Document:

Exhibit 10.1 

JPMORGAN CHASE BANK, N.A. 

and

THE
BANK OF NEW YORK MELLON

solely in its capacity as trustee of the ETFS Palladium Trust

and not individually

	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 ALLOCATED ACCOUNT AGREEMENT

 	
  

 
	
  

 	
  

 	
  

 

THIS AGREEMENT
is made with effect on and from ________, 2009

BETWEEN

	
  

 	
  

 
	
 (1)

 	
 JPMORGAN CHASE
 BANK, N.A,
 whose principal place of business in England is at 125 London Wall, London
 EC2Y 5AJ (the “Custodian”); and

 
	
  

 	
  

 
	
 (2)

 	
 THE BANK OF NEW
 YORK MELLON, a New York banking corporation, solely in its capacity as
 trustee of the ETFS Palladium Trust created under the Trust Agreement
 identified below and not individually (the “Trustee”), which expression shall,
 wherever the context so admits, include the named Trustee and all other
 persons or companies for the time being the trustee or trustees of the Trust
 Agreement (as defined below) as trustee for the Shareholders (as defined
 below). 

 

INTRODUCTION

	
  

 	
  

 
	
 (1)

 	
 The Trustee has agreed to act as trustee for the Shareholders of the
 Shares pursuant to the Trust Agreement.

 
	
  

 	
  

 
	
 (2)

 	
 Shares may be issued by the Trust against delivery of Bullion made by
 way of payment for the issue of such Shares. The Trustee has agreed that
 Bullion delivered to it on subscription for Shares will be paid into the
 Metal Accounts.

 
	
  

 	
  

 
	
 (3)

 	
 The Custodian has agreed to transfer Bullion from the Allocated
 Account into the Unallocated Account pursuant to the terms of this Agreement.

 
	
  

 	
  

 
	
 (4)

 	
 The Trustee has agreed that the Allocated Account will be established
 by the Trustee in its name (for each Shareholder pursuant to the Trust
 Agreement), and that the Trustee will have the sole right to give
 instructions for the making of any payments out of the Allocated Account.

 

IT IS AGREED AS
FOLLOWS

	
  

 	
  

 
	
 1.

 	
 INTERPRETATION

 
	
  

 	
  

 
	
 1.1

 	
 Definitions: Words
 and expressions defined in the Prospectus, unless otherwise defined herein,
 have the same meanings when used in this Agreement. In addition, in this
 Agreement, unless there is anything in the subject or context inconsistent
 therewith the following expressions shall have the following meanings:

 
	
  

 	
  

 
	
  

 	
 “Affiliate” means an entity that directly or indirectly
 through one or more intermediaries, controls, or is controlled by, or is
 under common control with the Custodian;

 
	
  

 	
  

 
	
  

 	
 “Allocated Account” means the loco London allocated Bullion
 account, number [ ], or the loco Zurich allocated Bullion account, each
 established in the name of the Trustee with the Custodian pursuant to this
 Agreement;

 

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 “Authorised Signatory” means, in relation to any person, an
 individual who is duly empowered to bind such person and whose authority is
 evidenced by a resolution of the board of directors (or any other appropriate
 means of authorisation) of such person, and, in relation to the Trustee, any
 individual named in the Trustee’s Authorised Signatory list having due
 authority to bind the Trustee, which list shall be provided by the Trustee
 from time to time;

 
	
  

 	
  

 
	
  

 	
 “Availability Date” means the Business Day on which the
 Trustee requests the Custodian to credit to the Allocated Account Bullion
 debited from the Unallocated Account;

 
	
  

 	
  

 
	
  

 	
 “Bullion” means palladium in physical form complying with the
 Rules of the Relevant Association held by the Custodian or any Sub-Custodian
 under this Agreement and/or any credit balance in the Unallocated Account as
 the context requires;

 
	
  

 	
  

 
	
  

 	
 “Conditions” means the terms and conditions on and subject to
 which Shares are issued in the form or substantially in the form set out in
 the Trust Agreement;

 
	
  

 	
  

 
	
  

 	
 “General Notice” means any notice given in accordance with
 this Agreement other than a Transfer Notice;

 
	
  

 	
  

 
	
  

 	
 “London Business Day” means a day (other than a Saturday or a
 Sunday or a public holiday in England) on which commercial banks generally
 and the London palladium market are open for the transaction of business in
 London;

 
	
  

 	
  

 
	
  

 	
 “London/Zurich Business Day” means a day which is both a
 London Business Day and a Zurich Business Day;

 
	
  

 	
  

 
	
  

 	
 “Metal Accounts” means
 the Allocated Account and the Unallocated Account;

 
	
  

 	
  

 
	
  

 	
 “Point of Delivery” means such date and time that the
 recipient (or its agent) acknowledges in written form its receipt of delivery
 of Bullion;

 
	
  

 	
  

 
	
  

 	
 “Prospectus” means the prospectus constituting a part of the
 registration statement filed on Form S-1, Registration Number 333-158380 with
 the Securities Exchange Commission in accordance with the U.S. Securities Act
 of 1933, as amended, in relation to the Shares dated on or about [__], 2009
 as the same may be modified, supplemented or amended from time to time;

 
	
  

 	
  

 
	
  

 	
 “Redemption” means the redemption of Shares by the Trust in
 accordance with the Conditions;

 
	
  

 	
  

 
	
  

 	
 “Redemption Form” means a notice in the form prescribed from
 time to time by the Trust requesting Redemption of Shares;

 
	
  

 	
  

 
	
  

 	
 “Redemption Obligations” means the obligation of the Trust on
 Redemption of a Share to make payment or deliver Bullion to the relevant
 Authorized Participant or Shareholder in accordance with the Conditions;

 

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 “Relevant Association” means the London Platinum and
 Palladium Market association or its successors;

 
	
  

 	
  

 
	
  

 	
 “Rules” means the rules, regulations, practices and customs
 of the Relevant Association (including without limitation the “rules as to
 Good Delivery”), the Bank of England and such other regulatory authority or
 other body as shall affect the activities contemplated by this Agreement or
 the activities of a Sub-Custodian;

 
	
  

 	
  

 
	
  

 	
 “Shareholder” means the beneficial owner of one or more
 Shares;

 
	
  

 	
  

 
	
  

 	
 “Shares” means the units of fractional undivided
 beneficial interest in and ownership of the Trust which are issued by the
 Trust, named “ETFS Physical Palladium Shares” and created pursuant to
 and constituted by the Trust Agreement;

 
	
  

 	
  

 
	
  

 	
 “Sponsor” means ETF
 USA Securities LLC, its successors and assigns and any successor Sponsor
 appointed pursuant to the Trust Agreement;

 
	
  

 	
  

 
	
  

 	
 “Sub-Custodian” means a sub-custodian, agent or depository
 (including an entity within the Custodian’s corporate group) appointed by the
 Custodian pursuant to clause 8 to perform any of the Custodian’s duties under
 this Agreement including the custody and safekeeping of Bullion;

 
	
  

 	
  

 
	
  

 	
 “Transfer Notice” means any notice of a deposit or withdrawal
 made pursuant to clause 3 or clause 4 of this Agreement;

 
	
  

 	
  

 
	
  

 	
 “Trust” means the ETFS Palladium Trust formed
 pursuant to the Trust Agreement;

 
	
  

 	
  

 
	
  

 	
 “Trust Agreement” means the Depositary Trust Agreement of
 the ETFS Palladium Trust dated on or about [__], 2009, as amended from time
 to time, between the ETF Securities
 USA LLC, as Sponsor, and The Bank of New York Mellon, as Trustee;

 
	
  

 	
  

 
	
  

 	
 “Unallocated Account” means the loco London unallocated
 Bullion account, number [ ], or loco Zurich the unallocated Bullion, account
 number [ ], each established in the name of the Trustee with the Custodian
 pursuant to the Unallocated Account Agreement;

 
	
  

 	
  

 
	
  

 	
 “Unallocated Account Agreement” means the Unallocated Account
 Agreement dated [ ] between the Trustee and the Custodian pursuant to which
 the Unallocated Account is established and operated;

 
	
  

 	
  

 
	
  

 	
 “VAT” means value added tax as provided for in the Value
 Added Tax Act 1994 (as amended or re-enacted from time to time) and
 legislation supplemental thereto and any other tax (whether imposed in the
 United Kingdom in substitution thereof or in addition thereto or elsewhere)
 of a similar fiscal nature;

 
	
  

 	
  

 
	
  

 	
 “Withdrawal Date” means the Business Day on which the Trustee
 wishes a withdrawal of Bullion from the Allocated Account to take place;

 
	
  

 	
  

 
	
  

 	
 “Zurich Business Day” means a day (other than a Saturday or a
 Sunday or a public

 

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 holiday in Zurich) on which commercial banks generally and the Zurich
 palladium market are open for the transaction of business in Zurich; and

 
	
  

 	
  

 
	
  

 	
 “Zurich Sub-Custodian” means any firm selected by
 the Custodian to hold palladium on behalf of the Custodian in the firm’s
 Zurich vault premises on a segregated basis, in the manner provided in
 clauses 7.2, 7.3 and 8.3 and whose appointment has been approved in writing
 by the Sponsor (such approval not to be unreasonably withheld). 

 
	
  

 	
  

 
	
 1.2

 	
 Headings: The
 headings in this Agreement do not affect its interpretation.

 
	
  

 	
  

 
	
 1.3

 	
 Singular and plural:
 References to the singular include the plural and vice versa.

 
	
  

 	
  

 
	
 2.

 	
 ALLOCATED ACCOUNT

 
	
  

 	
  

 
	
 2.1

 	
 Opening Allocated
 Account: The Custodian shall open and maintain
 the Allocated Account in the name of the Trustee (in its capacity as trustee
 for the Shareholders). 

 
	
  

 	
  

 
	
 2.2

 	
 Deposits and
 Withdrawals: The Allocated Account shall
 evidence and record deposits and withdrawals of Bullion made pursuant to the
 terms of this Agreement. 

 
	
  

 	
  

 
	
 2.3

 	
 Denomination of
 Allocated Account: The Allocated Account will
 hold deposits of Bullion and will be denominated in fine troy ounces.

 
	
  

 	
  

 
	
 2.4

 	
 Reports: For
 each Business Day, by no later than the following Business Day, Custodian
 will transmit to Trustee a report showing the movement of Bullion into and
 out of the Allocated Account, identifying separately each transaction and the
 Business Day on which it occurred and providing sufficient information to
 identify each individual bar of Bullion held in the Allocated Account. For
 each calendar month, the Custodian will provide the Trustee within a
 reasonable time after the end of the month a statement of account for the
 Allocated Account. 

 
	
  

 	
  

 
	
 2.5

 	
 Reversal of
 Entries: The Custodian shall reverse any
 provisional or erroneous entries to the Allocated Account which it discovers
 or of which it is notified with effect back-valued to the date upon which the
 final or correct entry (or no entry) should have been made.

 
	
  

 	
  

 
	
 2.6

 	
 Provision of
 Information: The Custodian agrees that it will
 forthwith notify the Trustee in writing of any encumbrance of which it is
 aware is or is purported to have been created over or in respect of the
 Allocated Account or any of the amounts standing to the credit thereof.

 
	
  

 	
  

 
	
 2.7

 	
 Access:
 The Custodian will allow the Sponsor and the Trustee and their Bullion
 auditors (currently Inspectorate International Limited), and will procure
 that any Zurich Sub-Custodian that it appoints allows, access to its premises
 during normal business hours, to examine the Bullion and such records as they
 may reasonably require to perform their respective duties with regard to
 investors in Shares. The Trustee agrees that any such access shall be subject
 to execution of a confidentiality agreement and agreement to the Custodian’s
 security procedures, and such audit shall be at the Trust’s expense and shall
 be limited to no more than twice a calendar year.

 

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 3.

 	
 DEPOSITS

 
	
  

 	
  

 
	
 3.1

 	
 Procedure:
 The Custodian shall receive deposits of Bullion into the Allocated Account
 relating to the same kind of Bullion and having the same denomination as that
 (or one of those) to which the Allocated Account relates only pursuant to
 transfers from the Unallocated Account. 

 
	
  

 	
  

 
	
 3.2

 	
 Right to Amend
 Procedure: The Custodian may amend the procedure
 in relation to the deposit of Bullion only where such amendment is caused by
 a change in the Rules or procedures of the Relevant Association. The Custodian will, whenever practicable,
 notify the Trustee and the Sponsor within a commercially reasonable time
 before the Custodian amends its procedures or imposes additional ones in
 relation to the transfer of Bullion into and from the Unallocated Account,
 and in doing so the Custodian will consider the Trustee’s needs to
 communicate any such change to Authorized Participants and others. 

 
	
  

 	
  

 
	
 3.3

 	
 Allocation:
 The Trustee acknowledges that the process of allocation of Bullion to the
 Allocated Account from the Unallocated Account may involve minimal
 adjustments to the weights of Bullion to be allocated to adjust such weight
 to the number of whole bars available. 

 
	
  

 	
  

 
	
 4.

 	
 WITHDRAWALS

 
	
  

 	
  

 
	
 4.1

 	
 Procedure:
 The Trustee may at any time give instructions to the Custodian for the
 withdrawal of Bullion from the Allocated Account but only by way of
 de-allocation to the Unallocated Account or such other account as the Trustee
 may instruct (subject to clause 4.3 below). 

 
	
  

 	
  

 
	
 4.2

 	
 Notice
 Requirements: A confirmation from the Trustee to
 the Custodian, given in writing, that a valid Redemption Form has been lodged
 for Shares shall be deemed an instruction given under clause 4.1 unless
 otherwise notified in writing by the Trustee. Any other notice relating to a
 withdrawal of Bullion must be in writing. 

