Document:

Registration Rights Agreement

 Exhibit 10.3 
 REGISTRATION RIGHTS AGREEMENT 
 DATED AS OF AUGUST 20, 2008 
 AMONG 
 GSI GROUP INC. 
 AND 
 THE PURCHASERS 
 LISTED ON THE SIGNATURE PAGES HERETO 
  

 This REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of August 20, 2008,
among the Purchasers listed on the signature pages hereto and GSI Group Inc., a company continued and existing under the laws of New Brunswick (the “Company”). 
 The Purchasers own or have the right to acquire Warrants (as hereinafter defined) to acquire up to an aggregate of 5,882,520 Common Shares (as
hereinafter defined), subject to certain anti-dilution adjustments, of the Company pursuant to the terms of the Purchase Agreement (as hereinafter defined). The Company and the Purchasers deem it to be in their respective best interests to set forth
their rights in connection with public offerings and sales of Common Shares and are entering into this Registration Rights Agreement in connection with the Purchase Agreement. 
 NOW, THEREFORE, in consideration of the premises and mutual covenants and obligations hereinafter set forth, the Company and the Purchasers hereby agree
as follows: 
 SECTION 1. Certain Definitions. For purposes of this Registration Rights Agreement, the following terms shall have the
following respective meanings: 
 “Business Day” means any day that is not a Saturday or Sunday or a day on which banks are
required or permitted to be closed in the State of New York. 
 “Commission” means the United States Securities and Exchange
Commission. 
 “Common Shares” has the meaning ascribed to such term in the Purchase Agreement. 
 “Continuing Registration Delay Payment” has the meaning assigned thereto in Section 2(d) hereof. 
 “Delay Payments” has the meaning assigned thereto in Section 2(d) hereof. 
 “Effective Time” means the time and date as of which the Commission declares the Shelf Registration Statement effective or as of which
the Shelf Registration Statement otherwise becomes effective. 
 “Effectiveness Deadline” has the meaning assigned thereto
in Section 2(a) hereof. 
 “Effectiveness Failure” has the meaning assigned thereto in Section 2(a) hereof.

 “Electing Holder” means any holder of Registrable Securities that has returned a completed and signed Notice and
Questionnaire to the Company in accordance with Section 3(a)(ii) or 3(a)(iii) hereof and the instructions set forth on the Notice and Questionnaire. 
 “Eligible Market” means the Principal Market, the American Stock Exchange, The New York Stock Exchange, Inc., The NASDAQ Global Market or The NASDAQ Capital Market. 
 “Exchange Act” means the Securities Exchange Act of 1934, or any successor thereto, as the same shall be amended from time to time.

  

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 “Exchange Act Reports” has the meaning ascribed to such term in the Purchase Agreement.

 “Filing Deadline” has the meaning assigned thereto in Section 2(a) hereof. 
 “Filing Failure” has the meaning assigned thereto in Section 2(d) hereof. 
 “FINRA” has the meaning assigned thereto in Section 4(a) hereof. 
 The term “holder” means each of the Purchasers and other persons who acquire Registrable Securities from time to time (including any
permitted successors or assigns), in each case for so long as such person owns any Registrable Securities. 
 “Initial Registration
Delay Payment” has the meaning assigned thereto in Section 2(d) hereof. 
 “Inspectors” has the meaning
assigned thereto in Section 3(a)(xvii) hereof. 
 “Maintenance Period” has the meaning assigned thereto in
Section 2(a) hereof. 
 “Maintenance Failure” has the meaning assigned thereto in Section 2(d) hereof. 

“Merger” has the meaning ascribed to such term in the Purchase Agreement. 
 “Notice and Questionnaire” means a Notice of Registration Statement and Selling Securityholder Questionnaire substantially in the form
of Exhibit A hereto. 
 The term “person” means a corporation, association, partnership, organization, limited liability
company, limited partnership, limited liability partnership, or other similar entity, individual, government or political subdivision thereof or governmental agency. 
 “Principal Market” has the meaning set forth in the Purchase Agreement. 
 “Purchase
Agreement” means that certain Purchase Agreement, dated as of July 9, 2008, among the Company, GSI Group Corporation and the Purchasers, as may be amended, modified or supplemented from time to time. 
 “Purchasers” means the Purchasers named on the signature pages to the Purchase Agreement. 
 “Records” has the meaning assigned thereto in Section 3(a)(xvii) hereof. 
 “Registrable Securities” means the Securities; provided, however, that a Security shall cease to be a Registrable Security
upon the earliest to occur of the following: (i) a Shelf Registration Statement registering such Security under the Securities Act has been declared or becomes effective and such Security has been sold or otherwise transferred by the holder
thereof pursuant to and in a manner contemplated by such effective Shelf Registration Statement; (ii) such Security is sold pursuant to Rule 144 under circumstances in which any legend borne by such Security relating to restrictions on
transferability thereof, under the Securities Act or 

  

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otherwise, is removed by the Company; (iii) such Security is eligible to be sold to the public by a non-affiliate of the Company without restriction
pursuant to Rule 144 (or any successor rule) and without the requirement to be in compliance with Rule 144(c)(1) (or any successor rule); or (iv) such Security shall cease to be outstanding. 
 “Registered Securities” has the meaning assigned thereto in Section 2(d) hereof. 
 “Registration Expenses” has the meaning assigned thereto in Section 4 hereof. 
 “Required Holders” means the holders of at least a majority of the Registrable Securities. 
 “Review Notice” means the oral or written notification by the Commission to the Company or its legal counsel that the Shelf Registration
Statement or any one or more Exchange Act Reports that are or will be incorporated by reference therein will be subject to the review of the Commission in whole or in part. 
 “Rule 144,” “Rule 405” and “Rule 415” mean, in each case, such rule promulgated under the Securities
Act (or any successor provision), as the same shall be amended from time to time. 
 “Securities” means, collectively,
(i) the Common Shares of the Company issued and issuable upon exercise of the Warrants and (ii) any capital stock of the Company issued or issuable, with respect to the Warrants or the Securities as a result of any stock split, stock
dividend, recapitalization, exchange or similar event or otherwise, without regard to any limitations on exercises of the Warrants. 
 “Securities Act” means the Securities Act of 1933, or any successor thereto, as the same shall be amended from time to time. 
 “Shelf Registration” has the meaning assigned thereto in Section 2(a) hereof. 
 “Shelf Registration Statement” has the meaning assigned thereto in Section 2(a) hereof. 
 “Suspension
Period” has the meaning assigned thereto in Section 3(d) hereof. 
 “Warrants” has the meaning ascribed to
such term in the Purchase Agreement. 
 Unless the context otherwise requires, any reference herein to a “Section” or
“clause” refers to a Section or clause, as the case may be, of this Registration Rights Agreement, and the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Registration
Rights Agreement as a whole and not to any particular Section or other subdivision. Capitalized terms used herein but not defined herein shall have the meaning assigned to such terms in the Purchase Agreement. 
 SECTION 2. Registration Under the Securities Act. 
 (a) The Company shall file under the Securities Act as soon as reasonably practicable, but no later than 45 days after the consummation of the Merger (the “Filing Deadline”), a “shelf”
registration statement providing for the registration of, and the sale on a 

  

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continuous or delayed basis by the holders of, all, but not less than all, of the Registrable Securities, pursuant to Rule 415 or any similar rule that may
be adopted by the Commission (such filing, the “Shelf Registration” and such registration statement, the “Shelf Registration Statement”); provided, however, that no holder shall be entitled to be named
as a selling securityholder in the Shelf Registration Statement or to use the prospectus forming a part thereof for resales of Registrable Securities unless such holder is an Electing Holder. The Company agrees to use reasonable best efforts to
cause the Shelf Registration Statement to become or be declared effective no later than 60 days after the consummation of the Merger unless the Company (or its legal counsel) receives a Review Notice, in which case such 60-day period shall be a
90-day period (in either case, the “Effectiveness Deadline”). Subject to Section 3(d), the Company agrees to use reasonable best efforts to keep such Shelf Registration Statement continuously effective until the earlier of
(i) the date which is twelve (12) months after the Effective Time and (ii) the date on which there are no Registrable Securities (the “Maintenance Period”). The Company further agrees to use reasonable best efforts
to, after the Effective Time of the Shelf Registration Statement, promptly upon the request of any holder of Registrable Securities that is not then an Electing Holder, to take any action reasonably necessary to enable such holder to use the
prospectus forming a part thereof for resales of Registrable Securities, including, without limitation, any action necessary to identify such holder as a selling securityholder in the Shelf Registration Statement, provided, however,
that nothing in this sentence shall relieve any such holder of the obligation to return a completed and signed Notice and Questionnaire to the Company in accordance with Section 3(a)(iii) hereof; provided further that each holder
shall promptly furnish additional information reasonably required to be disclosed in order to make information previously furnished to the Company by such holder not misleading. The Shelf Registration Statement shall contain (except if otherwise
mutually agreed to by the Company by the Required Holders) the “Selling Securityholders” and “Plan of Distribution” sections in substantially the form attached hereto as Exhibit B. The Company further agrees
to supplement or make amendments to the Shelf Registration Statement, including without limitation, any post effective amendments, as and when required by the rules, regulations or instructions applicable to the registration form used by the Company
for such Shelf Registration Statement or by the Securities Act or rules and regulations thereunder for shelf registration. By 9:30 a.m. New York time on the second Business Day following the Effective Time of the Shelf Registration Statement or the
post effective amendment, as applicable, the Company shall file with the Commission in accordance with Rule 424 under the Securities Act the final prospectus to be used in connection with sales pursuant to such Shelf Registration Statement.

 (b) The Company shall use reasonable best efforts to take all actions reasonably necessary to ensure that the transactions
contemplated herein are effected as so contemplated in Section 2(a) hereof, and to submit to the Commission, within five Business Days after the Company learns that no review of the Shelf Registration Statement will be made by the staff of the
Commission or that the staff has no further comments on the Shelf Registration Statement, as the case may be, a request for acceleration of effectiveness (or post effective amendment, if applicable) of the Shelf Registration Statement to a time and
date not later than 48 hours after the submission of such request. 
  

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 (c) Any reference herein to a registration statement or prospectus as of any time shall
be deemed to include any document incorporated, or deemed to be incorporated, therein by reference as of such time and any reference herein to any post-effective amendment to a registration statement as of any time shall be deemed to include any
document incorporated, or deemed to be incorporated, therein by reference as of such time. Any reference to a prospectus as of any time shall include any supplement thereto, preliminary prospectus, or any free writing prospectus in respect thereof.

 (d) If (i) the Shelf Registration Statement is (A) not
filed with the Commission on or before the Filing Deadline (a “Filing Failure”) or (B) not declared effective by the Commission on or before the Effectiveness Deadline, (an “Effectiveness Failure”);
(ii) at any time during the Maintenance Period sales of Registrable Securities required to be included on the Shelf Registration Statement pursuant to Section 2(a) hereof (the “Registered Securities”) cannot be made (other
than during a Suspension Period (as defined in Section 3(d)) or during the period after a post-effective amendment is filed, and prior to the effectiveness thereof, to include information at the request of an Electing Holder) pursuant to the
Shelf Registration Statement because the Shelf Registration Statement is not effective at such time or the Company shall have failed to maintain the listing of the Common Shares on an Eligible Market (a “Maintenance Failure and, together
with a Filing Failure and an Effectiveness Failure, a “Failure”), then the Company shall pay to each Electing Holder that continues to hold Registrable Securities on the date of such Failure (i) an amount in cash equal to one
percent (1%) of the product of (x) $the “issue price” of the Warrants determined in accordance with Section 5.13 of the Purchase Agreement, minus $0.01 (the “Warrant Share Value”), and (y) the aggregate amount
of Registered Securities held by such Electing Holder on the date of such Failure (the “Initial Registration Delay Payment”), and (ii) for each additional thirty-day period in which one or more Failures are continuing at the
completion of such thirty-day period, the Company shall pay to each Electing Holder that continues to hold Registrable Securities on such thirtieth day an amount in cash equal to one percent (1%) of the product of (x) the Warrant Share
Value, and (y) the aggregate amount of Registered Securities held by such Electing Holder on each successive thirtieth day that any Failure continues (the “Continuing Registration Delay Payment” and, together with the Initial
Registration Delay Payment, the “Delay Payments”). Notwithstanding anything to the contrary in this Section 2, each Electing Holder will only be entitled to receive a Delay Payment for one Failure at any one time even if two or
more Failures are ongoing at any one time. Delay Payments shall be due and payable on the fifth (5th) Business Day after the Failure giving
rise to the Initial Registration Delay Payment, and if any Failure is ongoing thereafter, then on the first day of each successive thirty (30) day period that such Failure is continuing; provided, however, that Delay Payments
shall cease to accrue or be payable on and after the later of (i) the date that is twelve (12) months after the Effective Time of the Shelf Registration Statement and (ii) the date on which each of the Registrable Securities has
ceased to be a Registrable Security. Additionally, no Maintenance Failure will be deemed to have occurred as a result of the Shelf Registration Statement ceasing to be effective during the period beginning on the six month anniversary of the
Effective Time and ending on the last day of the Maintenance Period provided that the Company otherwise continues to satisfy the information requirements of Rule 144(c)(1). 
 (e) Neither the Company nor any Subsidiary (as defined in the Purchase Agreement) or affiliate thereof shall identify any holder as an
underwriter in any public disclosure or filing with the Commission, the Principal Market or an Eligible Market and any 

  

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holder being deemed an underwriter by the Commission shall not relieve the Company of any obligations it has under this Agreement or any other Transaction
Document (as defined in the Purchase Agreement); provided, however, that the foregoing shall not prohibit the Company from including the disclosure found in the “Plan of Distribution” section attached hereto as
Exhibit B in the Shelf Registration Statement; provided, further, that the Company will not be obligated to pay any Registration Delay Payment as a result of any Failure due to any dispute between a holder and the Commission
regarding such holder’s status as an underwriter. Notwithstanding anything to the contrary, to the extent a holder is required to be identified as an underwriter in a Shelf Registration Statement, such holder shall have the right to withdraw
from the Shelf Registration Statement, at any time, without being so named. 
 (f) In no event shall the Company include any
securities other than Registrable Securities on any Shelf Registration Statement without the prior written consent of the Required Holders. 
 (g) If at any time during which Registrable Securities are outstanding there is not an effective Shelf Registration Statement covering all of the Registrable Securities and the Company shall determine to prepare and
file with the Commission a registration statement relating to an offering for its own account or the account of others under the Securities Act of any of its equity securities, other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with stock option or other employee benefit plans,
then the Company shall send to the holder written notice of such determination and if, within five (5) Business Days after receipt of such notice, the holder shall so request in writing, the Company shall include in such registration statement
all or any part of such Registrable Securities the holder requests to be registered. Notwithstanding the foregoing, if the managing underwriter of the public underwritten offering determines in its reasonable discretion that the success of the
offering will be jeopardized without a limitation on the number of shares to be underwritten, the managing underwriter may in its reasonable discretion limit the Registrable Securities or other securities to be distributed through such underwriting
pro rata (other than any securities being offered by the Company), and if necessary, exclude all selling stockholders. If the holder disapproves of the terms of any such underwriting, it may elect to withdraw therefrom by written notice to the
Company and the managing underwriter. Notwithstanding anything to the contrary, to the extent a holder is required to be identified as an underwriter in a Shelf Registration Statement, such holder shall have the right to withdraw from the Shelf
Registration Statement, at any time, without being so named. 
 SECTION 3. Registration Procedures. 
 The following provisions shall apply to the filing of the Shelf Registration Statement: 
 (a) The Company shall: 
 (i) prepare and file with the Commission within the time periods specified in Section 2(a), a Shelf Registration Statement on any form which may be utilized by the Company and which shall register all of the
Registrable Securities for resale by the holders 

  

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thereof in accordance with such method or methods of disposition (but which shall not include an underwritten offering as to which the Company needs to
assist) as may be specified by such of the holders as, from time to time, may be Electing Holders and use reasonable best efforts to cause such Shelf Registration Statement to become effective as soon as reasonably practicable but in any case within
the time periods specified in Section 2(a); 
 (ii) not more than 5 Business Days after the consummation of the Merger,
mail the Notice and Questionnaire to the holders of Registrable Securities; no holder shall be entitled to be named as a selling securityholder in the Shelf Registration Statement as of the Effective Time, and no holder shall be entitled to use the
prospectus forming a part thereof for resales of Registrable Securities at any time, unless such holder has returned a completed and signed Notice and Questionnaire to the Company by the deadline for response set forth therein; provided,
however, holders of Registrable Securities shall have at least 20 calendar days from the date on which the Notice and Questionnaire is first mailed to such holders to return a completed and signed Notice and Questionnaire to the Company;

 (iii) after the Effective Time of the Shelf Registration Statement, upon the request of any holder of Registrable
Securities that is not then an Electing Holder, send a Notice and Questionnaire to such holder, and, upon return of such Notice and Questionnaire from such Holder, use reasonable best efforts to include such holder’s Registrable Securities in
the Shelf Registration Statement as soon as practicable but in any event within five days following receipt by the Company of such Notice and Questionnaire; provided that the Company shall not be required to take any action to name such
holder as a selling securityholder in the Shelf Registration Statement or to enable such holder to use the prospectus forming a part thereof for resales of Registrable Securities until such holder has returned a completed and signed Notice and
Questionnaire to the Company; 
 (iv) as soon as reasonably practicable prepare and file with the Commission such amendments
and supplements to such Shelf Registration Statement (including without limitation, any required post effective amendments) and the prospectus included therein as may be necessary to effect and maintain the effectiveness of such Shelf Registration
Statement for the period specified in Section 2(a) hereof and as may be required by the applicable rules and regulations of the Commission and the instructions applicable to the form of such Shelf Registration Statement, including without
limitation, to promptly include any Electing Holder to be named as a selling security holder therein; 
 (v) comply with the
provisions of the Securities Act with respect to the disposition of all of the Registrable Securities covered by such Shelf Registration Statement in accordance with the intended methods of disposition by the Electing Holders provided for in such
Shelf Registration Statement; 
 (vi) provide (A) one representative of the Electing Holders and (B) not more than
one counsel (“Legal Counsel”) for all the Electing Holders the opportunity to participate in the preparation of such Shelf Registration Statement, each prospectus included therein or filed with the Commission and each amendment or
supplement thereto (but not including any documents incorporated by reference), in each case subject to customary confidentiality restrictions. The Company shall (A) permit Legal Counsel to review and 

