ideas, inventions, machines, mask works, procedures, processes, rates, security codes, and works of authorship in all cases whether or not patentable or copyrightable, that are owned or in-licensed by Anchorage or that otherwise are or have been created, developed, owned, incorporated or generated, in whole or in part, by or on behalf of Anchorage for or into or in connection with features, functions, tools or services to be provided pursuant to this Agreement, (ii) all data and other information that are or can be collected, compiled, or derived by or on behalf of Anchorage from any usage by Client or any other person of any work, invention, or other subject matter referred to in the foregoing, and (iii) any work, invention, or other subject matter that constitutes or relates to a suggestion, enhancement, modification, improvement, upgrade, or update regarding, or that is otherwise based on or derived from or related to, any work, invention, or other subject matter referred to in this the foregoing.

"**Third Party**" means a person(s) or any legal entity that is not a Party, a Representative of a Party, or an Affiliate of a Party.

"**UCC**" means the New York Uniform Commercial Code.

"**UUC**" or "**Units Under Custody**" means the average daily quantity of Client Digital Assets in Anchorage's custody each month, calculated after the conclusion of each month, where the average daily quantity is determined by adding each daily quantity and dividing the sum of the daily quantity amounts by the number of days in such month (or in the case of the first month, by the number of days in such month following the Fees Commencement Date). The first invoice will be sent after the end of the calendar month including the Fees Commencement Date, unless otherwise agreed in writing by the Parties.

"**Vault**" means a subdivision of an Account. Each Vault is held separately on Anchorage's books and records and may have one or more unique wallet addresses on the relevant Blockchain. The Authorized Persons and Quorum requirements for each Vault may differ from those of other Vaults.

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**SCHEDULE B**

**TECHNICAL AND EQUIPMENT SPECIFICATIONS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Acceptable Device.** 

As to each nominated Authorized Person, a unique iPhone or iPad with TouchID or FaceID is required for the Services and must meet the minimum iPhone or iPad model as required by Anchorage.

*Note: Anchorage also reserves the right, upon notice to Client, to exclude new iPhone versions for a brief period as Anchorage deems necessary in its sole discretion (such as to ensure that the new software and/or device is operable with the Anchorage application and systems, is secure, and free from material bugs).* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **Software Specifications.** 

As to each Acceptable Device of each nominated Authorized Person, the operating system must meet the minimum iOS version as required by Anchorage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **Changes to Schedule B.** 

Anchorage may, in its sole discretion, amend the Acceptable Device and Software Specification requirements in this Schedule B for security or service purposes, with 30 days prior written notice to Client. Upon amendment of any Acceptable Device and Software Specification requirements, as provided hereunder, Client will update and/or replace the Acceptable Device(s) as may be necessary, at its sole expense. Client understands and agrees that ongoing access to the Services will depend on compliance with Anchorage Acceptable Device and Software Specification requirements.

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**Exhibit A**

**Service Level Agreement**

**SCOPE OF SERVICES**

[Redacted]

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**<u>ADDENDUM NO. 1</u>**

**<u>TO ANCHORAGE DIGITAL BANK STANDARD TERMS AND CONDITIONS</u>**

[Redacted]

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**<u>EXHIBIT A</u>**

**DATA PROTECTION: PERSONAL INFORMATION SUPPLEMENT** 

[Redacted]

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**Annex A to Exhibit A: List of Authorized Subcontractors**

[Redacted]

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**<u>EXHIBIT B</u>**

**<u>BACKGROUND SCREENING CRITERIA</u>**

[Redacted]

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**<u>EXHIBIT C</u>**

**INSURANCE** 

[Redacted]

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**<u>EXHIBIT D</u>**

**BUSINESS CONTINUITY PLANNING: SUPPLEMENTAL TERMS**

[Redacted]

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**<u>EXHIBIT E</u>**

**<u>CLIENT INFORMATION SECURITY</u>**

[Redacted]

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## Exhibit 10.10

**Exhibit 10.10**

**FIRST AMENDMENT TO MASTER CUSTODY SERVICE AGREEMENT**

This FIRST AMENDMENT (the "**Amendment**") to the Master Custody Service Agreement, dated April 8, 2025 (the "**Agreement**"), is made on December 18, 2025 ("**Amendment Effective Date**"), by and between **Anchorage Digital Bank N.A.** (formerly Anchorage Trust Company, herein "**Anchorage**") and each entity listed on the Order Form of the Agreement (each a "**Client**") (Anchorage and Client, collectively, the "**Parties**").

Pursuant to Section 12.7 of the Agreement, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree to amend the Agreement as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Amendments.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1. Each of the following Clients are hereby added to the "Client(s)" section of the Order Form of the Agreement:<br>

&nbsp;&nbsp;&nbsp; iShares Staked Ethereum Trust ETF<br> iShares Bitcoin Premium Income ETF<br>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. **Miscellaneous.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. <u>Governing Law</u>. This Amendment will be subject to the relevant governing law provision in the Agreement (as amended hereto).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. <u>Effect of Amendments</u>. Except as otherwise amended herein, all other provisions of the Agreement remain in full force and effect, and any provision in the Agreement that conflicts with the terms of this Amendment shall be deemed to be amended appropriately in order to be consistent with this Amendment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. <u>Capitalized Terms</u>. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Agreement, including without limitation Schedule A (Definitions).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. <u>Execution in Counterparts and by Electronic Means</u>. This Amendment may be executed in counterparts and by electronic means, and the Parties agree that such electronic means and delivery will have the same force and effect as delivery of an original document with original signatures.

IN WITNESS WHEREOF, by their duly authorized representatives, Anchorage and Client hereby execute this Amendment as of the Amendment Effective Date.

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| | |
|:---|:---|
| **ANCHORAGE DIGITAL BANK N.A.** | **ON BEHALF OF EACH CLIENT HEREIN** |
| By: /s/Rachel Anderika | By: /s/Shannon Ghia |
| Name: Rachel Anderika | Name: Shannon Ghia |
| Title: Bank COO | Title: Managing Director |
|  | Company: **BlackRock Fund Advisors** |

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## Exhibit 23.1

**Exhibit 23.1**

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the use in this Registration Statement on Form S-1 of iShares Staked Ethereum Trust ETF of our report dated February 13, 2026 relating to the financial statement of iShares Staked Ethereum Trust ETF, which appears in this Registration Statement. We also consent to the reference to us under the heading "Experts" in such Registration Statement.

/s/ PricewaterhouseCoopers LLP

Philadelphia, Pennsylvania

February 17, 2026