 
	
  

 	
  

 
	
 4.3

 	
 Right to amend
 procedure: The Custodian may amend the procedure
 for the withdrawal of Bullion only where such amendment is caused by a change
 in the Rules or procedures of the Relevant Association. Any such amendment
 will be subject to the conditions of the preceding clause 3.2 and will be
 promptly notified to the Sponsor and the Trustee, such notice to be given in
 advance of implementation whenever practicable.

 
	
  

 	
  

 
	
 4.4

 	
 Specification of
 Bullion: The Custodian may specify the serial
 numbers of the bars to be withdrawn once it receives instructions from the
 Trustee to effect a withdrawal of Bullion pursuant to clause 4.1. The
 Custodian is entitled to select the Bullion to be made available to the
 Trustee; provided, however, that to the extent the Trustee provides specific
 serial numbers of bars to be so selected, the Custodian will take reasonable
 efforts to select such Bullion as specified by the Trustee. The Custodian may
 require more than two Business Days prior notice in the event that the
 Trustee does specify the serial numbers of bars to be withdrawn. 

 

5

	
  

 	
  

 
	
 4.5

 	
 Collection of
 Bullion: The Trustee agrees that in the normal
 course (which, for the avoidance of doubt, shall not include withdrawal in
 connection with the termination of this Agreement) withdrawal of Bullion from
 the Allocated Account shall be by way of de-allocation and subsequent credit
 of Bullion to the Unallocated Account.

 
	
  

 	
  

 
	
 4.6

 	
 De-allocation: Following
 receipt by the Custodian of notice for the withdrawal of Bullion from the
 Allocated Account pursuant to clause 4.1, the Custodian shall de-allocate
 sufficient Bullion from the Allocated Account to credit the Unallocated
 Account in the amount required. The Trustee acknowledges that the process of
 de-allocation of Bullion for withdrawal and/or credit to the Unallocated
 Account may involve minimal adjustments to the weight of Bullion to be
 withdrawn to adjust such weight to the whole bars available.

 
	
  

 	
  

 
	
 4.7

 	
 Risk:
 With the exception of any transfer pursuant to clause 4.2 of the Unallocated
 Account Agreement, where there is a shipment to or from the Custodian of
 Bullion, all right, title and risk in and to such Bullion shall pass at the
 Point of Delivery to the relevant person for whose account the Bullion is
 being delivered.

 
	
  

 	
  

 
	
 5.

 	
 INSTRUCTIONS

 
	
  

 	
  

 
	
 5.1

 	
 Giving of
 Instructions: Only the Trustee shall have the
 right to give instructions to the Custodian for deposit of Bullion to or
 withdrawal of Bullion from the Allocated Account. All such instructions given
 by the Trustee to the Custodian shall be given in writing and signed by two
 Authorised Signatories of the Trustee. The Trustee shall notify the Custodian
 in writing of the names of the people who are authorised to give instructions
 on the Trustee’s behalf. Until the Custodian receives written notice to the
 contrary, the Custodian is entitled to assume that any of those people have
 full and unrestricted power to give instructions on the Trustee’s behalf. The
 Custodian is also entitled to rely on any instructions which are from, or
 which purport to emanate from, any person who appears to have such authority.

 
	
  

 	
  

 
	
 5.2

 	
 Account not to be
 Overdrawn:
 The Allocated Account may not at any time have a debit balance thereon, and
 no instruction shall be valid to the extent that the effect thereof would be
 for the Allocated Account to have a debit balance thereon.

 
	
  

 	
  

 
	
 5.3

 	
 Amendments:
 Once given, instructions continue in full force and effect until they are cancelled,
 amended or superseded. Notice of amendment shall have effect only after
 actual receipt by the Custodian.

 
	
  

 	
  

 
	
 5.4

 	
 Unclear or
 Ambiguous Instructions: If, in the Custodian’s
 opinion, any instructions are unclear or ambiguous, the Custodian shall use
 reasonable endeavours (taking into account any relevant time constraints) to
 obtain clarification of those instructions from the Trustee and, failing
 that, the Custodian may in its absolute discretion and without any liability
 on its part, act upon what the Custodian believes in good faith such
 instructions to be or refuse to take any action or execute such instructions
 until any ambiguity or conflict has been resolved to the Custodian’s
 satisfaction.

 
	
  

 	
  

 
	
 5.5

 	
 Refusal to
 Execute: The Custodian will, where practicable,
 refuse to execute instructions if in the Custodian’s opinion they are or may
 be contrary to the Rules or any applicable law.

 

6

	
  
 	
  
 
	
 6.
 	
 CONFIDENTIALITY
 
	
  
 	
  
 
	
 6.1
 	
 Disclosure to
 Others: Subject to clause 6.2, each of the
 Trustee and the Custodian shall respect the confidentiality of information
 acquired under this Agreement and will not, without the other party’s
 consent, disclose to any other person any transaction or other information
 acquired about the other party, its business or the Trust under this
 Agreement, in the event such other party has made clear, at or before the
 time such information is provided, that such information is being provided on
 a confidential basis.
 
	
  
 	
  
 
	
 6.2
 	
 Permitted
 Disclosures: Each party accepts that from time
 to time any other party may be required by law or the Rules, or requested by
 a government department or agency, fiscal body or regulatory or listing
 authority or as otherwise necessary in conducting the Trust’s business, to
 disclose information acquired under this Agreement. In addition, the
 disclosure of such information may be required by a party’s auditors, by its
 legal or other advisors, by a company which is in the same group of companies
 as a party (i.e., a subsidiary or holding company of a party), by a
 Sub-Custodian or (in the case of the Trustee) by any beneficiary of the
 trusts constituted by the Trust Agreement. Each party irrevocably authorises
 the others to make such disclosures without further reference to such party.
 
	
  
 	
  
 
	
 7.
 	
 CUSTODY SERVICES
 
	
  
 	
  
 
	
 7.1
 	
 Appointment:
 The Trustee hereby appoints the Custodian to act as custodian of the Bullion in accordance with
 this Agreement and any Rules which apply to the Custodian. 
 
	
  
 	
  
 
	
 7.2
 	
 Segregation of
 Bullion: The Custodian will be responsible for
 the safekeeping of the Bullion on the terms and conditions of this Agreement.
 The Custodian will segregate the Bullion from any Bullion which the Custodian
 owns or holds for others by making appropriate entries in its books and
 records and will require Sub-Custodians to segregate the Bullion from any
 palladium which they own or hold for others by making appropriate entries in
 their books and records. The Custodian shall be deemed to have required such
 segregation in relation to the Sub-Custodians named in clause 8.1.
 
	
  
 	
  
 
	
 7.3
 	
 Ownership of
 Bullion: The Custodian will identify in its
 books that the Bullion belongs to the Trustee (on trust for the
 Shareholders).
 
	
  
 	
  
 
	
 7.4
 	
 Location of
 Bullion: Subject to and in accordance with
 clause 8.1 and unless otherwise agreed between the parties, Bullion must be
 held by the Custodian at its London vaulting premises or at the Zurich
 Sub-Custodian’s Zurich vaulting premises. The Custodian agrees that it shall
 use, or where applicable procure any Sub-Custodian to use, commercially
 reasonable efforts promptly to transport any Bullion held for the Trustee to
 these locations at the Custodian’s cost and risk. The Custodian agrees that
 all delivery and packing shall be in accordance with the Rules and Relevant
 Association good market practices.
 
	
  
 	
  
 

7

	
  
 	
  
 
	8.
	SUB-CUSTODIANS

	
  
 	
  
 
	
 8.1
 	
 Sub-Custodians:
 With the exception of the Zurich Sub Custodian, which shall, for the
 avoidance of doubt, be governed by clause 8.3, the Custodian may employ
 Sub-Custodians solely for the temporary custody and safekeeping of Bullion until
 transported to the relevant vault premises as provided in clause 7.4. The
 Sub-Custodians the Custodian selects may themselves select sub-custodians to
 provide such temporary custody and safekeeping of Bullion, but such
 sub-custodians shall not by such selection or otherwise be, or be considered
 to be, a Sub-Custodian as such term is used herein. The Custodian will use
 reasonable care in selecting any Sub-Custodian. As of the date of this
 Agreement, the Sub-Custodians that the Custodian uses are: Brinks Global
 Services, Via Mat International and Group 4 Security Limited. The Custodian
 will notify each of the Trustee and the Sponsor if it selects any additional
 Sub-Custodian, or stops using any Sub-Custodian for such purpose. The receipt
 of notice by each of the Trustee and the Sponsor that the Custodian has
 selected a Sub-Custodian (including those named in this clause 8.1) shall not
 be deemed to limit the Custodian’s responsibility in selecting such
 Sub-Custodian. 
 
	
  
 	
  
 
	
 8.2
 	
 Liability:
 Except for the Custodian’s obligation to make commercially reasonable efforts
 to obtain delivery of Bullion from Sub-Custodians, the Custodian shall not be
 liable in contract, tort or otherwise for any loss, damage or expense arising
 directly or indirectly from an act or omission, or insolvency, of any
 Sub-Custodian or any further delegate of such Sub-Custodian unless the
 appointment of that Sub-Custodian was made by the Custodian negligently or in
 bad faith. 
 
	
  
 	
  
 
	
 8.3
 	
 Zurich
 Sub-Custodians: The Custodian may employ Zurich
 Sub-Custodians for the custody and safekeeping of palladium in their Zurich
 vault premises. The Custodian will use reasonable care in selecting any
 Zurich Sub-Custodian. As of the date of this Agreement, the Zurich
 Sub-Custodian that the Custodian uses is UBS AG. The Custodian will notify
 each of the Trustee and the Sponsor if it selects any additional Zurich
 Sub-Custodian, or stops using any Zurich Sub-Custodian for such purpose. The
 receipt of notice by each of the Trustee and the Sponsor that the Custodian has
 selected a Zurich Sub-Custodian (including those named in this clause 8.3)
 shall not be deemed to limit the Custodian’s responsibility in selecting such
 Zurich Sub-Custodian. Nothing in clause 8.2 shall limit the Custodian’s
 liability with respect to palladium held by a Zurich Sub-Custodian. In
 addition to the requirements of clauses 7.2 and 7.3, the Custodian shall
 require any Zurich Sub-Custodian to segregate the Bullion from any palladium
 which they hold for the Custodian and any other customers of the Custodian or
 the Zurich Sub-Custodian by making appropriate entries in their books and
 records. On entering into this Agreement and on the appointment of any
 subsequent Zurich Sub-Custodian, the Custodian shall give to such Zurich
 Sub-Custodian notices in the form of Schedule 1 and ensure that the
 Zurich Sub-Custodian delivers to the Trustee (with a copy to the Sponsor)
 acknowledgements in the form of Schedule 2 prior to delivery of any Bullion
 to it.
 

8

	
  

 	
  

 	
  

 	
  

 
	
 9.

 	
 REPRESENTATIONS

 
	
  

 	
  

 	
  

 	
  

 
	
 9.1

 	
 Trustee’s
 Representations: The Trustee represents and
 warrants to the Custodian that (such representations and warranties being
 deemed to be repeated upon each occasion of deposit of Bullion under this
 Agreement):

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (1)

 	
 the Trustee has all necessary authority, powers, consents, licences
 and authorisations (which have not been revoked) and has taken all necessary
 action to enable it lawfully to enter into and perform its duties and
 obligations under this Agreement;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (2)

 	
 the persons entering into this Agreement on behalf of the Trustee
 have been duly authorised to do so; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (3)

 	
 this Agreement and the obligations created under it are binding upon
 and enforceable against the Trustee, as trustee of the Trust, in accordance
 with its terms (subject to applicable principles of equity) and do not and
 will not violate the terms of the Rules or any order, charge or agreement by
 which the Trustee is bound.

 
	
  

 	
  

 	
  

 	
  

 
	
 9.2

 	
 Custodian’s
 Representations: The Custodian represents and
 warrants to the Trust that (such representations and warranties being deemed
 to be repeated upon each occasion of deposit of Bullion under this
 Agreement):

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (1)

 	
 the Custodian has all necessary authority, powers, consents, licences
 and authorisations (which have not been revoked) and has taken all necessary
 action to enable it lawfully to enter into and perform its duties and
 obligations under this Agreement;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (2)

 	
 the persons entering into this Agreement on behalf of the Custodian
 have been duly authorised to do so; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (3)

 	
 this Agreement and the obligations created under it are binding upon
 the Custodian and enforceable against the Custodian in accordance with its
 terms (subject to applicable principles of equity) and do not and will not
 violate the terms of the Rules or any order, charge or agreement by which the
 Custodian is bound.

 
	
  

 	
  

 	
  

 	
  

 
	
 10.

 	
 FEES AND EXPENSES 

 
	
  

 	
  

 
	
 10.1

 	
 Fees:
 For the Custodian’s services under this Agreement, the Trustee has procured
 the Sponsor’s written agreement, to which the Custodian has agreed, to pay to
 the Custodian’s fee for services under this Agreement

 

9

	
  

 	
  

 	
  

 	
  

 
	
 10.2

 	
 Expenses:
 The Trustee has procured the Sponsor’s written agreement, to which the
 Custodian has agreed, to pay to the Custodian on demand all costs, charges
 and expenses (excluding (i) any relevant taxes and VAT, duties and other
 governmental charges, (ii) fees for storage and insurance of the Bullion and
 any fees and expenses of Sub-Custodians, which will be recovered under clause
 10.1, and (iii) indemnification obligations of the Trustee under clause 12.5
 which will be paid pursuant to the following sentence) incurred by the
 Custodian in connection with the performance of its duties and obligations
 under this Agreement or otherwise in connection with the Bullion. The Trustee
 will procure payment on demand, solely from and to the extent of the assets
 of the Trust, of any other costs, charges and expenses not assumed by the
 Sponsor under its agreement with the Custodian procured under this clause
 10.2 (including any relevant taxes and VAT, duties, other governmental
 charges and indemnification claims of the Custodian payable by the Trustee
 pursuant to clause 12.5, but excluding fees for storage and insurance of the
 Bullion and any fees and expenses of Sub-Custodians, which will be recovered
 under clause 10.1) incurred by the Custodian in connection with the Bullion.