  

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comment upon (i) a Shelf Registration Statement at least five (5) Business Days prior to its filing with the Commission and (ii) all
amendments and supplements to all Shelf Registration Statements (except for Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any similar or successor reports) within a reasonable number of days prior to
their filing with the Commission, and (B) give due consideration to any comments Legal Counsel provides with respect to any Shelf Registration Statement or amendment or supplement thereto. The Company shall furnish to Legal Counsel, without
charge, (i) copies of any correspondence from the Commission or the staff of the Commission to the Company or its representatives relating to any Shelf Registration Statement, (ii) promptly after the same is prepared and filed with the
Commission, one copy of any Shelf Registration Statement and any amendment(s) thereto, including financial statements and schedules, and, if requested by a holder and unavailable on EDGAR, all documents incorporated therein by reference and all
exhibits to such Shelf Registration Statement and (iii) upon the effectiveness of any Shelf Registration Statement, one copy of the prospectus included in such Shelf Registration Statement and all amendments and supplements thereto. The Company
shall reasonably cooperate with Legal Counsel in performing the Company’s obligations pursuant to this Section 3(vi); 
 (vii) for a reasonable period prior to the filing of such Shelf Registration Statement, and throughout the period specified in Section 2(a), make available between 9 a.m. and 5 p.m. on any Business Day at the Company’s principal
place of business or such other reasonable place for inspection by the persons referred to in Section 3(a)(vi) who shall certify to the Company that they have a current intention to sell the Registrable Securities pursuant to the Shelf
Registration such financial and other information and books and records of the Company, and cause the officers, employees, counsel and independent certified public accountants of the Company to be available to respond to such inquiries, as shall be
reasonably necessary, in the judgment of the respective counsel referred to in such Section, to conduct a reasonable investigation within the meaning of Section 11 of the Securities Act; provided, however, that each such party
shall be required to maintain in confidence and not to disclose to any other person any information or records reasonably designated by the Company as being confidential, until such time as (A) such information becomes a matter of public record
other than through a breach of this provision by such person or by an Electing Holder (but excluding by virtue of its inclusion in such registration statement or otherwise by the Company), or (B) such person shall be required so to disclose
such information pursuant to a subpoena or order of any court or other governmental agency or body having jurisdiction over the matter (provided such person agrees that it will give prompt notice to the Company and allow the Company, at its expense,
to promptly undertake appropriate action and to prevent disclosure of such information deemed confidential), or (C) such information is required to be set forth in such Shelf Registration Statement or the prospectus included therein or in an
amendment to such Shelf Registration Statement or an amendment or supplement to such prospectus in order that such Shelf Registration Statement, prospectus, amendment or supplement, as the case may be, complies with applicable requirements of the
federal securities laws and the rules and regulations of the Commission and does not contain an untrue statement of a material fact or omit to state therein a material fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing; 
  

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 (viii) promptly notify each of the Electing Holders, and if requested by any such
Electing Holder, confirm such advice in writing, (A) when such Shelf Registration Statement or the prospectus included therein or any prospectus amendment or supplement or post-effective amendment has been filed, and, with respect to such Shelf
Registration Statement or any post-effective amendment, when the same has become effective, (B) of any comments by the Commission and by the blue sky or securities commissioner or regulator of any state with respect thereto or any request by
the Commission for amendments or supplements to such Shelf Registration Statement or prospectus or for additional information, (C) of the issuance by the Commission of any stop order suspending the effectiveness of such Shelf Registration
Statement or the initiation or threatening of any proceedings for that purpose, (D) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose, or (E) if at any time when a prospectus is required to be delivered under the Securities Act, that such Shelf Registration Statement, prospectus, prospectus amendment or
supplement or post-effective amendment does not conform in all material respects to the applicable requirements of the Securities Act and the rules and regulations of the Commission thereunder or contains an untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing; 
 (ix) use reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of such registration statement or any
post-effective amendment thereto at the earliest practicable date; 
 (x) if requested by any Electing Holder, promptly
incorporate in a prospectus supplement or post-effective amendment such information as is required by the applicable rules and regulations of the Commission and as such Electing Holder specifies should be included therein relating to the terms of
the sale of such Registrable Securities, including information with respect to the amount of Registrable Securities being sold by such Electing Holder, the name and description of such Electing Holder the offering price of such Registrable
Securities and any compensation payable in respect thereof, and make all required filings of such prospectus supplement or post-effective amendment promptly after notification of the matters to be incorporated in such prospectus supplement or
post-effective amendment; provided, however, that any suspension of the Shelf Registration Statement caused by the Company filing a post-effective amendment to incorporate information pursuant to this Section 3(a)(x) shall not be
deemed a Failure under this Agreement; 
 (xi) if requested by any Electing Holder, furnish to such Electing Holder and the
respective counsel referred to in Section 3(a)(vi) a conformed copy of such Shelf Registration Statement, each such amendment and supplement thereto (in each case, if so requested, including all exhibits thereto and documents incorporated by
reference therein) and such number of copies of such Shelf Registration Statement (excluding exhibits thereto and documents incorporated by reference therein unless specifically so requested by such Electing Holder) and of the prospectus included in
such Shelf Registration Statement, in conformity in all material respects with the applicable requirements of the Securities Act and the rules and regulations of the Commission thereunder, and such other documents, as such Electing Holder may
reasonably request in order to facilitate the offering and disposition of the Registrable Securities owned by such Electing Holder and to permit such Electing Holder to satisfy the prospectus delivery requirements of the Securities Act; and subject
to Section 3(b) below, the 

  

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Company hereby consents to the use of such prospectus and any amendment or supplement thereto by each such Electing Holder, in each case in the form most
recently provided to such person by the Company, in connection with the offering and sale of the Registrable Securities covered by the prospectus or any supplement or amendment thereto; 
 (xii) (A) register or qualify the Registrable Securities to be included in such Shelf Registration Statement under such securities laws or
blue sky laws of all applicable jurisdictions in the United States, (B) keep such registrations or qualifications in effect and comply with such laws so as to permit the continuance of offers, sales and dealings therein in such jurisdictions
during the period the Shelf Registration is required to remain effective under Section 2(a) above and for so long as may be necessary to enable any such Electing Holder to complete its distribution of Securities pursuant to such Shelf
Registration Statement and (C) take any and all other actions as may be reasonably necessary to enable each such Electing Holder to consummate the disposition in such jurisdictions of such Registrable Securities; provided,
however, that the Company shall not be required for any such purpose to (1) qualify as a foreign corporation in any jurisdiction wherein it would not otherwise be required to qualify but for the requirements of this
Section 3(a)(xii), (2) consent to general service of process in any such jurisdiction or become subject to taxation in any such jurisdiction or (3) make any changes to its articles of incorporation or by-laws or other governing
documents or any agreement between it and its stockholders; 
 (xiii) unless any Registrable Securities shall be in book-entry
only form, reasonably cooperate with the Electing Holders to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold, which certificates, if so required by any securities exchange upon which any
Registrable Securities are listed, shall be penned, lithographed or engraved, or produced by any combination of such methods, on steel engraved borders, and which certificates shall not bear any restrictive legends; 
 (xiv) comply with all applicable rules and regulations of the Commission, and make generally available to its securityholders as soon as
reasonably practicable but in any event not later than ninety (90) days after the close of the period covered thereby, if requested, an earning statement of the Company and its subsidiaries complying with Section 11(a) of the Securities
Act (including, at the option of the Company, Rule 158 thereunder); 
 (xv) in the event that Form S-3 is not available for
the registration of the resale of Registrable Securities hereunder, the Company shall (i) register the resale of the Registrable Securities on another appropriate form reasonably acceptable to the Required Holders and (ii) undertake to
register the Registrable Securities on Form S-3 as soon as such form is available, provided that the Company shall maintain the effectiveness of the Shelf Registration Statement then in effect until such time as a Shelf Registration Statement
on Form S-3 covering the Registrable Securities has been declared effective by the Commission. 
 (xvi) if any holder is
required under applicable securities laws to be described in the Shelf Registration Statement as an underwriter or a holder believes that it could reasonably be deemed to be an underwriter of Registrable Securities, at the reasonable request of such
holder, the Company shall furnish to such holder, on such date as a holder may reasonably 

  

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request (i) a letter, dated such date, from the Company’s independent certified public accountants in form and substance as is customarily given by
independent certified public accountants to underwriters in an underwritten public offering, addressed to the holders, and (ii) an opinion, dated as of such date, of counsel representing the Company for purposes of such Shelf Registration
Statement, in form, scope and substance as is customarily given in an underwritten public offering, addressed to the holders; provided, however, that the holder shall pay all fees and expenses relating to any letter or opinion
requested by such holder pursuant to this Section 3(a)(xvi). 
 (xvii) if any holder is required under applicable
securities laws to be described in the Shelf Registration Statement as an underwriter, or a holder believes that it could reasonably be deemed to be an underwriter of Registrable Securities, the Company shall make available for inspection by
(i) such holder, (ii) Legal Counsel and (iii) one firm of accountants or other agents retained by the Investors (collectively, the “Inspectors”), all pertinent financial and other records, and pertinent corporate
documents and properties of the Company (collectively, the “Records”), as shall be reasonably deemed necessary by each Inspector, and cause the Company’s officers, directors and employees to supply all information which any
Inspector may reasonably request; provided, however, that each Inspector shall agree to hold in strict confidence and shall not make any disclosure (except to an Investor) or use of any Record or other information which the Company
determines in good faith to be confidential, and of which determination the Inspectors are so notified, unless (a) the disclosure of such Records is necessary to avoid or correct a misstatement or omission in any Shelf Registration Statement or
is otherwise required under the Securities Act, (b) the release of such Records is ordered pursuant to a final, non-appealable subpoena or order from a court or government body of competent jurisdiction, or (c) the information in such
Records has been made generally available to the public other than by disclosure in violation of this Agreement. Each Investor agrees that it shall, upon learning that disclosure of such Records is sought in or by a court or governmental body of
competent jurisdiction or through other means, give prompt notice to the Company and allow the Company, at its expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective order for, the Records deemed confidential.
Nothing herein (or in any other confidentiality agreement between the Company and any holder) shall be deemed to limit the holders’ ability to sell Registrable Securities in a manner which is otherwise consistent with applicable laws and
regulations. 
 (b) In the event that the Company would be required, pursuant to Section 3(a)(viii)(C), (D) or
(E) above, to notify the Electing Holders, the Company shall promptly prepare and furnish to each of the Electing Holders a reasonable number of copies of a prospectus supplemented or amended so that, as thereafter delivered to purchasers of
Registrable Securities, such prospectus shall conform in all material respects to the applicable requirements of the Securities Act and the rules and regulations of the Commission thereunder and shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing. Each Electing Holder agrees that upon receipt of any notice from the Company
pursuant to Section 3(a)(viii)(C), (D) or (E) hereof, such Electing Holder shall forthwith discontinue the disposition of Registrable Securities pursuant to the Shelf Registration Statement applicable to such Registrable Securities
until such Electing Holder shall have received copies of such amended or supplemented prospectus, and if so 

  

 12 

 
directed by the Company, such Electing Holder shall deliver to the Company (at the Company’s expense) all copies, other than permanent file copies, then
in such Electing Holder’s possession of the prospectus covering such Registrable Securities at the time of receipt of such notice. 
 (c) In the event of a Shelf Registration, in addition to the information required to be provided by each Electing Holder in its Notice and Questionnaire, the Company may require such Electing Holder to furnish to the
Company such additional information regarding such Electing Holder and such Electing Holder’s intended method of distribution of Registrable Securities as may be required in order to comply with the Securities Act. Each such Electing Holder
agrees to notify the Company as promptly as practicable of any inaccuracy or change in information previously furnished by such Electing Holder to the Company or of the occurrence of any event in either case that could cause the prospectus to
contain an untrue statement of a material fact regarding such Electing Holder or such Electing Holder’s intended method of disposition of such Registrable Securities or omits to state any material fact regarding such Electing Holder or such
Electing Holder’s intended method of disposition of such Registrable Securities required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing, and promptly to furnish to the
Company any additional information required to correct and update any previously furnished information or required so that such prospectus shall not contain, with respect to such Electing Holder or the disposition of such Registrable Securities, an
untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing. If an Electing Holder fails to provide to the
Company any information required to be provided pursuant to this Section 3(c) within fifteen (15) days after the Electing Holder became aware of the inaccuracy, omission or required change, the Company may suspend the use of the Shelf
Registration Statement and the prospectus contained therein until such time as the Electing Holder provides the required information to the Company and such period will not be deemed to be a Suspension Period (as defined below) hereunder.

 (d) Notwithstanding any other provision of this Agreement, the Company may for any valid business reasons (other than
avoidance of its obligations hereunder), including without limitation, a potential material acquisition, divestiture of assets or other material corporate transaction, notify holders of Registrable Securities in writing that the Shelf Registration
Statement is no longer effective or the prospectus included therein is no longer usable for offers and sales of Securities for a period not to exceed 45 consecutive days and 60 days in the aggregate during any twelve-month period; provided,
that the Company promptly thereafter complies with the requirements of Section 2(b) hereof, if applicable, and provided further that, if a post-effective amendment is required by applicable law to be filed with the Commission to cause a
Electing Holder to be named as a selling security holder in the Shelf Registration Statement or to correct any information previously provided by an Electing Holder or to change other information requested by an Electing Holder to be included
therein, the period of time between the filing and the effectiveness of any such post effective amendment shall be permitted and shall not deemed to be a Suspension Period hereunder so long as the Company uses its reasonable best efforts promptly to
file such post effective amendment. The first day of any Suspension Period must be at least five trading days after the last day of any prior Suspension Period. Each holder agrees that upon receipt of 

  

 13 

 
any notice from the Company pursuant to this Section 3(d), it will discontinue use of the prospectus contained in the Shelf Registration Statement until
receipt of copies of the supplemented or amended prospectus relating thereto or until advised in writing by the Company that the use of the prospectus contained in the Shelf Registration Statement may be resumed (any such period, a
“Suspension Period”). 
 SECTION 4. Registration Expenses. 
 (a) The Company agrees to bear and to pay or cause to be paid promptly all expenses incident to the Company’s performance of or
compliance with this Registration Rights Agreement, including (a) all Commission and any Financial Industry Regulatory Authority (“FINRA”) registration, filing and review fees and expenses (b) all fees and expenses in
connection with the qualification of the Securities for offering and sale under the State securities and blue sky laws referred to in Section 3(a)(xii) hereof and determination of their eligibility for investment under the laws of all
jurisdictions, including reasonable fees and disbursements of not more than one counsel for the Electing Holders in connection with such qualification and determination, (c) all expenses relating to the preparation, printing, production,
distribution and reproduction of each registration statement required to be filed hereunder, each prospectus included therein or prepared for distribution pursuant hereto, each amendment or supplement to the foregoing, the expenses of preparing the
Securities for delivery and the expenses of printing or producing blue sky memoranda and all other documents in connection with the offering, sale or delivery of Securities to be disposed of (including certificates representing the Securities),
(d) messenger, telephone and delivery expenses relating to the offering, sale or delivery of Securities and the preparation of documents referred in clause (c) above, (e) internal expenses (including all salaries and expenses of the
Company’s officers and employees performing legal or accounting duties), (f) fees, disbursements and expenses of counsel and independent certified public accountants of the Company (including the expenses of any opinions required by or
incident to such performance and compliance), (g) reasonable fees, disbursements and expenses of one counsel for the Electing Holders retained in connection with a Shelf Registration, as selected by the Electing Holders of at least a majority
in aggregate principal amount of the Registrable Securities held by Electing Holders (which counsel shall be reasonably satisfactory to the Company with Milbank, Tweed, Hadley & McCloy LLP or Schulte Roth & Zabel LLP deemed
reasonably satisfactory), and (h) fees, expenses and disbursements of any other persons, including special experts, retained by the Company in connection with such registration (collectively, the “Registration Expenses”).
Notwithstanding the foregoing, the holders of the Registrable Securities being registered shall pay all agency fees and commissions and underwriting discounts and commissions attributable to the sale of such Registrable Securities and the fees and
disbursements of any counsel or other advisors or experts retained by such holders (severally or jointly), other than the counsel and experts specifically referred to above. 
 SECTION 5. Indemnification. 
 (a) Indemnification by the Company. The Company will indemnify and hold harmless each of the Electing Holders, the directors, officers, partners, members, employees, agents, representatives of, and each person, if any, who controls
any of the 

  

 14 

 
Electing Holders within the meaning of the Securities Act or the Exchange Act included in a Shelf Registration Statement against any losses, claims, damages
or liabilities, joint or several, to which such holder may become subject under the Securities 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 any Shelf Registration Statement under which such Registrable Securities were registered under the Securities Act, or any preliminary, final or free writing prospectus contained
therein or furnished by the Company to any such Electing Holder 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 not misleading, and will reimburse such holder, such Electing Holder for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Company shall not be liable to any such person in any such case to the extent that any such loss, claim, damage or liability (x) arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in such registration statement, or preliminary, final or free writing prospectus, or amendment or supplement thereto, in reliance upon and in conformity with written information furnished to the
Company by any such person for use therein or (y) arises from such person’s use of the Shelf Registration Statement or prospectus or any amendments or supplements thereto (i) during a Suspension Period or (ii) that occurs prior
to such person being named in the Shelf Registration Statement. 
 (b) Indemnification by the Holders. Each Electing
Holder agrees, severally and not jointly, to (i) indemnify and hold harmless the Company, against any losses, claims, damages or liabilities to which the Company or such other holders of Registrable Securities may become subject, under the
Securities 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 such registration
statement, or any preliminary, final or free writing prospectus contained therein or furnished by the Company to any such Electing Holder, 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 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 reliance upon and in conformity with written information furnished to the Company by such Electing Holder expressly for use therein, and (ii) reimburse the Company for any legal or other expenses reasonably incurred by the
Company in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that no such Electing Holder shall be required to undertake liability to any person under this
Section 5(b) for any amounts in excess of the dollar amount of the net proceeds to be received by such Electing Holder from the sale of such Electing Holder’s Registrable Securities pursuant to such registration. 
 (c) Notices of Claims, Etc. Promptly after receipt by an indemnified party under subsection (a) or (b) above of written
notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against an indemnifying party pursuant to the indemnification provisions of or contemplated by this Section 5, notify such
indemnifying party in writing of the commencement of such action; but the omission so 

  

 15 

 
to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under the indemnification
provisions of or contemplated by Section 5(a) or 6(b) hereof to the extent the indemnifying party is not materially prejudiced by such omission. In case any such action shall be brought against any indemnified party and it shall notify an
indemnifying party of the commencement thereof, such indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, such indemnifying party shall not be liable to such indemnified party
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. 
 (d) Contribution. If for any reason the indemnification provisions contemplated by Section 5(a) or Section 5(b) are
unavailable to or insufficient to hold harmless an indemnified party 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 fault of the indemnifying party and the indemnified party 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 of such indemnifying party and
indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such
indemnifying party or by such indemnified party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The parties hereto agree that it would not be just and
equitable if contributions pursuant to this Section 5(d) were determined by pro rata allocation (even if the holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable
considerations referred to in this Section 5(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 shall be deemed to include any
legal or other fees or expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 5(d), no holder shall be required to contribute
any amount in excess of the amount by which the dollar amount of the net proceeds received by such holder from the sale of any Registrable Securities (after deducting any fees, discounts and commissions applicable thereto) exceeds the amount of any
damages which such holder has otherwise been required to pay by reason 

  

 16 

 
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 Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The holders’ obligations in this Section 5(d) to contribute shall be several in proportion
to the principal amount of Registrable Securities registered by them and not joint. 
 (e) The obligations of the Company
under this Section 5 shall be in addition to any liability which the Company may otherwise have and shall extend, upon the same terms and conditions, to each officer, director and partner of each holder and each person, if any, who controls any
holder within the meaning of the Securities Act; and the obligations of the holders contemplated by this Section 5 shall be in addition to any liability which the respective holder may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company (including any person who, with his consent, is named in any registration statement as about to become a director of the Company) and to each person, if any, who controls the Company within the
meaning of the Securities Act. 
 SECTION 6. Rule 144. 
 The Company covenants to the holders of Registrable Securities that until such date as the Registrable Securities cease to be Registrable Securities, to the extent it shall be required to do so under the Exchange Act,
the Company shall timely file the reports required to be filed by it under the Exchange Act or the Securities Act (including the reports under Section 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144) and the
rules and regulations adopted by the Commission thereunder, and shall take such further action as any holder of Registrable Securities may reasonably request, all to the extent required from time to time to enable such holder to sell Registrable
Securities without registration under the Securities Act within the limitations of the exemption provided by Rule 144, as such Rule may be amended from time to time, or any similar or successor rule or regulation hereafter adopted by the Commission.
Promptly upon receipt of a request from any holder of Registrable Securities in connection with that holder’s sale pursuant to Rule 144, the Company shall deliver to such holder a written statement as to whether it has complied with such
requirements. The Company shall within two (2) Business Days confirm orally and in writing to the Holder the number of Common Shares then outstanding. 
 SECTION 7. Miscellaneous. 
 (a) Specific Performance. The parties hereto
acknowledge that there would be no adequate remedy at law if the Company fails to perform any of its obligations hereunder and that the Purchasers and the holders from time to time of the Registrable Securities may be irreparably harmed by any such
failure, and accordingly agree that the Purchasers and such holders, in addition to any other remedy to which they may be entitled at law or in equity, shall be entitled to compel specific performance of the obligations of the Company under this
Registration Rights Agreement in accordance with the terms and conditions of this Registration Rights Agreement, in any court of the United States or any State thereof having jurisdiction. 
  

 17 

 (b) Notices. All notices, requests, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have been duly given when delivered by hand, if delivered personally, by facsimile or by courier, or three days after being deposited in the mail (registered or certified mail,
postage prepaid, return receipt requested) as follows: If to the Company, to it at GSI Group Inc., 125 Middlesex Turnpike, Bedford, Massachusetts 01730, Attention: General Counsel; with a copy to Skadden, Arps, Slate, Meagher & Flom LLP,
Four Times Square, New York, New York 10036, Attention: Michael J. Zeidel, Esq., and if to a holder, to the address of such holder set forth in the security register or other records of the Company, or to such other address as the Company or any
such holder may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt. 
 (c) Parties in Interest. All the terms and provisions of this Registration Rights Agreement shall be binding upon, shall inure to
the benefit of and shall be enforceable by the parties hereto and the holders from time to time of the Registrable Securities and the respective successors and assigns of the parties hereto and such holders. In the event that any transferee of any
holder of Registrable Securities shall acquire Registrable Securities, in any manner, whether by gift, bequest, purchase, operation of law or otherwise, such transferee shall, without any further writing or action of any kind, be deemed a
beneficiary hereof for all purposes and such Registrable Securities shall be held subject to all of the terms of this Registration Rights Agreement, and by taking and holding such Registrable Securities such transferee shall be entitled to receive
the benefits of, and be conclusively deemed to have agreed to be bound by all of the applicable terms and provisions of this Registration Rights Agreement. If the Company shall so request, any such successor, assign or transferee shall agree in
writing to acquire and hold the Registrable Securities subject to all of the applicable terms hereof. 
 (d) Survival.
The respective indemnities, agreements, representations, warranties and each other provision set forth in this Registration Rights Agreement or made pursuant hereto shall remain in full force and effect regardless of any investigation (or statement
as to the results thereof) made by or on behalf of any holder of Registrable Securities, any director, officer or partner of such holder or any director, officer or partner thereof, or any controlling person of any of the foregoing, and shall
survive delivery of and payment for the Registrable Securities pursuant to the Purchase Agreement and the transfer and registration of Registrable Securities by such holder and the consummation of the transactions contemplated herein. 
 (e) Governing Law. This Registration Rights Agreement shall be governed by and construed in accordance with the laws of the State
of New York. 
 (f) EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO SUBMIT TO THE EXCLUSIVE JURISDICTION OF
COURTS OF UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, OR THE STATE OF NEW YORK, AND ANY APPELLATE COURT THEREFROM, FOR THE RESOLUTION OF ANY AND ALL DISPUTES, CONTROVERSIES, CONFLICTS, LITIGATION OR ACTIONS ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND THE SUBJECT MATTER HEREOF AND AGREES NOT TO COMMENCE ANY LITIGATION OR ACTIONS ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE SUBJECT MATTER HEREOF IN ANY OTHER COURT. 
  

 18 

 (g) Headings. The descriptive headings of the several Sections and paragraphs of
this Registration Rights Agreement are inserted for convenience only, do not constitute a part of this Registration Rights Agreement and shall not affect in any way the meaning or interpretation of this Registration Rights Agreement. 
 (h) Entire Agreement; Amendments. This Registration Rights Agreement and the other writings referred to herein or delivered
pursuant hereto which form a part hereof contain the entire understanding of the parties with respect to its subject matter. This Registration Rights Agreement supersedes all prior agreements and understandings between the parties with respect to
its subject matter. This Registration Rights Agreement may be amended and the observance of any term of this Registration Rights Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only by
a written instrument duly executed by the Company and the holders of at least a majority of the Registrable Securities at the time outstanding. Each holder of any Registrable Securities at the time or thereafter outstanding shall be bound by any
amendment or waiver effected pursuant to this Section 7(h), whether or not any notice, writing or marking indicating such amendment or waiver appears on such Registrable Securities or is delivered to such holder. 
 (i) Inspection. For so long as this Registration Rights Agreement shall be in effect, this Registration Rights Agreement and a
complete list of the names and addresses of all the holders of Registrable Securities shall be made available for inspection and copying on any Business Day between 9 a.m. and 5 p.m. by any holder of Registrable Securities for proper purposes only
(which shall include any purpose related to the rights of the holders of Registrable Securities under the Securities and this Agreement) at the offices of the Company at the address thereof set forth in Section 7(c) above. 
 (j) Counterparts. This Registration Rights Agreement may be executed by the parties in counterparts, each of which shall be deemed
to be an original, but all such respective counterparts shall together constitute one and the same instrument. If the foregoing is in accordance with your understanding, please sign and return to us counterparts hereof, and upon the acceptance
hereof by you, on behalf of each of the Purchasers, this letter and such acceptance hereof shall constitute a binding agreement among the Purchasers and the Company. 
 (k) Assignment of Registration Rights. The rights under this Agreement shall be automatically assignable by the holders to any
transferee of all or any portion of such holder’s Registrable Securities if: (i) the holder agrees in writing with the transferee or assignee to assign such rights, and a copy of such agreement is furnished to the Company within a
reasonable time after such assignment; (ii) the Company is, within a reasonable time after such transfer or assignment, furnished with written notice of (a) the name and address of such transferee or assignee, and (b) the securities
with respect to which such registration rights are being transferred or assigned; (iii) immediately following such transfer or 

  

 19 

 
assignment the further disposition of such securities by the transferee or assignee is restricted under the Securities Act or applicable state securities
laws; (iv) at or before the time the Company receives the written notice contemplated by clause (ii) of this sentence the transferee or assignee agrees in writing with the Company to be bound by all of the provisions contained herein; and
(v) such transfer shall have been made in accordance with the applicable requirements of the Purchase Agreement. 
 (l)
Independent Nature of the Purchasers. The obligations of each Investor hereunder are several and not joint with the obligations of any other holder, and no provision of this Agreement is intended to confer any obligations on any holder
vis-à-vis any other holder. Nothing contained herein, and no action taken by any holder pursuant hereto, shall be deemed to constitute the holders as a partnership, an association, a joint venture or any other kind of entity, or create a
presumption that the holders are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated herein. 
  

 20 

 IN WITNESS WHEREOF, this Registration Rights Agreement has been duly executed by each of the parties
hereto as of the date first written above. 
  

					
	GSI GROUP INC.
		
	By:	 	/s/ Robert L. Bowen
		 	Name:	 	Robert L. Bowen
		 	Title:	 	Vice President and Chief Financial Officer

  

			
	Accepted as of the date hereof: 
	
	PURCHASERS
	
	HIGHBRIDGE INTERNATIONAL LLC
	
	 By: HIGHBRIDGE CAPITAL
 MANAGEMENT,
LLC,
 its Trading Manager

		
	By:	 	/s/ Adam J. Chill
	Name:	 	Adam J. Chill
	Title:	 	Managing Director

  

 S-2 

			
	TEMPO MASTER FUND LP
		
	By:	 	/s/ Andrew Barnard
	Name:	 	Andrew Barnard
	Title:	 	Portfolio Manager

  

 S-3 

			
	SILVER OAK CAPITAL, L.L.C
		
	By:	 	/s/ Michael L. Gordon
	Name:	 	Michael L. Gordon
	Title:	 	Managing Member

  

 S-4 

			
	 INTERLACHEN CONVERTIBLE INVESTMENTS LIMITED
 By: Interlachen Capital Group LP,
its Authorized Signatory

		
	By:	 	/s/ Gregg T. Colburn
	Name:	 	Gregg T. Colburn
	Title:	 	Authorized Signatory

  

 S-5 

			
	SPECIAL VALUE CONTINUATION PARTNERS, L.P.
	
	By: Tennenbaum Capital Partners, LLC
	Its: Investment Manager
	
	SPECIAL VALUE EXPANSION FUND, LLC
	
	 By: Tennenbaum Capital Partners, LLC
 Its:
Investment Manager

	
	TENNENBAUM OPPORTUNITIES PARTNERS V, LP
	
	 By: Tennenbaum Capital Partners, LLC
 Its:
Investment Manager

	
	SPECIAL VALUE OPPORTUNITIES FUND, LLC
	
	 By: Tennenbaum Capital Partners, LLC
 Its:
Investment Manager

	
	Each of the above by:
	
	/s/ Mark Holdsworth
	Name: Mark Holdsworth
	Title: Managing Partner

  

 S-6 

			
	HALE CAPITAL PARTNERS, LP
		
	By:	 	/s/ Anthony Cirurgiao
	Name:	 	Anthony Cirurgiao
	Title:	 	COO

  

 S-7 

			
	 LIBERTY HARBOR MASTER FUND I, L.P.
 By:
Liberty Harbor I GP, LLC
 Its General Partner

		
	By:	 	/s/ Brendan McGovern
	Name:	 	Brendan McGovern
	Title:	 	Vice President

  

 S-8 

			
	UBS O’CONNOR LLC F/B/O: O’CONNOR GLOBAL CONVERTIBLE ARBITRAGE MASTER LIMITED
		
	By:	 	/s/ Andrew Martin
	Name:	 	Andrew Martin
	Title:	 	Managing Director
	
	UBS O’CONNOR LLC F/B/O: O’CONNOR GLOBAL CONVERTIBLE ARBITRAGE II MASTER LIMITED
		
	By:	 	/s/ Andrew Martin
	Name:	 	Andrew Martin
	Title:	 	Managing Director

  

 S-9 

 EXHIBIT A 
 GSI GROUP INC. 
 INSTRUCTION TO DTC PARTICIPANTS 
 (Date of Mailing) 
 URGENT - IMMEDIATE
ATTENTION REQUESTED 
 DEADLINE FOR RESPONSE: [DATE]* 
 The Company is in the process of registering the Securities under the Securities Act of 1933 for resale by the beneficial owners thereof. In order to have their Securities included in the registration statement, beneficial owners must
complete and return the enclosed Notice of Registration Statement and Selling Securityholder Questionnaire. 
  

	*	Not less than 20 calendar days from date of mailing. 

 GSI GROUP INC. 
 Notice of Registration Statement 
 and  
 Selling Securityholder Questionnaire 
 (Date) 
 Reference is hereby made to the Registration Rights Agreement, dated as of August 20, 2008 (the “Registration Rights Agreement”), by and among GSI
GROUP INC. (the “Company”), and the Purchasers named therein. Pursuant to the Registration Rights Agreement, the Company will file with the United States Securities and Exchange Commission (the “Commission”) a
registration statement (the “Shelf Registration Statement”) for the registration and resale under Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), of the Company’s Common Shares (the
“Securities”). A copy of the Registration Rights Agreement is attached hereto. All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Registration Rights Agreement. 
 Each beneficial owner of Registrable Securities (as defined below) is entitled to have the Registrable Securities beneficially owned by it included in the Shelf
Registration Statement. In order to have Registrable Securities included in the Shelf Registration Statement, this Notice of Registration Statement and Selling Securityholder Questionnaire (“Notice and Questionnaire”) must be
completed, executed and delivered to the Company’s counsel at the address set forth herein for receipt ON OR BEFORE [DEADLINE FOR RESPONSE]. Beneficial owners of Registrable Securities who do not complete, execute and return this Notice and
Questionnaire by such date (i) will not be named as Selling Securityholders in the Shelf Registration Statement and (ii) may not use the Prospectus forming a part thereof for resales of Registrable Securities. 
 Certain legal consequences arise from being named as a selling securityholder in the Shelf Registration Statement and related Prospectus. Accordingly, holders and
beneficial owners of Registrable Securities are advised to consult their own securities law counsel regarding the consequences of being named or not being named as a selling securityholder in the Shelf Registration Statement and related Prospectus.

 The term “Registrable Securities” is defined in the Registration Rights Agreement. 
  

 A-2 

 ELECTION 
 The undersigned holder (the “Selling Securityholder”) of Registrable Securities hereby elects to include in the Shelf Registration Statement the Registrable Securities beneficially owned by it and listed below in Item (3).
The undersigned, by signing and returning this Notice and Questionnaire, agrees to be bound with respect to such Registrable Securities by the terms and conditions of this Notice and Questionnaire and the Registration Rights Agreement, including,
without limitation, Section 5 of the Registration Rights Agreement, as if the undersigned Selling Securityholder were an original party thereto. 
 The
Selling Securityholder hereby provides the following information to the Company and represents and warrants that such information is accurate and complete: 
  

 A-3 

 QUESTIONNAIRE 
  

	(1)    (a)    	Full Legal Name of Selling Securityholder: 

  

	 	(b)	Full Legal Name of Registered Holder (if not the same as in (a) above) of Registrable Securities Listed in Item (3) below: 

  

	 	(c)	Full Legal Name of DTC Participant (if applicable and if not the same ( as (b) above) Through Which Registrable Securities Listed in Item (3) below are Held:

  

	(2)	Address for Notices to Selling Securityholder: 

 ______________________________________ 
 ______________________________________ 
 ______________________________________ 
 ______________________________________ 
 Telephone: ____________________________ 
 Fax: __________________________________ 
 Contact Person __________________________ 
  

	(3)	Beneficial Ownership of Securities: 

 Except as set forth
below in this Item (3), the undersigned does not beneficially own any Securities. 
  