 
	
  

 	
  

 	
  

 	
  

 
	
 10.3

 	
 Default
 Interest: If the Trustee fails to procure
 payment to the Custodian of any amount when it is due, the Custodian reserves
 the right to charge interest (both before and after any judgement) on any
 such unpaid amount calculated at a rate equal to 1% above the overnight
 London Interbank Offered Rate (LIBOR) for the currency in which the amount is
 due. Interest will accrue on a daily basis and will be due and payable as a
 separate debt.

 
	
  

 	
  

 
	
 10.4

 	
 Credit
 Balances: No interest or other amount will be
 paid by the Custodian on any credit balance on an Allocated Account.

 
	
  

 	
  

 	
  

 	
  

 
	
 10.5

 	
 Recovery
 from Trust: Amounts payable pursuant to this
 clause 10 shall not be debited from the Allocated Account, but shall be
 payable on behalf of the Trust, and the Custodian hereby acknowledges that it
 will have no recourse against Bullion standing to the credit of the Allocated
 Account or to the Trustee individually in respect of any such amounts.

 
	
  

 	
  

 	
  

 	
  

 
	
 11.

 	
 VALUE ADDED TAX

 
	
  

 	
  

 	
  

 	
  

 
	
 11.1

 	
 VAT
 Inclusive: All sums payable under this Agreement
 by the Trust to the Custodian shall be deemed to be inclusive of VAT if and
 to the extent VAT is properly chargeable on any supplies made by the
 Custodian to the Trust pursuant to this Agreement.

 
	
  

 	
  

 	
  

 	
  

 
	
 11.2

 	
 VAT
 Invoice: If VAT is properly chargeable on any
 supplies made by the Custodian to the Trust pursuant to this Agreement, the
 Custodian shall provide a valid VAT invoice to the Trust.

 
	
  

 	
  

 	
  

 	
  

 
	
 12.

 	
 SCOPE OF RESPONSIBILITY

 
	
  

 	
  

 	
  

 	
  

 
	
 12.1

 	
 Exclusion
 of Liability: The Custodian will use reasonable
 care in the performance of its duties under this Agreement and will only be
 responsible for any loss or damage suffered as a direct result of any
 negligence, fraud or wilful default on its part in the 

 

10

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 performance of its duties, and in which case its liability will not
 exceed the market value of the Bullion lost or damaged at the time such
 negligence, fraud or wilful default is discovered by the Custodian, provided
 the Custodian notifies the Trustee promptly after any discovery of such lost
 or damaged Bullion.

 
	
  

 	
  

 	
  

 	
  

 
	
 12.2

 	
 No
 Duty or Obligation: The Custodian is under no
 duty or obligation to make or take, or require any Sub-Custodian to make or
 take, any special arrangements or precautions beyond those required by the
 Rules or as specifically set forth in this Agreement.

 
	
  

 	
  

 	
  

 	
  

 
	
 12.3

 	
 Insurance:
 The Custodian (or one of its Affiliates)
 shall make such insurance arrangements from time to time in connection with
 the Custodian’s custodial obligations under this Agreement as the Custodian
 considers appropriate and will be responsible for all costs, fees and
 expenses (including any relevant taxes) in relation to any such insurance
 policy or policies. Upon reasonable prior written notice, in
 connection with the preparation of the initial registration statement under
 the United States Securities Act of 1933, as amended, covering any Shares,
 the Custodian will allow its insurance to be reviewed by the Trustee and by
 the Sponsor. The Custodian also will allow the Trustee and the Sponsor to
 review such insurance in connection with any amendment to that initial
 registration statement and from time to time, in each case upon reasonable
 prior written notice from the Trustee. Any permission to review the
 Custodian’s insurance is limited to the term of this agreement and is
 conditioned on the reviewing party executing a form of confidentiality
 agreement provided by the Custodian, or if the confidentiality agreement is
 already in force, acknowledging that the review is subject thereto; provided,
 however, that the Custodian agrees to use reasonable efforts to assist the
 Trustee in finding a replacement custodian (including, but not limited to,
 agreeing to an assignment of its rights and obligations hereunder) should any
 event described in this clause 11.4 so prevent the Custodian from performing
 its obligations.

 
	
  

 	
  

 	
  

 	
  

 
	
 12.4

 	
 Force
 Majeure: The Custodian shall not be liable for
 any delay in performance or for the non-performance of any of its obligations
 under this Agreement by reason of any cause beyond the Custodian’s reasonable
 control. This includes any act of God or war or terrorism or any breakdown,
 malfunction or failure of transmission, communication or computer facilities,
 industrial action, acts and regulations of any governmental or supra national
 bodies or authorities or regulatory or self-regulatory organisation or
 failure to any such body, authority or organization, for any reason, to
 perform its obligations. 

 
	
  

 	
  

 	
  

 	
  

 
	
 12.5

 	
 Indemnity:
 The Trustee, solely from and to the extent of the assets of the Trust, shall
 indemnify and keep indemnified the Custodian (on an after tax basis) on
 demand against all costs and expenses, damages, liabilities and losses (other
 than VAT and the expenses assumed by the Sponsor under its agreement with the
 Custodian procured under clause 10.2) which the Custodian may suffer or
 incur, directly or indirectly in connection with this Agreement except to the
 extent that such sums are due directly to the negligence, wilful default or
 fraud of the Custodian.

 
	
  

 	
  

 	
  

 	
  

 
	
 12.6

 	
 Third
 Parties: Except with respect to the Trust, which
 shall be considered a beneficiary of this entire Agreement, and to the
 Sponsor, which shall be considered a beneficiary (as applicable) of clauses
 2.6 and 12.3, the Custodian does not owe any 

 

11

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 duty or obligation or have any liability towards any person who is
 not a party to this Agreement. Except as set forth in this clause 12.6, this
 Agreement does not confer a benefit on any person who is not a party to it.
 The parties hereto do not intend that any term of this Agreement shall be
 enforceable by any person who is not a party to it and do intend that the
 Contracts (Rights of Third Parties) 1999 Act shall not apply to this
 Agreement, provided that the Sponsor may enforce its rights under clauses 2.6
 and 12.3. Nothing in this paragraph is intended to limit the obligations
 hereunder of any successor Trustee of the Trust or to limit the right of any
 successor Trustee of the Trust to enforce the Custodian’s obligations
 hereunder.

 
	
  

 	
  

 	
  

 	
  

 
	
 13.

 	
 TERM AND TERMINATION

 
	
  

 	
  

 	
  

 	
  

 
	
 13.1

 	
 Method: Subject to clause 13.2 below, either the Trustee or the Custodian may
 terminate this Agreement for any reason or if the Custodian or Zurich
 Sub-Custodian ceases to offer the services contemplated by this Agreement to
 its clients or proposes to withdraw from the Bullion business, by giving not
 less than 90 days’ written notice to the other party. Any such notice given
 by the Trustee must specify: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (1)

 	
 the date on which the termination will take effect;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (2)

 	
 the person to whom the Bullion is to be made available; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (3)

 	
 all other necessary arrangements for the redelivery of the Bullion to
 the order of the Trustee.

 
	
  

 	
  

 	
  

 	
  

 
	
 13.2

 	
 Term: This
 Agreement shall have a fixed term up to and including five years and will automatically renew for a further term of
 five years thereafter unless terminated by the parties in accordance with
 this clause 13; provided
 that during such periods this Agreement may be terminated
 immediately upon written notice as follows:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (1)

 	
 by the Trustee, if the Custodian ceases to offer the services
 contemplated by this Agreement to its clients or proposes to withdraw from
 the Bullion business;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (2)

 	
 by the Trustee or the Custodian, if it becomes unlawful for the
 Custodian to be a party to this Agreement or to offer its services on the
 terms contemplated by this Agreement or it becomes unlawful for the Trustee
 or the Trust to receive such services or for the Trustee to be a party to
 this Agreement; 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (3)

 	
 by the Custodian, if there is any event which, in the Custodian’s
 reasonable view, indicates the Trust’s insolvency or impending insolvency; 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (4)

 	
 by the Trustee, if there is any event which, in the Trustee’s sole
 view, indicates the Custodian’s insolvency or impending insolvency;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (5)

 	
 by the Trustee, if the Trust is to be terminated; or

 

12

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (6)

 	
 by the Trustee or the Custodian, if the Unallocated Account Agreement
 ceases to be in full force and effect at any time.

 
	
  

 	
  

 	
  

 	
  

 
	
 13.3

 	
 Change
 in Trustee: If there is any change in the
 identity of the Trustee in accordance with the Trust Agreement, then the
 Custodian, the Trustee and the Trust shall execute such documents and shall take
 such actions as the new Trustee and the outgoing Trustee may reasonably
 require for the purpose of vesting in the new Trustee the rights and
 obligations of the outgoing Trustee, and releasing the outgoing Trustee from
 its future obligations under this Agreement.

 
	
  

 	
  

 	
  

 	
  

 
	
 13.4

 	
 Redelivery
 Arrangements: If the Trustee does not make
 arrangements acceptable to the Custodian for the redelivery of the Bullion
 the Custodian may continue to store the Bullion, in which case the Custodian
 will continue to charge the fees and expenses payable under clause 10. If the
 Trustee has not made arrangements acceptable to the Custodian for the
 redelivery of the Bullion within six months of the date specified in the
 termination notice as the date on which the termination will take effect, the
 Custodian will be entitled to sell the Bullion and account to the Trustee for
 the proceeds. 

 
	
  

 	
  

 	
  

 	
  

 
	
 13.5

 	
 Existing
 Rights: Termination shall not affect rights and
 obligations then outstanding under this Agreement which shall continue to be
 governed by this Agreement until all obligations have been fully performed.

 
	
  

 	
  

 	
  

 	
  

 
	
 14.

 	
 NOTICES

 
	
  

 	
  

 	
  

 	
  

 
	
 14.1

 	
 Transfer
 Notices: Subject to clause 5.1, any Transfer
 Notice shall be in writing in English and shall be marked “Urgent – This
 Requires Immediate Attention” and signed by or on behalf of the party giving
 it (or its duly authorised representative). Any Transfer Notice shall be sent
 either by facsimile or such other authenticated method as may, from time to
 time, be agreed between the parties. Any Transfer Notice shall be deemed to
 have been given, made or served upon actual receipt by the recipient.

 
	
  

 	
  

 	
  

 	
  

 
	
 14.2

 	
 General
 Notices: Any General Notice shall be in writing
 in English and shall be marked “Urgent – This Requires Immediate Attention”
 and shall be signed by or on behalf of the party giving it (or its duly
 authorised representative). Any General Notice shall be given, made or served
 by sending the same by pre-paid registered post (first class if inland, first
 class airmail if overseas) or facsimile transmission. Any General Notice sent
 by pre-paid registered post shall be deemed to have been received three
 Business Days in the case of inland post or seven Business Days in the case
 of overseas post after despatch. Any General Notice sent by facsimile shall be
 deemed to have been given, made or served upon actual receipt by the
 recipient.

 
	
  

 	
  

 	
  

 	
  

 
	
 14.3

 	
 The addresses and numbers of the parties for the purposes of clauses
 14.1 and 14.2 are:

 

13

	
  

 	
  

 	
  

 
	
  

 	
 The Custodian:

 	
 JPMorgan Chase Bank, N.A. 

 
	
  

 	
  

 	
 125 London Wall

 
	
  

 	
  

 	
 London EC2Y 5AJ

 
	
  

 	
  

 	
 Attention:
 Peter Smith – Global Commodities

 
	
  

 	
  

 	
 Facsimile
 No. +44 207 777 4915

 
	
  

 	
  

 	
  

 
	
  

 	
 The Trustee:

 	
 The Bank of
 New York Mellon

 
	
  

 	
  

 	
 2 Hanson
 Place

 
	
  

 	
  

 	
 Brooklyn,
 New York 11217

 
	
  

 	
  

 	
 Attention:
 Donald Guire

 
	
  

 	
  

 	
 Facsimile:
 718-315-4927

 
	
  

 	
  

 	
  

 
	
  

 	
 or such other address or facsimile number as shall have been notified
 (in accordance with this clause) to the other party hereto. The address and
 numbers of the Sponsor for purposes of receiving notices under this Agreement
 is:

 
	
  

 	
  

 	
  

 
	
  

 	
 The Sponsor:

 	
 ETF
 Securities USA LLC

 
	
  

 	
  

 	
 c/o ETF
 Securities Representative Office

 
	
  

 	
  

 	
 6th
 Floor 

 
	
  

 	
  

 	
 2 London
 Wall Buildings

 
	
  

 	
  

 	
 London EC2M
 5UU

 
	
  

 	
  

 	
 Telephone:
 +442074404330 

 
	
  

 	
  

 	
 Attention:
 US Fund Services 

 

	
  

 	
  

 
	
 14.4

 	
 Recording
 of Calls: Each of the Custodian and the Trustee
 may record telephone conversations without use of a warning tone. Such
 records will be the recording party’s sole property and accepted by the other
 parties hereto as evidence of the orders or instructions given.

 
	
  

 	
  

 
	
 15.

 	
 GENERAL

 
	
  

 	
  

 
	
 15.1

 	
 Role
 of Trustee: The Trustee is a party to this
 Agreement in its capacity as Trustee for the Shareholders and accordingly (i)
 the Trustee shall only be liable to satisfy any obligations under this
 Agreement, including any obligations or liabilities arising in connection
 with any default by the Trustee under this Agreement, to the extent of the
 assets held from time to time by the Trustee as trustee of the trusts
 constituted by the Trust Agreement (the “Trust
 Assets”) to the extent authorized by the Trust Agreement and (ii)
 no recourse shall be had to (a) any assets other than the Trust Assets,
 including any of the assets held by the Trustee as trustee, co-trustee or
 nominee of a trust other than the trusts constituted by the Trust Agreement,
 as owner in its individual capacity or in any way other than as trustee of
 the trusts constituted by the Trust Agreement; or (b) the Trustee for any
 assets that have been distributed by the Trustee to the beneficiaries of the
 trusts constituted by the Trust Agreement.

 
	
  

 	
  

 
	
 15.2

 	
 No
 Advice: The Custodian’s duties and obligations
 under this Agreement do not include providing the other party hereto with
 investment advice. In asking the Custodian to open and maintain the Allocated
 Account, the Trustee acknowledges that it is acting pursuant to the Trust
 Agreement and the Custodian shall not owe to the Trustee or the Trust any
 duty to exercise any judgment on their behalf as to the merits or suitability
 of any deposits into, or withdrawals from, the Allocated Account.

 

14

	
  

 	
  

 
	
 15.3

 	
 Rights
 and Remedies: The Custodian hereby waives any
 right it has or may hereafter acquire to combine, consolidate or merge the
 Metal Accounts with any other account of the Trust or the Trustee or to set
 off any liabilities of the Trust or of the Trustee to the Custodian and
 agrees that it may not set off, transfer or combine or withhold payment of
 any sum standing to the credit or to be credited to the Metal Accounts in or
 towards or conditionally upon satisfaction of any liabilities to it of the
 Trust or the Trustee. Subject thereto, the Custodian’s rights under this
 Agreement are in addition to, and independent of, any other rights which the
 Custodian may have at any time in relation to the Bullion.

 
	
  

 	
  

 
	
 15.4

 	
 Assignment:
 This Agreement is for the benefit of and binding upon the parties hereto
 and their respective successors and assigns. Save as expressly provided
 herein, no party may assign, transfer or encumber, or purport to assign,
 transfer or encumber, any right or obligation under this Agreement unless the
 other party otherwise agrees in writing, except that consent is not required
 where the Custodian assigns, transfers or encumbers any right or obligation
 under this Agreement to its Affiliate. This clause shall not restrict the
 Custodian’s power to merge or consolidate with any party, or to dispose of
 all or part of its custody business and further provided that this clause
 shall not restrict the Trust from assigning its rights hereunder to a
 Shareholder to the extent required for the Trust to fulfil its obligations
 under the Trust Agreement.

 
	
  

 	
  

 
	
 15.5

 	
 Amendments:
 Any amendment to this Agreement must be agreed in writing and be signed by
 all of the parties hereto. Unless otherwise agreed, an amendment will not
 affect any legal rights or obligations which may already have arisen.

 
	
  

 	
  

 
	
 15.6

 	
 Partial
 Invalidity: If any of the clauses (or part of a
 clause) of this Agreement becomes invalid or unenforceable in any way under
 the Rules or any law, the validity of the remaining clauses (or part of a
 clause) will not in any way be affected or impaired.

 
	
  

 	
  

 
	
 15.7

 	
 Entire
 Agreement: This document represents the entire
 agreement between the parties hereto in respect of its subject matter save
 for any agreements made with fraudulent intent, and excludes any prior
 agreements or representations. This Agreement supersedes and replaces any
 prior existing agreement between the parties relating to the same subject
 matter. 

 
	
  

 	
  

 
	
 15.8

 	
 Counterparts:
 This Agreement may be executed in any number of counterparts each of which
 when executed and delivered is an original, but all the counterparts together
 constitute the same agreement.

 
	
  

 	
  

 
	
 15.9

 	
 Business
 Days: If any obligation falls due to be
 performed on a day which is not a Business Day, then the relevant obligations
 shall be performed on the next succeeding Business Day.

 

15

	
  

 	
  

 
	
 15.10

 	
 Prior
 Agreements: The Custodian or any member of the
 JPMorgan group of companies (the “JPMorgan Group”) may trade in Shares for
 its own account as principal, may have underwritten or may underwrite an
 issue of Shares or, together with any such entities’ directors, officers or
 employees, may have a long or short position in Shares or in any related
 security or instrument. Brokerage or other fees may be earned by any member
 of the JPMorgan Group or persons associated with them in respect of any
 business transacted by them in all or any of the aforementioned securities or
 instruments. 

 
	
  

 	
  

 
	
 16.

 	
 GOVERNING LAW AND JURISDICTION 

 
	
  

 	
  

 
	
 16.1

 	
 Governing
 Law: This Agreement is governed by, and will be
 construed in accordance with, English law.

 
	
  

 	
  

 
	
 16.2

 	
 Jurisdiction: The
 Trustee and the Custodian agree that the courts of the State of New York, in
 the United States of America, and the United States federal court located in
 the Borough of Manhattan in such state are to have jurisdiction to settle any
 disputes or claims which may arise out of or in connection with this
 Agreement and, for these purposes the Trustee and the Custodian irrevocably
 submits to the non-exclusive jurisdiction of such courts, waive any claim of
 forum non conveniens and any objection to laying of venue, and further waive
 any personal service.

 
	
  

 	
  

 
	
 16.3

 	
 Waiver
 of Immunity: To the extent that the Trustee may in
 any jurisdiction claim for it as Trustee, the Trust or its assets any
 immunity from suit, judgment, enforcement or otherwise howsoever, the Trustee
 agrees not to claim and irrevocably waives any such immunity which it would
 otherwise be entitled to (whether on grounds of sovereignty or otherwise) to
 the full extent permitted by the laws of such jurisdiction.

 
	
  

 	
  

 
	
 16.4

 	
 Service
 of Process: Process by which any proceedings are
 begun may be served on a party by being delivered to the party’s address
 specified below. This does not affect any right to serve process in another
 manner permitted by law. 

 
	
  

 	
  

 
	
  

 	
 Custodian’s
 Address for service of process:

 
	
  

 	
  

 
	
  

 	
 JPMorgan Chase Bank, N.A. 

 
	
  

 	
 125 London Wall

 
	
  

 	
 London EC2Y 5AJ

 
	
  

 	
 Facsimile
 No.          +44 207 777
 4915

 
	
  

 	
 Attention: Peter Smith – Global
 Commodities

 
	
  

 	
  

 
	
  

 	
 With a copy to:

 
	
  

 	
  

 
	
  

 	
 JPMorgan Chase Bank, N.A.

 
	
  

 	
 125 London Wall, 13th Floor

 
	
  

 	
 London EC2Y 

 
	
  

 	
 Facsimile No.: +44 (0)20 7325 8150

 
	
  

 	
 Attention: Legal Department-FX and Derivatives Group

 

16

	
  
 	
  
 
	 
	Trustee’s Address
             for service of process:

	
  

 	
  

 
	
  
 	
 The Bank of New York Mellon
 
	
  
 	
 One Wall Street
 
	
  
 	
 New York, New York 10286 
 
	
  
 	
 Attention: Legal Department 
 

17

EXECUTED
by the Parties: 

Signed on behalf of and for JPMORGAN CHASE BANK, N.A. by 

	
  

 	
  

 	
  

 
	
 Signature

 	 

 	
  

 

	
  

 	
  

 	
  

 
	
 Name

 	 

 	
  

 

	
  

 	
  

 	
  

 
	
 Title

 	 

 	
  

 

Signed on behalf of and for 

THE BANK OF NEW YORK MELLON, solely in its
capacity as trustee of the ETFS 

Palladium Trust and not individually by 

	
  

 	
  

 	
  

 
	
 Signature

 	 

 	
  

 

	
  

 	
  

 	
  

 
	
 Name

 	 

 	
  

 

	
  

 	
  

 	
  

 
	
 Title

 	 

 	
  

 

	
  

 	
  

 	
  

 
	
 Signature

 	 

 	
  

 

	
  

 	
  

 	
  

 
	
 Name

 	 

 	
  

 

	
  

 	
  

 	
  

 
	
 Title

 	 

 	
  

 

18

Schedule 1

Notice to Zurich Sub-Custodians

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 
	
 From:

 	
 JPMorgan Chase Bank, N.A. 

 
	
  

 	
 125 London Wall

 
	
  

 	
 London
 EC2Y 5AJ 

 
	
  

 	
  

 
	
 To:

 	
 [Zurich
 Sub-Custodian]

 
	
  

 	
  

 
	
 Date:

 	
  

 
	
  

 	
  

 
	
 Dear Sirs

 
	
  

 	
  

 
	
 Allocated
 Account Agreement (the “Agreement”)

 dated _______________ between

 The Bank of New York Mellon (the “Trustee”)
 and

 JPMorgan Chase Bank, N.A. (the “Custodian”)

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	 

 	
  

 

We
hereby give you notice that pursuant to the above-captioned Agreement certain
of the palladium(“Bullion”) that we
may deliver to you or arrange to be delivered to you belongs to the ETFS
Palladium Trust (the “Trust”)
and/or the Trustee (as trustee for the holders of certain securities of the
Trust) and under such Agreement we have agreed to require you: (a) to segregate
the Bullion from any palladium which you own or hold for others and (b) to
segregate the Bullion from any palladium which you hold for the Custodian and
any other customers of the Custodian, in each case by making appropriate
entries in your books and records.

Please
sign and return the enclosed copy of this notice to us and the Trustee (with a
copy to ETF Securities USA UC, the Sponsor of the Trust) by way of your
confirmation that you have received this notice and will comply with the
requirements of the above paragraph.

This letter is governed by
English law.

Yours faithfully

	
  

 	
  

 
	 

 	
  

 
	
 for an on behalf of

 
	
 JPMorgan
 Chase Bank, N.A. 

 

19

Schedule 2

Acknowledgement from Zurich Sub-Custodians

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 
	
 From:

 	
 [Zurich Sub-Custodian]

 
	
  

 	
  

 
	
 To:

 	
 JPMorgan Chase Bank, N.A. 

 
	
  

 	
 125 London Wall

 
	
  

 	
 London
 EC2Y 5AJ 

 
	
  

 	
  

 
	
 To:

 	
 ETF Securities USA LLC

 
	
  

 	
 c/o ETF Securities
 Representative Office

 
	
  

 	
 6th Floor

 
	
  

 	
 2 London Wall Buildings

 
	
  

 	
 London EC2M5UU

 
	
  

 	
 Attention: US Fund
 Services

 
	
  

 	
  

 
	
 To:

 	
 ETFS
 PalladiumTrust 

 
	
  

 	
 c/o
 The Bank of New York Mellon

 
	
  

 	
 Two
 Hanson Place

 
	
  

 	
 Brooklyn,
 NY 11217 

 
	
  

 	
 Attention:
 Donald Guire 

 
	
  

 	
  

 
	
 Date:

 
	
  

 	
  

 
	
 Dear Sirs

 
	
  

 	
  

 
	
 Allocated
 Account Agreement (the “Agreement”)

 dated _______________ between

 The Bank of New York Mellon (the “Trustee”)
 and

 JPMorgan Chase Bank, N.A. (the “Custodian”)

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	 

 	
  

 

We
hereby acknowledge receipt of the letter of which the attached is a copy and undertake
in relation to all Bullion (as defined in such letter):

	
  

 	
  

 
	
 (a)

 	
 to
 segregate the Bullion from any palladium which we own or hold for others; and 

 
	
  

 	
  

 
	
 (b)

 	
 to
 segregate the Bullion from any palladium which we hold for the Custodian and
 any other customers of the Custodian, 

 

and in each case we will
make appropriate entries in our books and records.

Yours faithfully

	
  

 	
  

 
	 

 	
  

 
	
 duly authorised

 for and on behalf of

 [Zurich Sub-Custodian]

 

20Exhibit 10.2 

	
  

 	
  

 	
  

 
	
 JPMORGAN CHASE BANK, N.A.

 
	
  

 	
  

 	
  

 
	
 and

 
	
  

 	
  

 	
  

 
	
 THE BANK OF NEW YORK MELLON

 
	
 solely in its capacity as trustee of the ETFS Palladium Trust

 
	
 and not individually

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	 

 	
  

 
	
  

 	
  

 	
  

 
	
 UNALLOCATED ACCOUNT AGREEMENT

 
	
  

 	
  

 	
  

 
	
  

 	 

 	
  

 

THIS AGREEMENT is
made with effect on and from [_______], 2009

BETWEEN 

	
  

 	
  

 
	
 (1)

 	
 JPMORGAN CHASE
 BANK, N.A,
 whose principal place of business in England is at 125 London Wall, London
 EC2Y 5AJ (the “Custodian”); and

 
	
  

 	
  

 
	
 (2)

 	
 THE BANK OF NEW
 YORK MELLON, a New York banking corporation, solely in its capacity as
 trustee of the ETFS Palladium Trust created under the Trust Agreement
 identified below and not individually (the “Trustee”), which expression shall,
 wherever the context so admits, include the named Trustee and all other
 persons or companies for the time being the trustee or trustees of the Trust
 Agreement (as defined below) as trustee for the Shareholders (as defined
 below). 

 
	
  

 	
  

 
	
 INTRODUCTION 

 
	
  

 	
  

 
	
 (1)

 	
 The Trustee has agreed to act as trustee for the Shareholders of the Shares pursuant to the
 Trust Agreement.