	 	(a)	Number of shares of Registrable Securities beneficially owned:             

  

	 	(b)	Number of shares of Securities other than Registrable Securities beneficially owned:            

  

	 	(c)	Number of shares of Registrable Securities which the undersigned wishes to be included in the Shelf Registration
Statement:             

  

	(4)	Beneficial Ownership of Other Securities of the Company: 

 Except as set forth below in this Item (4), the undersigned Selling Securityholder is not the beneficial or registered owner of any other securities of the Company, other than the Securities listed above in Item (3). 
 State any exceptions here: 
  

 A-4 

	(5)	Relationships with the Company: 

 Except as set forth
below, neither the Selling Securityholder nor any of its affiliates, officers, directors or principal equity holders (5% or more) has held any position or office or has had any other material relationship with the Company (or its predecessors or
affiliates) during the past three years. 
 State any exceptions here: 
  

	(6)	Plan of Distribution: 

 Except as set forth below, the
undersigned Selling Securityholder intends to distribute the Registrable Securities listed above in Item (3) only as follows (if at all): Such Registrable Securities may be sold from time to time directly by the undersigned Selling
Securityholder or, alternatively, through broker-dealers or agents. Such Registrable Securities may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of sale, at varying prices determined at the time of
sale, or at negotiated prices. Such sales (which may involve crosses or block transactions) may be effected in (i) transactions on any national securities exchange or quotation service on which the Registered Securities may be listed or quoted
at the time of sale, (ii) transactions in the over-the-counter market, (iii) transactions otherwise than on such exchanges or services or in the over-the-counter market, (iv) transactions through the writing of options, whether such
options are listed on an options exchange or otherwise, (v) ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers, (vi) block trades in which the broker-dealer will attempt to sell the shares as
agent but may position and resell a portion of the block as principal to facilitate the transaction, (vii) purchases by a broker-dealer as principal and resale by the broker-dealer for its account, (viii) an exchange distribution in
accordance with the rules of the applicable exchange, (ix) privately negotiated transactions, (x) short sales, (xi) sales pursuant to Rule 144, (xii) broker-dealers may agree with the Selling Securityholders to sell a specified
number of such shares at a stipulated price per share, (xiii) a combination of any such methods of sale or (xiv) any other method permitted pursuant to applicable law. In connection with sales of the Registrable Securities or otherwise,
the Selling Securityholder may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the Registrable Securities in the course of hedging the positions they assume. The Selling Securityholder may also sell
Registrable Securities short and deliver Registrable Securities to close out such short positions, or loan or pledge Registrable Securities to broker-dealers that in turn may sell such securities. 
 State any exceptions here: 
 By signing below, the Selling
Securityholder acknowledges that it understands its obligation to comply, and agrees that it will comply, with the provisions of the Exchange Act and the rules and regulations thereunder, particularly Regulation M. 
  

 A-5 

 In the event that the Selling Securityholder transfers all or any portion of the Registrable Securities listed in Item
(3) above after the date on which such information is provided to the Company, the Selling Securityholder agrees to notify the transferee(s) at the time of the transfer of its rights and obligations under this Notice and Questionnaire and the
Registration Rights Agreement. 
 By signing below, the Selling Securityholder consents to the disclosure of the information contained herein in its answers
to Items (1) through (6) above and the inclusion of such information in the Shelf Registration Statement and related Prospectus. The Selling Securityholder understands that such information will be relied upon by the Company in connection
with the preparation of the Shelf Registration Statement and related Prospectus. 
 All notices hereunder and pursuant to the Registration Rights Agreement
shall be made in writing, by hand-delivery, first-class mail, or air courier guaranteeing overnight delivery as follows: 
  

	 	(i)	To the Company: 

 GSI Group Inc. 
 125 Middlesex Turnpike 
 Bedford,
Massachusetts 01730 
 Attention: General Counsel 
 Telephone No.: (781) 266-5786 
 Telecopier No.: (781) 266-5115 
  

	 	(ii)	With a copy to: 

 Skadden, Arp, Slate, Meagher &
Flom LLP 
 Four Times Square, 
 New York, New York 10036 
 Attention: Michael J. Zeidel, Esq. 
 Telephone: 617-573-4815 
 Telecopier:
617-305-4815 
 Once this Notice and Questionnaire is executed by the Selling Securityholder and received by the Company’s counsel, the terms of this
Notice and Questionnaire, and the representations and warranties contained herein, shall be binding on, shall inure to the benefit of and shall be enforceable by the respective successors, heirs, personal representatives, and assigns of the Company
and the Selling Securityholder (with respect to the Registrable Securities beneficially owned by such Selling Securityholder and listed in Item (3) above. This Agreement shall be governed in all respects by the laws of the State of New York.

  

 A-6 

 IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this Notice and Questionnaire to be executed and
delivered either in person or by its duly authorized agent. 
  

			
	Dated:	 	__________
		
		 	 
		 	Selling Securityholder

 (Print/type full legal name of beneficial owner of Registrable Securities) 
  

			
		
	By:	 	 
		 	Name:
		 	Title:

 PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE FOR RECEIPT ON OR BEFORE [DEADLINE FOR
RESPONSE] TO THE COMPANY’S COUNSEL AT: 
  

 A-7 

 EXHIBIT B 
 SELLING SECURITYHOLDERS 
 The shares of common stock being offered by the Selling Securityholders are
those issuable to the Selling Securityholders upon exercise of the warrants. For additional information regarding the issuances of the warrants, see “Private Placement of Warrants” above. We are registering the common shares in order to
permit the Selling Securityholders to offer the shares for resale from time to time. Except for the ownership of the warrants, the Selling Securityholders have not had any material relationship with us within the past three years. 
 The table below lists the Selling Securityholders and other information regarding the beneficial ownership of the common shares by each of the Selling
Securityholders. The second column lists the number of common shares beneficially owned by each Selling Securityholder, based on its ownership of the warrants, as of             ,
2008, assuming exercise of all of the warrants held by the Selling Securityholders on that date. 
 The third column lists the common shares
being offered by this prospectus by the Selling Securityholders. 
 In accordance with the terms of a registration rights agreements with the
holders of the warrants, this prospectus generally covers the resale of at least the sum of (i) the maximum number of common shares issued and issuable upon exercise of the warrants, determined as if the outstanding warrants were exercised, as
applicable, in full, as of the Trading Day immediately preceding the date this registration statement is initially filed with the SEC. The fourth column assumes the sale of all of the shares offered by the Selling Securityholders pursuant to this
prospectus. 
 The Selling Securityholders may sell all, some or none of their shares in this offering. See “Plan of Distribution.”

							
	 Name of Selling Securityholder
	  	Number of Common Shares
Owned Prior to Offering	  	Maximum Number of
Common Shares to be Sold
Pursuant to this Prospectus	  	Number of Common
Shares Owned After
Offering
	 [ ] (1)
	  		  		  	0
	 [ ] (2)
	  		  		  	0
	 [Other Purchasers] (3)
	  		  		  	
	     (1)	  		  		  	
	      (2)
	  		  		  	
	      (3)
	  		  		  	

  
  
  
  

 PLAN OF DISTRIBUTION 
 We are registering the common shares issuable upon exercise of the warrants to permit the resale of these common shares by the holders of the warrants from time to time after the date of this prospectus. We will not
receive any of the proceeds from the sale by the Selling Securityholders of the common shares. We will bear all fees and expenses incident to our obligation to register the common shares. 
 The Selling Securityholders may sell all or a portion of the common shares beneficially owned by them and offered hereby from time to time directly or
through one or more underwriters, broker-dealers or agents. If the common shares are sold through underwriters or broker-dealers, the Selling Securityholders will be responsible for underwriting discounts or commissions or agent’s commissions.
The common shares may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated prices. These sales may be effected in transactions,
which may involve crosses or block transactions, 
  

	 	•	 	 on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale; 

  

	 	•	 	 in the over-the-counter market; 

  

	 	•	 	 in transactions otherwise than on these exchanges or systems or in the over-the-counter market; 

  

	 	•	 	 through the writing of options, whether such options are listed on an options exchange or otherwise; 

  

	 	•	 	 ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; 

  

	 	•	 	 block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the
transaction; 

  

	 	•	 	 purchases by a broker-dealer as principal and resale by the broker-dealer for its account; 

  

	 	•	 	 an exchange distribution in accordance with the rules of the applicable exchange; 

  

	 	•	 	 privately negotiated transactions; 

  

	 	•	 	 short sales; 

  

	 	•	 	 sales pursuant to Rule 144; 

  

	 	•	 	 broker-dealers may agree with the Selling Securityholders to sell a specified number of such shares at a stipulated price per share; 

	 	•	 	 a combination of any such methods of sale; and 

  

	 	•	 	 any other method permitted pursuant to applicable law. 

 If the Selling Securityholders effect such transactions by selling common shares to or through underwriters, broker-dealers or agents, such underwriters, broker-dealers or agents may receive commissions in the form of
discounts, concessions or commissions from the Selling Securityholders or commissions from purchasers of the common shares for whom they may act as agent or to whom they may sell as principal (which discounts, concessions or commissions as to
particular underwriters, broker-dealers or agents may be in excess of those customary in the types of transactions involved). In connection with sales of the common shares or otherwise, the Selling Securityholders may enter into hedging transactions
with broker-dealers, which may in turn engage in short sales of the common shares in the course of hedging in positions they assume. The Selling Securityholders may also sell common shares short and deliver common shares covered by this prospectus
to close out short positions and to return borrowed shares in connection with such short sales. The Selling Securityholders may also loan or pledge common shares to broker-dealers that in turn may sell such shares. 
 The Selling Securityholders may pledge or grant a security interest in some or all of the warrants, or common shares owned by them and, if they default
in the performance of their secured obligations, the pledgees or secured parties may offer and sell the common shares from time to time pursuant to this prospectus or any amendment to this prospectus under Rule 424(b)(3) or other applicable
provision of the Securities Act of 1933, as amended, amending, if necessary, the list of Selling Securityholders to include the pledgee, transferee or other successors in interest as Selling Securityholders under this prospectus. The Selling
Securityholders also may transfer and donate the common shares in other circumstances in which case the transferees, donees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus. 

The Selling Securityholders and any broker-dealer participating in the distribution of the common shares may be deemed to be “underwriters”
within the meaning of the Securities Act, and any commission paid, or any discounts or concessions allowed to, any such broker-dealer may be deemed to be underwriting commissions or discounts under the Securities Act. At the time a particular
offering of the common shares is made, a prospectus supplement, if required, will be distributed which will set forth the aggregate amount of common shares being offered and the terms of the offering, including the name or names of any
broker-dealers or agents, any discounts, commissions and other terms constituting compensation from the Selling Securityholders and any discounts, commissions or concessions allowed or reallowed or paid to broker-dealers. 
 Under the securities laws of some states, the common shares may be sold in such states only through registered or licensed brokers or dealers. In
addition, in some states the common shares may not be sold unless such shares have been registered or qualified for sale in such state or an exemption from registration or qualification is available and is complied with. 
  

 A-2 

 There can be no assurance that any Selling Securityholders will sell any or all of the common shares
registered pursuant to the shelf registration statement, of which this prospectus forms a part. 
 The Selling Securityholders and any other
person participating in such distribution will be subject to applicable provisions of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, including, without limitation, Regulation M of the Exchange Act, which
may limit the timing of purchases and sales of any of the common shares by the Selling Securityholders and any other participating person. Regulation M may also restrict the ability of any person engaged in the distribution of the common shares to
engage in market-making activities with respect to the common shares. All of the foregoing may affect the marketability of the common shares and the ability of any person or entity to engage in market-making activities with respect to the common
shares. 
 We will pay all expenses of the registration of the common shares pursuant to the registration rights agreement, estimated to be
$[            ] in total, including, without limitation, Securities and Exchange Commission filing fees and expenses of compliance with state securities or “blue sky” laws;
provided, however, that a selling securityholder will pay all underwriting discounts and selling commissions, if any. We will indemnify the Selling Securityholders against liabilities, including some liabilities under the Securities
Act, in accordance with the registration rights agreements, or the Selling Securityholders will be entitled to contribution. We may be indemnified by the Selling Securityholders against civil liabilities, including liabilities under the Securities
Act, that may arise from any written information furnished to us by the Selling Securityholder specifically for use in this prospectus, in accordance with the related registration rights agreement, or we may be entitled to contribution. 

Once sold under the shelf registration statement, of which this prospectus forms a part, the common shares will be freely tradable in the hands of
persons other than our affiliates. 
  

 A-3Form of Depositary Trust Agreement

 RYDEX SPECIALIZED PRODUCTS LLC, d/b/a “RYDEX INVESTMENTS”, 
 as Sponsor, 
 THE BANK OF NEW YORK,

 as Trustee, 
 ALL REGISTERED
OWNERS AND BENEFICIAL OWNERS OF SOUTH AFRICAN 
 RAND SHARES ISSUED HEREUNDER 
 and 
 ALL DEPOSITORS 
  
  
 Form of Depositary Trust Agreement 
 CurrencySharesSM South African Rand Trust 
  
  
 Dated as of
[                    ], 200     

 TABLE OF CONTENTS 
  

					
	 	  	 	  	 Page

	 ARTICLE 1
	  	DEFINITIONS AND RULES OF CONSTRUCTION	  	2
			
	 Section 1.1
	  	Definitions.	  	2
	 Section 1.2
	  	Rules of Construction.	  	8
			
	 ARTICLE 2
	  	STATEMENT OF PURPOSE; CREATION AND DECLARATION OF TRUST; FORM OF CERTIFICATES; DEPOSIT OF SOUTH AFRICAN RAND; DELIVERY, REGISTRATION OF TRANSFER AND SURRENDER OF SHARES	  	9
			
	 Section 2.1
	  	Statement of Purpose; Duties and Powers of the Trust.	  	9
	 Section 2.2
	  	Creation and Declaration of Trust; Business of the Trust.	  	9
	 Section 2.3
	  	Form of Certificates; Book-Entry System; Transferability of Shares.	  	10
	 Section 2.4
	  	Deposit of South African Rand.	  	12
	 Section 2.5
	  	Delivery of Shares.	  	14
	 Section 2.6
	  	Registration and Registration of Transfer of Shares; Combination and Split-up of Certificates.	  	14
	 Section 2.7
	  	Surrender of Shares and Withdrawal of Trust Property.	  	15
	 Section 2.8
	  	Limitations on Delivery, Registration of Transfer and Surrender of Shares.	  	17
	 Section 2.9
	  	Lost Certificates, Etc.	  	17
	 Section 2.10
	  	Cancellation and Destruction of Surrendered Certificates.	  	18
	 Section 2.11
	  	Splits and Reverse Splits of Shares.	  	18
			
	 ARTICLE 3
	  	CERTAIN OBLIGATIONS OF REGISTERED OWNERS OF SHARES	  	19
			
	 Section 3.1
	  	Liability of Registered Owner for Taxes and Other Governmental Charges.	  	19
	 Section 3.2
	  	Warranties on Deposit of South African Rand.	  	19
			
	 ARTICLE 4
	  	ADMINISTRATION OF THE TRUST	  	20
			
	 Section 4.1
	  	Evaluation of South African Rand; Calculation of Net Asset Value.	  	20
	 Section 4.2
	  	Responsibility of the Trustee for Evaluations.	  	21
	 Section 4.3
	  	Interest Account and Non-Interest Account.	  	21
	 Section 4.4
	  	Cash Distributions.	  	21
	 Section 4.5
	  	Distributions of Surplus Property.	  	22
	 Section 4.6
	  	Fixing of Record Date.	  	22
	 Section 4.7
	  	Payment of Trust Expenses.	  	23
	 Section 4.8
	  	Statements and Reports.	  	24

  

 i 

					
	 Section 4.9
	  	Further Provisions for Sales of Trust Property; Currency Conversion.	  	25
	 Section 4.10
	  	Counsel.	  	26
	 Section 4.11
	  	Grantor Trust.	  	27
			
	 ARTICLE 5
	  	THE SPONSOR	  	27
			
	 Section 5.1
	  	Duties of the Sponsor.	  	27
	 Section 5.2
	  	Obligations of the Sponsor.	  	28
	 Section 5.3
	  	Prevention or Delay in Performance by the Sponsor.	  	29
	 Section 5.4
	  	Certain Matters Regarding Successor Sponsor.	  	29
	 Section 5.5
	  	Resignation of Sponsor; Successors.	  	30
	 Section 5.6
	  	Compensation of the Sponsor.	  	31
	 Section 5.7
	  	Federal Securities Law Filings.	  	31
	 Section 5.8
	  	Discretionary Actions by Sponsor; Consultation.	  	32
			
	 ARTICLE 6
	  	THE TRUSTEE	  	33
			
	 Section 6.1
	  	Maintenance of Office and Transfer Books by the Trustee.	  	33
	 Section 6.2
	  	Obligations of the Trustee.	  	33
	 Section 6.3
	  	Prevention or Delay in Performance by the Trustee.	  	34
	 Section 6.4
	  	Resignation or Removal of the Trustee; Appointment of Successor Trustee.	  	35
	 Section 6.5
	  	Transfers Between Interest Account and Non-Interest Account.	  	37
	 Section 6.6
	  	The Depository.	  	37
	 Section 6.7
	  	Compensation of the Trustee.	  	38
	 Section 6.8
	  	Retention of Trust Documents.	  	38
	 Section 6.9
	  	Prospectus Delivery.	  	38
	 Section 6.10
	  	Discretionary Actions by Trustee; Consultation.	  	39
			
	 ARTICLE 7
	  	INDEMNIFICATION	  	39
			
	 Section 7.1
	  	Indemnification of the Sponsor and Trustee.	  	39
			
	 ARTICLE 8
	  	AMENDMENT AND TERMINATION	  	44
			
	 Section 8.1
	  	Amendment.	  	44
	 Section 8.2
	  	Termination.	  	44
			
	 ARTICLE 9
	  	MISCELLANEOUS	  	46
			
	 Section 9.1
	  	Counterparts.	  	46
	 Section 9.2
	  	Third-Party Beneficiaries.	  	47
	 Section 9.3
	  	Severability.	  	47
	 Section 9.4
	  	Registered Owners, Beneficial Owners and Depositors as Parties; Binding Effect.	  	47
	 Section 9.5
	  	Notices.	  	47
	 Section 9.6
	  	Agent for Service; Submission to Jurisdiction.	  	49
	 Section 9.7
	  	Governing Law.	  	49

  

 ii 

 EXHIBIT A – DEPOSIT ACCOUNT AGREEMENT 
 EXHIBIT B – FORM OF CERTIFICATES 
  

 iii 

 DEPOSITARY TRUST AGREEMENT 
 THIS DEPOSITARY TRUST AGREEMENT dated as of
[                    ], 200    , between Rydex Specialized Products LLC, a Delaware limited liability company d/b/a
“RYDEX INVESTMENTS”, as sponsor, THE BANK OF NEW YORK, a New York banking corporation, as trustee, all Registered Owners and Beneficial Owners from time to time of South African Rand Shares issued hereunder and all Depositors. 