 
	
  

 	
  

 
	
 (2)

 	
 An Authorized Participant may apply to become a Shareholder by: (i)
 applying for Shares in accordance with an Authorized Participant Agreement
 and (ii) depositing the relevant amount of Bullion into the Unallocated
 Account.

 
	
  

 	
  

 
	
 (3)

 	
 The Custodian has agreed to transfer Bullion deposited into the
 Unallocated Account to the Allocated Account and where applicable, other
 accounts, pursuant to the terms of this Agreement. 

 
	
  

 	
  

 
	
 (4)

 	
 In order to effect redemptions of Shares, Bullion must be transferred
 from the Allocated Account to the Unallocated Account by way of
 de-allocation, and must then be delivered to the Shareholder Account.

 
	
  

 	
  

 
	
 (5)

 	
 The Trustee has agreed that the Unallocated Account will be
 established by the Trustee for the account of the Trust, and that the Trustee
 will have the sole right to give instructions for the making of any payments
 into or out of the Unallocated Account.

 
	
  

 	
  

 
	
 IT IS AGREED AS FOLLOWS 

 
	
  

 
	
 1.

 	
 INTERPRETATION 

 
	
  

 	
  

 
	
 1.1

 	
 Definitions:
 Words and expressions defined in the Prospectus, unless otherwise defined
 herein, have the same meanings when used in this Agreement. In addition, in
 this Agreement, unless there is anything in the subject or context
 inconsistent therewith the following expressions shall have the following meanings:
 

 
	
  

 	
  

 
	
  

 	
 “Affiliate” means an entity that directly or indirectly
 through one or more

 

1

	
  

 	
  

 
	
  

 	
 intermediaries, controls, or is controlled by, or is under
 common control with the Custodian;

 
	
  

 	
  

 
	
  

 	
 “Allocated Account” means the loco London allocated Bullion
 account, number [     ], or the loco Zurich allocated Bullion account, number [     ], each established in the name of the Trustee, with the Custodian pursuant
 to the Allocated Account Agreement;

 
	
  

 	
  

 
	
  

 	
 “Allocated Account Agreement” means the Allocated Account
 Agreement dated [ ] between the Trustee and the Custodian pursuant to which
 the Allocated Account is established and operated; 

 
	
  

 	
  

 
	
  

 	
 “AP Account”
 means a loco London or Zurich account maintained on an unallocated basis by
 the Custodian or a Bullion clearing bank for the Authorized Participant, as
 specified in the applicable Transfer Notice;

 
	
  

 	
  

 
	
  

 	
 “Application” means an offer by an Authorized Participant to
 the Trust (in the form prescribed by the Trust) to subscribe for Shares,
 being an offer on terms referred to in the Prospectus and in accordance with
 the provisions of the relevant Authorized Participant Agreement;

 
	
  

 	
  

 
	
  

 	
 “Application Date” means the New York Business Day on which a
 valid Application Form is received (or deemed to be received) by the Trustee
 in accordance with the relevant Authorized Participant Agreement;

 
	
  

 	
  

 
	
  

 	
 “Application Form” means a Purchase Order as defined in the
 Authorized Participant Agreement;

 
	
  

 	
  

 
	
  

 	
  “Authorized Participant”
 means a person which has entered into an Authorized Participant Agreement
 with the Sponsor and the Trustee in relation to Shares and which: (a) is a
 person who (i) is a registered broker-dealer or other securities market
 participant such as a bank or other financial institution which is not
 required to register as a broker-dealer to engage in securities transactions
 and (ii) is a participant in DTC; (b) is approved by the Sponsor (in its
 absolute discretion); and (c) has established an AP Account;

 
	
  

 	
  

 
	
  

 	
 “Authorized Participant Agreement” means a written agreement
 between the Trustee, the Sponsor and another person under which such
 person is appointed to act as an “Authorized Participant,” in relation to
 Shares and if such agreement is subject to conditions precedent, provided
 that such conditions have been satisfied; 

 
	
  

 	
  

 
	
  

 	
 “Authorized Signatory”
 means, in relation to any person, an individual who is duly empowered to bind
 such person and whose authority is evidenced by a resolution of the board of
 directors (or any other appropriate means of authorisation) of such person,
 and, in relation to the Trustee, any individual named in the Trustee’s
 Authorized Signatory list having due authority to bind the Trustee, which
 list shall be provided by the Trustee from time to time; 

 
	
  

 	
  

 
	
  

 	
 “Availability Date”
 means the London/Zurich Business Day on which the 

 

2

	
  

 	
  

 
	
  

 	
 Trustee requests the Custodian to credit to the Unallocated Account
 Bullion debited from the Allocated Account;

 
	
  

 	
  

 
	
  

 	
 “Benchmark Price” means, as of any day, that publicly
 available per ounce price of Bullion used by the Trust on such day to value
 the Trust’s Bullion, which is expected to be the London PM Fix but is subject
 to change by the Sponsor in accordance with the Trust Agreement;

 
	
  

 	
  

 
	
  

 	
 “Bullion” means palladium in physical form complying with the
 Rules of the Relevant Association held by the Custodian or any Sub-Custodian
 under the Allocated Account Agreement and/or any credit balance in the
 Unallocated Account as the context requires;

 
	
  

 	
  

 
	
  

 	
 “Conditions” means the terms and conditions on and subject to
 which Shares are issued in the form or substantially in the form set out in
 the Trust Agreement;

 
	
  

 	
  

 
	
  

 	
  “General Notice” means
 any notice given in accordance with this Agreement other than a Transfer
 Notice;

 
	
  

 	
  

 
	
  

 	
 “Loco London” means in respect of an account holding Bullion,
 the custody, trading or clearing of such Bullion in London, United Kingdom;

 
	
  

 	
  

 
	
  

 	
 “Loco Zurich” means in respect of an account holding Bullion,
 the custody, trading or clearing of such Bullion in Zurich, Switzerland;

 
	
  

 	
  

 
	
  

 	
 “London Business Day” means a day (other than a Saturday or a
 Sunday or a public holiday in England) on which commercial banks generally
 and the London palladium market are open for the transaction of business in
 London;

 
	
  

 	
  

 
	
  

 	
  “London/Zurich
 Business Day” means a day which is both a London
 Business Day and a Zurich Business Day;

 
	
  

 	
  

 
	
  

 	
 “Management Fee” means
 the amount of Bullion which may be debited from the Metal Accounts at the end
 of each month and paid to the Sponsor Account in accordance with the terms of
 the Prospectus;

 
	
  

 	
  

 
	
  

 	
 “Metal Accounts” means
 the Allocated Account and the Unallocated Account; 

 
	
  

 	
  

 
	
  

 	
  “Metal Entitlement”
 means as at any date and in relation to any Share the amount(s) of Bullion to
 which the Shareholder is entitled on Redemption of that Share on that date in
 accordance with the Conditions;

 
	
  

 	
  

 
	
  

 	
  “New York Business
 Day” means a “Business Day” as defined in the Trust
 Agreement;

 
	
  

 	
  

 
	
  

 	
 “Point of Delivery” means such date and time that the
 recipient (or its agent) acknowledges in written form its receipt of delivery
 of Bullion;

 

3

	
  

 	
  

 
	
  

 	
  “Prospectus”
 means the prospectus constituting a part of the registration statement filed
 on Form S-1, Registration Number 333-158380 with the Securities Exchange
 Commission in accordance with the U.S. Securities Act of 1933, as amended, in
 relation to the Shares dated on or about [     ], 2009 as the same may be
 modified, supplemented or amended from time to time;

 
	
  

 	
  

 
	
  

 	
 “Redemption” means the redemption of Shares by the Trust in
 accordance with the Conditions;

 
	
  

 	
  

 
	
  

 	
 “Redemption Obligations” means the obligation of the Trust on
 Redemption of a Share to make payment or deliver Bullion to the relevant
 Authorized Participant or Shareholder in accordance with the Conditions;

 
	
  

 	
  

 
	
  

 	
 “Relevant Association” means the London Platinum and
 Palladium Market or its successors;

 
	
  

 	
  

 
	
  

 	
 “Rules” means the rules,
 regulations, practices and customs of the Relevant Association (including
 without limitation the rules as to Good Delivery), the Bank of England and
 such other regulatory authority or other body as shall affect the activities
 contemplated by this Agreement; 

 
	
  

 	
  

 
	
  

 	
  “Shareholder”
 means the beneficial owner of one or more Shares;

 
	
  

 	
  

 
	
  

 	
  “Shareholder
 Account” means a loco London or Zurich account
 maintained on an unallocated basis by the Custodian or a Bullion clearing bank,
 as applicable, for an Authorized Participant or a Shareholder, as specified
 in the applicable Redemption Notice;

 
	
  

 	
  

 
	
  

 	
  “Shares” means
 the units of fractional undivided beneficial interest in and ownership of the
 Trust which are issued by the Trust and named “ETFS Physical Palladium
 Shares” and created pursuant to and constituted by the Trust Agreement;

 
	
  

 	
  

 
	
  

 	
  “Sponsor” means
 ETF Securities USA LLC, its
 successors and assigns and any successor Sponsor appointed pursuant to the
 Trust Agreement;

 
	
  

 	
  

 
	
  

 	
  “Sponsor Account” means
 a loco London or Zurich account maintained on an unallocated basis by the Custodian or a Bullion clearing
 bank, as applicable, for the Sponsor;

 
	
  

 	
  

 
	
  

 	
  “Transfer Notice” means
 any notice of a deposit or withdrawal made pursuant to clause 3 or clause 4
 of this Agreement;

 
	
  

 	
  

 
	
  

 	
  “Trust” means
 the ETFS Palladium Trust formed pursuant to the Trust Agreement;

 
	
  

 	
  

 
	
  

 	
  “Trust Agreement” means
 the Depositary Trust Agreement of the ETFS Palladium Trust dated on or about [     ], as amended from time to time,
 between the ETF Securities USA LLC,
 as Sponsor, and The Bank of New York Mellon, as Trustee; 

 

4

	
  

 	
  

 
	
  

 	
 “Unallocated Account” means the loco London unallocated
 Bullion account, number [     ], or the loco Zurich unallocated Bullion account,
 number [     ], each established in the name of the Trustee, with the Custodian
 pursuant to this Agreement on an Unallocated Basis;

 
	
  

 	
  

 
	
  

 	
  “Unallocated Basis”
 means, with
 respect to an Unallocated Account maintained with the Custodian, that the
 person in whose name the account is held is entitled to delivery in
 accordance with the Rules of an amount of Bullion equal to the amount of
 Bullion standing to the credit of the person’s account but is an unsecured
 creditor in any Bullion that the Custodian owns or holds.

 
	
  

 	
  

 
	
  

 	
 “VAT” means value added
 tax as provided for in the Value Added Tax Act 1994 (as amended or re-enacted
 from time to time) and legislation supplemental thereto and any other tax
 (whether imposed in the United Kingdom in substitution thereof or in addition
 thereto or elsewhere) of a similar fiscal nature; and

 
	
  

 	
  

 
	
  

 	
 “Withdrawal Date” means the London/Zurich Business Day on
 which the Trustee wishes a withdrawal of Bullion from the Unallocated Account
 to take place.

 
	
  

 	
  

 
	
  

 	
  “Zurich Business
 Day” means a day (other than a Saturday or a Sunday
 or a public holiday in Zurich) on which commercial banks generally and the
 Zurich palladium market are open for the transaction of business in Zurich;
 and

 
	
  

 	
  

 
	
  

 	
 “Zurich Sub-Custodian” means any firm selected by
 the Custodian to hold palladium on behalf of the Custodian in the firm’s
 Zurich vault premises on a segregated basis, in the manner provided in
 clauses 7.2 and 7.3 of the Allocated Account Agreement and whose appointment
 has been approved in writing by the Sponsor (such approval not to be unreasonably
 with held). 

 
	
  

 	
  

 
	
 1.2

 	
 Headings: The
 headings in this Agreement do not affect its interpretation. 

 
	
  

 	
  

 
	
 1.3

 	
 Singular and
 plural: References to the singular include the
 plural and vice versa. 

 
	
  

 	
  

 
	
 2.

 	
 UNALLOCATED ACCOUNT 

 
	
  

 	
  

 
	
 2.1

 	
 Opening
 Unallocated Account: The Custodian shall open
 and maintain the Unallocated Account in the name of the Trustee (in its
 capacity as trustee for the Shareholders).

 
	
  

 	
  

 
	
 2.2

 	
 Denomination of
 Unallocated Account: The Unallocated Account
 will hold deposits of Bullion and will be denominated in fine troy ounces.

 
	
  

 	
  

 
	
 2.3

 	
 Unallocated
 Account Reports: For each London/Zurich Business
 Day, by no later than the following London/Zurich Business Day, the Custodian
 will provide the Trustee access to information showing the increases and decreases

 

5

	
  

 	
  

 
	
  

 	
 to the Bullion standing to the Trustee’s credit in the Unallocated
 Account, and identifying separately each transaction and the New York or
 London Business Day on which it occurred. On each London/Zurich Business Day
 on which Bullion is deposited or that is a Withdrawal Date, the Custodian
 will send the Trustee a notification of (i) each separate transaction
 transferring Bullion to the Unallocated Account, including the amount of
 Bullion transferred to the Unallocated Account and the AP Account or Shareholder
 Account from which such Bullion is transferred, (ii) the amount of Bullion
 transferred from the Unallocated Account to the Allocated Account or to any
 AP Account or Shareholder Account and (iii) the amount of any remaining
 Bullion in the Unallocated Account, and the Custodian will use commercially
 reasonable efforts to send the notification by 9:00 a.m. (New York time). In
 addition, the Custodian will provide the Trustee such information about the
 increases and decreases to the Bullion standing to the Trustee’s credit in
 the Unallocated Account on a same-day basis at such other times and in such
 other form as the Trustee and the Custodian shall agree. For each calendar
 month, the Custodian will provide the Trustee within a reasonable time after
 the end of the month a statement of account for the Unallocated Account. Such reports will be made available to the
 Trustee by means of the Custodian’s proprietary electronic Bullion Transfer
 System website (“eBTS”). In the
 event eBTS is unavailable for any reason, the Trustee and the Custodian will
 agree upon a temporary notification system for making such reports available
 to the Trustee.