W I T N E S S E T H : 
 WHEREAS the Sponsor desires to establish a trust, to be known as the
“CurrencySharesSM South African Rand Trust”, pursuant to the laws of the State of New York; 
 WHEREAS the Sponsor desires to establish the terms on which South African Rand (as herein defined) may be deposited in the trust and provide for the
creation of South African Rand Shares in Baskets (as herein defined) representing fractional undivided interests in the net assets of the trust and the execution and delivery of Certificates (as herein defined) evidencing the South African Rand
Shares; and 
 WHEREAS the Sponsor desires to provide for other terms and conditions upon which the trust shall be established and
administered, as hereinafter provided. 
 NOW, THEREFORE, in consideration of the premises and of the mutual agreements herein contained, the
Sponsor and the Trustee hereby agree as follows: 

 ARTICLE 1 
 DEFINITIONS AND RULES OF CONSTRUCTION 
 Section 1.1 Definitions. 
 Except as otherwise specified in this Trust Agreement or as the context may otherwise require, the following terms have the respective meanings set forth
below for all purposes of this Depositary Trust Agreement. 
 “Agreement” means this Depositary Trust Agreement, as amended or
supplemented in accordance with its terms. 
 “Authorized Participant” means a Person that, at the time of submitting a Purchase
Order or a Redemption Order, (i) is a registered broker-dealer or other securities market participant, (ii) is a DTC Participant or an Indirect Participant and (iii) has in effect a valid Authorized Participant Agreement. 

“Authorized Participant Agreement” means an agreement among the Trustee, the Sponsor and an Authorized Participant that authorizes the
Authorized Participant to submit Purchase Orders and Redemption Orders under this Agreement. 
 “Basket” means 50,000 Shares,
except that the Trustee, in consultation with the Sponsor, may from time to time increase or decrease the number of Shares comprising a Basket. 
 “Basket South African Rand Amount” is the amount of South African Rand that must be deposited for issuance of one Basket or that, subject to the exception stated in Section 2.7, is deliverable upon
Surrender of one Basket. The Basket South African Rand Amount will be determined as provided in Section 2.4(b). 
 “Beneficial
Owner” means any Person owning, through DTC, a DTC Participant, or an Indirect Participant, a Share. 
  

 2 

 “Certificate” means a certificate that may be executed and delivered by the Trustee under this
Agreement evidencing Shares. 
 “Closing Spot Rate” means the South African Rand/Dollar exchange rate, as determined by WM/Reuters
each New York Business Day at approximately 4:00 PM (London time). 
 “Code” means the Internal Revenue Code of 1986, as amended.

 “Commission” means the Securities and Exchange Commission of the United States or any successor governmental agency in the
United States. 
 “Corporate Trust Office” means the office of the Trustee at which its depositary receipt business is administered
which, at the date of this Agreement, is located at 101 Barclay Street, New York, New York 10286. 
 “Deliver” means (a) when
used with respect to South African Rand, either (i) a wire transfer of immediately available South African Rand to the account specified by the Person entitled to the Delivery or (ii) if requested by the Person entitled to the Delivery,
delivery of a certified or official bank check for South African Rand payable as requested by the person entitled to the Delivery and (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 2.3(e), execution and delivery at the Corporate Trust Office of
the Trustee of one or more Certificates evidencing those Shares. 
 “Deposit Account Agreement” means the Deposit Account Agreement
entered into between the Trustee and the Depository, substantially in the form annexed hereto as Exhibit A, as it may be amended or supplemented in accordance with this Agreement. 
 “Depositor” means any Authorized Participant that deposits South African Rand into the Trust, either for its own account or on behalf of
another Person that is the owner or beneficial owner of those South African Rand. 
  

 3 

 “Depository” means JPMorgan Chase Bank, N.A., London Branch. 
 “Dollars” or “$” means the official currency of the United States of America. 
 “DTC” means The Depository Trust Company, its nominees and their respective successors. 
 “DTC Participant” means a Person that, pursuant to DTC’s governing documents, is entitled to deposit securities with DTC in its capacity
as a “participant.” 
 “Exchange” means the exchange on which the Shares are principally traded, as specified by the
Sponsor, initially the New York Stock Exchange. 
 “Fiscal Year” means the annual accounting periods of the Trust which will end on
October 31 of each year. 
 “Indemnified Amounts” is defined in Section 7.1. 
 “Indemnitee” is defined in Section 7.1. 
 “Indemnitor” is defined in Section 7.1. 
 “Indirect Participant” means a Person
that, by clearing securities through, or maintaining a custodial relationship with, a DTC Participant, has access to the DTC clearing system. 
 “Interest Account” means the interest-bearing account for the Trust’s assets maintained with the Depository pursuant to the Deposit Account Agreement. 
 “Local Business Day” means any day other than (i) a Saturday or Sunday or (ii) a day which has been designated a bank holiday in
South Africa. 
  

 4 

 “NAV” means the net asset value of the Trust determined under Section 4.1. 
 “NAV per Basket” means the value of a Basket determined under Section 2.4. 
 “NAV per Share” means the value of a Share determined under Section 4.1. 
 “New York Business Day” means any day other than (i) a Saturday or Sunday or (ii) a day on which the Exchange is not open for regular
trading at noon, New York time. 
 “Non-Interest Account” means the non-interest-bearing account maintained with the Depository
pursuant to the Deposit Account Agreement. 
 “Order Cutoff Time” means
(i) [            ] PM (New York time) or (ii) another time agreed to by the Sponsor and the Trustee and of which Registered Owners and all existing Authorized
Participants have been notified by the Trustee. 
 “Order Date” means, with respect to a Purchase Order, the date specified in
Section 2.4(a) and, with respect to a Redemption Order, the date specified in Section 2.7. 
 “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. 
  

 5 

 “Proceeding” is defined in Section 7.1. 
 “Purchase Order” is defined in Section 2.4. 
 “Qualified Bank” means a bank, trust company, corporation or national banking association organized and doing business under the laws of the United States or any State of the United States that is authorized
under those laws to exercise corporate trust powers and that (i) is a DTC Participant or a participant in such other securities depository as is then acting with respect to the Shares, (ii) unless counsel to the Sponsor determines that the
following requirement is not necessary for the exception under Section 408(m) of the Code to apply, is a banking institution as defined in Section 408(n) of the Code and (iii) had, as of the date of its most recent annual financial
statements, an aggregate capital, surplus and undivided profits of at least $500,000,000. 
 “Redemption Order” is defined in
Section 2.7. 
 “Registered Owner” means the Person in whose name Shares are registered on the books of the Trustee maintained
for that purpose. 
 “Registrar” means any bank or trust company that is appointed to register Shares and transfers of Shares as
herein provided. 
 “Relevant Price” means the Closing Spot Rate, except as provided below. If, on a particular evaluation day,
WM/Reuters does not announce a Closing Spot Rate by 6:00 PM (London time), then the most recent WM/Reuters determination of the Closing Spot Rate will be the “Relevant Price” and be used to determine the NAV of the Trust unless the
Trustee, in consultation with the Sponsor, determines that such price is inappropriate to use as the basis for such valuation. In the event that the Trustee and the Sponsor determine that the most recent WM/Reuters determination of the Closing Spot
Rate is not an appropriate basis for valuation of the Trust’s South African Rand, the Trustee and the Sponsor shall determine an alternative basis for such evaluation to be employed by the Trustee, which will be the “Relevant Price.”

  

 6 

 “Settlement Date” means, with respect to a Purchase Order, the date specified in
Section 2.4(a) and, with respect to a Redemption Order, the date specified in Section 2.7. 
 “Shares” means South
African Rand Shares created under this Agreement, each representing a fractional undivided ownership interest in the net assets of the Trust, which interest shall equal a fraction, the numerator of which is 1 and the denominator of which is the
total number of Shares outstanding. 
 “South African Rand” means the official currency of South Africa. 
 “Sponsor” means Rydex Specialized Products LLC, a Delaware limited liability company, d/b/a “Rydex Investments”. 
 “Sponsor’s Fee” means the fee to be paid to the Sponsor, which for each day shall be equal to (.004/365 or 366, depending on the number of
days in the year) multiplied by (the South African Rand in the Trust as of the close of business on the preceding Local Business Day, which shall include all unpaid interest but exclude unpaid fees, each as accrued through the immediately preceding
day). 
 “Sponsor Indemnified Persons” is defined in Section 7.1. 
 “Surplus Property” means any Trust Property other than (i) South African Rand deposited by or on behalf of Authorized Participants
pursuant to Section 2.4, in the Interest Account or the Non-Interest Account, (ii) South African Rand received as interest on South African Rand in the Interest Account, (iii) amounts withdrawn from the Interest Account in order to
make a redemption described in Section 2.7, or (iv) amounts being held for the payment of estimated Trust expenses. 
  

 7 

 “Surrender” means, when used with respect to Shares, (a) one or more book-entry transfers
of Shares to the DTC account of the Trustee or (b) surrender to the Trustee at its Corporate Trust Office of one or more Certificates evidencing Shares. 
 “Trust” means the CurrencyShares South African Rand Trust, the trust entity created by this Agreement. 
 “Trust Property” means the South African Rand that are deposited under this Agreement and any other money or other property that is received by the Trustee in respect of Trust Property and that is being held under this Agreement.
Trust Property shall not include any property subject to distribution for which the record date for determining Registered Owners entitled to such distribution has passed. 
 “Trustee” means The Bank of New York, a New York banking corporation, in its capacity as trustee under this Agreement, or any successor as
trustee under this Agreement. 
 “Trustee Indemnified Persons” is defined in Section 7.1. 
 “WM/Reuters” means the joint venture of The WM Company PLC and Thomson Reuters. 
 Section 1.2 Rules of Construction. 
 Unless the context otherwise requires: 
 (i) a term has the meaning assigned to it; 
 (ii) an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles as in effect in
the United States; 
 (iii) “or” is not exclusive; 
 (iv) the words “herein”, “hereof”, “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or other subdivision;

  

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 (v) “including” means including without limitation; and 
 (vi) words in the singular include the plural and words in the plural include the singular. 
 ARTICLE 2 
 STATEMENT OF PURPOSE; 
 CREATION AND DECLARATION OF TRUST; 
 FORM OF CERTIFICATES; DEPOSIT OF SOUTH AFRICAN RAND; DELIVERY, 
 REGISTRATION OF TRANSFER AND SURRENDER OF SHARES 

 Section 2.1 Statement of Purpose; Duties and Powers of the Trust. 
 (a) The Trust is a passive investment vehicle that is not actively managed. The sole purpose of the Trust is to hold South African Rand on behalf of the
Registered Owners. The Trust shall have no directors or persons acting in similar capacity and no officers or employees, and shall act only through the Trustee and the Sponsor. 
 (b) The Trust shall have the power to receive and hold deposits of South African Rand, issue Baskets representing those deposits, distribute South
African Rand upon surrenders of Baskets, and perform acts incidental to the foregoing as provided in this Agreement, but the Trust shall not have the power to engage in any other business activities. 
 Section 2.2 Creation and Declaration of Trust; Business of the Trust. 
 (a) The Trustee acknowledges that an initial deposit of 1,000 South African Rand under and in accordance with this Agreement has been made in the
Interest Account by the Sponsor on the date hereof in exchange for one Share. The Sponsor is purchasing the initial Share solely for the purpose of forming the Trust. The Sponsor will redeem the initial Share for 1,000 South African Rand as promptly
as practicable after the 

  

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Form S-1 registration statement filed with the Commission with respect to the Shares is declared effective by the Commission and the Initial Purchaser, as
defined in the registration statement, deposits South African Rand in accordance with the registration statement. 
 (b) The Trustee declares that it will hold that initial deposit and all other Trust Property as trustee for the benefit of the Registered Owners for the purposes of, and subject to and limited by the terms and
conditions set forth in, this Agreement. The trust created by this Agreement shall be known as the “CurrencySharesSM South African Rand
Trust”. 
 Section 2.3 Form of Certificates; Book-Entry System; Transferability of Shares. 
 (a) The Certificates evidencing Shares shall be substantially in the form set forth in Exhibit B annexed to this Agreement, with appropriate insertions,
modifications and omissions, as hereinafter provided. No Shares shall be entitled to any benefits under this Agreement or be valid or obligatory for any purpose unless a Certificate evidencing those Shares has been executed by the Trustee by the
manual or facsimile signature of a duly authorized signatory of the Trustee and, if a Registrar (other than the Trustee) for the Shares shall have been appointed, countersigned by the manual signature of a duly authorized officer of the Registrar.
The Trustee shall maintain books on which the registered ownership of each Share and transfers, if any, of such registered ownership shall be recorded. Certificates evidencing Shares bearing the manual or facsimile signature of a duly authorized
signatory of the Trustee and the manual signature of a duly authorized officer of the Registrar, if applicable, who was, at the time such Certificates were executed, a proper signatory of the Trustee or Registrar, if applicable, shall bind the
Trustee, notwithstanding that such signatory has ceased to hold such office prior to the delivery of such Certificates. 
  

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 (b) The Certificates may be endorsed with or have incorporated in the text thereof such legends or
recitals or modifications not inconsistent with the provisions of this Agreement as may be required by the Trustee or required to comply with any applicable law or regulations thereunder or with the rules and regulations of the Exchange or to
conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which the Shares evidenced by a particular Certificate are subject. 
 (c) The Sponsor and the Trustee will apply to DTC for acceptance of the Shares in its book-entry settlement system. Shares deposited with DTC shall be evidenced by one or more global Certificates which shall be
registered in the name of Cede & Co., as nominee for DTC, and shall bear the following legend: 
 UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE AGENT AUTHORIZED BY THE ISSUER FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 
 (d) So long as the Shares are eligible for book-entry settlement with DTC and such settlement is available, unless otherwise required by law,
notwithstanding the provisions of Section 2.3(a) and Section 2.3(b), all Shares shall be evidenced by one or more global Certificates the Registered Owner of which is DTC or a nominee of DTC and (i) no Beneficial Owner of Shares will
be entitled to receive a separate Certificate evidencing those Shares, (ii) the interest of a Beneficial Owner in Shares represented by a global Certificate will be shown only on, and transfer of that interest will be effected only 

  

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through, records maintained by DTC or a DTC Participant or Indirect Participant through which the Beneficial Owner holds that interest and (iii) the
rights of a Beneficial Owner with respect to Shares represented by a global Certificate will be exercised only to the extent allowed by, and in compliance with, the arrangements in effect between such Beneficial Owner and DTC or the DTC Participant
or Indirect Participant through which that Beneficial Owner holds an interest in Shares. 
 (e) If, at any time when Shares are evidenced by
a global Certificate, DTC ceases to make its book-entry settlement system available for such Shares, the Trustee shall execute and deliver separate Certificates evidencing Shares to the DTC Participants entitled thereto, with such additions,
deletions and modifications to this Agreement and to the form of Certificate evidencing Shares as the Sponsor and the Trustee may agree. 
 (f) Title to a Certificate evidencing Shares (and to the Shares evidenced thereby), when properly endorsed or accompanied by proper instruments of transfer, shall be transferable by delivery with the same effect as in the case of a
negotiable instrument under the laws of New York; provided, however, that the Trustee, notwithstanding any notice to the contrary, may treat the Registered Owner of Shares as the absolute owner thereof for the purpose of determining
the person entitled to any distribution or to any notice provided for in this Agreement and for all other purposes. 
 Section 2.4
Deposit of South African Rand. 
 (a) After the deposit of South African Rand in the Trust by the Initial Purchaser, as defined in the
registration statement, the issuance and Delivery of Shares will take place only in integral numbers of Baskets and in compliance with the provisions of this Agreement, as supplemented by any procedures attached to an applicable Authorized
Participant Agreement, to the extent those procedures are consistent with this Agreement. Authorized Participants wishing to acquire from the Trustee one or more Baskets must place an order with the Trustee (a “Purchase Order”).
Purchase Orders received by the Trustee prior to the Order Cutoff Time on a New York Business Day will 

  

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have that day as the Order Date. Purchase Orders received on a day that is not a New York Business Day or received after the Order Cutoff Time on a New York
Business Day will have the next following New York Business Day as the Order Date. The “Settlement Date” for a Purchase Order shall be the third New York Business Day following the Order Date unless that day is not a Local Business
Day, in which case the Settlement Date shall be the next following day that is both a New York Business Day and a Local Business Day. As consideration for each Basket acquired, Authorized Participants must deposit with the Depository the Basket
South African Rand Amount determined by the Trustee on the Business Day prior to the Settlement Date for the corresponding Purchase Order. The Basket South African Rand Amount shall be deposited in the Non-Interest Account. Pursuant to
Section 6.5, the Trustee shall contemporaneously instruct the Depository to transfer the portion of the Basket South African Rand Amount representing principal from the Non-Interest Account to the Interest Account. The portion of the Basket
South African Rand Amount representing a pro rata portion of accrued but unpaid interest will remain in the Non-Interest Account. 
 (b) The
Trustee shall determine the Basket South African Rand Amount for each New York Business Day. The initial “Basket South African Rand Amount” is 50,000,000 South African Rand. After the initial deposit, the “Basket South
African Rand Amount” shall be an amount of South African Rand equal to the quotient obtained by dividing the NAV per Basket on the date on which the determination is being made by the Relevant Price on such date. For purposes of this
computation, “NAV per Basket” is the product obtained by multiplying (x) the NAV per Share determined in compliance with Section 4.1, by (y) the number of Shares which constitute a Basket on the date on which the
determination is being made. Fractions of a South African Rand smaller than .001 shall be disregarded. The Sponsor intends to publish, or may designate other persons to publish, for each New York Business Day, the Basket South African Rand Amount.