 
	
  

 	
  

 
	
 2.4

 	
 Reversal of
 Entries: The Custodian shall reverse any
 provisional or erroneous entries to the Unallocated Account which it
 discovers or of which it is notified with effect back-valued to the date upon
 which the final or correct entry (or no entry) should have been made (including,
 without limitation, where the Custodian has credited a deposit made pursuant
 to clause 3.1(b) and on receipt by the Custodian of the Bullion if it is
 determined that the Bullion does not comply with the Rules or that it is not
 the required weight).

 
	
  

 	
  

 
	
 2.5

 	
 Provision of
 Information: The Custodian agrees that it will
 forthwith notify the Trustee in writing of any encumbrance of which it is
 aware is or is purported to have been created over or in respect of the
 Unallocated Account or any of the amounts standing to the credit thereof. 

 
	
  

 	
  

 
	
 2.6

 	
 Access:
 The Custodian will allow the Sponsor and the Trustee and their Bullion
 auditors (currently Inspectorate International Limited) access to its
 premises during normal business hours, to examine the Bullion and such
 records, as they may reasonably require to perform their respective duties
 with regard to investors in Shares. The Trustee agrees that any such access
 shall be subject to execution of a confidentiality agreement and agreement to
 the Custodian’s security procedures, and such audit shall be at the Trust’s
 expense and shall be limited to no more than twice a calendar year, provided
 however that any second visit within the same calendar year shall be subject
 to the consent of the Custodian, such consent not to be unreasonably
 withheld. 

 
	
  

 	
  

 
	
 3. DEPOSITS

 
	
  

 	
  

 
	
 3.1

 	
 Procedure:
 The Custodian shall receive deposits of Bullion into the

 

6

	
  

 	
  

 	
  

 
	
  

 	
 Unallocated Account (in the manner and accompanied by such
 documentation as the Custodian may require) by: 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 de-allocation of Bullion held in the Allocated Account on redemption
 of Shares by a Shareholder or Authorized Participant or for any other purpose
 authorized by the Trust Agreement; or

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 de-allocation of Bullion held in the Allocated Account for payment of
 the Management Fee; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 transfer of Bullion from an AP Account relating to the same kind of
 Bullion and having the same denomination as that to which the Unallocated
 Account relates on Application by an Authorized Participant for Shares.

 
	
  

 	
  

 	
  

 
	
  

 	
 No other methods of deposit are permitted. 

 
	
  

 	
  

 	
  

 
	
 3.2

 	
 Loco Designation
 for Deposits: The Custodian shall
 receive deposits of Bullion pursuant to clause 3.1 into the Unallocated
 Account loco Zurich or loco London, provided, however, that the Custodian
 shall bear all costs, including all insurance costs, relating to any
 transfers between loco London and loco Zurich.

 
	
  

 	
  

 	
  

 
	
 3.3

 	
 Notice
 Requirements: Notice of intended deposit must be
 received by the Custodian from the Trustee no later than 3:00 p.m. (London
 time) one London/Zurich Business Day prior to the Availability Date and
 specify the weight (in fine troy ounces of palladium) to be credited to the
 Unallocated Account, the Availability Date, the account from which such
 deposit will be transferred, and any other information which the Custodian
 may, with the agreement of the Trustee, from time to time require. When by reference to the Trustee’s
 notifications and instructions to the Custodian, the Custodian reasonably
 believes an amount of Bullion has been credited to the Unallocated Account in
 error, the Custodian will notify the Trustee promptly and, pending a joint
 resolution of the error, will treat such amount as not being subject to the
 standing instruction in clause 5.2 below. 

 
	
  

 	
  

 	
  

 
	
 3.4

 	
 Right to Amend
 Procedure: The Custodian may amend the procedure
 in relation to the deposit of Bullion only where such amendment is caused by
 a change in the Rules or procedures of the Relevant Association. The Custodian will, whenever practicable,
 notify the Trustee and the Sponsor within a commercially reasonable time
 before the Custodian amends its procedures or imposes additional ones in
 relation to the transfer of Bullion into and from the Unallocated Account,
 and in doing so the Custodian will consider the Trustee’s needs to
 communicate any such change to Authorized Participants and others. 

 
	
  

 	
  

 	
  

 
	
 4. WITHDRAWALS

 
	
  

 	
  

 	
  

 
	
 4.1

 	
 Procedure:
 The Trustee may at any time give instructions to the Custodian for the
 withdrawal of Bullion standing to the credit of the Unallocated Account in

 

7

	
  

 	
  

 	
  

 
	
  

 	
 such form as may be agreed by the parties from time to time, provided
 that a withdrawal may be made only by: 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 transfer to a Shareholder Account relating to the same kind of
 Bullion and having the same denomination as that to which the Unallocated
 Account relates when Shares are redeemed; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 transfer to the Sponsor Account for payment of the Management Fee; or

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 transfer of Bullion to the Allocated Account; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 the collection of Bullion from the Custodian at its vault premises,
 or such other location as the Custodian may direct by notice to the party taking
 delivery received not later than one London/Zurich Business Day prior to the
 Availability Date, at the Trust’s expense and risk; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (e)

 	
 delivery of Bullion to such location as the Trustee directs, at the
 Trust’s expense and risk; or

 
	
  

 	
  

 	
  

 
	
  

 	
 (f)

 	
 transfer to an account maintained by the Custodian or by a third
 party on an unallocated basis in connection with the sale of Bullion or other
 transfers permitted under the Trust Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
 and no other methods of withdrawal are permitted, save that the
 Trustee agrees to exercise its rights under clauses 4.1(d) and (e) on an
 exceptional basis only. Any Bullion made available to the relevant person (as
 instructed by the Trustee) pursuant to clauses 4.1(d) and (e) will be in a
 form which complies with the Rules or in such other form as may be agreed
 between the Trustee and the Custodian the combined fine weight of which will
 not exceed the number of fine ounces of Bullion the Trustee has instructed
 the Custodian to debit. The Custodian is entitled to select the Bullion to be
 made available to the relevant person (as instructed by the Trustee) provided
 it is in the same form as that deposited. To the extent that the Trustee is
 authorized to sell Bullion under the Trust Agreement, the Custodian may, but
 is not required to, purchase such Bullion; provided that the Custodian’s
 purchase price for such Bullion must be the Benchmark Price.

 
	
  

 	
  

 	
  

 
	
 4.2

 	
 Loco Designations
 for Withdrawals: The Custodian may transfer
 Bullion from the Unallocated Account loco Zurich or loco London for all
 withdrawals under clause 4.1, provided, however, that the Custodian shall
 bear all costs, including all insurance costs, relating to any transfers
 between loco London and loco Zurich.

 
	
  

 	
  

 	
  

 
	
 4.3

 	
 Notice
 Requirements: Any notice relating to a withdrawal
 of Bullion must be in writing and: 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 if it relates to a withdrawal pursuant to clauses 4.1(a) or 4.1(b),
 to be in such form as may be agreed by the parties from time to time;

 
	
  

 	
  

 	
  

 
	
  

 	
 and in all cases be received by the Custodian no later than 3:00 p.m
 (London

 

8

	
  

 	
  

 	
  

 
	
  

 	
 time) on the Withdrawal Date unless otherwise agreed.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 if it relates to a transfer pursuant to clause 4.1(c), be in the form
 of an Application (which shall be sufficient instruction for the purposes of
 this Agreement) and be received by the Custodian no later than 3:00p.m.
 (London time) on the day which is one London/Zurich Business Day prior to the
 Withdrawal Date. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 if it relates to a withdrawal pursuant to clause 4.1(d) or (e), be
 received by the Custodian no later than 11:30 a.m. (London time) not less
 than two London/Zurich Business Days prior to the Withdrawal Date unless
 otherwise agreed and specify the name of the person or carrier that will
 collect the Bullion from the Custodian or the identity of the person to whom
 delivery is to be made, as the case may be; 

 
	
  

 	
  

 	
  

 
	
  

 	
 and in all cases, specify the weight (in fine troy ounces of palladium) of the Bullion to be debited
 from the Unallocated Account, the Withdrawal Date and any other information
 which the Custodian may, with the agreement of the Trustee from time to time
 require. 

 
	
  

 	
  

 	
  

 
	
 4.4

 	
 Right to Amend
 Procedure: The Custodian may amend the procedure
 for the withdrawal of Bullion from the Unallocated Account only where such
 amendment is caused by a change in the Rules or procedures of the Relevant
 Association. Any such amendment will be subject to the conditions of the
 preceding clause 4.3 and will be promptly notified to the Sponsor and the
 Trustee, such notice to be given in advance of implementation whenever
 practicable. 

 
	
  

 	
  

 	
  

 
	
 4.6

 	
 Delivery
 Obligations: Unless otherwise instructed by the
 Trustee on behalf of the Trust or the relevant person, the Custodian shall
 make any transportation and insurance arrangements in respect of delivery of
 Bullion in accordance with its usual practice. Where instructions are given,
 the Custodian shall use all reasonable efforts to comply with the same. The
 Custodian shall not be obliged to effect any requested delivery if, in its
 reasonable opinion, this would cause the Custodian or its agents to be in
 breach of the Rules or other applicable law, court order or regulation; the
 costs incurred would be excessive or delivery is impracticable for any
 reason. With the exception of any delivery pursuant to clause 4.3, all
 insurance and transportation costs shall be for the account of the Trust.

 
	
  

 	
  

 	
  

 
	
 4.7

 	
 Risk:
 With the exception of any transfer pursuant to clause 4.2, where there is a
 shipment from the Custodian of Bullion, all right, title and risk in and to
 such Bullion shall pass at the Point of Delivery to the relevant person for
 whose account the Bullion is being delivered. 

 
	
  

 	
  

 	
  

 
	
 4.8

 	
 Allocation:
 Subject to clause 5.2 below, in the case of a transfer under clause 4.1(c),
 the Custodian will use its commercially reasonable endeavours to complete the
 allocation of such deposits of Bullion by not later than 2:00 p.m. (London
 time) on the London/Zurich Business Day after receipt of notice given in the
 form prescribed in clause 4.3(b). Following the Custodian’s

 

9

	
  

 	
  

 
	
  

 	
 receipt of such notice, the Custodian shall identify bars or ingots
 of a weight most closely approximating, but not exceeding, the balance in the
 Unallocated Account and shall transfer such weight from the Unallocated
 Account to the Allocated Account. The Trustee acknowledges that the process
 of allocation of Bullion to the Allocated Account from the Unallocated
 Account may involve minimal adjustments to the weights of Bullion to be
 allocated to adjust such weight to the number of whole bars available.

 
	
  

 	
  

 
	
 5. INSTRUCTIONS

 
	
  

 	
  

 
	
 5.1

 	
 Giving of
 Instructions: Only the Trustee shall have the
 right to give instructions to the Custodian for deposit of Bullion to or
 withdrawal of Bullion from the Unallocated Account. All instructions given by
 the Trustee to the Custodian shall be given in writing and signed by two
 Authorized Signatories of the Trustee. The Trustee shall notify the Custodian
 in writing of the names of the people who are authorized to give instructions
 on the Trustee’s behalf. Until the Custodian receives written notice to the
 contrary, the Custodian is entitled to assume that any of those people have
 full and unrestricted power to give instructions on the Trustee’s behalf. The
 Custodian is also entitled to rely on any instructions which are from, or
 which purport to emanate from, any person who appears to have such authority.
 

 
	
  

 	
  

 
	
 5.2

 	
 Continuous
 Allocation of Bullion: Without prejudice to clause 5.1 above, unless
 otherwise notified by the Trustee in writing, the Trustee hereby instructs
 the Custodian that, whenever Bullion is to be transferred from an AP Account
 to the Metal Accounts, it will combine such Bullion with any Bullion then
 standing to the credit of the Unallocated Account (excluding Bullion which
 has been de-allocated in order to effect delivery of Bullion to a redeeming
 Authorized Participant or Shareholder or pursuant to other withdrawal
 occurring on such day) and to the fullest extent possible, transfer such
 Bullion to the Allocated Account such that the amount of Bullion that remains
 standing to the credit of the Trustee in the Unallocated Account does not
 exceed [192] fine ounces at the close of each London/Zurich Business Day. 

 
	
  

 	
  

 
	
 5.3

 	
 Account not to be
 Overdrawn: The Unallocated Account may not at
 any time have a debit balance thereon, and no instruction shall be valid to
 the extent that the effect thereof would be for the Unallocated Account to
 have a debit balance thereon. 

 
	
  

 	
  

 
	
 5.4

 	
 Amendments:
 Once given, instructions continue in full force and effect until they are
 cancelled, amended or superseded. Notice of amendment shall have effect only
 upon actual receipt by the Custodian. 

 
	
  

 	
  

 
	
 5.5

 	
 Unclear or
 Ambiguous Instructions: If, in the Custodian’s
 opinion, any instructions are unclear or ambiguous, the Custodian shall use
 reasonable endeavours (taking into account any relevant time constraints) to
 obtain clarification of those instructions from the Trustee and, failing
 that, the Custodian may in its absolute discretion and without any liability
 on its part, act upon what the Custodian believes in good faith such
 instructions to be or

 

10

	
  

 	
  

 
	
  

 	
 refuse to take any action or execute such instructions until any
 ambiguity or conflict has been resolved to the Custodian’s satisfaction.

 
	
  

 	
  

 
	
 5.6

 	
 Refusal to
 Execute: The Custodian will, where practicable,
 refuse to execute instructions if in the Custodian’s opinion they are or may
 be contrary to the Rules or any applicable law. 

 
	
  

 	
  

 
	
 6. CONFIDENTIALITY

 
	
  

 	
  

 
	
 6.1

 	
 Disclosure to
 Others: Subject to clause 6.2, each of the
 Trustee and the Custodian shall respect the confidentiality of information
 acquired under this Agreement and will not, without the other party’s
 consent, disclose to any other person any transaction or other information
 acquired about the other party, its business or the Trust under this
 Agreement, in the event such other party has made clear, at or before the
 time such information is provided, that such information is being provided on
 a confidential basis.

 
	
  

 	
  

 
	
 6.2

 	
 Permitted
 Disclosures: Each party accepts that from time
 to time any other party may be required by law or the Rules, or requested by
 a government department or agency, fiscal body or regulatory or listing
 authority or as otherwise necessary in conducting the Trust’s business, to
 disclose information acquired under this Agreement. In addition, the
 disclosure of such information may be required by a party’s auditors, by its
 legal or other advisors, by a company which is in the same group of companies
 as a party (i.e., a subsidiary or holding company of a party) or (in
 the case of the Trustee) by any beneficiary of the trusts constituted by the
 Trust Agreement. Each party irrevocably authorises the others to make such
 disclosures without further reference to such party. 

 
	
  

 	
  

 
	
 7. CUSTODY SERVICES

 
	
  

 	
  

 
	
 7.1

 	
 Appointment:
 The Trustee hereby appoints the Custodian to act as custodian of the Bullion
 in accordance with this Agreement and any Rules which apply to the Custodian.
 

 
	
  

 	
  

 
	
 7.2

 	
 Safekeeping of Bullion: The Custodian will
 be responsible for the safekeeping of the Bullion on the terms and conditions
 of this Agreement. 

 
	
  

 	
  

 
	
 7.3

 	
 Ownership of Bullion: The Custodian will
 identify in its books that the Bullion belongs to the Trustee (on trust for
 the Shareholders).

 
	
  

 	
  

 
	
 8. REPRESENTATIONS

 
	
  

 	
  

 
	
 8.1

 	
 Trustee’s
 Representations: The Trustee represents and
 warrants to the Custodian that (such representations and warranties being
 deemed to be repeated upon each occasion of withdrawal of Bullion under this
 Agreement): 

 

	
  

 	
  

 	
  

 
	
  

 	
  (1)

 	
 the Trustee has all necessary authority, powers, consents, licences
 and authorisations (which have not been revoked) and has taken all 

 

11

	
  

 	
  

 	
  

 
	
  

 	
  

 	
 necessary action to enable it lawfully to enter into and perform its
 duties and obligations under this Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
 (2)

 	
 the persons entering into this Agreement on the Trustee’s behalf have
 been duly authorized to do so; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (3)

 	
 this Agreement and the obligations created under it are binding upon
 and enforceable against the Trustee, as trustee of the Trust, in accordance
 with its terms (subject to applicable principles of equity) and do not and
 will not violate the terms of the Rules or any order, charge or agreement by
 which the Trustee is bound. 

 

	
  

 	
  

 	
  

 	
  

 
	
 8.2

 	
 Custodian’s
 Representations: The Custodian represents and
 warrants to the Trust that (such representations and warranties being deemed
 to be repeated upon each occasion of withdrawal of Bullion under this
 Agreement): 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (1)

 	
 the Custodian has all necessary authority, powers, consents, licences
 and authorisations (which have not been revoked) and has taken all necessary
 action to enable it lawfully to enter into and perform its duties and
 obligations under this Agreement; 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (2)

 	
 the persons entering into this Agreement on behalf of the Custodian
 have been duly Authorized to do so; and 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (3)

 	
 this Agreement and the obligations created under it are binding upon
 the Custodian and enforceable against the Custodian in accordance with its
 terms (subject to applicable principles of equity) and do not and will not
 violate the terms of the Rules or any order, charge or agreement by which the
 Custodian is bound. 

 

	
  

 	
  

 
	
 9. FEES AND EXPENSES 

 
	
  

 	
  

 
	
 9.1

 	
 Fees:
 There will be no fees charged by the Custodian for the services provided by
 it under this Agreement. Payment of such fees will be made by the Sponsor
 under the Allocated Account Agreement.

 
	
  

 	
  

 
	
 9.2

 	
 Expenses:
 The Trustee has procured the Sponsor’s written agreement, to which the
 Custodian has agreed, to pay to the Custodian on demand all costs, charges
 and expenses (excluding (i) any relevant taxes and VAT, duties and other
 governmental charges, (ii) fees for storage and insurance of the Bullion,
 which will be recovered under the Allocated Account Agreement, and (iii)
 indemnification obligations of the Trustee under clause 11.5, which will be
 paid under the following sentence) incurred by the Custodian in connection
 with the performance of its duties and obligations under this Agreement or
 otherwise in connection with the Bullion. The Trustee will procure payment on
 demand, solely from and to the extent of the assets of the Trust, any other
 costs, charges and expenses not paid by the Sponsor under its agreement with
 the Custodian procured under this clause 9.2 (including any relevant taxes
 and VAT, duties, other governmental charges and indemnification claims of the
 Custodian payable by the Trustee pursuant to clause 11.5, but excluding fees 

 

12

	
  

 	
  

 
	
  

 	
 for storage and insurance of the Bullion, which will be recovered
 under the Allocated Account Agreement) incurred by the Custodian in
 connection with the Bullion.

 
	
  

 	
  

 
	
 9.3

 	
 Default Interest:
 If the Trustee and the Sponsor fail to procure payment to the Custodian
 any amount when it is due, the Custodian reserves the right to charge
 interest (both before and after any judgment) on any such unpaid amount
 calculated at a rate equal to 1% above the overnight London Interbank Offered
 Rate (LIBOR) for the currency in which the amount is due. Interest will
 accrue on a daily basis and will be due and payable as a separate debt. 

 
	
  

 	
  

 
	
 9.4

 	
 Credit Balances: No
 interest or other amount will be paid by the Custodian on any credit balance
 on an Unallocated Account.

 
	
  

 	
  

 
	
 9.5

 	
 Recovery from
 Trust: Amounts payable pursuant to this clause 9
 shall not be debited from the Unallocated Account, but shall be payable on
 behalf of the Trust, and the Custodian hereby acknowledges that it will have
 no recourse against Bullion standing to the credit of the Unallocated Account
 or to the Trustee in respect of any such amounts.

 
	
  

 
	
 10. VALUE ADDED TAX 

 
	
  

 	
  

 
	
 10.1

 	
 VAT Inclusive:
 All sums payable under this Agreement by the Trust to the Custodian shall be
 deemed to be inclusive of VAT if and to the extent VAT is properly chargeable
 on any supplies made by the Custodian to the Trust pursuant to this
 Agreement. 

 
	
  

 	
  

 
	
 10.2

 	
 VAT
 Invoice: If VAT is properly chargeable on any
 supplies made by the Custodian to the Trust pursuant to this Agreement, the
 Custodian shall provide a valid VAT invoice to the Trust. 

 
	
  

 	
  

 
	
 11. SCOPE OF RESPONSIBILITY 

 
	
  

 	
  

 
	
 11.1

 	
 Exclusion of
 Liability: The Custodian will use reasonable
 care in the performance of its duties under this Agreement and will only be
 responsible for any loss or damage suffered as a direct result of any
 negligence, fraud or wilful default on its part in the performance of its
 duties, and in which case its liability will not exceed the market value of
 the Bullion lost or damaged at the time such negligence, fraud or wilful
 default is discovered by the Custodian, provided that the Custodian notifies
 the Trust and the Trustee promptly after any discovery of such lost or
 damaged Bullion. If the Custodian delivers from the Unallocated Account
 Bullion that is not of the fine weight the Custodian has represented to the
 Trustee, recovery by the Trustee, to the extent such recovery is otherwise
 allowed, shall not be barred by any delay in asserting a claim because of the
 failure to discover such loss or damage regardless of whether such loss or
 damage could or should have been discovered.

 
	
  

 	
  

 
	
 11.2

 	
 No Duty or
 Obligation: The Custodian is under no duty or
 obligation to make or take any special arrangements or precautions beyond
 those required by the Rules or as specifically set forth in this Agreement. 

 

13

	
  

 	
  

 
	
 11.3

 	
 Insurance:
 The Custodian (or one of its Affiliates) shall make such insurance
 arrangements from time to time in connection with the Custodian’s custodial
 obligations under this Agreement as the Custodian considers appropriate and
 will be responsible for all costs, fees and expenses (including any relevant
 taxes) in relation to such insurance policy or policies. Upon reasonable
 prior written notice, in connection with the preparation of the initial
 registration statement under the United States Securities Act of 1933, as
 amended, covering any Shares, the Custodian will allow its insurance to be
 reviewed by the Trustee and by the Sponsor. The Custodian also will allow the
 Trustee and the Sponsor to review such insurance in connection with any
 amendment to that initial registration statement and from time to time, in
 each case upon reasonable prior written notice from the Trustee. Any
 permission to review the Custodian’s insurance is limited to the term of this
 agreement and is conditioned on the reviewing party executing a form of
 confidentiality agreement provided by the Custodian, or if the
 confidentiality agreement is already in force, acknowledging that the review
 is subject thereto.

 
	
  

 	
  

 
	
 11.4

 	
 Force Majeure:
 The Custodian shall not be liable for any delay in performance, or for the
 non-performance of any of its obligations under this Agreement by reason of
 any cause beyond the Custodian’s reasonable control. This includes any act of
 God or war or terrorism or any breakdown, malfunction or failure of
 transmission, communication or computer facilities, industrial action, acts
 and regulations of any governmental or supra national bodies or authorities
 or regulatory or self-regulatory organization or failure of any such body,
 authority or organization, for any reason, to perform its obligations;
 provided, however, that the Custodian agrees to use reasonable efforts to
 assist the Trustee in finding a replacement custodian (including, but not
 limited to, agreeing to an assignment of its rights and obligations
 hereunder) should any event described in this clause 11.4 so prevent the
 Custodian from performing its obligations.

 
	
  

 	
  

 
	
 11.5

 	
 Indemnity:
 The Trustee, solely from and to the extent of the assets of the Trust, shall
 indemnify and keep indemnified the Custodian (on an after tax basis) on
 demand against all costs and expenses, damages, liabilities and losses (other
 than VAT and the expenses assumed by the Sponsor under its agreement with the
 Custodian procured under clause 9.2) which the Custodian may suffer or incur,
 directly or indirectly in connection with this Agreement except to the extent
 that such sums are due directly to the negligence, wilful default or fraud of
 the Custodian. 

 
	
  

 	
  

 
	
 11.6

 	
 Third Parties:
 Except with respect to the Trust, which shall be considered a beneficiary of
 this entire Agreement, and the Sponsor, which shall be a beneficiary (as
 applicable) of clauses 2.6 and 11.3, the Custodian does not owe any duty or
 obligation or have any liability towards any person who is not a party to
 this Agreement. Except as set forth in this clause 11.6, this Agreement does
 not confer a benefit on any person who is not a party to it. The parties to
 this Agreement do not intend that any term of this Agreement shall be
 enforceable by any person who is not a party to it and do intend that the
 Contracts (Rights of Third Parties) 1999 Act shall not apply to this
 Agreement, 

 

14

	
  

 	
  

 
	
  

 	
 provided that the Sponsor may enforce its rights under clauses 2.6
 and 11.3. Nothing in this paragraph is intended to limit the obligations
 hereunder of any successor Trustee of the Trust or to limit the right of any
 successor Trustee of the Trust to enforce the Custodian’s obligations
 hereunder.

 
	
  

 	
  

 
	
 12. TERM AND TERMINATION

 
	
  

 	
  

 
	
 12.1

 	
 Method:
 Subject to clause 12.2 below, either the Trustee or the Custodian may
 terminate this Agreement for any reason including if the Custodian or Zurich
 Sub-Custodian ceases to offer the services contemplated by this Agreement to
 its clients or proposes to withdraw from the Bullion business, by giving not
 less than 90 days’ written notice to the other party. Any such notice given
 by the Trustee must specify: 

 

	
  

 	
  

 	
  

 
	
  

 	
 (1)

 	
 the date on
 which the termination will take effect; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (2)

 	
 the person
 to whom the Bullion is to be made available; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (3)

 	
 all other
 necessary arrangements for the redelivery of the Bullion to the order of the
 Trustee. 

 

	
  

 	
  

 	
  

 	
  

 
	
 12.2

 	
 Term:
 This Agreement shall have a fixed term up to and including five years and
 will automatically renew for a further term of five years thereafter unless
 terminated by the parties in accordance with this clause 12; provided that during such periods this
 Agreement may be terminated immediately upon written notice as follows: 

 

	
  

 	
  

 	
  

 
	
  

 	
 (1)

 	
 by the Trustee, if the Custodian ceases to offer the services
 contemplated by this Agreement to its clients or proposes to withdraw from
 the Bullion business; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (2)

 	
 by the Trustee or the Custodian, if it becomes unlawful for the Custodian
 to be a party to this Agreement or to offer its services to the Trust on the
 terms contemplated by this Agreement or if it becomes unlawful for the
 Trustee or the Trust to receive such services or for the Trustee to be a
 party to this Agreement; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (3)

 	
 by the Custodian, if there is any event which, in the Custodian’s
 reasonable view, indicates the Trust’s insolvency or impending insolvency; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (4)

 	
 by the Trustee, if there is any event which, in the Trustee’s sole
 view, indicates the Custodian’s insolvency or impending insolvency; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (5)

 	
 by the Trustee, if the Trust is to be terminated; or

 
	
  

 	
  

 	
  

 
	
  

 	
 (6)

 	
 by the Trustee or by the Custodian, if the Allocated Account
 Agreement ceases to be in full force and effect at any time.