  

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 (c) If the Trust Property includes Surplus Property, no deposits of South African Rand will be accepted
until after a record date for distribution of that money or property, or proceeds from that property, has passed. 
 (d) All deposited South
African Rand shall be owned by the Trust and held for the Trust by the Depository in the Interest Account or the Non-Interest Account. Any assets of the Trust other than South African Rand shall be held by the Trustee or the Depository at such place
and in such manner as the Trustee shall determine. 
 Section 2.5 Delivery of Shares. 
 Upon receipt by the Trustee of any deposit in accordance with Section 2.4, together with a Purchase Order and the other documents required under
this Agreement, if any, and a confirmation from the Depository that the Basket South African Rand Amount has been Delivered to the Depository for each Basket of Shares and the Depository is holding those South African Rand for the account of the
Trust, the Trustee, subject to the terms and conditions of this Agreement, shall Deliver to the Depositor the number of Baskets of Shares issuable in respect of such deposit as requested in the corresponding Purchase Order, but only upon payment to
the Trustee of the fees and expenses of the Trustee as provided in Section 6.7 and of all taxes and governmental charges and fees payable in connection with such deposit, the transfer of the South African Rand and the issuance and Delivery of
the Shares. 
 Section 2.6 Registration and Registration of Transfer of Shares; Combination and Split-up of Certificates.

 (a) The Trustee shall keep or cause to be kept a register of Registered Owners of Shares and shall provide for the registration of Shares
and the registration of transfers of Shares. 
 (b) The Trustee, subject to the terms and conditions of this Agreement, shall register
transfers of ownership of Shares on its transfer books from time to time, 

  

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upon any Surrender of a Certificate evidencing such Shares, by the Registered Owner in person or by a duly authorized attorney, properly endorsed or
accompanied by proper instruments of transfer, and duly stamped as may be required by the laws of the State of New York and of the United States of America. Thereupon the Trustee shall execute a new Certificate or Certificates evidencing such
Shares, and deliver the same to or upon the order of the Person entitled thereto. 
 (c) The Trustee, subject to the terms and conditions of
this Agreement, shall, upon Surrender of a Certificate or Certificates evidencing Shares for the purposes of effecting a split-up or combination of that certificate or certificates, execute and deliver one or more new Certificates evidencing those
Shares. 
 (d) The Trustee may, with the written approval of the Sponsor (which approval shall not be unreasonably withheld), appoint one or
more co-transfer agents for the purpose of effecting registration of transfers of Shares and combinations and split-ups of Certificates at designated transfer offices on behalf of the Trustee at the Trustee’s expense. In carrying out its
functions, a co-transfer agent may require evidence of authority and compliance with applicable laws and other requirements by Registered Owners or Persons entitled to Shares and will be entitled to protection and indemnity to the same extent as the
Trustee. 
 Section 2.7 Surrender of Shares and Withdrawal of Trust Property. 
 Upon Surrender of any integral number of Baskets for the purpose of withdrawal of the amount of Trust Property represented thereby, and upon payment of
the fee of the Trustee in connection with the Surrender of Shares as provided in Section 6.7 and payment of all taxes and charges payable in connection with such Surrender and withdrawal of Trust Property, and subject to the terms and
conditions of this Agreement, an Authorized Participant acting on authority of the Registered Owner of those Shares will be entitled to Delivery, in accordance with the provisions of this Agreement, as supplemented by any procedures attached to an
applicable Authorized Participant 

  

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Agreement, to the extent those procedures are consistent with this Agreement, of the amount of Trust Property at the time represented by such Baskets,
including the Basket South African Rand Amounts corresponding to such Baskets for the New York Business Day prior to the Settlement Date (as defined below), but excluding from those Basket South African Rand Amounts any portion that represents the
value of Trust Property that is not held as South African Rand. Authorized Participants wishing to redeem one or more Baskets must place an order with the Trustee (a “Redemption Order”). Redemption Orders received by the Trustee
prior to the Order Cutoff Time on a New York Business Day will have that day as the Order Date. Redemption Orders received by the Trustee after the Order Cutoff Time on a New York Business Day or on a day that is not a New York Business Day will
have the next New York Business Day as the Order Date. The “Settlement Date” for a Redemption Order shall be the third New York Business Day following the Order Date unless that day is not a Local Business Day, in which case the
Settlement Date shall be the next following day that is both a New York Business Day and a Local Business Day. Any Trust Property other than South African Rand will be delivered by the Trustee. 
 The Trustee may require that a Certificate evidencing Shares Surrendered for the purpose of withdrawal is properly endorsed in blank or accompanied by
proper instruments of transfer in blank. Upon a Surrender of an integral number of Baskets of Shares and satisfaction of all the conditions for withdrawal of Trust Property, the Trustee shall instruct the Depository to Deliver, to or to the order of
the Surrendering Authorized Participant, the amount of South African Rand represented by the Surrendered Baskets of Shares and the Depository or the Trustee shall pay or deliver to or to the order of the Surrendering Authorized Participant the
amount of any other Trust Property represented by the Surrendered Baskets of Shares. Any Delivery of South African Rand other than by wire transfer or at the office of the Depository will be at the expense and risk of the Authorized Participant.

  

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 Section 2.8 Limitations on Delivery, Registration of Transfer and Surrender of Shares.

 (a) As a condition precedent to the Delivery, registration of transfer, split-up, combination or Surrender of any Shares or withdrawal of
any Trust Property, the Trustee or Registrar may require payment from the Depositor or the Authorized Participant Surrendering the Shares of a sum sufficient to reimburse it for any tax or other governmental 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 and may also require compliance with any regulations the Trustee may establish consistent with the provisions of this Agreement, including this Section 2.8. 
 (b) The Delivery of Shares against deposits of South African Rand or the registration of transfer of Shares may be suspended generally, or refused with
respect to particular requested Deliveries or transfers, during any period when the transfer books of the Trustee are closed or if any such action is deemed necessary or advisable by the Trustee or the Sponsor for any reason at any time or from time
to time. 
 (c) The Surrender of Shares for purposes of withdrawing Trust Property may be suspended by the Trustee only if (i) the Trust
holds Surplus Property that has not been distributed in accordance with Section 4.5 or (ii) the Trustee determines, in its sole discretion, that a suspension is necessary or desirable. In either case, the Trustee and the Depository shall
consult with each other and use good faith efforts to resume accepting and honoring Redemption Orders as soon as possible. 
 Section 2.9 Lost Certificates, Etc. 
 The Trustee shall execute and deliver a new Certificate of like tenor in exchange
and substitution for a mutilated Certificate upon cancellation thereof, or in lieu of and in substitution for a destroyed, lost or stolen Certificate if the Registered Owner 

  

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thereof has (a) filed with the Trustee (i) a request for such execution and delivery before the Trustee has notice that the Shares evidenced by the
Certificate have been acquired by a protected purchaser and (ii) a sufficient indemnity bond and (b) satisfied any other reasonable requirements imposed by the Trustee. 
 Section 2.10 Cancellation and Destruction of Surrendered Certificates. 
 All Certificates Surrendered to the Trustee shall be canceled by the Trustee. The Trustee is authorized to destroy Certificates so canceled. 

Section 2.11 Splits and Reverse Splits of Shares. 
 If requested in writing by the Sponsor, the Trustee shall effect a split or reverse split of the Shares as of a record date set by the Trustee in accordance with procedures determined by the Trustee. 
 The Trustee is not required to distribute any fraction of a Share in connection with a split or reverse split of the Shares. The Trustee may sell the
aggregated fractions of Shares that would otherwise be distributed in a split or reverse split of the Shares or the amount of Trust Property that would be represented by those Shares and distribute the net proceeds of those Shares or that Trust
Property to the Registered Owners entitled to them. 
 The amount of Trust Property represented by each Share and the Basket South African
Rand Amount shall be adjusted as appropriate as of the open of business on the New York Business Day following the record date for a split or reverse split of the Shares. 
  

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 ARTICLE 3 
 CERTAIN OBLIGATIONS OF REGISTERED OWNERS OF SHARES 
 Section 3.1 Liability of Registered
Owner for Taxes and Other Governmental Charges. 
 If any tax or other governmental charge shall become payable by the Trustee with
respect to any transfer or redemption of Shares, such tax or other governmental charge shall be payable by the Registered Owner of such Shares to the Trustee. The Trustee shall refuse to effect any 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 Trustee shall distribute any net proceeds of a sale made under the preceding sentence
that remain, after payment of the tax or other governmental charge, to the Registered Owners entitled thereto as in the case of a distribution in cash. 
 Section 3.2 Warranties on Deposit of South African Rand. 
 Every Person depositing South African
Rand under this Agreement shall be deemed thereby to represent and warrant that the Person making such deposit is duly authorized to do so and that at the time of delivery, the South African Rand are free and clear of any lien, pledge, encumbrance,
right, charge or claim (other than the rights created by this Agreement). All representations and warranties deemed made under this Section 3.2 shall survive the deposit of South African Rand, Delivery or Surrender of Shares or termination of
this Agreement. 
  

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 ARTICLE 4 
 ADMINISTRATION OF THE TRUST 
 Section 4.1 Evaluation of South African Rand; Calculation of
Net Asset Value. 
 As promptly as practicable after the determination of the Relevant Price on each New York Business Day, ordinarily no
later than 2:00 PM (New York time), the Trustee will calculate, and the Sponsor or a person designated by the Sponsor will publish, the Trust’s net asset value (“NAV”). To calculate the NAV, the Trustee will: 
 (a) take the sum of South African Rand in the Interest Account and Non-Interest Account as of the close of business on the preceding Local Business Day,
as reported by the Depository; 
 (b) add interest accrued but unpaid on the Interest Account through the preceding day; 
 (c) subtract the accrued but unpaid Sponsor’s Fee through the preceding day; 
 (d) add South African Rand receivable by the Trust under Purchase Orders having Order Dates on or before the preceding New York Business Day; 

(e) subtract South African Rand payable by the Trust under Redemption Orders having Order Dates on or before the preceding New York Business Day;

 (f) convert the result after step (e) into Dollars using the Relevant Price; 
 (g) add the Dollar value of any other assets included in the Trust Property as of the close of business on the preceding New York Business Day; and

 (h) subtract the Dollar value of any other expenses and liabilities of the Trust as of the close of business on the preceding New York
Business Day. 
  

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 The result is the NAV of the Trust for that New York Business Day. The Trustee shall also divide the NAV
of the Trust by the number of Shares outstanding for the date of the evaluation then being made, which figure is the “NAV per Share.” For purposes of the preceding sentence, the number of Shares deemed outstanding shall include
Shares to be Delivered under Purchase Orders having Order Dates on or before the preceding New York Business Day and shall exclude Shares to be Surrendered under Redemption Orders having Order Dates on or before the preceding New York Business Day.

 Section 4.2 Responsibility of the Trustee for Evaluations. 
 The Sponsor, Depositors, Registered Owners and Beneficial Owners may rely on any evaluation or determination of any amount made by the Trustee, and the
Sponsor shall have no responsibility for the accuracy thereof. The determinations made by the Trustee under this Agreement shall be made in good faith upon the basis of, and the Trustee shall not be liable for any errors contained in, information
reasonably available to it. The Trustee shall be under no liability to the Sponsor, or to Depositors, Registered Owners or Beneficial Owners, for errors in judgment; provided, however, that this provision shall not protect the Trustee
against any liability to which it would otherwise be subject by reason of negligence or bad faith in the performance of its duties. 
 Section 4.3 Interest Account and Non-Interest Account. 
 The Trustee will deposit all South African Rand into the
Interest Account or the Non-Interest Account in accordance with Section 6.5. The Interest Account will accrue interest in accordance with the terms of the Deposit Account Agreement. The Non-Interest Account will not accrue interest. 

Section 4.4 Cash Distributions. 
 On the first Local Business Day of each month, the Depository will deposit into the Non-Interest Account the accrued but unpaid interest for the previous 

  

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month. On the first day of each month that is both a Local Business Day and a New York Business Day, the Trustee will make withdrawals from the Non-Interest
Account to pay the accrued Sponsor’s Fee for the previous month plus any other Trust expenses. In the event that the interest deposited exceeds the sum of the Sponsor’s Fee for the previous month plus other Trust expenses, if any, then the
Trustee shall convert the excess into Dollars in accordance with Section 4.9, and, as promptly as practicable declare a record date and distribute the net proceeds to Registered Owners on a pro rata basis (in accordance with the number of
Shares that they own); provided, however, that in the event that the Trustee shall be required to withhold and does withhold from such cash an amount on account of taxes, the amount distributed to the Registered Owners shall be reduced
accordingly; and provided, further, that the Trustee shall round the amount paid to each Registered Owner to the nearest whole cent. 
 Section 4.5 Distributions of Surplus Property. 
 At any time that the Trust Property includes Surplus Property, the
Trustee shall, as promptly as practicable, (a) distribute all Surplus Property consisting of Dollars to the Registered Owners in proportion to the number of Shares held by them, and (b) convert into Dollars or sell for Dollars all other
Surplus Property and distribute the Dollar proceeds, net of the fees and expenses of the Trustee, to the Registered Owners in proportion to the number of Shares held by them. If the Trust Property includes any Surplus Property that is not South
African Rand, the Trustee shall suspend deposits of South African Rand for the purpose of issuance of Shares until after a record date for distribution of that Surplus Property, or proceeds of that Surplus Property, has passed. 
 Section 4.6 Fixing of Record Date. 
 Whenever any distribution will be made, or whenever the Trustee receives notice of any solicitation of proxies or consents from Registered Owners, or whenever for any reason there is a split, reverse split or other change in the outstanding
Shares, or whenever the Trustee shall find it necessary or convenient in respect of any matter, the 

  

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Trustee, in consultation with the Sponsor, shall fix a record date for the determination of the Registered Owners who shall be (i) entitled to receive
such distribution or the net proceeds of the sale thereof, (ii) entitled to give such proxies or consents in respect of any such solicitation or (iii) entitled to act in respect of any other matter for which the record date was set.

 Section 4.7 Payment of Trust Expenses. 
 (a) The following expenses are or may be accrued and paid by the Trust: 
 (1) the Sponsor’s Fee and
other fees and expenses of the Sponsor set forth in Section 5.6; 
 (2) expenses of the Trust not assumed by the Sponsor pursuant to
Section 5.1(b); 
 (3) taxes and other governmental charges; 
 (4) expenses and costs of any extraordinary services performed by the Trustee or the Sponsor on behalf of the Trust or action taken by the Trustee or the
Sponsor to protect the Trust or the interests of Registered Owners; and 
 (5) indemnification of the Sponsor as provided in
Section 7.1(d). 
 (b) On first day of each month that is both a Local Business Day and a New York Business Day, the Trustee shall
withdraw from the Non-Interest Account amounts necessary to pay the Trust expenses provided for in Section 4.7(a) and any otherwise unpaid expenses hereunder. In the event that the expenses exceed the balance of the Non-Interest Account, such
excess shall be withdrawn from the Interest Account. The Trustee will withdraw and sell sufficient South African Rand to purchase an amount of currency other than South African Rand sufficient to pay any Trust expenses payable other than in South
African Rand and the costs of currency conversion. 
  

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 (c) Notwithstanding the foregoing, if requested by the Sponsor and agreed to by the Trustee, the Trustee
will advance amounts out of its own funds for the payment of Trust expenses, provided that the amount advanced at any time shall not exceed $20,000. The amount of such advances, together with interest thereon at a percentage rate equal to
then-current overnight federal funds rate, shall be expenses of the Trust. The Trustee shall have a lien on the balances on hand in the Interest Account and Non-Interest Account to the extent of all amounts advanced by it pursuant to this
Section 4.7(c), which lien shall be superior to the interest of the Registered Owners. 
 (d) The Trustee is conclusively authorized to
sell South African Rand in the smallest amounts required to permit payment of Trust expenses, it being the intention to minimize the Trust’s holdings of assets other than South African Rand. Neither the Trustee nor the Sponsor shall have any
liability for loss or depreciation resulting from sales of South African Rand so made. The Trustee shall not be liable or responsible in any way for depreciation or loss incurred by reason of any sale made in accordance with this
Section 4.7(d). 
 Section 4.8 Statements and Reports. 
 After the end of each Fiscal Year and within the time period required by applicable laws, rules and regulations, at the Sponsor’s expense, the
Trustee shall send to the Registered Owners as of the end of such Fiscal Year, an annual report of the Trust containing financial statements audited by independent accountants designated by the Sponsor and such other information as may be required
by such laws, rules and regulations or otherwise, or which the Sponsor determines shall be included. The Trustee may distribute the annual report by any means acceptable to the Registered Owners and that complies with applicable laws, rules and
regulations. 
  

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 Section 4.9 Further Provisions for Sales of Trust Property; Currency Conversion. 

In addition to selling South African Rand in accordance with Section 4.7, the Trustee shall sell South African Rand whenever any one or more of
the following conditions exist: 
 (i) the Sponsor has notified the Trustee that such sale is required by applicable law or regulation; or

 (ii) the Trust is to be terminated and its assets liquidated in accordance with Section 8.2. 
 When the Trustee is required or permitted to sell Trust Property, it may sell that Trust Property by public or private sale in any manner and on any
terms that are (i) commercially reasonable in the circumstances and (ii) reasonably calculated to maximize the value of the Trust Property while taking into account any duty of the Trustee under this Agreement to sell that Trust Property
as promptly as practicable. 
 However, whenever the Trustee is required or permitted to sell Trust Property that is currency, if at the time
the currency can, in the judgment of the Trustee, be converted on a reasonable basis into the required currency that, if applicable, is transferable to the United States, the Trustee shall place orders with dealers (which may include the Depository
or the Trustee or any of their affiliates) through which it may reasonably expect to obtain a commercially reasonable rate of exchange (net of commission) and good execution of orders. 
 If such conversion can be effected only with the approval or license of any government or agency thereof, the Trustee shall file such application for
approval or license, if any, as it may deem desirable. 
  