 

	
  

 	
  

 	
  

 	
  

 
	
 12.3

 	
 Change in Trustee:
 If there is any change in the identity of the Trustee in

 

15

	
  

 	
  

 
	
  

 	
 accordance with the Trust Agreement, then the Custodian, the Trustee
 and the Trust shall execute such documents and shall take such actions as the
 new Trustee and the outgoing Trustee may reasonably require for the purpose
 of vesting in the new Trustee the rights and obligations of the outgoing
 Trustee, and releasing the outgoing Trustee from its future obligations under
 this Agreement. 

 
	
  

 	
  

 
	
 12.4

 	
 Redelivery
 Arrangements: If the Trustee does not make
 arrangements acceptable to the Custodian for the redelivery of the Bullion
 the Custodian may continue to store the Bullion, in which case the Custodian
 will continue to charge the fees and expenses payable under clause 10 of the
 Allocated Account Agreement. If the Trustee has not made arrangements
 acceptable to the Custodian for the redelivery of the Bullion within six
 months of the date specified in the termination notice as the date on which
 the termination will take effect, the Custodian will be entitled to sell the
 Bullion and account to the Trustee for the proceeds. 

 
	
  

 	
  

 
	
 12.5

 	
 Existing Rights:
 Termination shall not affect rights and obligations then outstanding under
 this Agreement which shall continue to be governed by this Agreement until
 all obligations have been fully performed. 

 
	
  

 	
  

 
	
 13. NOTICES

 
	
  

 	
  

 
	
 13.1

 	
 Transfer Notices: Subject
 to clause 5.1, any Transfer Notice shall be in writing in English and shall
 be marked “Urgent – This Requires Immediate Attention” and signed by or on
 behalf of the party giving it (or its duly Authorized representative). Any
 Transfer Notice shall be sent either by facsimile or such other authenticated
 method as may, from time to time, be agreed between the parties. Any Transfer
 Notice shall be deemed to have been given, made or served upon actual receipt
 by the recipient.

 
	
  

 	
  

 
	
 13.2

 	
 General Notices:
 Any General Notice shall be in writing in English and shall be marked “Urgent
 – This Requires Immediate Attention” and shall be signed by or on behalf of
 the party giving it (or its duly Authorized representative). Any General
 Notice shall be given, made or served by sending the same by pre-paid
 registered post (first class if inland, first class airmail if overseas) or
 facsimile transmission. Any General Notice sent by pre-paid registered post
 shall be deemed to have been received three London/Zurich Business Days in
 the case of inland post or seven London/Zurich Business Days in the case of
 overseas post after dispatch. Any General Notice sent by facsimile shall be
 deemed to have been given, made or served upon actual receipt by the recipient.

 
	
  

 	
  

 
	
 13.3

 	
 The
 addresses and numbers of the parties for the purposes of clauses 13.1 and
 13.2 are:

 

	
  

 	
  

 	
  

 
	
  

 	
 The Custodian:

 	
 JPMorgan Chase Bank, N.A. 

 
	
  

 	
  

 	
 125 London Wall, London EC2Y 5AJ

 
	
  

 	
  

 	
 Attention:
 Peter Smith – Global Commodities

 
	
  

 	
  

 	
 Facsimile
 No. +44 207 777 4915

 

16

	
  

 	
  

 	
  

 
	
  

 	
 The Trustee:

 	
  

 
	
  

 	
  

 	
 The Bank of
 New York Mellon

 
	
  

 	
  

 	
 2 Hanson
 Place

 
	
  

 	
  

 	
 Brooklyn,
 New York 11217

 
	
  

 	
  

 	
 Attention:
 Donald Guire

 
	
  

 	
  

 	
 Facsimile:
 718-315-4927

 

	
  

 	
  

 	
  

 
	
  

 	
 or such other address or facsimile number as shall have been notified
 (in accordance with this clause) to the other party hereto. The address and
 numbers of the Sponsor for purposes of receiving notices under this Agreement
 is:

 
	
  

 	
  

 
	
  

 	
 The Sponsor:

 	
  

 
	
  

 	
  

 	
 ETF
 Securities USA LLC

 
	
  

 	
  

 	
 c/o ETF
 Securities Representative Office 

 
	
  

 	
  

 	
 6th
 Floor

 
	
  

 	
  

 	
 2 London
 Wall Buildings

 
	
  

 	
  

 	
 London EC2M
 5UU

 
	
  

 	
  

 	
 Telephone:
 +442074404330 

 
	
  

 	
  

 	
 Attention:
 US Fund Services 

 
	
  

 	
  

 
	
 13.4

 	
 Recording of
 Calls: Each of the Custodian and the Trustee may
 record telephone conversations without use of a warning tone. Such records
 will be the recording party’s sole property and accepted by the other parties
 hereto as evidence of the orders or instructions given. 

 
	
  

 	
  

 
	
 14. GENERAL

 	
  

 
	
  

 	
  

 
	
 14.1

 	
 Role of Trustee:
 The Trustee is a party to this Agreement solely in its capacity as Trustee
 for the Shareholders and accordingly (i) the Trustee shall only be liable to
 satisfy any obligations under this Agreement, including any obligations or
 liabilities arising in connection with any default by the Trustee under this
 Agreement, to the extent of the assets held from time to time by the Trustee
 as trustee of the trusts constituted by the Trust Agreement (the “Trust Assets”) to the extent authorized
 by the Trust Agreement and (ii) no recourse shall be had to (a) any assets
 other than the Trust Assets, including any of the assets held by the Trustee
 as trustee, co-trustee or nominee of a trust other than the trusts
 constituted by the Trust Agreement, as owner in its individual capacity or in
 any way other than as trustee of the trusts constituted by the Trust
 Agreement; or (b) the Trustee for any assets that have been distributed by
 the Trustee to the beneficiaries of the trusts constituted by the Trust
 Agreement. 

 
	
  

 	
  

 
	
 14.2

 	
 No Advice:
 The Custodian’s duties and obligations under this Agreement do not include
 providing the other party hereto with investment advice. In asking the
 Custodian to open and maintain the Unallocated Account, the Trustee
 acknowledges that it is pursuant to the Trust Agreement and the Custodian
 shall not owe the Trustee or the Trust any duty to exercise any judgment on
 their behalf as to the merits or suitability of any deposits into, or
 withdrawals

 

17

	
  

 	
  

 
	
  

 	
 from, the Unallocated Account. 

 
	
  

 	
  

 
	
 14.3

 	
 Rights and
 Remedies: The Custodian hereby waives any right
 it has or may hereafter acquire to combine, consolidate or merge the Metal
 Accounts with any other account of the Trust or the Trustee or to set off any
 liabilities of the Trust or of the Trustee to the Custodian and agrees that
 it may not set off, transfer or combine or withhold payment of any sum
 standing to the credit or to be credited to the Metal Accounts in or towards
 or conditionally upon satisfaction of any liabilities to it of the Trust or
 the Trustee. Subject thereto, the Custodian’s rights under this Agreement are
 in addition to, and independent of, any other rights which the Custodian may
 have at any time in relation to the Bullion.

 
	
  

 	
  

 
	
 14.4

 	
 Assignment:
 This Agreement is for the benefit of and binding upon the parties hereto and
 their respective successors and assigns. Save as expressly provided herein,
 no party may assign, transfer or encumber, or purport to assign, transfer or
 encumber any right or obligation under this Agreement unless the other party
 otherwise agrees in writing except that consent is not required where the
 Custodian assigns, transfers or encumbers any right or obligation under this
 Agreement to an Affiliate. This clause shall not restrict the Custodian’s
 power to merge or consolidate with any party, or to dispose of all or part of
 its custody business and further provided that this clause shall not restrict
 the Trustee from assigning its rights hereunder to a Shareholder to the
 extent required for the Trust to fulfill its obligations under the Trust
 Agreement. 

 
	
  

 	
  

 
	
 14.5

 	
 Amendments:
 Any amendment to this Agreement must be agreed in writing and be signed by
 all of the parties hereto. Unless otherwise agreed, an amendment will not
 affect any legal rights or obligations which may already have arisen. 

 
	
  

 	
  

 
	
 14.6

 	
 Partial
 Invalidity: If any of the clauses (or part of a
 clause) of this Agreement becomes invalid or unenforceable in any way under
 the Rules or any law, the validity of the remaining clauses (or part of a
 clause) will not in any way be affected or impaired. 

 
	
  

 	
  

 
	
 14.7

 	
 Entire Agreement: This
 document represents the entire agreement between the parties in respect of
 its subject matter save for any agreements made with fraudulent intent, and
 excludes any prior agreements or representations. This Agreement supersedes
 and replaces any prior existing agreement between the parties hereto relating
 to the same subject matter. 

 
	
  

 	
  

 
	
 14.8

 	
 Counterparts:
 This Agreement may be executed in any number of counterparts each of
 which when executed and delivered is an original, but all the counterparts
 together constitute the same agreement. 

 
	
  

 	
  

 
	
 14.9

 	
 Business Days:
 If any obligation falls due to be performed on a day which is not a New York
 Business Day or a London/Zurich Business Day, as the case may be, then the
 relevant obligations shall be performed on the next succeeding Business Day. 

 

18

	
  

 	
  

 
	
 14.10

 	
 Prior Agreements:
 The Custodian or any member of the JP Morgan group of companies (the “JP Morgan Group”) may trade in Shares for
 its own account as principal, may have underwritten or may underwrite an
 issue of Shares or, together with any such entities’ directors, officers or
 employees, may have a long or short position in Shares or in any related
 security or instrument. Brokerage or other fees may be earned by any member
 of the JP Morgan Group or persons associated with them in respect of any
 business transacted by them in all or any of the aforementioned securities or
 instruments. This Agreement supersedes and replaces any prior existing
 agreement between the parties hereto relating to the same subject matter. 

 

	
  

 	
  

 
	
 15. GOVERNING LAW AND JURISDICTION 

 
	
  

 	
  

 
	
 15.1

 	
 Governing Law:
 This Agreement is governed by, and will be construed in accordance with,
 English law. 

 
	
  

 	
  

 
	
 15.2

 	
 Jurisdiction: The
 Trustee and the Custodian agree that the courts of the State of New York, in
 the United States of America, and the United States federal court located in
 the Borough of Manhattan in such state are to have jurisdiction to settle any
 disputes or claims which may arise out of or in connection with this
 Agreement and, for these purposes the Trustee and the Custodian irrevocably
 submits to the non-exclusive jurisdiction of such courts, waive any claim of
 forum non conveniens and any objection to laying of venue, and further waive
 any personal service. 

 
	
  

 
	
 15.4

 	
 Waiver of Immunity: To
 the extent that the Trustee may in any jurisdiction claim for it as Trustee,
 the Trust or its assets any immunity from suit, judgment, enforcement or
 otherwise howsoever, the Trustee agrees not to claim and irrevocably waives
 any such immunity which it would otherwise be entitled to (whether on grounds
 of sovereignty or otherwise) to the full extent permitted by the laws of such
 jurisdiction. 

 
	
  

 	
  

 
	
 15.5

 	
 Service of Process:
 Process by which any proceedings are begun may be served on a party by being
 delivered to the address specified below. This does not affect any right to
 serve process in another manner permitted by law. 

 
	
  

 	
  

 
	
  

 	
 Custodian’s Address for service of process:
 

 
	
  

 	
  

 
	
  

 	
 JPMorgan Chase Bank, N.A. 

 
	
  

 	
 125 London Wall, London EC2Y 5AJ

 
	
  

 	
 Attention:
 Peter Smith – Global Commodities

 
	
  

 	
  

 
	
  

 	
 With a copy to:

 
	
  

 	
  

 
	
  

 	
 JPMorgan
 Chase Bank, N.A.

 
	
  

 	
 125 London
 Wall, 13th Floor

 
	
  

 	
 London EC2Y
 5AJ

 
	
  

 	
 Facsimile
 No.: +44 (0)20 7325 8150

 
	
  

 	
 Attention:
 Legal Department-FX and Derivatives Group

 

19

	
  

 	
  

 
	
  

 	
 Trustee’s Address for service of process:

 
	
  

 	
  

 
	
  

 	
 The Bank of
 New York Mellon

 One Wall Street

 New York, New York 10286 

 Attention: Legal Department

 

20

	
  

 
	
 EXECUTED by the parties: 

 
	
  

 
	
 Signed on
 behalf of and for JPMORGAN CHASE BANK, N.A.
 by 

 
	
  

 
	
 Signature
 ............................................... 

 
	
  

 
	
 Name
 ............................................... 

 
	
  

 
	
 Title
 ............................................... 

 
	
  

 
	
 Signed on
 behalf of and for

 
	
 THE BANK OF NEW YORK MELLON solely in its
 capacity as

 
	
 trustee of the ETFS Palladium Trust and not individually by
 

 
	
  

 
	
 Signature
 ................................................. 

 
	
  

 
	
 Name
 ................................................. 

 
	
  

 
	
 Title
 ................................................. 

 

21

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