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 If at any time the Trustee shall determine that in its judgment the currency is not convertible on a
reasonable basis into the required currency or that, if applicable, is transferable to the United States, or if any approval or license of any government or agency thereof which is required for such conversion is denied or in the opinion of the
Trustee is not obtainable, or if any such approval or license is not obtained within a reasonable period as determined by the Trustee, the Trustee may distribute the currency without conversion (or an appropriate document evidencing the right to
receive such currency) to, or in its discretion may hold such currency for the respective accounts of, the persons entitled to receive it. Any interest earned or investment gains attributable to amounts withheld from distribution shall be held by
the Trustee for distribution to the Registered Owners entitled to the amount to which the interest or gain is attributable. 
 If any such
conversion of currency, in whole or in part, cannot be effected for distribution to some of the persons entitled to it, the Trustee may, in its discretion, make such conversion and distribution to the extent permissible to the persons entitled to it
and may distribute the balance of the currency without conversion to, or in its discretion may hold such currency for the respective accounts of, the persons entitled to receive it. Any interest earned or investment gains attributable to amounts
withheld from distribution shall be held by the Trustee for distribution to the Registered Owners entitled to the amount to which the interest or gain is attributable. 
 The Trustee and the Sponsor shall not be liable or responsible in any way for depreciation or loss incurred by reason of any sale made pursuant to this Section 4.9. 
 Section 4.10 Counsel. 
 The
Sponsor may from time to time employ counsel to act on behalf of the Trust and perform any legal services in connection with the South African Rand and the Trust, including any legal matters relating to the possible disposition or acquisition of any
South African Rand. The reasonable fees and expenses of such counsel shall be paid by the Sponsor up to an aggregate maximum of $100,000 per year, with any excess amount to be paid by the Trust. 
  

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 Section 4.11 Grantor Trust. 
 Nothing in this Agreement, any agreement with a Depository, or otherwise, shall be construed to give the Trustee or Sponsor the power to vary the
investment of the Beneficial Owners within the meaning of Section 301.7701-4(c) of the regulations under the Code or any similar or successor provision of the regulations under the Code, nor shall the Sponsor give the Trustee any direction that
would vary the investment of the Beneficial Owners. However, the Trustee shall not be liable to any Person for any failure of the Trust to qualify as a grantor trust under the Code or any comparable provision of the laws of any State or other
jurisdiction where that treatment is sought, except that this sentence shall not limit the Trustee’s responsibility for the administration of the Trust in accordance with this Agreement. Neither the Trustee nor the Sponsor will agree to
any amendment of the Deposit Account Agreement unless the Sponsor obtains and delivers to the Trustee a prior written opinion of counsel to the effect that such amendment will have no adverse effect on the classification of the Trust as a
“grantor trust” under the Code. 
 ARTICLE 5 
 THE SPONSOR 
 Section 5.1 Duties of the Sponsor. 
 (a) The Sponsor shall select the Depository and shall be solely responsible for that selection. The Sponsor is responsible for establishing the Trust and
for the registration of the Shares. The Sponsor will generally oversee the performance of the Trustee and the Trust’s principal service providers, but will not exercise day-to-day oversight over the Trustee or such service providers. The
Sponsor will regularly communicate with the Trustee to monitor the overall performance of the Trust. The Sponsor will also designate the independent certified public accountants of the Trust and may from time to time employ legal counsel for the
Trust. 
  

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 (b) The Sponsor shall be responsible for all organizational expenses of the Trust, and for the following
administrative and marketing expenses of the Trust: the Trustee’s monthly fee, routine transaction and maintenance fees charged by the Depository, listing fees of the Exchange, registration fees charged by the Commission, printing and mailing
costs, audit fees, legal expenses not in excess of $100,000 per year and any applicable license fees. 
 (c) The Sponsor will monitor the
interest rate paid by the Depository and has the right and duty to instruct the Trustee to terminate the Deposit Account Agreement if the Sponsor considers the interest rate to be noncompetitive. 
 Section 5.2 Obligations of the Sponsor. 
 (a) The Sponsor does not assume any obligation nor shall it be subject to any liability under this Agreement to any Registered Owner or Beneficial Owner or Depositor (including liability with respect to the worth of the Trust Property),
except that the Sponsor agrees to perform its obligations specifically set forth in this Agreement without negligence or bad faith. 
 (b)
The Sponsor shall not be under any obligation to prosecute any action, suit or other proceeding in respect of any Trust Property or in respect of the Shares on behalf of a Registered Owner, Beneficial Owner, Depositor or other Person. 
 (c) The Sponsor shall not be liable for any action or non-action by it in reliance upon the advice of or information from legal counsel, accountants, any
Depositor, any Registered Owner or any other person believed by it in good faith to be competent to give such advice or information. 
 (d)
The Sponsor shall not be liable for any acts or omissions made by a successor sponsor whether in connection with a previous act or omission of the Sponsor 

  

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or in connection with any matter arising wholly after the resignation of the Sponsor, provided that in connection with the issue out of which such potential
liability arises the Sponsor performed its obligations without negligence or bad faith while it acted as sponsor. 
 (e) The Sponsor shall
have no obligation to comply with any direction or instruction from any Registered Owner or Beneficial Owner or Depositor regarding Shares except to the extent specifically provided in this Agreement. 
 Section 5.3 Prevention or Delay in Performance by the Sponsor. 
 The Sponsor and its directors, employees, agents and affiliates shall not incur any liability to any Registered Owner, Beneficial Owner 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 is prevented or
forbidden from, or would be subject to any civil or criminal penalty on account of, or is delayed in, doing or performing any act or thing which by the terms of this Agreement it is provided shall be done or performed and accordingly the Sponsor
does not do that act or thing or does that act or thing at a later time than would otherwise be required. The Sponsor will not incur any liability to any Registered Owner or Beneficial Owner or Depositor by reason of any non-performance or delay in
the performance of any act or thing which by the terms of this Agreement it is provided may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in this Agreement. 
 Section 5.4 Certain Matters Regarding Successor Sponsor. 
 The covenants, provisions and agreements herein contained shall in every case be binding upon any successor to the business of the Sponsor. The Sponsor may transfer all or substantially all of its assets to an entity
which carries on the business of the Sponsor, if at the time of such transfer such successor duly assumes all the obligations of the Sponsor under this Agreement, and in such event, the Sponsor shall be relieved of all further liability under this
Agreement. 
  

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 Section 5.5 Resignation of Sponsor; Successors. 
 If at any time the Sponsor desires to resign its position as Sponsor hereunder, it may resign by delivering to the Trustee an instrument of resignation
executed by the Sponsor. Such resignation shall become effective upon the earliest of the following: (i) the effective date of the appointment by the Trustee of a successor sponsor and the acceptance by the successor sponsor of that
appointment, with such compensation from the Trust as the Trustee may deem reasonable under the circumstances, by an instrument of appointment and assumption executed by the Trustee and the successor sponsor; or (ii) an agreement by the Trustee
to act as sponsor hereunder succeeding to all the rights and duties of the resigning Sponsor without appointing a successor sponsor and without terminating this Agreement; or (iii) termination of this Agreement in accordance with its terms and
completion of distribution of all remaining assets to Registered Owners. The Trustee shall have no obligation to appoint a successor sponsor or to assume the duties of the Sponsor and shall have no liability to any person because the Trust is
terminated by reason of the Sponsor’s resignation. 
 If the Sponsor shall fail to undertake or perform or become incapable of
undertaking or performing its duties hereunder or shall become bankrupt or its affairs shall be taken over by public authorities, the effect of that event shall be the same as if the Sponsor had given a notice of resignation as provided in the
preceding paragraph. 
 Upon its resignation becoming effective, the resigning Sponsor shall be discharged and shall no longer be liable in
any manner hereunder except as to acts or omissions occurring before its resignation became effective, and the successor sponsor shall thereupon undertake and perform all duties and be entitled to all rights and compensation as sponsor under this
Agreement. The successor sponsor shall not be under any liability hereunder for acts or omissions occurring prior to the effective date stated in the instrument appointing it successor sponsor. The Trustee shall notify Registered Owners of the
appointment of a successor sponsor. 
  

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 Section 5.6 Compensation of the Sponsor. 
 (a) The Sponsor is entitled to receive from the Trust, as an expense of the Trust, the Sponsor’s Fee. The Sponsor’s Fee shall be accrued daily
but paid monthly in arrears. 
 (b) In addition to the Sponsor’s Fee, the Sponsor is entitled to receive reimbursement from the Trust
for all expenses and disbursements incurred by it. Such reimbursement shall be made promptly after such expenses are incurred by the Sponsor. Notwithstanding the foregoing, 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) expenses for performing, or fees of agents for performing, services the Sponsor is required to perform under this Agreement. 
 (c) Within 30 days following the end of each Fiscal Year, the Sponsor shall certify to the Trustee the amount of its actual expenses and disbursements
incurred by it during the preceding Fiscal Year by it in connection with action taken by it pursuant to Section 5.8 and shall reimburse the Trust any amounts received by it from the Trust that exceed the amount so certified. 
 (d) The Trustee shall have no liability or responsibility for amounts paid to the Sponsor pursuant to this Section 5.6. 
 Section 5.7 Federal Securities Law Filings. 
 The Sponsor shall (i) prepare and file a registration statement with the Commission and take such action as is necessary from time to time to qualify the Shares for offering and sale under the federal securities
laws of the United States, including the preparation and filing of amendments and supplements to such registration statement, (ii) promptly notify the Trustee of any amendment or supplement to the registration 

  

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statement or prospectus, of any order preventing or suspending the use of any prospectus, of any request for the amending or supplementing of the
registration statement or prospectus or if any event or circumstance occurs 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 Trustee from time to time with copies, including copies in
electronic form, of the prospectus, as amended and supplemented, in such quantities as the Trustee may reasonably request and (iv) prepare and file any periodic reports or updates that may be required under the Securities Exchange Act of 1934,
as amended. The Trustee shall furnish to the Sponsor any information from the records of the Trust that the Sponsor reasonably requests in writing that is needed to prepare any filing or submission that the Sponsor or the Trust is required to make
under the federal securities laws of the United States. 
 Section 5.8 Discretionary Actions by Sponsor; Consultation.

 (a) The Sponsor may, in its discretion, undertake any action which it may deem necessary or desirable to protect the rights of the
Registered Owners. The expenses incurred by the Sponsor in connection with taking any action under the preceding sentence (including the fees and disbursements of legal counsel) shall be expenses of the Trust, and the Sponsor shall be entitled to be
promptly reimbursed for those expenses by the Trust. 
 (b) The Sponsor shall promptly notify the Trustee (i) regarding any action it
takes pursuant to Section 5.8(a) 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. 
  

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 ARTICLE 6 
 THE TRUSTEE 
 Section 6.1 Maintenance of Office and Transfer Books by the Trustee.

 (a) Until termination of this Agreement in accordance with its terms, the Trustee shall maintain facilities for the Delivery,
registration, registration of transfers and Surrender of Shares in accordance with the provisions of this Agreement. 
 (b) The 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. 
 (c) Subject to the limitations set forth in Section 2.8(b), the Trustee may, and at the reasonable written request of the Sponsor shall, close the transfer books at any time or from time to time if such action is
deemed necessary or advisable in the reasonable judgment of the Trustee or the Sponsor. 
 (d) Pursuant to Section 2.8(c), the Trustee
may, at its sole discretion, suspend withdrawals of Trust Property if the Trustee, at its sole discretion, determines that such a suspension is necessary or desirable. 
 (e) If any Shares are listed on one or more stock exchanges in the United States, the Trustee shall act as Registrar or, with the written approval of the Sponsor (which approval shall not be unreasonably withheld),
appoint a registrar or one or more co-registrars for registry of such Shares in accordance with any requirements of such exchange or exchanges. 
 Section 6.2 Obligations of the Trustee. 
 (a) The Trustee assumes no obligation nor shall it be subject to any
liability under this Agreement to any Registered Owner or Beneficial Owner or Depositor (including liability with respect to the worth of the Trust Property), except that the Trustee agrees to perform its obligations specifically set forth in this
Agreement without negligence or bad faith. 
  

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 (b) The Trustee shall not be under any obligation to prosecute any action, suit or other proceeding in
respect of any Trust Property or in respect of the Shares on behalf of a Registered Owner, Beneficial Owner, Depositor or other Person. 
 (c) The Trustee shall not be liable for any action or non-action by it in reliance upon the advice of or information from legal counsel, accountants, any Depositor, any Registered Owner or any other person believed by it in good faith to be
competent to give such advice or information. 
 (d) The Trustee shall not be liable for any acts or omissions made by a successor trustee
whether in connection with a previous act or omission of the Trustee or in connection with any matter arising wholly after the resignation of the Trustee, provided that in connection with the issue out of which such potential liability arises the
Trustee performed its obligations without negligence or bad faith while it acted as Trustee. 
 (e) The Trustee shall have no obligation to
comply with any direction or instruction from any Registered Owner or Beneficial Owner or Depositor regarding Shares except to the extent specifically provided in this Agreement. 
 Section 6.3 Prevention or Delay in Performance by the Trustee. 
 The Trustee and its directors, employees, agents and affiliates shall not incur any liability to any Registered Owner, Beneficial Owner 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 Trustee is prevented or
forbidden from, or would be subject to any civil or criminal penalty on account of, or is delayed in, doing or performing any act or thing which by the 

  

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terms of this Agreement it is provided shall be done or performed and accordingly the Trustee does not do that act or thing or does that act or thing at a
later time than would otherwise be required. The Trustee will not incur any liability to any Registered Owner or Beneficial Owner or Depositor by reason of any non-performance or delay in the performance of any act or thing which by the terms of
this Agreement it is provided may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in this Agreement. 
 Section 6.4 Resignation or Removal of the Trustee; Appointment of Successor Trustee. 
 (a)
Resignation. The Trustee may at any time resign as Trustee hereunder by notice of its election so to do, delivered to the Sponsor, and such resignation shall take effect upon the appointment of a successor trustee and its acceptance of such
appointment. 
 (b) Removal by the Sponsor. In case at any time the Trustee shall be adjudged bankrupt or insolvent, or a receiver of
the Trustee or of its property shall be appointed, or a trustee or liquidator or any public officer shall take charge or control of the Trustee or of its property or affairs for the purposes of rehabilitation, conservation or liquidation, then in
any such case the Sponsor shall, subject to the requirements of Section 6.4(e), remove the Trustee by notice to the Trustee, and such removal shall take effect upon the appointment of a successor trustee and its acceptance of such appointment.

 (c) Removal by Registered Owners. Registered Owners of at least two-thirds (66-2/3 %) of the Shares then outstanding may at any
time remove the Trustee by a notice delivered to the Trustee and Sponsor, and such removal shall take effect upon the appointment of a successor trustee and its acceptance of such appointment. 
 (d) Removal for Material Breach. If at any time the Trustee ceases to be a Qualified Bank or is in material breach of its obligations under this
Agreement and the 

  

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Trustee fails to cure such breach within 30 days after receipt by the Trustee of notice from the Sponsor or Registered Owners acting on behalf of at least
25% of the outstanding Shares specifying such default and requiring the Trustee to cure such default, the Sponsor may remove the Trustee by notice delivered to the Trustee, and such removal shall take effect upon the appointment of a successor
trustee and its acceptance of such appointment as hereinafter provided. 
 (e) Appointing Successor Trustees. If the Trustee acting
hereunder resigns or is removed, the Sponsor, acting on behalf of the Registered Owners, shall use its reasonable efforts to appoint a successor trustee, which shall be a Qualified Bank. Every successor trustee shall execute and deliver to its
predecessor and to the Sponsor, acting on behalf of the Registered Owners, an instrument in writing accepting its appointment hereunder, and thereupon such successor trustee, without any further act or deed, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor; but such predecessor, nevertheless, upon payment of all sums due it and on the written request of the Sponsor, acting on behalf of the Registered Owners, shall execute and deliver an
instrument transferring to such successor all rights and powers of such predecessor hereunder, shall duly assign, transfer and deliver all right, title and interest in the Trust Property to such successor, and shall deliver to such successor a list
of the Registered Owners of all outstanding Shares. The Sponsor or any such successor trustee shall promptly notify the Registered Owners of the appointment of such successor trustee. 
 (f) Liability of Trustee. Upon effective resignation hereunder, the resigning or removed Trustee shall be discharged and shall no longer be liable
in any manner hereunder except as to acts or omissions occurring prior to such resignation or removal, and the new trustee shall thereupon undertake and perform all duties and be entitled to all rights and compensation as trustee under this
Agreement. The successor trustee shall not be under any liability hereunder for acts or omissions occurring prior to execution of an instrument accepting its appointment as trustee. 
  

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 (g) Effect of Merger of the Trustee. Any corporation into which the Trustee may be merged,
consolidated or converted in a transaction in which the Trustee is not the surviving corporation shall be the successor of the Trustee without the execution or filing of any document or any further act. 
 Section 6.5 Transfers Between Interest Account and Non-Interest Account. 
 (a) Proceeds from creation of Baskets shall be deposited into the Non-Interest Account. The Trustee shall contemporaneously instruct the Depository to
transfer the portion of the Basket South African Rand Amount representing principal from the Non-Interest Account to the Interest Account. The portion of the Basket South African Rand Amount representing a pro rata portion of accrued but unpaid
interest will remain in the Non-Interest Account. 
 (b) Amounts payable upon Surrender of Shares in whole Baskets shall be paid from the
Non-Interest Account. The Trustee shall contemporaneously instruct the Depository to transfer the portion of the Basket South African Rand Amount representing principal from the Interest Account to the Non-Interest Account. 
 Section 6.6 The Depository. 
 The parties acknowledge that the Depository was selected solely by the Sponsor. The Trustee will have no duty or liability to any Person on account of that selection or the terms of the Deposit Account Agreement. The Depository will be
subject at all times and in all respects to the directions of the Trustee and will be responsible solely to it. The rights and duties of the Depository with reference to the Trust will be determined by the Deposit Account Agreement and applicable
law. The Trustee shall not amend or terminate the Deposit Account Agreement without the written consent of the Sponsor. The Trustee shall terminate the Deposit Account Agreement if the Sponsor directs it in writing to do so. 
  

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 Section 6.7 Compensation of the Trustee. 
 (a) Each Depositor, and each person surrendering Shares for the purpose of withdrawing Trust Property, shall pay to the Trustee a fee of $500.00 per
Purchase Order pursuant to Section 2.5 or Redemption Order pursuant to Section 2.7 or surrender of Shares after termination of this Agreement pursuant to Section 8.2(e). 
 (b) The 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 Trustee. 
 (c) The Trustee is entitled to charge the Trust for all expenses and disbursements
incurred by it in connection with action taken by it under Section 6.10(a) (including the reasonable fees and disbursements of its legal counsel), except that the Trustee is not entitled to charge the Trust for (i) expenses and
disbursements incurred by it prior to the commencement of trading of Shares on the Exchange and (ii) fees of agents for performing services the Trustee is required to perform under this Agreement. 
 Section 6.8 Retention of Trust Documents. 
 The Trustee is authorized to destroy those documents, records, bills and other data compiled during the term of this Agreement at the times permitted by the laws or regulations governing the Trustee, unless the
Sponsor reasonably requests the Trustee in writing to retain those items for a longer period. 
 Section 6.9 Prospectus Delivery.

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

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 Section 6.10 Discretionary Actions by Trustee; Consultation. 
 (a) The Trustee may, in its discretion, undertake any action which it may deem necessary or desirable to protect the rights of the Registered Owners. The
expenses incurred by the Trustee in connection with taking any action under the preceding sentence (including the fees and disbursements of legal counsel) shall be expenses of the Trust, and the Trustee shall be entitled to be promptly reimbursed
for those expenses by the Trust. 
 (b) The Trustee shall notify and consult with the Sponsor before undertaking any action under subsection
(a) above or if the Trustee becomes aware of any development or event that affects the administration of the Trust but is not contemplated or provided for in this Agreement. 
 ARTICLE 7 
 INDEMNIFICATION 
 Section 7.1 Indemnification of the Sponsor and Trustee. 
 (a) The Sponsor shall indemnify the Trustee, its directors, employees and agents (the “Trustee Indemnified Persons”) against, and hold each of them harmless from, any loss, liability, cost, expense or
judgment (including, but not limited to, 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 of Shares 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, by (A) a Trustee Indemnified Person or
(B) the Sponsor or (iii) any filings with or submissions to the Commission 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 Commission or any periodic reports or updates that may be filed under the Securities Exchange Act of 1934, as amended, or any failure to make any filings with or 

  

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submissions to the Commission which 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 7.1(a) to pay Indemnified Amounts incurred as a result of and attributable to (x) the negligence or bad faith of, or material breach of the terms of this Agreement by, the Trustee, (y) written
information furnished in writing by the Trustee to the Sponsor expressly for use in the registration statement, or any amendment thereto, filed with the Commission relating to the Shares that is not materially altered by the Sponsor or (z) any
misrepresentations or omissions made by a Depositor (other than Sponsor) in connection with such Depositor’s offer and sale of Shares. 
 (b) The Trustee shall indemnify the Sponsor, its members, officers, employees and agents against, and hold each of them harmless from, any Indemnified Amounts (i) caused by the negligence or bad faith of the Trustee or
(ii) arising out of any information furnished in writing to the Sponsor by the Trustee expressly for use in an registration statement, or any amendment thereto, a prospectus pursuant to the Securities Act of 1933 Section 10(a) or
Section 10(b), or a prospectus supplement thereto with the Commission relating to the Shares that is not materially altered by the Sponsor. 
 (c) If the indemnification provided for in Section 7.1(a) or Section 7.1(b) is unavailable or insufficient to hold harmless the indemnified party under subsection (a) or (b) above, then the indemnifying party shall
contribute to the Indemnified Amounts referred to in subsection (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 Trustee on the other hand from
the fees each receives that are attributable to 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 Trustee on the other hand in connection with the action, statement or omission which resulted in such Indemnified
Amount as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among other 

  

 40 

 
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 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 subsection (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 which is the subject of this subsection (c). 
 (d) The Sponsor and its shareholders, directors, officers,
employees, affiliates (as such term is defined under the Securities Act of 1933, as amended) and subsidiaries (each, a “Sponsor Indemnified Party”) shall be indemnified from the Trust and held harmless against any loss, liability or
expense incurred without (i) negligence, bad faith, willful misconduct or willful malfeasance on the part of the Sponsor 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 or (ii) reckless disregard by the Sponsor 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 7.1(d) may be payable in advance or shall be secured by a lien on the
Trust. 
 (e) If an action, proceeding (including, but not limited to, any governmental investigation), claim or dispute (each, 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 

  

 41 

 
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 7.1(a), Section 7.1(b) or
Section 7.1(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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 ARTICLE 8 
 AMENDMENT AND TERMINATION 
 Section 8.1 Amendment. 
 The Trustee and the Sponsor may amend any provisions of this Agreement without the consent of any Registered Owner; provided, however, that the
provisions of Section 2.6, Section 2.7, Section 2.10, Section 4.2 through Section 4.7, this Section 8.1 and Section 8.2 may not be amended unless (i) the provision relates solely to procedural or logistical
matters (as distinguished from core economic rights), or (ii) prior to the amendment, (a) the Sponsor obtains and delivers to the Trustee a written opinion of counsel to the effect that after such amendment the Trust will continue to be
classified as a “grantor trust” under the Code, and (b) in the event that such opinion of counsel assumes that certain actions are taken by the Sponsor or the Trustee in connection with such amendment, such actions shall be taken by
the Sponsor or the Trustee, as the case may be. Any amendment that imposes or increases any fees or charges (other than taxes and other governmental charges, registration fees or other such expenses), or that otherwise prejudices any substantial
existing right of the Registered Owners, will not become effective as to outstanding Shares until 30 days after notice of such amendment is given to the Registered Owners. Every Registered Owner and Beneficial Owner, at the time any amendment so
becomes effective, shall be deemed, by continuing to hold any Shares or an interest therein, to consent and agree to such amendment and to be bound by this Agreement as amended thereby. In no event shall any amendment impair the right of the
Registered Owner of Shares to Surrender Baskets of Shares and receive therefor the amount of Trust Property represented thereby, except in order to comply with mandatory provisions of applicable law. 
 Section 8.2 Termination. 
 (a)
The Trustee shall set a date on which this Agreement will terminate and mail notice of that termination to the Registered Owners at least 30 days prior to the date set for termination, which date shall be no later than 90 days from the mailing of
termination notice, if any of the following occurs: 
 (i) the Sponsor has given notice of resignation or is unable to perform its duties or
becomes bankrupt or insolvent and the Trustee will not appoint a successor sponsor or agree to act as Sponsor; 
  

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 (ii) Registered Owners holding at least 75% of the outstanding Shares notify the Trustee that they elect
to terminate the Trust; 
 (iii) the Depository resigns or is removed; or 
 (iv) the Trust receives notice from the Internal Revenue Service or counsel for the Trust or the Sponsor that the Trust fails to qualify for treatment,
or will not be treated, as a grantor trust under the Code. 
 (b) The Trustee shall set a date on which this Agreement will terminate and
mail notice of that termination to the Registered Owners at least 30 days prior to the date set for termination, which date shall be no later than 90 days from the mailing of termination notice, if any of the following occurs and the Sponsor has
notified the Trustee that it elects to terminate this Agreement: 
 (i) The Trustee is notified that the Shares are delisted from a national
securities exchange and are not approved for listing on another national securities exchange within five New York Business Days of their delisting; 
 (ii) the Commission determines that the Trust is an investment company under the Investment Company Act of 1940, as amended; 
 (iii) the NAV of the Trust remains less than $100 million for 30 consecutive New York Business Days at any time after the first 90 days of the Shares being traded on the Exchange; 
  

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 (iv) all of the Trust’s assets are sold; 
 (v) the aggregate market capitalization of the Trust, based on the closing price for the Shares remains less than $300 million at any time for five
consecutive trading days beginning after the first anniversary of this Agreement; or 
 (vi) DTC ceases providing book-entry settlement
services for the Shares. 
 (c) If 60 days have elapsed since the Trustee gave the Sponsor notice of its election to resign and no successor
trustee appointed by the Sponsor has accepted appointment as Trustee, the Trustee may set a date on which this Agreement will terminate and mail notice of that termination to the Registered Owners at least 30 days prior to the date set for
termination. 
 (d) If not terminated sooner, this Agreement shall terminate forty years from the date of this Agreement, and the Trustee
shall mail a notice of that termination to the Registered Owners and the Sponsor at least 30 days before the termination date. 
 (e) On and
after the date of termination of this Agreement, the Registered Owner of Shares will, upon (i) Surrender of those Shares, (ii) payment of the fee of the Trustee for the Surrender of Shares provided in Section 6.7, and
(iii) payment of any applicable taxes or other governmental charges, be entitled to Delivery, to the Registered Owner or upon the Registered Owner’s order, of the amount of Trust Property represented by those Shares. The Trustee shall not
accept any deposits of South African Rand after the date of termination of this Agreement. If any Shares remain outstanding after the date of termination of this Agreement, the Trustee thereafter shall discontinue the registration of transfers of
Shares, shall not make any distributions to Registered Owners, and shall not give any further notices or perform any further acts under this Agreement, except that the Trustee shall continue to collect distributions pertaining to Trust
Property and hold the same uninvested and without liability for interest, pay the Trust’s expenses and sell South African Rand as necessary to meet those expenses and 

  

 45 

 
shall continue to deliver Trust Property, together with any distributions received with respect thereto and the net proceeds of the sale of any other
property, in exchange for Shares Surrendered to the Trustee (after deducting or upon payment of, in each case, the fee of the Trustee set forth in 5.7 for the Surrender of Shares, any expenses for the account of the Registered Owner of such Shares
in accordance with the terms and conditions of this Agreement, and any applicable taxes or other governmental charges). At any time after the expiration of 90 days following the date of termination of this Agreement, the Trustee may sell for Dollars
the Trust Property for then held under this Agreement and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it under this Agreement, unsegregated and without liability for interest, for the
pro rata benefit of the Registered Owners of Shares that have not theretofore been Surrendered, such Registered Owners thereupon becoming general creditors of the Trustee with respect to such net proceeds. After making such sale, the
Trustee shall be discharged from all obligations under this Agreement, except to account for such net proceeds and other cash (after deducting, in each case, any fees, expenses, taxes or other governmental charges payable by the Trust, the fee of
the Trustee for the Surrender of Shares and any expenses for the account of the Registered Owner of such Shares in accordance with the terms and conditions of this Agreement, and any applicable taxes or other governmental charges), and the trust
created by this Agreement shall terminate. Upon the termination of this Agreement, the Sponsor shall be discharged from all obligations under this Agreement except for its obligations to the Trustee under Section 6.7 and Section 7.1, each
of which shall survive termination of this Agreement. Section 5.6 and this Section 8.1(e) shall also survive termination of this Agreement. 
 ARTICLE 9 
 MISCELLANEOUS 
 Section 9.1 Counterparts. 
 This
Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of such counterparts shall constitute one and the same instrument. Copies of this Agreement shall be filed with the Trustee and shall be open
to inspection by any Registered Owner during the Trustee’s business hours. 
  

 46 

 Section 9.2 Third-Party Beneficiaries. 
 This Agreement is for the exclusive benefit of the parties hereto, and shall not be deemed to give any legal or equitable right, remedy or claim
whatsoever to any other person. 
 Section 9.3 Severability. 
 In case any one or more of the provisions contained in this Agreement should be or become invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions of this Agreement shall in no way be affected, prejudiced or disturbed thereby. 
 Section 9.4 Registered Owners, Beneficial Owners and Depositors as Parties; Binding Effect. 
 The Registered Owners,
Beneficial Owners and Depositors 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 South African Rand, as
the case may be. 
 Section 9.5 Notices. 
 (a) All notices given under this Agreement must be in writing. 
 (b) Any and all notices to be given to the
Trustee or the Sponsor shall be deemed to have been duly given (i) when it is actually delivered by a messenger or recognized courier service, (ii) five days after it is mailed by registered or certified mail, postage paid or
(iii) when receipt of a facsimile transmission is acknowledged via a return receipt or receipt confirmation as requested by the original transmission, in each case to or at the address set forth below: 
 To the Trustee: 
 The Bank of New York

 101 Barclay Street, 22-W 
 New
York, New York 10286 
 Attention: ADR Administration 
 Facsimile: 212-571-3050 
  

 47 

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

 To the Sponsor: 
 Rydex
Specialized Products LLC 
 c/o Rydex Investments 
 9601 Blackwell Road, Suite 500 
 Rockville, Maryland 20850 
 Attention: Carl G. Verboncoeur, President 
 Facsimile: 301-296-5112 
 or any other place to which the Sponsor may have transferred its principal office with notice to the Trustee. 

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

 48 

 Section 9.6 Agent for Service; Submission to Jurisdiction. 
 The Sponsor hereby (i) irrevocably designates and appoints CT Corporation, in the State of New York, as the Sponsor’s authorized agent upon
which process may be served in any suit or proceeding arising out of or relating to the Shares, the Trust Property or this Agreement, (ii) consents and submits to the jurisdiction of any state or federal court in The City of New York, State of
New York, in which any such suit or proceeding may be instituted, and (iii) agrees that service of process upon said authorized agent shall be deemed in every respect effective service of process upon the Sponsor in any such suit or proceeding.
The Sponsor agrees to deliver, upon the execution and delivery of this Agreement, a written acceptance by such agent of its appointment as such agent. The Sponsor further agrees to take any and all action, including the filing of any and all such
documents and instruments, as may be necessary to continue such designation and appointment in full force and effect for so long as any Shares remain outstanding or this Agreement remains in force. In the event the Sponsor fails to continue such
designation and appointment in full force and effect, the Sponsor hereby waives personal service of process upon it and consents that any such service of process may be made by certified or registered mail, return receipt requested, directed to the
Sponsor at its address last specified for notices hereunder, and service so made shall be deemed completed five (5) days after the same shall have been so mailed. 
 Section 9.7 Governing Law. 
 This Agreement shall be interpreted under, and all rights and
duties under this Agreement shall be governed by, the laws of the State of New York. 
  

 49 

 IN WITNESS WHEREOF, RYDEX SPECIALIZED PRODUCTS LLC and THE BANK OF NEW YORK have duly executed this
Agreement as of the day and year first set forth above. 
  

			
	 RYDEX SPECIALIZED PRODUCTS LLC,
 as Sponsor

		
	By:	 	  

	Name:	 	Carl G. Verboncoeur
	Title:	 	Chief Executive Officer and Treasurer
	
	 THE BANK OF NEW YORK,
 as
Trustee

		
	By:	 	  

	Name:	 	
	Title:	 	

  

 50 

 EXHIBIT A 
 Form of Deposit Account Agreement 
  

 1 

 EXHIBIT B 
 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 TRUST AND DO NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN, AND ARE NOT GUARANTEED BY THE SPONSOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THE SHARES NOR THE UNDERLYING
TRUST PROPERTY ARE INSURED UNDER ANY AGREEMENT THAT DIRECTLY BENEFITS THE TRUST OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON. 
 UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE AGENT AUTHORIZED BY THE ISSUER FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 
  

 2 

 SOUTH AFRICAN RAND SHARES 
 ISSUED BY 
 CURRENCYSHARES SOUTH AFRICAN RAND TRUST 
 REPRESENTING 
 FRACTIONAL INTERESTS IN DEPOSITED SOUTH AFRICAN RAND AND ANY 

OTHER TRUST PROPERTY 
 THE BANK OF NEW YORK,
as Trustee 
  

	 No.              
	 * Shares 

 CUSIP:
                     
 THE BANK
OF NEW YORK, as Trustee (hereinafter called the Trustee), hereby certifies that CEDE & CO., as nominee of the Depository Trust Company, or registered assigns, IS THE OWNER OF * Shares issued by CurrencyShares South African Rand Trust, each
representing a fractional undivided interest in the net assets of the Trust, as provided in the Agreement referred to below. At the time of delivery of the Agreement, each 50,000 Shares represented an interest in 50,000,000 South African Rand that
are deposited under the Agreement and held by the Depository referred to in the Agreement. The amount of South African Rand in which each 50,000 Shares represents an interest may change from time to time as provided in the Agreement. The
Trustee’s Corporate Trust Office is located at a different address than its principal executive office. Its Corporate Trust Office is located at 101 Barclay Street, New York, New York 10286, and its principal executive office is located at One
Wall Street, New York, New York 10286. 
 This Certificate is issued upon the terms and conditions set forth in the Trust Agreement dated as
of                     , 200     (the “Agreement”) among Rydex Specialized Products LLC d/b/a “Rydex
Investments” (herein called the Sponsor), the Trustee, all Registered Owners and Beneficial Owners from time to time of Shares issued thereunder and all Depositors. By becoming a Registered Owner or Beneficial Owner, or by depositing South
African Rand, a Person becomes a party to the Agreement and is bound by all the terms and conditions of the Agreement. The Agreement sets forth the rights of Depositors and Registered Owners and the rights and duties of the Trustee and the Sponsor.
Copies of the Agreement are on file at the Trustee’s Corporate Trust Office in New York City. 
  

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

  

 3 

 The Agreement is hereby incorporated by reference into and made a part of this Certificate as if set
forth in full in this place. Capitalized terms not defined herein shall have the meanings set forth in the Agreement. 
 This Certificate
shall not be entitled to any benefits under the Agreement or be valid or obligatory for any purpose unless it is executed by the Trustee by the manual or facsimile signature of a duly authorized signatory of the Trustee and, if a Registrar (other
than the Trustee) for the Shares shall have been appointed, countersigned by the manual signature of a duly authorized officer of the Registrar. 
  

							
	Dated:                             	 		 	THE BANK OF NEW YORK,
		 		 	 as Trustee

				
		 		 	By:	 	  

		 		 	Its:	 	  

 THE TRUSTEE’S CORPORATE TRUST OFFICE ADDRESS IS 
 101 BARCLAY STREET, NEW YORK, NEW YORK 10286 
  

 4

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